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PETITIONER: BANGALORE WATER-SUPPLY & SEWERAGE BOARD, ETC.

       Vs.

RESPONDENT: R.   RAJAPPA & OTHERS

DATE OF JUDGMENT21/02/1978

BENCH: BEG, M. HAMEEDULLAH (CJ) BENCH: BEG, M. HAMEEDULLAH (CJ) CHANDRACHUD, Y.V. BHAGWATI, P.N. KRISHNAIYER, V.R. SINGH, JASWANT TULZAPURKAR, V.D. DESAI, D.A.

CITATION:  1978 AIR  548            1978 SCR  (3) 207  1978 SCC  (2) 213  CITATOR INFO :  R          1979 SC 170  (22)  R          1979 SC 582  (6)  D          1979 SC1132  (2,6)  APL        1979 SC1210  (1)  E          1980 SC 856  (3)  R          1980 SC2181  (28,54)  D          1984 SC1700  (13)  D          1985 SC  76  (5)  D          1985 SC1016  (12)  RF         1988 SC1060  (12)  R          1988 SC1182  (13)  RF         1988 SC1700  (6)  RF         1990 SC2047  (7,9)  F          1991 SC 101  (30)  D          1991 SC 915  (6,7)

ACT: "INDUSTRY"  Industry  in  Section  2(j)  of  the  Industrial Disputes  Act,  1947-Triple  test  to  be  applied  and  the dominant  nature test-Whether the statutory body  performing what  is in essence regal functions by providing  the  basic amenties  to  the  citizens  is outside  the  scope  of  the definition.

HEADNOTE: The  respondent employees were fined by the Appellant  Board for  misconduct,duct  and various sums were  recovered  from them.   Therefore, they filed a Claims Application No.  5/72 under  Section  33C  (2) of  the  Industrial  Disputes  Art. alleging  that the said punishment was imposed in  violation of  the principles of natural justice.  The appellant  Board raised a preliminary objection before the Labour Court  that the Board, a statutory body performing what is in essence  a regal  function  by  providing the basic  amenities  to  the citizens,  is  not  an industry within the  meaning  of  the expression  under  section 2(j) of the  Industrial  Disputes Act, and consequently the employees were not workmen and the

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Labour Court had no jurisdiction to decide the claim of  the workmen.   This  objection being over-ruled,  the  appellant Board  filed two Writ ’Petitions viz.  Nos. 868 and 2439  of 1973  before  the Karnataka High Court  at  Bangalore.   The Division  Bench of that High Court dismissed  the  petitions and  held that the appellant Board is "industry" within  the meaning  ’of  the  ,expression under  section  2(i)  of  the Industrial,  Disputes  Act, 1947.  The  appeals  by  Special Leave,  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, ? comprehensive, clear and conclusive declaration as to what is  an  industry  under the Industrial Disputes  Act  as  it stands" were placed for consideration by a larger Bench. HELD Per M. H. Beg, C.J. (concurring with Bhagwati,  Krishna Iyer and Desai, JJ. 1.   The term "analogous to the trade or business" could not cut  down the scope of the term "industry".  The said  words can  reasonably  mean only activity which results  in  goods made and manufactured or service rendered which are  capable of being converted into saleable ones.  They must be capable of entering the world of "res commercium", although they may be  kept out of the market for some reason.  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.   But even this may not  be  always  a satisfactory test.  By this test the type of services  which are  rendered  purely for the satisfaction of  spiritual  or psychological  urges  of persons  rendering  those  services would  be  excluded.  Whenever an industrial  dispute  would arise between either employers and their workmen or  between workmen and workmen, it should be considered an area  within the sphere of "industry" but not otherwise.  In other words, the  nature  of  the  activity will  be  determined  by  the conditions  which give rise to the likelihood of the  occur- rence  of such disputes and their actual occurrence  in  the sphere.                                         [220D, G, 22 1 A-B] *Judgments published in the order and  date as delivered. 208 "D.   N. Banerje’s case [1953] SCR 302; Corporation of  City of Nagpur v. Its Employees [1960] 2 SCR 942; State of Bombay and Others v. The Hospital Mazdoor Sabha and Others [1960] 2 SCR 866 referred to and followed. 3.   The term "sovereign should be reserved technically  and more  correctly  for  the  sphere  of  ultimate   decisions. Sovereignty operates on a sovereign plane, of its own.  Only those  services  which are governed by  separate  rules  and constitutional  provisions  such  as Articles  310  and  311 should,  strictly  speaking be excluded from the  sphere  of industry by a necessary implication.                                             [221E, G] H.   H.  Kesvananda  Bharati Sripathagalavaru  v.  State  of Kerala [1973] Supplemental S-C-R, Page-1 referred to. 4.   The special excludes the applicability of the  general. Certain  public  utility services which are carried  out  by governmental agencies or Corporations are treated by the Act itself  as within the sphere of industry.  If express  rules under  other enactments govern the relationship between  the State  as an employer and its servants as employees, it  may be  contended  on  the strength of such  provisions  that  a particular  set  of employees are outside the scope  of  the Industrial Disputes Act. [221G-H, 222A]

