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4. Whether Nehru Yuva Kendra is "Industry":

It is the submission of the petitioner that the petitioner is a registered society in the name of Nehru Yuva Kendra Sangathan (NYKS) under the Societies Registration Act,1860. This Sangathan started in 1972 under the Ministry of Human Resource Development, Department of Youth Affairs & Sports, Government of India. The main objects of the NYKS are social trans formation in rural area, and in preserving, promoting and developing concept of unity and national integration, discipline, selfhelp and secularism, democracy, scientific tempore, cultural and heritage, functional literacy, building awareness among the rural youths and in providing avenues to the Youth to strive towards excellence in all spare of activities. The programmes are proposed by HRD Ministry/Ministry of Youth Affairs & Sports and the same is completely funded by the Ministry for the training programmes, social service programme, sports, games, physical education and adult literacy etc. It was further submitted that NYKS is an organisation and the same is dedicated to implement the different projects of the Ministry of HRD and has been working under the guide lines of the Government of India. Therefore, an activity of Govt. of India undertaken through the NYKS herein cannot be regarded as "Industry" because the same is done in discharge of its sovereign functions. The petitioner herein is engaged in discharging of its sovereign function for the public welfare and hence the same does not fall under the definition of "Industry" as defined under Section 2(j) of Industrial Disputes Act,1947. In support of his submissions, learned counsel relied upon the judgment of Supreme Court in the case of Physical Research Laboratory Vs. K.G.Sharma . It was also submitted that the petitioner herein is engaged in Public Welfare functions and discharging the directive principles of the State Policy. It is also carrying on different projects to promote the national integration, developing critical awareness among the Youth of country of their environments and social service programmes. The Hon'ble Supreme Court has also held in the case of Bangalore Water Supply & Sewerage Board Vs. A. Rajappa and Others that the activity undertaken by the State and when the same are governed by the separate rules and constitutional provisions such as Articles 310 and 311 should strictly speaking be excluded from the sphere of Industry by necessary implications. The main objects of NYKS are to provide social services to the Public at large and the same are done without expecting any return in the form of monetary or in any other form and it is further submitted that social evolution is a process of constant growth and the State cannot afford to stand still without taking adequate measures through different organisations and hence the services provided by NYKS cannot be defined as Industry. The Hon'ble Supreme Court has also held that the word industry can reasonably mean only activity which results in goods made and manufactured or service rendered which are capable of being converted into saleable ones. They must be capable of entering the world of "res commercium" although they may be kept out of the market for some reason. It is not the motive of an activity in making goods or running a service but the possibility of making them marketable if one who makes goods or renders service so desires, that should determine whether the activity lies within the domain or circle of industry. In the petitioner's Sangathan the employees/volunteers do the services to the community at large without any profit motive and the petitioners' activity are completely in the name of sovereign function.

5. On the other hand Mr.Sanjay Parikh, learned counsel appearing for the workman submitted that the petitioner was an "Industry" within the meaning of Section 2(j) of the I.D. Act and this aspect was clearly answered by Supreme Court in the case of Bangalore Water Supply & Sewerage Board Vs. A. Rajappa and Others . He submitted that the said judgment holds the field till date and in fact whenever the another Bench of Supreme Court took contrary view it was specifically overruled by the Larger Bench of the Supreme Court relying upon Bangalore Water Supply case (supra To substantiate this, he submitted that the Supreme Court in two judgments, namely, SubDivisional Inspector of Posts Vs. Theyyam Joseph and in Bombay Telephone Canteen Employees Association Vs. Union of India had distinguished Bangalore Water Supply case (Supra) and had held that the establishments therein were not covered by the definition of industry. These two judgments were overruled by a Bench of 3 Judges in General Manager, Telecom Vs. S. Srinivas Rao where it was held that Bangalore Water Supply case (supra) holds the field. Thereafter in Coir Board Vs. Indira Devi the Su preme Court had cited Physical Research Laboratory case (Supra) and also other cases mentioned above, in paras 17 & 18 of its judgment, and had decided to refer the decision in Bangalore Water Supply case (supra) for reconsideration by a Larger Bench. Subsequently, three Judges of the Supreme Court held by its order dated 10th November,1998 in Coir Board case (supra) held that Bangalore Water Supply case (supra) does not require any reconsideration. Learned counsel relied upon Paras 126, 140, 141, 142 and 143 of the judgment of Supreme Court in the case of Bangalore Water Supply case (supra) and submitted that in these paras it has been categorically held that a cooperative societies and other societies are industries. The activity of the petitioner is a systematic activity organized by cooperation by employer and employee and it is meant for services to satisfy human wants and wishes. The profit motive is immaterial; philanthropy is immaterial and the decisive test is to see the nature of activity with special emphasise on employer-employee relationship. If one looks at the resolution, Nehru Yuva Kendra Sanghatan (Service Regulations 1987 and the Rules of Nehru Yuva Kendra Sanghatan and also illustrative list of activities undertaken by Nehru Yuva Kendra, it becomes clear that all the tests given in Bangalore Water Supply case (supra) are fulfillled to declare Nehru Yuva Kendra Sanghatan an "industry" under Section 2(j) of the I.D. Act, 1947. It was also submitted that the petitioner had not raised the contention that petitioner was doing sovereign function before the CGIT and in any case the function being discharged by the petitioner cannot be treated as sovereign function.

8. In fact it was mainly emphasised by the learned counsel for the petitioner that the function being discharged by the petitioner was a sovereign function and, therefore, it would qualify for exemption. However, the function being discharged by the petitioner cannot be treated as sovereign function which would take it outside the scope of Section 2(j) of the Industrial Disputes Act.

In Subparas (b) & (c) of Para-143 of Bangalore Water Supply case (supra), already reproduced above, the Supreme Court had clarified that-

(b) Notwithstanding the previous clauses, sovereign functions, strictly understood, (alone) qualify for exemption, not the welfare activities or economic adventures undertaken by Government or statutory bodies.

(c) Even in departments discharging sovereign functions, if there are units which are industries and they are substantially severable, then they can be considered to come within Section 2(j).

9. Thus as per this para only those sovereign functions which are strictly understood as such would qualify for exemption and not the welfare activities or economic adventures undertaken by the Government or statutory bodies. The activity of the petitioner may be welfare activity but it is not sovereign function stricto senso.