LABOUR LAW LAW
(CASE ANALYSIS) ANALYSIS)
“BANGALORE “BANGALO RE WATER WATER SUPPLY SUPP LY vs. R. RAJAPPA RA JAPPA & OTHERS” OTH ERS” (1978 AIR !8)
S"#$%' *
S"#$%' #+*
,R. -ITA PO,,AR
A-IT U-AR
ASSISTANT PRO/ESSOR B
SE-0 II2 SEC0
LABOUR LAW 313
ROLL NO.
NATIONAL NATIONAL UNIERSITY UNIERS ITY O/ STU,Y STU ,Y AN, RESEARCH IN LAW L AW22 RANCHI 4444444444444444444444444444444444444444444444444444444444444444
INTRODUCTION:
The Bangalore case bench1 was constituted to clarify the concept of “industry” 2. The majority in the case re-stated re-stated3 so!ereign functions" as an e#ception to what amounts to an industry". The scope scope of this this project project is to determ determine ine whethe whetherr the Bangal Bangalore ore case ga!e ga!e managea manageable ble standards for the application of this e#ception. Broadly the acti!ities which are argued to be so!ereign function are$ Core functions of the state. Activities governed governed under Article 309 3!0 3!0 and 3!! 3!! of the Constitution. Constitution. "unction of the state in furtherance of #art I$ of the Constitution.
The analysis will set the standard in the Bangalore case for the abo!e functions separately. Through this e#ercise % will try to pro!e that the judgement does not gi!e us a clear idea as to what e#tent of the abo!e functions is co!ered under the e#ception. % will also use subse&uent judgements to highlight the ambiguity faced 'either in principle or in practical application( while applying the so!ereign function" standards laid down in the case. "ACT% O" T&' CA%':
The appellant Board raised a preliminary objection before the )abour *ourt that the Board+ a statutory body performing what is in essence a regal function pro!iding the basic amenities to its citi,ens+ is not an industry within the meaning of the e#pression under section 2 'j( of the %ndustrial isputes ct+ and conse&uently the employees were not wor/men and the )abour *ourt had no jurisdiction to decide the claim of the wor/men. The objection being o!er-ruled+ 1 The 7 judge bench comprised of Krishna Iyer, Bhagwati, Desai, Chandrachud, Jaswant ingh and Tu!"apur#ar JJ$ The !eading opinion was de!i%ered by by Krishna Iyer J$ & See The Industria! Disputes 'ct, 1()7 *hereinafter referred to as +the 'ct-, . & *j-$ /See, e.g. tate of Bombay %$ 0ospita! a"door abha, *1(23- 1 44J &51 and Corporation of City of 6agpur %$ %$ Its mp!oyees, *1(23- 1 44J 5&/ *had incorporated the doctrine of so%ereign function whi!e interpreting the concept of industry, prior to the Banga!ore case-$
the appellant Board filed two 0rit etitions before the arnata/a igh *ourt at Bangalore. The i!ision Bench of that igh *ourt dismissed the petitions and held that the appellant Board is “industry” within the meaning of the e#pression under section 2'i( of the %ndustrial isputes ct. 1456. The appeals by 7pecial )ea!e+ 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+ comprehensi!e+ clear and conclusi!e declaration as to what is an industry under the %ndustrial isputes ct as it stands” were placed for consideration by a larger Bench. I%%U' IN T&' CA%': CA%': (hether )angalore (ater %u**l+ and %e,erage )oard ,ill fall under the definition of -industr+ and ,hat is an -industr+ under section / 12 of the Industrial Dis*utes Act
1. THE CORE0 CORE0/UN /UNCTI CTION ON O/ TH THE E STA STATE
ccording to the leading-judgement+ the benchmar/ for determining the core-functions is$ the “primary and inalienable inalienable functions functions of the *onstitutiona *onstitutionall 8o!ernment”. 8o!ernment”. %t is limited in scope than the tortuous-defence of so!ereign-immunity and is subject to modification by the legislature. The concurring opinion e#plained that this standard can be referred to as the go!ernmental function in the limited sense. %t is neither the regal function 'them being a misfit in the 9epublican form of go!ernment( nor the so!ereign function 'them operating on a separate plain in itself(. This standard gi!en in the case+ according to me does not gi!e us a wor/able formula. This is for the following reasons. :irstly+ the standards are not static. static . They are subject to the changing role of the go!ernment with time. This is rele!ant because the go!ernment is increasingly stepping into industrial domain and also outsourcing its functions to pri!ate entities. Therefore the standards of legislati!e+ e#ecuti!e and judicial functions" as being the only primary functions has a high probability of changing with time.
