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TMI Blog2000 (9) TMI 930X X X X Extracts X X X X X X X X Extracts X X X X ..... gn in character. Most of its functions could be undertaken even by private persons. Thus the appellant would fall within the definition of ‘industry’ under section 2(j) of the Central Act. In view of this, we uphold that respondent-employees are ‘workman’ under the Central Act as held by the Labour Court and confirmed by the High Court. The Labour Court has dealt with each individual cases and came to the conclusion in favour of respondent-employees which has also been confirmed by learned Single Judge and Division Bench of the High Court, which does not call for any interference - CIVIL APPEAL NOS. 5235-5241 OF 2000 - - - Dated:- 22-9-2000 - A.P. MISRA AND Y.K. SABHARWAL, JJ. G.V. Chandrasekhar and P.P. Singh for the Appellant. S.R. Bhat and Mrs. K. Sarada Devi for the Respondent. JUDGMENT Misra, J. - Leave granted. 2. The question raised in this appeal is drawing attention of this Court since very inception when Industrial Disputes Act, 1947 ( the Central Act ) was enacted and even after the passage of more than 50 years, issue remains in the fertile field of it yielding fresh crops time and again because of wide vaporous definition of the wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its ambit industry hence industrial law would have no application over it. 4. The question raised in this Appeal is : ( a )Whether the appellant, an Agricultural Produce Market Committee ( the Market Committee ), established under the Karnataka Agricultural Produce Marketing (Regulation) Act, 1966 ( the State Act ) is an industry as contemplated under the Central Act ? If yes, Will not employee under the State Act would be governed by the Central Act ? ( b )Will not the State Act override the Central Act for the reason, the State Act received the assent of the President of India, hence the Central Act would be inapplicable to the employees governed by the State Act ? 5. To properly appreciate the controversy, it is necessary to give short essential matrix of facts. The appellant is an Agricultural Produce Market Committee established under the State Act. It regulates the marketing of agricultural produce for the benefit of the agriculturist. This market committee is not intended to make any profit and the whole object is only to regulate the agricultural produce both for protecting the interest of agriculturist and interest of public at large. The submission for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. Sub-section (3) starts with non obstante clause, notwithstanding anything contained in the Central Act or in any other law for the time being in force or in any contract, in case of transfer of any officer or servant of a market committee by virtue of sub-section (1) and (1A) shall not entitle any such officer or such servant to any compensation or payment under that Act or other law or contract. The learned counsel for the appellant strongly relies on this sub-section to interpret that the Central Act is excluded from the purview of employees under the State Act. 6. Section 59 of the State Act is reproduced below : " Absorption of staff of market committees in Government service - (1) Officers and servants of market committees (by whatever name called) holding the classes of posts specified in sub-sections (1), (2) and (3) of section 58 on the date immediately prior to the date of commencement of that Act, shall, with effect from the date of such commencement become officers and servants of the State Government. Explanation - The State Government shall determine the designations of the officers and servants of the market committee who shall become officers and serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Under sub-section (2) the State Government could amalgamate both the Karnataka State Marketing Service and the Karnataka State Market Committee Services into one single service. 8. The submission for the appellant is that market committee is not conferred with the power of appointment, though under section 61(3) it could create temporary posts and appoint temporary employees for not more than 180 days with the prior approval of the Director of Agricultural Marketing. The learned counsel for the appellant, Mr. Chandrasekhar has taken us to the various provisions of the Act, namely, sections 9(3), 58, 59, 63, 65, 66, 67, 69, 72, 73 and 83 of the State Act to show that the scheme of the Act is to provide for the better regulation of marketing of agricultural produce and establishment and control of market for agricultural produce within the State. He emphasised, these provisions indicates that the function of the market committee is severeign in nature hence it could not constitute to be an industry to make its employees as workmen under the Central Act. Section 9(3) confers status on every market committee to be a local authority. Section 61 deals with appointments from among th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly Shri M.M. Satyannavar. He was appointed as an Assistant Engineer on 25-5-1984 on daily wage basis for looking after development work and his service was terminated on 15-5-1989. Each of these seven persons are respondents in this case. The Labour Court allowed their applications by setting aside their order of termination and directed their reinstatement. The appellant aggrieved filed writ petition challenging these orders, among other grounds, one is challenge to the jurisdiction of the Labour Courts to try the cases of these seven respondents as the appellant is not an industry within the meaning of the Central Act, hence the Labour Courts have no jurisdiction to try their claims. The learned Single Judge of the High Court dismissed the writ petition. Holding that the