The document discusses the definition of "industry" under the Industrial Disputes Act, 1947 in India through various court cases. It explains that initially the definition was interpreted broadly, but later some institutions like universities and clubs were excluded. The landmark Bangalore Water Supply case in 1978 established the "triple test" for determining if an activity qualifies as an industry, considering its systematic nature, employer-employee cooperation, and production of goods/services. Later, the amended definition of 1982 provided more clarity through exclusions.

1. THE INDUSTRIAL RELATIONS CODE,
2020
INDUSTRY
 (p) "industry" means
 any systematic activity carried on
 by co-operation
 between an employer and worker (whether such worker is
employed by such employer directly or by or through any
agency, including a contractor)
 for the production, supply or distribution of goods or
services with a view to satisfy human wants or wishes (not
being wants or wishes which are merely spiritual or
religious in nature), whether or not,—
 (i) any capital has been invested for the purpose of
carrying on such activity; or
 (ii) such activity is carried on with a motive to make any
gain or profit,

2. THE INDUSTRIAL RELATIONS CODE,
2020
 BUT DOES NOT INCLUDE—
 (i) institutions owned or managed by organisations
wholly or substantially engaged in any charitable,
social or philanthropic service;
 or
 (ii) any activity of the appropriate Government
relatable to the sovereign functions of the appropriate
Government including all the activities carried on by
the departments of the Central Government dealing
with defence research, atomic energy and space; or
 (iii) any domestic service; or
 (iv) any other activity as may be notified by the
Central Government;

3. Industrial Dispute Act, 1947

4. Introduction
 Preamble
Make provision for investigation and settlement of Industrial
Dispute and for certain other purposes.
 Extent and Commencement
Extends to whole of India
Came into force on 1st April 1947
 Objectives of the Act
Economic Justice
Industrial Peace

5. What is your understanding of the
term Industry?

6. Industry S.2(p)
 It means any business, trade, undertaking,
manufacture or calling of ANY EMPLOYER
 and includes any calling service,
employment, handicraft or industrial
occupation or avocation (customary
employment, a hobby or minor
occupation) OF WORKMEN.

7. Liberal Construction of the term
Industry - Position prior to 1978:
Widest possible interpretation should be given to the term Industry
and Industrial Dispute.
D.N. Bannerji v. P.R. Mukherji
 Facts
The fact of this case was that two employees of the
Municipality who were the members of Municipality Workers
Union were suspended by the Chairman on the charges of
the negligence, insubordination and indiscipline.
The workers were dismissed from the service saying that
their explanations were unsatisfactory.

8.  The union questioned the dismissal and the matter was
referred by the Government of West Bengal to the Industrial
Tribunal for adjudication.
 The Tribunal directed the workers reinstatement (the action of giving
someone back a position they have lost.) in their respective offices by making
an award saying that suspension of two employees was of
victimization
 The Municipality under Article 226 of the Indian Constitution
took the matter to the High Court.

9.  The Supreme Court analysed this situation in the
light of the Australian Judgment given in
Federated Municipal and Shire Council
Employees Union of Australia Vs Melbourne
Corporation and observed that through every
activity in which the relationship of employer and
employee existed is commonly understood as an
industry, but still a wider and more comprehensive
interpretation has to be given to such words to
meet the rapid industrial progress and to bring

10. Is educational Institution is treated as an Industry??
University of Delhi vs. Ram Nath
 Between 1963 And 1978
In 1963, the Supreme Court in the University of
Delhi vs. Ram Nath, had reversed the above
trend by interpreting the DEFINITION OF
INDUSTRY NARROWLY THEREBY HOLDING
THAT DELHI UNIVERSITY CANNOT BE
CONSIDERED AN INDUSTRY.
 This created the thought that the university of
Delhi case was decided not on the ground of logic
but on the basis of a sense that if the scope of the
Industrial dispute Act is enlarged to cover
educational institutions it might have an adverse
effect on discipline in educational institutions.