7econdly , the Court did not clarify the standard for practical application. application . %t did not outline the functions functions what it considered considered to fall in the e#emption. e#emption. Therefore Therefore subse&uently subse&uently the court again had to step in to clear the confusion by listing the functions. %t also had to be later clarified that the test to determine primary and inalienable functions is to chec/ whether any pri!ate person can perform the same acti!ity. Thus+ the standard for determining the core-function as laid down in the case pro!ided scope for ambiguity and needs further clarification. 5. ACTIITIES GOERNE, UN,ER ARTICLE 3692 316 AN, 311 O/ THE CONSTITUTION.
The Bangalore case also held that acti!ities under rticle 3;4+ 31; and 311 will be co!ered under so!ereign function. But the standards regarding determining when such acti!ities will fall into the e#ception can be argued to be ambiguous.
Bangalore case was unanimous to e#clude the acti!ities of the state in furtherance of art %= from so!ereign function. function. ccording ccording to this case+ welfare acti!ities of economic economic ad!enture" are e#cluded from the so!ereign function e#emption to industry. This is a policy choice made by the court to increase the ambit of benefit a!ailable by the application of the ct. lthough it was a clear stand ta/en by court+ a subse&uent case 'per in curium( argued for inclusion of welfare acti!ities as so!ereign function. ccording to that interpretation welfare functions functions arise out of the duties of the state under the art %= of the *onstitution. *onstitution. Therefore Therefore they they are constit constituti utiona onall functio functions ns as well well . *onstit *onstitutio utional nal functio functions ns are part part of so!erei so!ereign gn function+ hence e#cluded from the ambit of an industry. The line of arguments supporting the inclusion of the welfare functions into the octrine of so!ere so!ereign ign functio function n has been been gainin gaining g suppor supportt steadily steadily.. The general general trend trend stands stands contrary contrary to Bangalore case+ which being a higher judge bench is a binding precedent for application of the octrine in the concept of industry". industry". The justification justification for this argument argument is found in the altered notions of so!ereignty in a *onstitutional democracy. >nli/e the mandate of the *rown+ the constitutional go!ernment is obliged to discharge welfare functions due to the mandate under art %=. %=. Therefore the court needs to pro!ide ade&uate ade&uate justification for opting them out of so!ereign function. function. ?a#imising ?a#imising the benefit from the ct cannot cannot alone be the consideration. @!en if that be the case+ the legislature and not the #udiciary should s hould be making the choice. Therefore although the standard to e#clude welfare function from the octrine of 7o!ereign function is clear+ it may not be manageable for future. THE -INORITY IEW
&he Tri*le Te “'ndustry” Test st for cope of the definition of “'ndustry”
4a2 s+ste5atic activit+ 62 Co7o*eration 6et,een e5*lo+er and e5*lo+ee
c2 #roduction and distri6ution of goods and services calculated to satisf+ hu5an ,ants and ,ishes
>ni!ersities were held to be e#cluded from the ambit of “industry” since the predominant acti!ity of the >ni!ersity is teaching and teachers are not “wor/ers” as defined in the ct. This case was also critici,ed in Bangalore 0ater 7upply by saying that education is a ser!ice to the community and hence+ uni!ersity is an industry. The teaching staff of the >ni!ersity was not held to be “wor/men” but the non-teaching staff would come within the scope of the said term so that they are able to ta/e the benef benefits its under the ct. The The 7* court in Banga Bangalore lore 0ater 7upply+ held that industry is one where there is "a$ systematic activity organised by "b$ co(operation between employer and employee for "c$ production and distribution of goods and an d ser servi vices ces ca calc lcul ulat ated ed to sa satis tisfy fy hu huma man n wa want ntss an and d wi wish shes es ) th thee &r &rip iple le &est . The conse&uences of applying the aforesaid triple test is$ "i$ professions "ii$ clubs "iii$ educational institu ins titutio tions, ns, coo cooper perati atives, ves, "v$ re resear search ch ins instit titutes utes "vi "vi$$ cha charita ritable ble pr pro# o#ects ects and "vii "vii$$ oth other er kindered kinder ed adven adventure tures, s, if they fulfil the triple test A'a(+ 'b( and 'c( enumerated here abo!e+ cannot be e#empted from the definition of “%ndustry”. THE A/TER-ATH* CRITICIS- AN, NEE, /OR REIEW$
