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Bangalore Water Supply V A Rajappa - Brief Fact

The case involved a dispute between employees of the Bangalore Water Supply Board who were fined for misconduct. The employees filed a claim that the punishments violated principles of natural justice. The Board argued it was not an "industry" under the Industrial Disputes Act and the labor court lacked jurisdiction. The High Court ruled the Board was an industry. The Supreme Court was asked to determine the definition of "industry" and whether the Board fell under it. The Court laid out a triple test for what constitutes an industry, and found the Board met it by having systematic, organized activity for producing and distributing an essential service. The Court also clarified governmental and charitable organizations can be industries.

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442 views3 pages

Bangalore Water Supply V A Rajappa - Brief Fact

The case involved a dispute between employees of the Bangalore Water Supply Board who were fined for misconduct. The employees filed a claim that the punishments violated principles of natural justice. The Board argued it was not an "industry" under the Industrial Disputes Act and the labor court lacked jurisdiction. The High Court ruled the Board was an industry. The Supreme Court was asked to determine the definition of "industry" and whether the Board fell under it. The Court laid out a triple test for what constitutes an industry, and found the Board met it by having systematic, organized activity for producing and distributing an essential service. The Court also clarified governmental and charitable organizations can be industries.

Uploaded by

arun
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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The Bangalore Water Supply v/s A.

Rajjapa

Brief Facts of the Case

The respondent employees were fined by the Appellant Board for misconduct and various sums
were recovered from them. Therefore, they filed a Claims Application No. 5/72 under Section 33C
(2) of the Industrial Disputes Act, alleging that the said punishment was imposed in violation of
the principles of natural justice.

The appellant Board raised a preliminary objection before the Labour Court that the Board, a
statutory body performing what is in essence a regal function by providing the basic amenities to
the citizens, is not an industry within the meaning of the expression under section 2(j) of the
Industrial Disputes Act, and consequently the employees were not workmen and the Labour Court
had no jurisdiction to decide the claim of the workmen.

This objection being over-ruled, the appellant Board filed two Writ 'Petitions before the Karnataka
High Court at Bangalore. The Division Bench of that High Court dismissed the petitions and held
that the appellant Board is “industry” within the meaning 'of the expression under section 2(i) of
the Industrial, Disputes Act, 1947.

The appeals by Special Leave, considering “the chances of confusion from the crop 'of cases in an
area where the common man has to understand and apply the law and the desirability that there
should be, comprehensive, clear and conclusive declaration as to what is an industry under the
Industrial Disputes Act as it stands” were placed for consideration by a larger Bench.

Issues Involved

1. The issue in the case was that whether Bangalore Water Supply and Sewerage Board will
fall under the definition of 'Industry' and in fact, particularly the issue was what is an
'Industry' under Section 2(j) of the Industrial Dispute Act?

2. Whether Charitable Institutions Are Industries?

3. Do clubs and other organizations whose general emphasis is not on profit-making but
fellowship and self-service fit into the definitional circle?

4. Would a university or college or school or research institute be called an industry?


5. Could a lawyer's chamber or chartered accountant's office, a doctor's clinic or other liberal
profession's occupation or calling be designated an industry?

6. Are governmental functions, strict sense, industrial and if not, what is the extent of the
immunity of instrumentalities of government?

7. Whether Sovereign or Regal functions will be industry?

8. Whether Municipal Corporations Industry?

9. Whether Hospital is Industry?

10. What is the meaning of the term 'industry'?

Judgment
It was held that the Bangalore Water Supply and Sewerage Board will fall under the definition of
the industry and by justifying this it gave an elaborating definition of industry.
The triple test principle laid down by the Supreme Court in this case are:

(i) There should be a systematic activity,


(ii) Organized by co-operation between employer and employee
(iii) For the production and/or distribution of goods and services calculated to satisfy
human wants and wishes (not spiritual or religious but inclusive of material
things or services geared to celestial bliss e.g. making, on a large scale, Prasad
or food), prima facie, there is an 'industry' in that enterprise.

Other Observation:

a. Absence of profit motive or gainful objective is irrelevant, be the venture in the public,
joint private or other sector.

b. The true focus is functional and the decisive test is the nature of the activity with special
emphasis on the employer-employee relations.

c. If the organization is a trade or business it does not cease to be one because of philanthropy
animating the undertaking.

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