11. Is Club an Industry?
Madras Gymkhana Club Union vs. Management of
Madras Gymkhana
 The object of the club was to provide:
 Venue for Sports and Games and facilities for recreation and
entertainment.
 Catering Department which provided food
 The CLUB WAS HELD TO BE NOT AN INDUSTRY.
 if the activity can be described as an industry with reference
to the occupation of the employers, the ambit of the industry,
under the force of the second part takes in the different
kinds of activity of employees mentioned in the second part.
 But the second standing alone cannot define industry.
 By the inclusive part of the definition the labour force employed in
any industry is made an integral part of the industry for the purpose
of industrial disputes although industry is ordinarily something which
employers create or undertake”.

12. Is Hospital an Industry?
STATE OF BOMBAY v. HOSPITAL MAZDOOR
SABHA
 In 1960, Hospital Mazdoor Sabha Case brought
hospitals within ambit of industry. This case involved
payment of retrenchment compensation to workmen
in JJ Hospitals, Mumbai.
 The Management pleaded that the Hospital was not
involved in any trade or business and hence they are
not industry.
 Court framed a working principle that any systematic
activity for production or distribution of goods or
services done with help of employees in the manner
of a trade or business is an industry.
 The services in the hospital were held to be material
service and hence Hospitals are industry under the
Industrial Disputes Act.
 The reason for giving a wide interpretation to the word
Industry was that the Court wanted to bring
organizations within fold of ID Act so that a large

13. Solicitors firm is an Industry?
NATIONAL UNION OF COMMERCIAL EMPLOYEE v.
M.R. MEHER
 In the case of National Union of commercial
employer's vs. M.R Mehar, the lawyers
terminated the clerks, stenographers, and other
employees.
 This case came up to the Supreme Court,
Supreme Court conducted test that there must be
a Association of Labor and capital then only the
firm will be determined as an Industry.
 SO THE SUPREME COURT HELD THAT THE
LAWYERS FIRM IS NOT AN INDUSTRY.
 In this case the court held that the activity held by
the institution must involve the employee and the
workmen’s effort.

14. Is Religious Institutions Comes under Industry?
Shri Adi Visheshwara of Kashi Vishwanath Temple
vs. State of Uttar Pradesh
 In the case of Shri Adi Visheshwara of Kashi
Vishwanath Temple vs. State of Uttar Pradesh, the
question before the court is that the religious
institution comes under the Industrial Disputes Act,
1947.
 THE HIGH COURT OF ALLAHABAD CONCLUDED
THAT THE TEMPLES COULD NOT BE
CONSIDERED AS AN INDUSTRY.
 The Court has observed that the temple's purpose
was religious, and any economic activity was
incidental to that purpose.
 The court also observed that the temple was not
involved in any other commercial activity for profit
making and doesn't function like a Business
Enterprise.

15. Is a charitable Institution is an Industry?
Bombay Pingapore vs. Bombay Pingapore's
Employees
 In the case, Bombay Pingapore vs. Bombay
Pingapore's Employees, the Bombay Pingapore is
an charitable institution which protecting and
promoting the disabled and deformed cattle.
 It has been developed as Dairy Farm and started the
production of milk
 The small quantity of milk was consumed and the
large quantity of milk was being sold so the court
stated that the charitable institution has lost its
character as a charitable institution.
 SO THE COURT CONCLUDED THAT THE BOMBAY
PINGAPORE IS AN INSTITUTION.

16. CORPORATION OF CITY OF
NAGPUR v. EMPLOYEES
 In another case of City of Corporation of
Nagpur vs. City of Corporation of Nagpur its
employees, there is an industrial dispute between
the employer and employee regarding the wages.
 As it is an Industrial Dispute, it refers to the
Industrial Tribunal, the management has
challenged that the CORPORATION IS NOT AN
INDUSTRY.
 The cases gone to the Supreme Court of India,
Supreme Court states that the Corporation is an
Industry.

17. State of Bombay v Hospital Mazdoor
Sabha
 Facts:
 Services of some employees were terminated by
superintendent of the hospital after serving them
a notice.
 The Hospital Mazdoor Sabha, a registered
trade union of employees, filed a writ of
mandamus directing the State of Bombay to
reinstate the employees in their post and
contented that the retrenchment of employees
was not according to the provision of the act.
 It was contended that HOSPITAL WAS NOT A
INDUSTRY within the meaning of S.2(j).