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5.   The  State  today  increasingly  undertakes  commercial functions  and economic activities and services as  part  of its  duties  in  a welfare  state.   Hence  to  artificially exclude  state-ran  industry  from the sphere  of  the  Act, unless  the statutory provisions expressly or  by  necessary implication  have that effect, would not be correct.  [222F- 223A] Rajasthan  State Electricity Board v. Mohanlal [1967] 3  SCR 377;   Rajasthan   v.  Mst.   Vidyawanti   &   Anr.   [1962] Supplemental 2 SCR 989 at 1002 referred to. Per Chandrachud J. 1.   Section  2(j)  of the Industrial  Disputes  Act  (1947) which defines, "industry" contains words of wide import,  as wide as the Legislature could have possibly made them.   The problem  of what limitations could and should be  reasonably read in interpreting the wide words used in section 2(j)  is far  too.  policy oriented to be satisfactorily  settled  by judicial  decisions.   The  Parliament  must  step  in   and legislate  in ’a manner which will leave no doubt as to  its intention.  That alone can afford a satisfactory solution to the question which has agitated and perplexed the  judiciary at all levels. [284H, 286A-B] 2.   Hospital Mazdoor Sabha was correctly decided in so  far as  it held that the JJ Group of hospitals was  an  industry but  the  same cannot be said in regard to the view  of  the Court that certain activities ought to be treated as falling outside the definition clause. [287C-D] 3.   There is no justification for excepting the  categories of public utility activities undertaken by the Government in the  exercise  of  its  inalienable  function,.,  under  the constitution,  call  it regal or sovereign or by  any  other name,  from  the definition of "industry".  If it  be.  true that one must have regard to the nature of the activity  and not to who engages in it, it is beside the point to  enquire whether  the  activity  is  undertaken  by  the  State,  and further,  if so, whether it is undertaken in  fulfilment  of the  State’s constitutional obligations or in  discharge  of its  constitutional  functions.   In fact,  to  concede  the benefit of an exception to the State’s activities which  are in  the  nature  of sovereign functions is  really  to  have regard  not so much to the nature of the activity as to  the consideration  who engages in that activity; for,  sovereign functions  can only be discharged by the State and not by  a private  person.  If the State’s inalienable  functions  are excepted  from  the  sweep of the  definition  contained  in section  2(j),  one  shall  have it is  the  nature  of  the activity is an industry.  Indeed, in this respect, it should make no difference   whether 209 on  the one hand, an activity is undertaken by  a  corporate body in the discharge of its statutory functions or, on  the other,   by  the  State  itself  in  the  exercise  of   its inalienable  functions.   If the water supply  and  sewerage schemes   or   fire  fighting  establishments   run   by   a Municipality can be industries sought to be the  manufacture of  coins and currency, arms and ammunition and the  winning of  oil  and uranium.  The fact that these latter  kinds  of activities are, or can only be, undertaken by the State does not  furnish  any  answer  to  the  question  whether  these activities  are  industries.  When undertaken by  a  private individual they are industries, therefore, when under- taken  by the State,they are industries.  The nature of  the activity is the determining factor and that does not  change according  to who undertakes it.  Items 8, 11, 12, 17  and18 of  the First Schedule read with section 2 (n) (vi)  of  the

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Industrial Disputes Act render support to this view.   These provisions which were described in Hospital Mazdoor Sabha as ’very  significant’  at  least  show  that,  conceivably,  a Defence Establishment, a Mint or a Security Press can be  an industry  even though these activities are, ought to be  and can only be undertaken by the State in the discharge of  its constitutional obligations or functions.  The State does not trade when it prints a currency note or strikes a  coin. And yet,  considering the nature of the activity, it is  engaged inan   industry when it does so. [287E-H, 288A-B]      4. A systematic activity which is organised or arranged in a mannerin   which the trade or business is generally organised or arranged would bean   industry despite the fact that it proceeds from charitable motives. It is inthe nature  of the activity that one has to consider and  it  is upon   the  application  of  that  test  that  the   State’s inalienable   functions  fall  within  the   definition   of industry.   The very same principles must yield  the  result that  just  as  the consideration as  to  who  conducts  the activity, is irrelevant for determining whether the activity is  an  industry  so  is  the  fact  that  the  activity  is charitable  in  nature or is undertaken  with  a  charitable motive.  The status or capacity corporate or constitutional, of  the employer would have, if at all, closer  nexus,  than his  motive  on  the question whether  the  activity  is  an industry.   The  motive which propels the  activity  is  yet another step removed and ex hypothesi can have no  relevance on  the question as to what is the nature of  the  activity. It is never true to say that the nature of the activities is charitable.  The subjective motive force of an activity  can be  charity  but  for the purpose  of  deciding  whether  an activity  is  an  industry one has to look  at  the  process involved in the activity, objectively.  The jural foundation of  any  attempt to except charitable enterprises  from  the scope  of the definition can only be that’ such  enterprises are  not undertaken for profit.  But then, that clearly,  is to  introduce the profit concept by a, side wind, a  concept which has been rejected consistently over the years.  If any principle can be said to be settled law in this vexed  field it  is  this : the twin consideration of profit  motive  and capital investment is irrelevant for determining whether  an activity  is an industry.  Therefore, activities  which  are dominated  by  charitable motives either in the  sense  that they involve the rendering of free or near free services  or in the sense that the profits which they yield are  diverted to  charitable  purposes,  are not beyond the  pale  of  the definition of section 2(j).  It is as much beside the  point to  inquire who is the employer as it is to inquire, why  is the activity undertaken and what the employer does with  the profits, if any. [288C-H, 289A] 5.By  this test a Solicitor’s establishment would  be  an industry.  A Solicitor undoubtedly does not carry on a trade or  business when he acts for his client or advises  him  or pleads for him, if and when pleading is permissible to  him. He  pursues a profession which is variously and  justifiably described as learned, liberal or noble.  But it is difficult to infer from the language of the definition in section 2(j) that  the Legislature could not have intended to bring in  a liberal profession like that of an Attorney within the ambit of the definition of ’industry’. [289A-B] National  Union of Commercial Employees & Another v.  M.  R. Meher. Industrial Tribunal Bombay & Ors. [1962] Supplemental 3 SCR 157 dissented from. 210 6.In  Hospital Mazdoor Sabha the Court while  evolving  a

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working   principle  stated  that  an  industrial   activity generally  involves,  inter  alia, the  cooperation  of  the employer and the employees.  That the production of goods or the rendering of material services to the community must  be the  direct  and proximate result of such cooperation  is  a further extension of that principle and it is broadly by the application thereof that a Solicitor’s establishment is held not  to  attract the definition clause.   These  refinements are,  with  respect  not  warranted  by  the  words  of  the definition,  apart from the consideration that  in  practice they  make  the application of the  definition  to  concrete cases   dependent  upon  a  factual  assessment  so   highly subjective  as to lead to confusion and uncertainty  in  the understanding of the true legal position.  Granting that the language  of the definition is so wide that some  limitation ought  to be read into it, one must stop at a  point  beyond which the definition will skid into a domain too rarefied to be realistic.  Whether the cooperation between the  employer and  the  employee is the proximate cause  of  the  ultimate product  and bears direct nexus with it is a test  which  is almost   impossible  of  application  with  any  degree   of assurance or certitude.  It will be as much true to say that the Solicitor’s Assistant, Managing Clerk, Librarian and the Typist  do not directly contribute to the  intellectual  end product  which  is a creation of his  personal  professional skill,   as  that,  without  their  active  assistance   and cooperation  it  will  be impossible  for  him  to  function effectively.  The unhappy state of affairs in which the  law is marooned will continue to baffle the skilled professional and his employees alike as also the Judge who has to perform the  unenviable  task  of  sitting  in  judgment  over   the directness  of the cooperation between the employer and  the employee,  until  such time as the  legislature  decides  to manifest  its  intention by the use of clear  and  indubious language.   Beside the fact that this Court has so held  ’in National Union of Commercial Employees the legislature  will find a plausible case for exempting the learned and  liberal professions  of  Lawyers,  Solicitors,  Doctors,  Engineers, Chartered  Accountants  and the like from the  operation  of industrial  laws.   But until that happens, in  the  present state of the law it is difficult by judicial  interpretation to  create  exemptions in favour of  any  particular  class. [289C-H] 7.The  case  of the clubs, on the present  definition  is weaker still.  The definition squarely covers them and there is  no justification for amending the law so as  to  exclude them  from the operation of the industrial laws.   The  fact that  the running of clubs is not a calling of the  club  or its managing committee, that the club has no existence apart from  its  members  that it exists for  its  members  though occasionally strangers take the benefit of its services  and that even after the admission of guests, the club remains  a members’ self-serving institution does not touch the core of the problem. [290A-B] Per  Iyer  J.  (on behalf of Bhagwati, J. J.  Desai  J.  and himself.) (1)’Industry  as  defined ’in Sec. 2(j) and  explained  in Banerji’s case has a wide import. [282A] I.(a)  Where (i) systematic activity, (ii)  organized  by cooperation  between employer and employee (the  direct  and substantial element is chimerical); (iii) for the production and/or  distribution  of goods and  services  calculated  to satisfy human wants and wishes (not spiritual or  religious, but  inclusive  of  material things or  services  geared  to celestial  bliss  e.g. making, on a large  scale  prasad  or