The ruling by a fi!e-judge 7upreme *ourt Bench+ recommending the setting up of a larger Bench to re!iew the definition of “industry” as interpreted in law since 146C+ is a wa/eup call to the legislature and the e#ecuti!e. The cru# of the issue before the court in tate of *ttar +radesh v. asbir ingh ingh ta/en up along with nine other ci!il appeals+ was whether+ for purposes of application of the %ndustrial isputes ct 1456+ the Bangalore 0ater 0ater 7upply case that that amplif amplified ied the defini definitio tion n of “indu “industry stry”” should should continu continuee to be the law of the land.
The latest order of the Bench headed by Dustice E. 7antosh egde holds that the %yer Bench order needs a re!iew in !iew of the e#ecuti!e"s failure to notify and enforce the amended restricti!e definition of “industry”. The 8o!ernment had e#plained before courts that the 14C2 amendment was not notified in !iew of the fact that no alternati!e machinery for redress of grie grie!an !ances ces of empl employ oyees ees in estab establi lishm shment entss e#cl e#clud uded ed by the the amen amendm dmen entt had had been been pro!ided.
The egde Bench itself has pointed out that it was only in the absence of an unambiguous definition definition of industry industry in the % that the ape# court deli!ered deli!ered its ruling in 146C+ and that at the same time+ Dustice rishna %yer had said that “our judgment has no pontifical fla!our but see/s see/s to ser!e ser!e the the futu future re hour hour till till chan change gess in the the law or in indu indust stria riall cultu culture re occu occur”. r”.
owe!er+ some obser!ations made by the egde Bench in fa!our of a legal re!iew of the 146C ruling are on &uite different different lines and highly highly debatable. The order says that there is an “o!eremphasis on the rights of wor/ers” in industrial law and that this has resulted in payment of “huge amounts as bac/ wages” to wor/ers illegally terminated or retrenched.
The ape# court says that “an o!er-e#pansi!e interpretation of the definition of industry might be a deterrent to pri!ate enterprise in %ndia where public employment opportunities are s c a rc e ” . Dustice *handrachud+ a member of the Bench that deli!ered the 146C !erdict+ had said that the “problem Aof definition definition of industry industry is far too policy-oriente policy-oriented d to be satisfactorily settled by judicial j udicial decisions. arliament must step in and legislate in a manner which will lea!e no doubt as to its intention”. These+ are wise words.
ANALYSIS AN, CONCLUSION*
%n the present case the court by applying liberal interpretation ga!e a wider meaning to the definition of industry so industry so as to include all kinds of activities wherein there is an employer and employee relationship. ?ore than three decades after the Bangalore case+ it still stands as a binding precedent. ?any jurists ha!e argued either in fa!our or against the decision since then+ but the general trend of cases+ shows that there is a growing need to re!iew the judgement especially to include welfare welfare function function as part part of so!ere so!ereign ign function. function. The issue issue being being a policy policy matter matter needs needs go!ernment inter!ention.
in the strict interpretation of sovereign function. function . The confusing standards lead to multiple judgements trying to interpret them. Therefore whether the issue is of inalienable functions or *onstitutional acti!ities+ the case did not lay down manageable standards as what amounts to doctrine of so!ereign function.