18. State of Bombay v Hospital Mazdoor
Sabha
 The Supreme Court of India held
“hospital” to be industry within the
scope of Section 2 (j) and relied
upon the “inclusive part” of the
definition and also the definition of
employer under Sec. 2 (g) which
includes an industry carried on by
or under the authority of any
department of the Central

19. Management of Safdarjung v.
Kuldeep Singh Sethi.
Whether hospital is an Industry?
An Industry is to be found when the employees are
carrying on
any business ,
trade,
undertaking ,
manufacture or
calling of employers.
If they are not there is no Industry as such.
It was held that employees in a GOVERNMENT
HEALTH DEPARTMENT ARE NOT WORKMEN
ENGAGED IN AN INDUSTRY.

20. Position from 1978:
 From the year 1978, the scope of the word
'Industry ' has become wider and enlarged.
 The case BANGALORE WATER SUPPLY VS. A
RAJAPPA and others has bought a change in the
definition of the Industry.
 The Judgement of this case has bought a change
from the preceding cases.

21. Bangalore Water Supply and
Severage Board v. A Rajjapa
 Facts of the Case:
 In this case, A. Rajappa is an employee in the
Bangalore water Supply.
 An Industrial Dispute has arisen between the
Bangalore Water Supply and the employers.
 Each and every employee was fined by the
Bangalore water supply for the MISCONDUCT,
 the fine was very HIGH and it was not
reasonable.

22. Bangalore Water Supply and
Severage Board v. A Rajjapa
 The employees has approached the labor court under
the section 33(c) of Industrial Disputes Act, 1978,
stating that the breach of the Natural Justice
Principles.
 The Bangalore water supply's argument is that the
Bangalore water SUPPLY IS NOT AN INDUSTRY,
 so it is not a Industrial Dispute so the Labor Court
lacks the JURISDICTION.
 Under the Article 226 of Indian Constitution, the
employers have filed 2 writ petitions in the High Court
of Karnataka.
 The High Court concluded that the BANGALORE
WATER SUPPLY IS AN INDUSTRY UNDER
SECTION 2(J) THE INDUSTRIAL DISPUTES ACT,
1978.
 LATER, THE BANGALORE WATER SUPPLY HAS
GONE TO THE SUPREME COURT

23. Bangalore Water Supply and
Severage Board v. A Rajjapa
 Issues:
This is the question laid before the Supreme Court.
 Whether the Bangalore Water Supply is an Industry or
not?
 Judgement:
 The Apex Court of India has stated that ' to say any
particular organization is an Industry ' for that there
has to be a test conducted.
 THE TEST WAS NAMED AS A ' TRIPLE TEST '.
 TRIPLE TEST IS THE TEST WHICH SHOWS
WHETHER A PARTICULAR ORGANIZATION IS AN
INDUSTRY OR NOT.

24. Bangalore Water Supply and
Severage Board v. A Rajjapa
 A seven Judges Bench of the
Supreme Court exhaustively
examined and considered the
scope of ‘industry’ and prescribed
the Triple test which has practically
reiterated the test projected in
Hospital Mazdoor Sabha case.

25. A seven Judges Bench of the
Supreme Court
 BENCH:
 BEG, M. HAMEEDULLAH (CJ)
 CHANDRACHUD, Y.V.
 BHAGWATI, P.N.
 KRISHNAIYER, V.R.
 SINGH, JASWANT
 TULZAPURKAR, V.D.
 DESAI, D.A

26. Triple Test
I Where
a) systematic activity,
b) organized by co-operation between
employer and employee (direct and
substantial element is commercial)
c) for the production and/or distribution
of goods and services calculated to
satisfy human wants and wishes, prima
facie, there is an “industry”.

27.  Absence of profit motive or gainful
objective is irrelevant, be the venture in
public, joint, private or other sectors.
 The true focus is functional and the
decision test is the nature of the activity
with special emphasis on the employer
and employee relations.
 If the organization is a trade or business,
it does not cease to be one because of
philanthropy animating the undertaking

28.  In view of the above points and the
consequences of the decision given in the
Bangalore Water Supply case activities that
such as professions, clubs, educational
institutions, cooperatives, Research
institutes, charitable projects and other
similar adventures if they fulfil the above
Triple test, cannot be exempted from the
scope of section 2(j) of the Industrial

29. Industry?
 Activities of Government & Industry
 Sovereign Function of the Government
 Municipal Corporation
 Professions
 Hospitals & Charitable Institutions
 Educational Institution
 Clubs