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food),   prima  facie  there  is  an  ’industry’   in   that enterprise. (b)  Absence  of  profit  motive  or  gainful  objective  is irrelevant, be the venturein the public, joint,  private or other sector. (c)  The  true focus is functional and the decisive test  is the  nature  of the activity with special  emphasis  on  the employer-employee relations. (d)  If the Organisation is a trade or business it does  not cease to be one becauseof   philanthropy   animating   the undertaking. [282A-C] II.  Although   section  2(j)  uses  words  of  the   widest amplitude  in  its  two  limbs,  their  meaning  cannot   be magnified to overreach itself. [282D] 211 (a)’Undertaking’    must   suffer   a    contextual    and associational shrinkage as explained in Banerji and in  this judgment;  so  also, service, calling and  the  like.   This yields the inference that all organized activity  possessing the  triple  elements in I (supra), although  not  trade  or business, may still be ’industry’ provided the nature of the activity,   viz.   the   employer-employee   basis.    bears resemblance  to  what we find in trade  or  business.   This takes into the fold of ’industry’ undertakings, callings and services, adventures’ analogous to the carrying on of  trade or  business’.  All features, other than the methodology  of carrying on the activity viz. in organizing the  cooperation between  employer and employee, may be dissimilar.  It  does not,  matter, if on the employment terms there  is  analogy. [282D-E] III.Application  of these guidelines should not stop  short of their logical reachby  invocation of creeds, cults  or inner sense of incongruity or outer senseof   motivation for  or resultant of the economic operations.  The  ideology of the Act being industrial peace, regulation and resolution of  industrial  disputes between employer and  workmen,  the range  of this statutory ideology must inform the  reach  of the statutory definition.  Nothing less, nothing more. (a)The consequences are (i) professions, (ii) clubs  (iii) educational  institutions  (iv) cooperatives,  (v)  research institutes (vi) charitable projects and (vii) other  kindred adventures,  if  they  fulfil the  triple  tests  listed  in (supra), cannot be exempted from the scope of section 2(j). (b)A    restricted   category   of,   professions,    clubs, cooperatives  and even gurukulas and little  research  labs, may   qualify   for  exemption  if,  in   simple   ventures, substantially  and going by the dominant  nature  criterion, substantively  no employees are entertained but  in  minimal matters,  marginal employees are hired.  without  destroying the non-employee character of the unit. (c)If,  in  a  pious or altruistic  mission,  many  employ themselves,  free  or for small honoraria  or  like  return, mainly  drawn  by sharing in the purpose or cause,  such  as lawyers volunteering to run a free legal services clinic  or doctors  serving  in  their spare hours in  a  free  medical centre on asramites working at the bidding of the  holiness, divinity  or like central personality, and the services  are supplied free or at nominal cost and those who serve are not engaged  for  remuneration  or on the basis  of  master  and servant  relationship,  then  the  institution  is  not   an industry  even if stray servants, manual or  technical,  are hired.   Such  eleemosynary or like undertakings  alone  are exempt-not   other  generosity,  compassion,   developmental passion or project. [282F-H, 283A-C] IV.  The dominant nature test :

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(a)Where  a complex of activities, some of  which  qualify for  exemption, others not, involves employees on the  total undertaking,  some  of  whom Are not  ’workmen’  as  in  the University  of  Delhi  case  or  some  departments  are  not ’productive  of goods and services if isolated,  even  then, the  predominant nature of the services and  the  integrated nature of the departments as explained in the Corporation of Nagpur,  will be the true test.  The whole undertaking  will be  ’industry’  although  those who  are  not  ’workmen’  by definition may not benefit by the status. (b)Notwithstanding   the   previous   clauses,   sovereign functions,   strictly  understood,  (alone),   qualify   for exemption, not the welfare activities of economic adventures undertaken by Government or statutory bodies. (c)Even in departments discharging sovereign functions  if there   are  units  which  are  industries  and   they   are substantially severable, then they can be considered to come within sec. 2(j). (d)Constitutionally  and competently  enacted  legislative provisions  may  well  remove  from the  scope  of  the  Act categories which otherwise may be covered thereby. [283C-F] 212 Management of Safdarjung Hospital, New Delhi v. kuldip Singh Sethi  [1971]  1 SCR 177=AIR (1970)  S.C.  1407  Dhanrajgiri Hospital  v. Workmen AIR 1975 S.C. 2032, National  Union  of Commercial  Employees  & Anr.  V. M.  R.  Meher,  Industrial Tribunal,  Bombay AIR [1962] S.C. 1080.  Rabindranath Sen  & Ors.  v. First Industrial tribunal, West Bengal AIR  [1963], Cal. 310;. University of Delhi & Anr. v. Ramnath & Ors.  AIR [1963] S.C. 1873; Madras Gymkhana Club v.  Employees’  Union v. Management AIR [1968] S.C. 554. Cricket Club of India  v. Bombay  Labour Union & Anr. [1969] 1 SCR 600= AIR [1969]  SC 276 over-ruled; Hospital Mazdoor’s case AIR 1960 S.C. 610 approved. Per  Jaswant  Singh  J.  (on behalf  of  Tulzapurkar  J  and himself). 1.Despite the width of the definition it could not be the intention of the legislature that categories 2 and 3 of  the charities alluded. to in the leading judgment, hospitals run on  charitable  basis or as a part of the functions  of  the Government   or   local  bodies  like   Municipalities   and educational  and,  research  institutions  whether  run   by private  entities or by Government and liberal  and  learned professions like that of doctors, lawyers and teachers,  the pursuit  of  which  is dependent  upon  an  individuals  own education,  intellectual attainments and  special  expertise should fall within the pale of the definition.                                           [290G-H, 291A] 2.The  definition  in s. 2(j) of the Act  is  limited  to those activities systematically or habitually undertaken  on commercial   lines   by  private  entrepreneurs   with   the cooperation of employees for the production or  distribution of  goods or for the rendering of material services  to  the community at large or a part of such community.  In the case of  liberal professions, the contribution of the usual  type of  employees employed by the professionals to the value  of the  end product (viz. advice and services rendered  to  the client)  is  so  marginal that the  end  product  cannot  be regarded  as  the  fruit  of  the  cooperation  between  the professional and his employees. [291A-C] 3.The  need  for excluding some  callings,  services  and undertakings  from the purview of the  aforesaid  definition has been felt and recognised by this Court from time to time while explaining the scope of the definition of’ "industry". [291C-D]

