Comprehension

The landmark judgment of Bangalore Water Supply and Sewerage Board v. A. Rajappa & Others, delivered by the Supreme Court of India in 1978, significantly influenced the interpretation of the term ‘industry’ under the Industrial Disputes Act, 1947. The case cantered on whether the Bangalore Water Supply and Sewerage Board, a statutory body, could be classified as an industry under the Act, thereby making its employees eligible for certain protections and benefits. Prior to this case, the definition of ‘industry’ had been subject to varied interpretations, leading to confusion and inconsistency in its application. The Industrial Disputes Act, 1947, broadly defined ‘industry’ to include any business, trade, undertaking, manufacture, or calling of employers and any calling, service, employment, handicraft, or industrial occupation or avocation of workmen. However, this expansive definition left room for ambiguity, especially concerning statutory bodies and non-profit organizations. In this case, the Bangalore Water Supply and Sewerage Board argued that it was not an industry, emphasizing its statutory duties and public welfare objectives. The Board contended that its primary purpose was to provide essential services, not to engage in profit-making activities typical of private enterprises. On the other hand, the respondents, including A. Rajappa, argued that the Board’s activities fell within the scope of an industry as defined by the Act, and thus, its employees should be entitled to the benefits and protections accorded to workers in industries. The Supreme Court, in its judgment, undertook a comprehensive analysis of the term ‘industry.’ The bench, led by Chief Justice M. Hameedullah Beg, laid down a broad and inclusive definition of ‘industry.’ The Court asserted that what mattered was the nature of the activity and the relationship between the employer and the employees. This interpretation aimed to ensure that a wide range of workers, including those employed in public utility services, statutory bodies, and even some non-profit organizations, would be covered under the protective umbrella of the Industrial Disputes Act. The decision in Bangalore Water Supply v. A. Rajappa & Others had far-reaching implications. It extended the scope of labour protections to a broader spectrum of workers, ensuring that more employees could benefit from the dispute resolution mechanisms and other safeguards provided under the Industrial Disputes Act. This judgment underscored the judiciary’s role in interpreting labour laws to promote social justice and protect workers’ rights in a rapidly industrializing nation.
(Extract from Bangalore Water Supply v. A. Rajappa & Others, 1978 2 SCC)

Question: 1

According to the Supreme Court’s judgment, what is the most important factor in determining whether an activity constitutes an industry?

Updated On: Dec 3, 2024
  • The profit-making motive of the employer
  • When there are multiple activities carried on by an establishment, its dominant function has to be considered. If the dominant function is not commercial, benefits of a workman of an industry under the Industrial Dispute Act may be given
  • The nature of the activity and the authority of the employer over its employees
  • When there are multiple activities carried on by an establishment, all the activities must be considered. Even if one activity is commercial, the employees will not get the benefit of workman of an industry under the Industrial Dispute Act
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The Correct Option is B

Solution and Explanation

The Supreme Court ruled that when an establishment carries out multiple activities, its dominant function determines whether the establishment constitutes an industry under the Industrial Disputes Act. If the dominant function is not commercial, workers can still receive benefits under the Act.

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Question: 2

Which of the following best describes the broader impact of the judgment?

Updated On: Dec 3, 2024
  • It reduced labour protections for workers
  • It extended labour protections to a broader spectrum of workers
  • It had no significant impact on labour laws
  • It only affected private sector workers
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The Correct Option is B

Solution and Explanation

The judgment significantly expanded labour protections by broadening the definition of ”industry,” allowing more workers, including those in sectors previously excluded, to benefit from the protections provided under the Industrial Disputes Act.

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Question: 3

Which of the following best describes the term ‘industry’ as defined by the Supreme Court in this judgment?

Updated On: Dec 3, 2024
  • Any activity involving profit-making
  • Any systematic activity organized by cooperation between an employer and employees for producing or distributing goods and services
  • Only activities conducted by private enterprises
  • Activities limited to manufacturing sectors
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The Correct Option is B

Solution and Explanation

The Supreme Court defined ”industry” as any activity that involves systematic cooperation between an employer and employees for the purpose of producing or distributing goods and services, regardless of whether it is profit-oriented or not.

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Question: 4

In which of the following landmark judgment, the Supreme Court held that when an association or society of apartment owners employs workers for personal services to its members, those workers do not qualify as workmen under the Act and the association is not an “Industry” under the Industrial Disputes Act?

Updated On: Dec 3, 2024
  • Som Vihar Apartment Owners’ Housing Maintenance Society Ltd. v. Workmen, 2009 SC
  • Anand Vihar Apartment Owners’ Society Ltd. v. Workmen, 2024 SC
  • Kanchanjunga Building Employees Union v. Kanchanjunga Flat Owners Society & Anr., 2024 SC
  • None of the above
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The Correct Option is A

Solution and Explanation

In the 2009 case, the Supreme Court ruled that when apartment owners’ societies employ workers for personal services to members, these workers do not qualify as ”workmen” under the Industrial Disputes Act, and the society is not considered an ”industry.”

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Question: 5

Under the Industrial Dispute Act, 1947, what is the role of the “Works Committee” and which of the following correctly describes its function?

Updated On: Dec 3, 2024
  • The Works committee is a body formed by the Central government to address wage disputes between employer and employee in public sector industries
  • The Works committee is a grievance redressal body constituted by the employer, primarily to promote measures for securing and preserving amity and good relations between the employer and employee
  • The Works Committee is responsible for making binding decisions on industrial disputes related to layoffs, retrenchment and closure of industrial units
  • All of the above
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The Correct Option is B

Solution and Explanation

The Works Committee under the Industrial Disputes Act is a body formed by the employer to address grievances and promote amicable relations between the employer and employees. It plays an important role in creating a cooperative work environment but does not have the authority to make binding decisions on industrial disputes related to layoffs or retrenchment.

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