31. Amended Definition of Industry
 ‘Industry’ means any systematic activity carried on by
co-operation between an employer and his workmen
(whether such workmen are employed by such
employer directly or by or through any agency,
including a contract) for the production, supply or
distribution of goods or services with a view to satisfy
human wants or whether or not;

32.  But does not include –
a) Any agriculture operation except where such “agriculture operation”
is carried on in an integrated manner with any other activity (being any
such activity is referring to in the foregoing provisions of this clause)
and such other activity is the predominant one.
b) Explanation–For the purpose of the sub–clause “agriculture
operation” does not include any activity carried on in a plantation as
defined in clause (f) of Section 2 of the Plantation Labour Act, 1951; or
c) Hospitals or dispensaries; or
d) Educational, scientific, research or training institutions; or
e) Institutions owned or managed by organization wholly or
substantially engaged in any charitable, social or philanthropic
service; or

33.  g) Any activity of the Government relatable to the sovereign
functions of the Government including all the activities carried
on by the department of the Central Government dealing with
Defence Research, Atomic Energy and Space; or
 h) Any domestic service; or
 i) Any activity, being a profession practised by an individual or
body of individual, if the number of persons employed by the
individual or body of individual in relation to such profession is
less than ten; or
 j) Any activity, being an activity carried on by a cooperative
society or a club or any other like body of individuals, if the
number of persons employed by the cooperative society, club

34. The Industrial Disputes (Amendment) Act, 1982 enacts
altogether a new definition of industry.
THIS AMENDED DEFINITION HAS NOT BEEN
ENFORCED TILL NOW.
It nullifies the effect of many judicial decisions and
attempts to clarify the conflicting views arising out of
different interpretation of the word, ‘industry’ adopted by
the Supreme Court in various cases.

35. Industry
 In 2000, the three-judge bench of the Supreme
Court in the case of Coir Board Ernakulam
Kerela state vs. Indira Devai P.S stated that the
judgement delivered by a seven-judge bench in
the Bangalore water supply case does not in our
opinion, require any reconsideration.
 In 2005, the majority opinion by the Supreme
Court in State of U.P vs. Jai Bir Singh,
expressed the view that interpretation was only
tentative and temporary till the legislature stepped
in and removed vagueness and confusion.

36. U.P. v. Jai Bir Singh
 After considering the rival contentions and closer
examination of the decision in Bangalore Water
Supply, held that a reference to a larger bench for
reconsideration of the decision was required for the
following amongst other, reasons:
 a) The judges delivered different opinions in the case
of Bangalore Water Supply at different times and in
some cases without going through, or having had an
opportunity of going through, the opinion of some of
the judges on the Bench.
 They have themselves recognized that the definition
clause in the Act is so wide and vague that it is not 36

37.  b) In the opinion of all of them it would be better that
the legislature intervenes and clarifies the legal
position by simply amending the definition of
‘industry’.
 The legislature did respond by amending the
definition of ‘industry’, but unfortunately 24 years
were not enough for the legislature to provide
Alternative Dispute Resolution Forums to the
employees of specified categories of industries
excluded from the amended definition.
 The legal position thus continues to be unclear and
to a large extent uncovered by the decision of the
Bangalore Water Supply case.
 In its opinion the larger Bench will have to
necessarily go into legal questions in all dimensions

38.  Further, the Court in Jai Bir Singh case expected the
larger Bench which would review Bangalore Water
Supply to look at the statute under consideration not
only from the angle of protecting workers’ interests
but also of other stake holders in the industry- the
employer and the society at large
 The Court also stressed the need to reconsider
where the line should be drawn and what limitation
can and should be reasonably implied in interpreting
the wide words used in section 2 (j).
 It stated that no doubt it is rather a difficult problem
to resolve more so when both the legislative and the
executive branches are silent and have kept an
important amended provision of law dormant on the
statue book.

39. Post 1978
 Post 1978
 During the post-1978 period again the trend
started changing the Court had taken a wider
approach and sought to make it a comprehensive
definition that will serve the purpose of the needs
of the society.
 In 1978, in the Landmark case of Bangalore
Water Supply and Sewerage Board v. A.
Rajappa, THE SUPREME COURT BY GIVEN
LIBERAL INTERPRETATION TO THE WORD
INDUSTRY AND HELD THAT HOSPITALS,
CLUBS, AND EDUCATIONAL INSTITUTIONS,
RESEARCH AND CHARITABLE INSTITUTIONS
AS INDUSTRIES.