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OBSERVATION : 4.It  is high time that the Legislature steps in  with  a comprehensive bill to clean up the fog and remove the doubts and set at rest once for all the controversy which crops  up from  time  to  time  in relation  to  the  meaning  of  the aforesaid term rendering it necessary for larger Benches  of this  Court  to  be  constituted which  are  driven  to  the necessity of evolving a working formula to cover  particular cases. [292 A-B)]

JUDGMENT: CIVIL  APPELLATE JURISDICTION : Civil Appeal No. 753-754  of 1975 (Appeals by Special Leave from the Judgment and Order  dated 5-7-1974  of the Karnataka High Court in Writ Petition  Nos. 868 and 2439 of 1973)             CIVIL APPEAL Nos : 1544-1545 OF 1975 (Appeals by Special Leave from the Judgments and Order dated 15-4-75  and  11-6-1975 of the Andhra Pradesh High  in  Writ Appeals Nos. 205 and 231 of 1975) 213 SPECIAL LEAVE PETITION (CIVIL) No. 3359 OF 1977 (From  the Award dated 9-3-1977 of the  Industrial  Tribunal Gujarat  in  Ref.   I.T. No. 183 of 1973  published  in  the Gujarat Govt.  Gazette dated 14-4-1977)                CIVIL APPEAL No. 1171 OF 1972 (Appeal  by Special Leave from the Judgment and Order  dated 18-8-71  of the Madhya Pradesh High Court Gwalior  Bench  in Misc.  Petition No. 45 of 1970)                CIVIL APPEAL No. 1555 OF 1970 (Appeal  by Special Leave from the Award dated 6-12-1969  of the  4th industrial Tribunal West Bengal in Case No. 428  of 1966 published in the Calcutta Gazette dated 15-1-1970)                CIVIL APPEAL No. 2151 OF 1970 (Appeal by Special Leave from the Order dated 28-2-1970  ’of the Additional Industrial Tribunal, Delhi in I.D. No. 23  of 1969)                 CIVIL APPEAL No. 898 OF 1976 (Appeal  by Special Leave from the Order dated 23-1-1976  of the Lab-our Court Delhi in L.C.I.D. No. 14/72)             CIVIL APPEAL Nos. 1132-1135 OF 1977 (Appeal by Special Leave from the Order dated 25-11-1976  of the  Industrial Tribunal (II) U.P. at Lucknow in Adj.   Case Nos. 3-6/76)                CIVIL APPEAL No. 2119 OF 1970 (Appeal  by Special Leave from the Award dated 16-4-1970  of the Industrial Tribunal (1) U.P. Allahabad in Reference  No. 15 of 1968 published in the Uttar Pradesh Gazette dated  the 18th July, 1970) S.   V. Gupte, Att.  Genl., S. V. Subrahmanyam, M. Veerappa, and K.    N. Bhat for the appellants in C.A. No. 753-754 M.K. Ramamurthi (in CA753), M. C. Narasimhan (in CA 754), N. Nettar and J. Ramamurthi for the respondents R.K. Garg, S. C. Agarwal, V. J. Francis and A. Gupta for the Intervener G.B.  Pai, O. C. Mathur, D. N. Misra, Shri Narain and  K. J. John for the Interveners (T.  B. Hospital) Naunit  Lal  & Miss Lalita Kohli for the appellant  in  C.A. Nos. 1544-45 P.   P. Rao and G. N. Rao for R. 1 in CA 1545 214 P  P. Rao & T. V. S. N. Chari and Ashwani Kumar for R. 3  in CA 1545.

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I.   N. Shroff and H. S. Parihar for the Appellant in CA No. 1171/72 S.K.  Gambhir,  Mohan  Jha & B.  Ra.   Rakhiani  for  the respondent in CA No. 1171/72 K.Rajendra  Chowdhari & E. C. Agarwala for the  appellant in CA 1555/1970 L.   M. Singhvi, H. K. Puri, Miss Ashoka Jain, M. L. Dingra, Vivek Seth &H. L. Kumar for the appellant in CA No. 2151 A.   K. Gupta & Aruneshwar Gupta for the respondent in CA No. 2151 V.M. Tarkunde, O. C. Mathur, Shri Narain, K. J. John for the appellant in CA 898 Madan Mohan for the respondent in CA 898 In person : For the Applicant/Intervener in CA 898 A. K. Sen & E. C. Agarwala for the appellant in CA 1132-35 Urmila Kapoor, Sobha Dikshit & Kamlesh Bansal for the appel- lant in CA Nos. 1132-1135 A.   K.  Ganguli & D. P. Mukherjee for the appellant  in  CA 2119/70 R.K.  Garg, S. C. Agarwala, V. J. Francis & A. Gupta  for the respondent in 2119/70 D.V.  Patel, M. V Goswami & Ambrish Kumar for  the  peti- tioner in SLP No. 3359/77 P.   G. Gokhale, P. H. Parekh, Manju Sharma, Kailash  Vasdev & C. B. Singh for the respondent in SLP No. 3359. The, following Judgments were delivered BEG,  C.J.  I  am  in general agreement  with  the  line  of thinking  adopted and the conclusions reached by my  learned brother  Krishna  lyer.  I would, however, like  to  add  my reasons for this agreement and to indicate my approach to  a problem  where  relevant  legislation  leaves  so  much  for determination  by  the Court as to enable us  to  perform  a function very akin to legislation. My  learned  brother has relied on what  was  considered  in England  a  somewhat unorthodox method  of  construction  in Seaford Court Estates Ltd. v. Asher(1), where Lord  Denning, L.J., said :               "When  a defect appears a judge cannot  simply               fold  his hands and blame the  draftsman.   He               must  set to work on the constructive task  of               finding  the intention of Parliament and  then               he must supplement the written words so as  to               give  ’force  and life’ to  the  intention  of               legislature.   A judge should ask himself  the               question how, if the makers of the (1)  [1949] 2 All.  E. R. 15 5 at 164.  215                Act  had themselves come across this ruck  in               the   texture   of   it,   they   would   have               straightened it out?  He must then do as  they               would  have done.  A judge must not alter  the               material of which the Act is woven, but he can               and should iron out the creases". When this case went up to the House of Lords it appears that the Law Lords disapproved of the bold effort of Lord Denning to  make  ambiguous legislation more  comprehensible.   Lord Simonds   found  it  to  be  "a  naked  usurpation  of   the legislative   function   under   the   thin   disguise    of interpretation’.   Lord  Morton  (with  whom  Lord   Goddard entirely agreed) observed : "These heroics are out of place" and  Lord Tucker, said "Your Lordships would be acting in  a legislative rather than a judicial capacity if the view  put forward by Denning, L.J., were to prevail". Perhaps, with the passage of time, what may be described  as the extension of a method resembling the "arm chair rule" in