appellant-market committee is an industry and hence Labour Courts, have the jurisdiction to decide their cases. Feeling aggrieved the appellants preferred writ appeal and the Division Bench similarly dismissed the same upholding that appellant-committee is an industry within the meaning of the Central Act. 10. The learned counsel for the appellant challenges these concurrent findings by submitting that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Forests v. Jagannath Maruti Kondhare [1996] (2) SCC 293, could be exempted from the provisions of the Central Act. Hence, neither all governmental functions could be construed to be sovereign nor all statutory services could either be termed as sovereign or to exclude it from the purview of the Central Act. 12. The main thrust of submission for either side is, one trying to bring the functions of the appellant-committee within sovereign functions and the other stretching it out of it. The submission for the appellant is the power of the Government and functions of the committee, namely, notifying the intention of the Government to regulate the marketing of specified agricultural produce within specified area under section 3, declaration of market area under section 4, establishment of market under section 7, payment of Secretary and technical staff under section 58, absorption of staff of market committee in Government services under section 59, appointment of other staff under section 61, levy of market fees under section 65, grant of licence under section 72, de-notification of market area under Section 143, and amalgamation of market committees under section 144 are all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Corporation would like to enlarge the scope of these functions so as to comprehend all the welfare activities of a modern State, the learned counsel for the respondents would seek to confine them to what are aptly termed" the primary and inalienable functions of the constitutional Government.....Lord Watson, in Coomber v. Justices of Berks, describes the functions such as administration of justice, maintenance of order and repression of crime, as among the primary and inalienable functions of a constitutional Government. Isaacs, J. in his dissenting judgment in The Federated State School Teachers Association of Australia v. The State of Victoria, concisely states thus at p. 585 : "Regal functions are inescapable and inalienable. Such are the legislative power, the administration of laws, the exercise of the judicial power. Non-regal functions may be assumed by means of the legislative power. But when they are assumed the State acts simply as a huge corporation, with its legislation as the charter. Its action under the legislation, so far as it is not regal execution of the law is merely analogous to what of a private company similarly authorised." Supreme Court o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot that which pertains to private or personal employment. (3) The regal functions described as primary and inalienable functions of State though statutorily delegated to a corporation are necessarily excluded from the purview of the definition. Such regal functions shall be confined to legislative power, administration of law and judicial power. (4) If a service rendered by an individual or a private person would be an industry, it would equally be an industry in the hands of a corporation. (5) If a service rendered by a corporation is an industry, the employees in the departments connected with that service. Whether financial, administrative or executive, would be entitled to the benefits of the Act. (6) If a department of a municipality discharges many functions, some pertaining to industry as defined in the Act and other non-industrial activities, the predominant functions of the department shall be the criterion for the purposes of the Act." Within this premises this Court considered various departments of the corporation as to whether employees of such department would be covered by the Central Act. This Court holds various departments of the corporation including tax depart ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statutory bodies may, expressly or by necessary implication exclude the operation of the Industrial Disputes Act, 1947." The submission is, this observation excludes implicitly services under the statutory bodies from the operation of the Central Act. This submission is misconceived. This observation merely records what Parliament can make law in relation to the employees of statutory bodies etc. In other words, if it so desires may exclude the employees of the any statutory bodies expressly or by necessary implication from the purview of Industrial Disputes Act. This decision does not carve out any exception to exclude employees of all the statutory bodies. It merely indicates power of the Parliament, to place any class of employees outside the purview of the Central Act. The question is, whether there is any such provision under the State Act or the Central Act, which excludes these employees from the operation of the Central Act. In fact, section 2( a ) of the Central Act itself reveals large number of statutory corporations falling within the rubric of industry . 