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Indian Case Summary

Bangalore Water-Supply & … vs R. Rajappa & Others on 21 February, 1978 – Case Summary

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In the case of Bangalore Water Supply and Sewerage Board vs. R. Rajappa & Others, a landmark judgment was delivered by the Supreme Court of India on 21st February 1978. The case is significant for its interpretation of the term “industry” as defined in Section 2(j) of the Industrial Disputes Act, 1947, and its implications for statutory bodies performing essential public services.

Facts of the Case

The respondent employees were fined by the appellant board, Bangalore Water Supply and Sewerage Board, for misconduct, and various sums were recovered from them. In response, they filed a Claims Application No. 5/72 under Section 33C (2) of the Industrial Disputes Act, alleging that the punishment was imposed in violation of the principles of natural justice. The appellant board raised a preliminary objection before the Labour Court, arguing that the board, a statutory body performing what is essentially a regal function by providing basic amenities to citizens, is not an industry within the meaning of the expression under section 2(j) of the Industrial Disputes Act. Consequently, the employees were not workmen, and the Labour Court had no jurisdiction to decide the claim of the workmen.

Issues Raised and Court’s Observations

The main issue in this case was whether a statutory body providing essential public services could be considered an “industry” under the Industrial Disputes Act. The appellant board’s objection was overruled by the Labour Court, leading them to file two Writ Petitions before the Karnataka High Court at Bangalore. The Division Bench of the High Court dismissed the petitions and held that the appellant board is an “industry” within the meaning of the expression under section 2(j) of the Industrial Disputes Act, 1947.

The Supreme Court, in its judgment, held that the term “industry” in Section 2(j) of the Industrial Disputes Act, 1947, should be interpreted broadly. The court emphasized that it is not the motive of an activity in making goods or running a service, but the possibility of making them marketable if one who makes goods or renders service so desires, that should determine whether the activity lies within the domain or circle of industry. The court also noted that the nature of the activity will be determined by the conditions which give rise to the likelihood of the occurrence of such disputes and their actual occurrence in the sphere.

The court further observed that the State increasingly undertakes commercial functions and economic activities as part of its duties in a welfare state. Therefore, to artificially exclude state-run industry from the sphere of the Act, unless the statutory provisions expressly or by necessary implication have that effect, would not be correct.

Conclusion

The judgment in Bangalore Water Supply and Sewerage Board vs. R. Rajappa & Others expanded the definition of “industry” under the Industrial Disputes Act, 1947, to include statutory bodies providing essential public services. This interpretation has significant implications for the rights and protections available to employees of such bodies under the Act. The court’s emphasis on the nature of the activity and the conditions giving rise to disputes, rather than the motive or intent behind the activity, provides a broader and more inclusive understanding of what constitutes an “industry”.