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the construction of wills, judges can more frankly step into the  shoes of the legislature where an enactment leaves  its own  intentions in much too nebulous or uncertain  a  state. In  M. Pentiah v. Verramallappa(1), Sarkar, J.  approved  of the reasoning, set out above, adopted by Lord Denning.  And, I  must  say  that,  in  a  case  where  the  definition  of "industry"  is  left in the state in which we find  it,  the situation  perhaps calls for some judicial heroics  to  cope with the difficulties raised. In his heroic efforts, my learned brother Krishna Iyer, if I may  say so with great respect, has not discarded the  tests of industry formulated in the past. Indeed, he has  actually restored  the  tests  laid  down by  this  Court  in  D.  N. Banerji’s  case(2), and, after that, in the  Corporation  of the City of Nagpur v. Its Employees(3), and State of  Bombay & Ors. v. The Hospital Mazdoor Sabha & (OrS.) (4), to  their pristine  glory.  My learned brother has, however,  rejected what  may  appear, to use the word employed recently  by  an American  Jurist,  "excrescences" of subjective  notions  of judges  which may have blurred those tests.  The  temptation is  great, in such cases, for us to give expression of  what may  be purely subjective personal predilections.   It  has, however, to be resisted if law is to possess a direction  in Conformity with Constitutional objectives and criteria which must  impart  that reasonable state  of  predictability  and certainty to interpretations of the Constitution as well  as to the laws made under it which citizens should expect.   We have,  so to speak, to chart what may appear to be a Sea  in which  the  ship  of  law like Noah’s ark  may  have  to  be navigated.   Indeed, Lord Sankey on one occasion, said  that law  itself  is like the ark to which people look  for  some certainty   and  security  amidst  the  shifting  sands   of political life and vicissitudes of times.  The  Constitution and the directive principles of State policy, read with  the basic  fundamental rights, provide us with a compass.   This Court has tried to indicate in recent cases that the meaning of (1)A.I.R. 1961 S.C. 1107 @ 1115. (2)[1953] S.C.R. 302. (3)[1960] 2 S.C.R. 942. (4)[1960] 2 S.C.R. 866. 216 what  could  be  described as a  basic  "structure"  of  the Constitution must necessarily be found in express provisions of  the  construction and not merely in  subjective  notions about  meanings of words.  Similar must be the reasoning  we must employ in extracting the core of meaning hidden between the interstices of statutory provisions. Each  of  us  is likely to have a  subjective  notion  about "industry".  For objectivity, we have to look first to  the, words  used in the statutory provision defining industry  in an  attempt to find the meaning.  If that meaning is  clear, we  need proceed no further.  But, the trouble here is  that the  words  found there do not yield a meaning  so  readily. They  refer to what employers or workers may do as parts  of their ordinary avocation or business in life.  When we  turn to  the meaning given of the term "worker" in Sec.  2(s)  of the  Act,  we are once more driven back to find  it  in  the bosom of "industry", for the term "worker" is defined as one :               "  employed in any industry to do any  skilled               or unskilled manual, supervisory, technical or               clerical work for hire or reward, whether  the               terms  of employment be express  or  implied,,               and  for the purposes of any proceeding  under

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             this Act in relation to an industrial dispute,               includes   any  such  person  who   has   been               dismissed,   discharged   or   retrenched   in               connection  with, or as a consequence of  that               dispute.  or  whose  dismissal,  discharge  or               retrenchment has led to that               dispute". The definition, however, excludes specifically those who are subject  to the Army Act 1950 or the Air Force Act 1950,  or the  Navy  Discipline  Act 1934, as well as  those  who  are employed  in  the  Police  Service  or  Officers  and  other employees  of a Prison, or employed in mainly managerial  or administrative   capacities  or  who,  being   employed   in supervisory  capacity,  draw wages exceeding Rs.  500/-  per mensem. Thus, in order to draw the "circle of industry", to use  the expression  of my learned brother Iyer, we do not find  even the  term  "workman"  illuminating.   The  definition   only enables  us to see that certain classes of persons  employed in the service of the State are excluded from the purview of industrial dispute which the Act seeks to provide for in the interests  of  industrial  peace  and  harmony  between  the employers and employees so that the welfare of the nation is secured.   The  result is that we have then to turn  to  the preamble  to  find  the object of the  Act  itself,  to  the legislative  history  of the Act, and to  the  socioeconomic ethos  and aspirations and needs of the times in  which  the Act was passed. The  method  which has been followed, whether it  be  called interpretation or construction of a part of an organic whole in  which  the  statute, its objectives, its  past  and  its direction for the future, its constitutional setting are all parts  of  this  whole  with  their  correlated   functions. Perhaps  it  is  impossible, in adopting such  a  method  of interpretation, which some may still consider unorthodox,  a certain  217 degree  of subjectivity.  But our attempt should be  not  to break with     the wellestablished      principles      of interpretation in doing so. Progressive rational         and beneficial modes of interpretation import and fit  into the body of the old what may be new.It  is a process  of adaptation for giving  new  vitality  in  keeping  with  the progress of thought in our    times.  All this, however,  is not really novel, although we may try   to  say it in a  new way. If  one  keeps in mind what was laid down in  Heydon’s  case (supra)  referred  to by my learned brother Iyer,  the  well known  principle  that a statute must be  interpreted  as  a whole, in the context of all the  provisions of the statute, its  objects,  the preamble, and the  functions  of  various provisions,  the  true meaning may emerge.  It  may  not  be strictly adictionary  meaning in such  cases.   Indeed, even  in  a modern  statute the meaning of a  term  such  as "Industry"  may  change with a rapidly  changed  social  and economic structure.  For this proposition I can do no better than  to quote Subba Rao J. speaking for this Court  in  The Senior Electric Inspector v. Laxmi Narayan Chopra(1)               "The  legal position may be summarized thus  :               The maxim contemporanea expositio as laid down               by  Coke  was applied  to  construing  ancient               statutes  but not to interpreting  Acts  which               are  comparatively  modern.  There is  a  good               reason   for  this  change  in  the  mode   of               interpretation.    The  fundamental  rule   of