40. Post 1978
 It observed that pressing demands of the
competing sectors of employers and employees
and the helplessness of the legislative and the
executive branches in bringing into force the
Amendment Act compelled it to make the present
reference for constituting of a suitable bench for
reconsidering Bangalore Water Supply’s case
 It overruled its earlier decisions given in the cases
of Safdarjung Hospital vs. K.S sethi, National
Union of commercial Employees vs. M.R
Meher, University of Delhi v. Ram Nath, Madras
Gymkhana club employees vs. Management of
Gymkhana club and cricket club of Inida vs.
Bombay Labour Union.

41.  It overruled its earlier decisions given in the cases
of Safdarjung Hospital vs. K.S sethi, National
Union of commercial Employees vs. M.R
Meher[9], University of Delhi v. Ram Nath,
Madras Gymkhana club employees vs.
Management of Gymkhana club and cricket club
of Inida vs. Bombay Labour Union.

42. Industrial Dispute 2(k)
 Industrial dispute means any dispute or difference
between employers and employers, or between
employers and workmen, or between workmen and
workmen, which is connected with employment or
non-employment or the terms of employment or with
conditions of labour of any person

43. INDUSTRY
 With this test, the Supreme Court stated that the
Bangalore water supply is an Industry.
 Therefore the Labor court has the jurisdiction to take
the case and give the award (judgement).
There are some exceptions to the Triple test, which
gives that a particular organization is not an Industry.
Exceptions:
 Single Person's Firm (Doctor, Lawyers, etc.)
 Sovereign Functions
 Charitable Institutions
 Religious Institutions

44. INDUSTRY
 The single professions firm doesn't treated as a
Industry because the lawyers are not treated a
workmen and their purpose is to provide the service
to the public.
 Where ever the sovereign functions are there, then
the particular organization will not be treated as an
Industry.
 Because the sovereign functions need to be
performed by the government like postman, etc...
 With this definition the Supreme Court is not satisfied,
so the Supreme Court asked the parliament to come
with a amendment in relation to the term Industry
under Industrial Disputes Act, 1978.

45. INDUSTRY
 The parliament has come with amendment; the new
amendment's definition continues the triple test. If any
establishment of an organization satisfies with the
above three conditions then it is treated as an
Industry unless it's an:
 Agricultural operations
 Hospitals
 Education and Research Institutions
 Charitable Institutions
 Sovereign Functions
 Single Profession Firms
 Any clubs with less than 10 members.

46. Section 2(p) of the IR Code,
2020
 Presently, the 'Industry' is defined under Section
2(p) of the IR Code, 2020
 "Industry" means any systematic activity carried on by
cooperation between an employer and worker
(whether such worker is employed by such employer
directly or by or through any agency, including a
contractor) for the production, supply or distribution of
goods or services with a view to satisfying human
wants or wishes (not being wants or wishes which are
merely spiritual or religious in nature),
 whether or not,
Any capital has been invested for the purpose of
carrying on such activity; or
 Such activity is carried on with a motive to make any
gain or profit,

47. Section 2(p) of the IR Code,
2020

But does not include:
Institutions owned or managed by organisations
wholly or substantially engaged in any charitable,
social or philanthropic service; or
 Any activity of the appropriate Government relatable
to the sovereign functions of the appropriate
Government including all the activities carried on by
the departments of the Central Government dealing
with defence research, atomic energy and space; or
 Any domestic service; or
 Any other activity as may be notified by the Central
Government;


48. Section 2(p) of the IR Code,
2020
 Conclusion
The definition of industry had evolved over
decades and the reason was that there was so
much discussion regarding the definition because
the scope and ambit of the definition will make
many changes in the arena of labour laws since it
is taken certain organizations and some it
excluded.
 However, the present IR code, 2020 has been
well-drafted by the legislature in such a way that it
caters for the present-day needs through its
comprehensive and accessible nature of
legislature.

49.  Nine-Judge Bench To Examine Correctness Of
‘Bangalore Water Supply Case’