17. In relation to what are sovereign and what are non-sovereign functions, this Court in Jagannath Maru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l courts. The other functions of the State including welfare activity of State could not be construed as sovereign exercise of power. Hence, every Governmental function need not be sovereign . State activities are multifarious. From the primal sovereign power, which exclusively inalienably could be exercised by the Sovereign alone, which is not subject to challenge in any civil court to all the welfare activities, which would be undertaken by any private person. So merely one is employee of statutory bodies would not take it outside the Central Act. If that be then section 2( a ) of the Central Act read with Schedule I gives large number of statutory bodies should have been excluded, which is not. Even if a statute confers on any statutory body, any function which could be construed to be sovereign in nature would not mean every other functions under the same statute to be also sovereign. The court should examine the statute to severe one from the other by comprehensively examining various provisions of that statute. In interpreting any statute to find it is industry or not we have to find its pith and substance. The Central Act is enacted to maintain harmony between employe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nary civil court." 19. With reference to irrigation department of the State of Punjab this Court considered the question whether it is an industry within the meaning of section 2( j ) of the Central Act. The function of this department is for the development of agriculture. It undertakes harness of the surface and ground water resources of the State, the equitable distribution. It involves construction of major, medium and minor irrigation projects, maintenance of network of channels, regulation of canal supplies, enforcement of water laws etc. It is also responsible to provide protection to the valuable irrigated lands and public property from flooding, river action and waterlogging. This requires construction of flood protection, river training, drainage and anti-waterlogging works and their maintenance. It functions includes plan for irrigation development in the State. Each of these functions overall are inherently of the State. With reference to this irrigation department in Des Raj v. State of Punjab [1988] 2 SCC 537 this Court held : "With regard to the activities of the irrigation department and as also the tests laid down in various decisions of this Court part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... market committee to borrow money. The appointment of Government servants as Secretaries, Assistant Secretaries, Technical Accounts and Audit Staff is to ensure efficient administration and control of markets. In order to strengthen the said objectives Chapter II deals with the establishment of markets, Chapter III with constitution of market committees including provisions for election of its members. The constitution of the committee under section 11 consists of 11 members out of which one has to be a woman, two persons belonging to Scheduled Castes and Scheduled Tribes elected by the agriculturists in the market area, one member to be person other than retail traders, one member to be a representative of co-operative marketing society carrying on business in notified agricultural produce, one member to be representative of agricultural cooperative processing society, one to be an officer not below the rank of Secretary of the concerned market committee nominated by the Director of Agricultural Marketing who has no right to vote and three members to be nominated by the State Government who have right to vote. Chapter IV deals with conduct of business of the market committee, Chap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reveals, except one or two rests are all are elected members representing some on other class from the public. In fact, all Governmental functions cannot be construed either primary or inalienable sovereign function. Hence even if some of the functionaries under the State Act could be said to be performing sovereign functions of the State Government that by itself would not make the dominant object to be sovereign in nature or take the aforesaid Act out of the purview of the Central Act. 21. Thus merely an enterprise being statutory corporation, creature under a statute, would not take it outside the ambit of industry as defined under the Central Act. We do not find the present case falling under any exception laid down in the Bangalore Water Supply Sewerage Board case ( supra ). The mere fact that some employees of the appellant are Government servants would make no difference as the true test to find - has to be gathered from the dominant object for which functionaries are working. It cannot be doubted that the appellant is an undertaking performing its duties in a systematic and organised manner, regulating the marketing and trading of agricultural produce, rendering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce to sovereign power records : "The sovereign powers of a Government include all the powers necessary to accomplish its legitimate ends and purposes. Such powers must exist in all practical Governments. They are the incidents of sovereignty, of which a State cannot divest itself. Boggs v. Meree Min. Co., 14 Cal. 279, 309 . . . . In all Governments of constitutional limitations sovereign power manifests itself in but three ways. By exercising the right of taxation; by the right of eminent domain; and through its police power - United States v. Douglas-Willan Sartoris Co., 22 p. 92, 96, 3 Wyo. 287." So, sovereign function in the new sense may have very wide ramification but essentially sovereign functions are primary inalienable functions which only State could exercise. Thus, various functions of the State, may be ramifications of sovereignty but they all cannot be construed as primary inalienable function. Broadly it is taxation, eminent domain and police power which covers its field. It may cover its legislative functions, administration of law, eminent domain, maintenance of law and order, internal and external security, grant of pardon. So, the dichotomy be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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