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             construction is the same whether the Court  is               asked  to construe a provision of  an  ancient               statute  or that of a modem one, namely,  what               is the expressed intention of the Legislature.               It  is  perhaps difficult to  attribute  to  a               legislative  body  functioning  in  a   static               society  that  its intention  was  couched  in               terms  of considerable breadth so as  to  take               within  its  sweep  the  future   developments               comprehended  by the phraseology used.. It  is               more reasonable to confine its intention  only               to the circumstances obtaining at the time the               law  was  made.  But in a  modern  progressive               society  it would be unreasonable  to  confine               the intention of a Legislature to the  meaning               attributable to the word used at the time  the               law was made, for a modern Legislature  making               laws to govern a society which is fast  moving               must  be presumed to be aware of  an  enlarged               meaning  the same concept might  attract  with               the  march of time and with the  revolutionary               changes  brought  about in  social,  economic,               political  and scientific and other fields  of               human  activity.   Indeed, unless  a  contrary               intention appears, an interpretation should be               given  to the words used to take in new  facts               and  situations, if the words are  capable  of               comprehending them." In the Workmen of Dimakuchi Tea Estate v. The Management of Dimakuchi Tea Estate(2) it was observed (1)  [1962] 3 S.C.R. 146. (2)  [1958] S.C.R. 1156 at 1163. 15-21 1SCI/78 218               "A  little  careful consideration  will  show,               however,  that  the expression  "any  person".               occurring in the third part of, the definition               clause  cannot mean anybody and  everybody  in               this  wide  world.  First of all  the  subject               matter   of   dispute  must  relate   to   (i)               employment or non-employment or (ii) terms  of               employment  or  conditions of  labour  of  any               person; these necessarily import it limitation               in the sense that a person in respect of  whom               the  employer-employee relation never  existed               or  can  never possibly exist  cannot  be  the               subject matter of a dispute between  employers               and workmen.  Secondly, the definition  clause               must  be  read in the context of  the  subject               matter and scheme of the Act, and consistently               with  the objects and other provisions of  the               Act.  It is well settled that "the words of  a               statute,  when  there is a doubt  about  their               meaning  are to be understood in the sense  in               which they best harmonise with the subject  of               the   enactment  and  the  object  which   the               Legislature  has  in view.  Their  meaning  is               found  not so much in strictly grammatical  or               etymological  propriety of language, nor  even               in  its popular use, as in the subject  or  in               the occasion on which they are used,, and  the               object  to  be  attained."  (Maxwell,   Inter-               pretation of Statutes, , 9th Edition, p. 55).               It was also said there :               "It  is necessary, therefore, to take the  Act

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             as a whole and examine its salient provisions.               The  long title shows that the object  of  the               Act   is  "to  make  provision  for  the   in-               vestigation   and  settlement  of   industrial               disputes, and for certain other purposes." The               preamble states the same               object  and  s. 2 of the  Act  which  contains               definitions   states  that  unless  there   is               anything repugnant in the subject or  context,               certain   expressions   will   have    certain               meanings." Thus,  it is in the context of the purpose of the  Act  that the meaning of the term ’industry’ was sought. Again dealing with the objects of the Act before us in Budge Municipality case(1) this Court said :               "When  our  Act  came  to  be  passed,  labour               disputes  had already assumed big  proportions               and  there  were clashes between  workmen  and               employers in several instances.  We can assume               that it was to meet such a situation that  the               Act  was  enacted,  and  it  is   consequently               necessary  to give the terms employed  in  the               Act  referring  to such disputes  as  wide  an               import as reasonably possible."               In that very case this Court also said (at  p.               308) :               "There  is  nothing,  however,  to  prevent  a               statute  from giving the word  "industry"  and               the  words  "industrial dispute" a  wider  and               more comprehensive import in order to (1)  [1953] S.C.R. 302 at 310.  219               meet  the  requirements  of  rapid  industrial               progress  and to bring about in the  interests               of  industrial peace and economy, a  fair  and               satisfactory  adjustment of relations  between               employers  and workmen in a variety of  fields               of  activity.  It is obvious that the  limited               concept  of  what an industry meant  in  early               times  must now yield place to  an  enormously               wider  concept  so as to take in  various  and               varied  forms  of industry, so  that  disputes               arising  in  connection  with  them  might  be               settled  quickly without much dislocation  and               disorganisation  of the needs of  the  society               and  in a manner more adapted to  conciliation               and  settlement  than a determination  of  the               respective rights and liabilities according to               strict legal procedure and principles."               Again, in Hospital Mazdoor Sabha case(1)  this               Court said:               "If  the object and scope of the  statute  are               considered  there  would be no  difficulty  in               holding that the relevant words of wide import               have been deliberately used by the Legislature               in  defining  "industry" in  Sec.  2(j).   The               object  of the Act was to make  provision  for               the investigation and settlement of industrial               disputes,  and  the extent and  scope  of  the               provisions  would  be realised if we  bear  in               mind  the definition of "industrial  disputes"               given  by Section 2(k), of "wages" by  Section               2(rr),  "workmen"  by  Section  2(s),  and  of               "employer" by Section 2(g)."               It added :

