1998 (3) TMI 715 - SC - Indian Laws

Summary

Issues Involved:
1. Whether the appellant-Coir Board qualifies as an "industry" under the Industrial Disputes Act, 1947.
2. Applicability of the Industrial Disputes Act to the termination of services of temporary clerks and typists employed by the Coir Board.
3. Interpretation and judicial expansion of the term "industry" under the Industrial Disputes Act.
4. Need for re-examination of the judicial interpretation of "industry" as per the Bangalore Water Supply and Sewerage Board case.

Detailed Analysis:

1. Whether the appellant-Coir Board qualifies as an "industry" under the Industrial Disputes Act, 1947:
The Coir Board, established under the Coir Industry Act, 1953, aims to promote the coir industry by various measures including export promotion, quality control, and marketing. The Full Bench of the Kerala High Court concluded that the Coir Board is an "industry" as defined in the Industrial Disputes Act, 1947, which includes any business, trade, undertaking, manufacture, or calling of employers. The Supreme Court examined the functions of the Coir Board and noted that it maintains showrooms and sales depots, employs marketing personnel, and charges commissions on sales, indicating a systematic and habitual activity for production or distribution of goods or services.

2. Applicability of the Industrial Disputes Act to the termination of services of temporary clerks and typists employed by the Coir Board:
The temporary clerks and typists claimed that their termination should comply with the Industrial Disputes Act, 1947. The Kerala High Court, by categorizing the Coir Board as an "industry," applied Chapter V-A of the Industrial Disputes Act to their termination. The Supreme Court acknowledged that the Coir Board employs individuals for its operations, thus falling under the purview of the Industrial Disputes Act for employment-related disputes.

3. Interpretation and judicial expansion of the term "industry" under the Industrial Disputes Act:
The term "industry" has been subject to extensive judicial interpretation. Early cases like D.N. Banerji v. P.R. Mukherjee and The Corporation of the City of Nagpur v. Its Employees considered activities analogous to trade or business as industries. The State of Bombay v. The Hospital Mazdoor Sabha expanded the definition to include activities systematically undertaken for production or distribution of goods or services, irrespective of profit motive. Later cases, including Bangalore Water Supply and Sewerage Board v. A. Rajappa, further broadened the definition, encompassing professions, clubs, educational institutions, and charitable projects.

4. Need for re-examination of the judicial interpretation of "industry" as per the Bangalore Water Supply and Sewerage Board case:
The Supreme Court recognized the need to re-examine the broad interpretation given to "industry" in the Bangalore Water Supply and Sewerage Board case. The Court noted that the wide definition had led to the inclusion of philanthropic and charitable activities, potentially causing more harm than good by affecting the operations of voluntary organizations. The Court highlighted the necessity for a proper law to promote the welfare of labor in various types of organizations, tailored to their specific needs and capacities.

Conclusion:
The Supreme Court concluded that the Coir Board, under the current judicial interpretation, qualifies as an "industry" under the Industrial Disputes Act. However, the Court expressed concerns about the sweeping nature of this interpretation and directed that the matter be placed before the Chief Justice of India to consider whether a larger Bench should re-examine the decision in the Bangalore Water Supply and Sewerage Board case. The Court emphasized the importance of a legislative or judicial re-evaluation to ensure that the definition of "industry" aligns with the intended scope and purpose of the Industrial Disputes Act.