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             "It  is  obvious  that the words  used  in  an               inclusive  definition  denote  extension   and               cannot be treated as restricted in any sense."               I may here set out the definition given by the               Act of the term ’industry’ in section 2,  sub.               s. (j)               "(j)  "Industry"  means any  business,  trade,               undertaking,   manufacture   or   calling   of               employers  and includes any calling,  service,               employment,    handicraft,    or    industrial               occupation or avocation of workmen;" It seems to me that the definition was not meant to  provide more  than  a guide.  It raises doubts as to what  could  be meant by the "calling of employers" even if business, trade, undertaking  or manufacture could be found capable of  being more  clearly  delineated.   It is clear that  there  is  no mention  here  of any profit motive.   Obviously,  the  word "Manufacture"  of employers could not be interpreted  liter- al1y.  It merely means a process of manufacture in which the employers may be engaged.  It is, however, evident that  the term  ’employer’  necessarily postulates  employees  without whom there can be no employers.  But, the second part of the definition  makes  "  the  concept  more  nebulous  as   it, obviously, extends the definition to any calling, (1)  [1960] 2 S.C.R. 866 at 875. 220 service, employment, handicraft or industrial occupation  or avocation of workmen".  I have already examined the  meaning of  the term " workman" which refers us back to what  is  an "industry". it seems to me that the second part, relating to workmen,  must  necessarily  indicate  something  which  may exclude employers and include an "industry It consisting  of individual handicraftsmen or workmen only.  At any rate, the meaning  of  industrial disputes includes  disputes  between workmen  and workmen also.  Therefore, I cannot see  how  we can  cut down the wide ambit of last part of the  definition by  searching for the predominant meaning in the first  part unless  we  were determined, at the outset, to  curtail  the scope of the second part somehow.  If we do that, we will be deliberately  cutting down the real sweep of the last  part. Neither "Noscitur a sociis" rule nor the " ejusdem  generis" rule are adequate for such a case. There  is  wisdom in the suggestion that in  view  of  these difficulties in finding the meaning of the term  ’industry’, as  defined in the Act, it is best to say that  an  industry cannot strictly be defined but can only be described.   But, laying down such a rule may again leave too wide a door open for  speculation  and  subjective  notions  as  to  what  is describable as an industry.  It is, perhaps, better to  look for  a rough rule of guidance in such a case by  considering what the concept of ’industry’ must exclude. I  think the phrase ’analogous to industry’, which has  been used  in  the  Safdarjung Hospital case  (supra)  could  not really  cut  down  the scope  of  "industry".   The  result, however,  of that decision has been that the scope has  been cut  down.  1, therefore, completely agree with  my  learned brother  that  the  decisions of this  Court  in  Safdarjung Hospital  case  and  other cases  mentioned  by  my  learned brother  must be held to be overruled.  It seems to me  that the  term ’analogous to trade or business, could  reasonably mean   only  activity  which  results  in  goods   made   or manufactured or services rendered which are capable of being converted  into  saleable  ones.  They must  be  capable  of entering the world of "res commercium although they may  be, kept  out  of  the market for some reason.  It  is  not  the

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motive  of  an  activity  in making  goods  or  rendering  a service,  but the possibility of making them  marketable  if one  who makes goods or renders services, so  desires,  that should determine whether the activity lies within the domain or circle of industry.  But, even this may not be always  a, satisfactory test. The test indicated above would necessarily exclude the  type of  services which are rendered purely for the  satisfaction of  spiritual  or psychological urges of  persons  rendering those services.  These cannot be bought or sold. For persons rendering such services there may be no ’industry’, but, for persons  who want to benefit from the services rendered,  it could  become an "industry".  When services are rendered  by groups of charitable individuals to themselves or others out of  missionary  zeal and purely  charitable  motives,  there would  hardly  be any need to invoke-the provisions  of  the industrial 221 Disputes  Act  to  protect them.  Such is not  the  type  of persons  who  will  raise  such  a  dispute  as  workmen  or employees whatever they may be doing. This  leads one on to consider another kind of test.  It  is that,  wherever  an industrial dispute could  arise  between either  employers and their workmen or between  workmen  and workmen,  it should be considered an area within the  sphere of  ’industry’ but not otherwise In other words, the  nature of the activity will lie determined by the conditions  which give  rise to the likelihood of occurrence of such  disputes and  their actual occurrence in the sphere.  This may  be  a pragmatic test.  For example, a lawyer or a solicitor  could not  raise  a dispute with his litigants in general  on  the footing  that  they were his employers.  Nor  could  doctors raise  disputes  with  their patients  on  such  a  footing. Again, the personal character of the relationship between  a doctor  and his assistant and a lawyer and his clerk may  be of  such  a kind that it requires  complete  confidence  and harmony  in  the productive activity in which  they  may  be cooperating so that, unless the operations of the  solicitor or   the  lawyer  or  the  doctor  take  an  organised   and systematised form of a business or trade, employing a number of persons, in which disputes could arise between  employers and  their  employees,  they would not enter  the  field  of industry.    The  same  type  of  activity  may  have   both industrial and non-industrial aspects or sectors. I  would also like to make a few observations about  the  so called " sovereign’ functions which have been placed outside the field of industry.  I do not feel happy about the use of the   term  "sovereign"  here.   I  think  that   the   term ’sovereign’   should  be  reserved,  technically  and   more correctly,   for   the   sphere   of   ultimate   decisions. Sovereignty  operates on a sovereign plane of its own  as  I suggested in Keshvananda Bharati’s case (1)- Supported by  a quotation   from  Ernest  Barker’s  "Social  and   Political Theory".   Again,  the  term "Regal", from  which  the  term "sovereign"  functions appears to be derived, seems to be  a misfit in a Republic where the citizen shares the  political sovereignty  in  which he has even a  legal  share;  however small,  in as much as he exercises the right to vote.   What is meant by the use of the term "sovereign", in relation  to the activities of the State, is more accurately brought  out by  using the term "governmental" functions  although  there are difficulties here also in as much as the Government  has entered  largely  now fields of industry.   Therefore,  only those  services  which are governed by  separate  rules  and constitutional  provisions,  such  as Article  310  and  311

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should,  strictly speaking, be-excluded from the  sphere  of industry by necessary implication. I  am impressed by the argument that certain public  utility services  which are carried out by governmental agencies  or corporations  are  treated by the Act itself as  within  the sphere of industry.  If express rules under other enactments govern the relationship between the State as an employer and its  servants;  as  employees it may be  contended,  on  the strength  of  such  provisions, that  a  particular  set  of employees  are outside the scope of the Industrial  Disputes Act for that reason. The, special excludes the applicability of the general.  We cannot (1)  1973 Sup.S. C. R. P 1 222 forget  that  we have to determine the meaning of  the  term ’industry in the context of and for the purposes of  matters provided for in the Industrial Disputes Act only.  I have contented myselfwith  a  very  brief  and   hurried outline of my line of thinking partly because   I  am   in agreement with the conclusions of mylearned brother Iyer and I also endorse his reasoning almost whollybut   even more  because the opinion I have dictated just now  must  be given today if I have to deliver- it at all.  From  tomorrow I  cease  to have any authority as a Judge  to  deliver  it. Therefore, I have really no time to discuss the large number of cases cited before us, including those on what are  known as "sovereign" functions. I will, however, quote a passage from State of Rajasthan  v. Mst. Vidyawati & Anr.(1) where this Court said :               "In  this connection it has to  be  remembered               that   under   the   Constitution   we    have               established  a welfare state, whose  functions               are  not confined only to maintaining law  and               order but extend to engaging in all activities               including  industry, public  transport,  state               trading,  to name only a few of them.   In  so               far  as  the State activities have  such  wide               ramifications  involving not only the  use  of               sovereign  powers  but  also  its  powers   as               employers in so many public sectors, it is too               much to claim that the State should be  immune               from the consequences of tortious acts of  its               employees  committed  in the course  of  their               employment as such." I  may  also  quote another  passage  from  Rajasthan  State Electricity  Board  v. Mohan Lal(2) to show that  the  State today  increasingly  undertakes  commercial  functions   and economic activities and services, as part of its duties in a welfare state.  The Court said there :               "Under  the Constitution, the State is  itself               envisaged  as  having the right  to  carry  on               trade  or business as mentioned in Art.  19(1)               (g).  In Part IV, the State has been given the               same  meaning  as in Art. 12 and  one  of  the               Directive  Principles laid down in Art. 46  is               that  the  State shall pro-mote  with  special               care the educational and economic interests of               the weaker sections of the people.  The State,               as defined in Art. 12, is thus comprehended to               include  bodies  created for  the  purpose  of               promoting   the   educational   and   economic               interests  of  the  people.   The  State,   as               constituted  by our Constitution,  is  further               specifically empowered under Art. 298 to carry               on  any trade or business.  The  circumstances

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             that  the Board under the  Electricity  Supply               Act  is, required to carry on some  activities               of  the-nature of trade or commerce does  not,               therefore, give any indication that the  Board               must  be excluded from the scope of  the  word               "State" as used in Art. 12." (1)  [1962] Supp. 2 S.C.R. 989 at 1002. (2)  [1967] (3) SCR 377 at 385. 223 Hence, to artificially exclude State run industries from the sphere of the Act, unless statutory provisions, expressly or by  a necessary implication have that effect, would  not  be correct.   The question is one which can only be  solved  by more  satisfactory  legislation on  it.   Otherwise,  Judges could  only  speculate and formulate  tests  of  ,"industry" which cannot satisfy all.  Perhaps to seek to satisfy all is to cry for the moon. For  the reasons given above, I endorse the opinion and  the conclusions of my learned brother Krishna Iyer. KRISHNA  IYER, J.-The rather zigzag, course of the  landmark cases and the tangled web of judicial thought have perplexed one branch of Industrial Law, resulting from obfuscation  of the  basic  concept  of  ’industry’  under  the,  Industrial Disputes  Act,  1947  (for short, the  Act).   This  bizarre situation,   30   years  after  the  Act  was   passed   and industrialization  bad advanced on a national  scale,  could not be allowed to continue longer.  So, the urgent need  for an authoritative resolution of this confused position  which has survived indeed, has been accentuated by-the judgment of this  six-member bench in Safdar Jung(1), if we may  say  so with deep respect, has led to a reference to a larger  bench of  this  diehard  dispute as to what  an  ’industry’  under Section 2(j) means. Legalese  and logomachy have the genius to  inject  mystique into  common words, alienating the laity in effect from  the rule of law.  What is the common worker or ordinary employer to do if he is bewildered by a definitional dilemma, and  is unsure whether his. enterprise say, a hospital,  university, a  library,  a  service  club,  a  local  body,  a  research institute,  a pinjarapole, a chamber of commerce,  a  Gandhi Ashram-is an industry at all ? Natural meaning is nervous of acceptance in court where the meaning of meanings is lost in uncertain erudition and cases have even cancelled each other out while reading meaning.               "I  do  not  think" said  Diplock  L.J.,  that               anywhere,  except in a court of law, it  would               be  argued with gravity that a Dutch  barn  or               grain  and fodder stores or any ordinary  farm               buildings    are   properly    described    as               repositories.   A  Gloucester  shire   farmers               would  say they were farm buildings and  would               laugh at their being called ’repositories." in               the   same  spirit,  Stamp  J.  rejected   the               argument that the carrying on of the  business               of a crematorium involved the " subjection  of               goods  or  materials to  any  process"  within               section 271 (1) (c) of the Income Tax Act 1952               as a distortion of the English  language......               I  protest  against  subjecting  the   English               language, and more particularly simple English               phrase,  to this kind of process of  philology               and semasiology." (2) (1)Management  of  Safdarjung   Hospital,  New  Delhi,  v. Kuldip Singh Sethi [1971] 1 S.C.R. 177. (2)Maxwell  on ’The interpretation of Statutes" 12th  Edn.

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by P. St. J. Langan pp. 81-82. 224 Esoterica  is anathema for law affecting the common  man  in the  commerce  of life, and so the starting  point  for  our discussion is the determination to go by the plain, not  the possible,  sense  of  the  words  used  in  the  definition, informed  by  the,  context  and  purpose  of  the  statute, illumined  by  its  scheme  and  getting  and   conceptually coloured by what is an industry at the current developmental stag&  in  our  country.  In our system  of  precedents  our endeavour  must be, as urged by counsel, to reconcile  prior pronouncements, if possible, and to reconsider the  question altogether,  if necessary. , There are no absolutes  in  law since  life,  which  it serves, is relative.   ’What  is  an industry  in America or the Soviet Union may not be  one  in India  and  even  in our Country what was  not  an  industry decades  ago may well be one now.  Our judgment here has  so pontifical  flavour but seeks to serve the future hour  till changes in the law or industrial culture occur. Law,  especially industrial law, which regulates the  rights and  remedies  of  the working class,  unfamiliar  with  the sophistications  of  definitions and  shower  of  decisions, unable  to secure expert legal opinion,. what  with  poverty pricing them out of the justice market and denying them  the staying  power  to  withstand the  multi  decked  litigative process, de facto denies social justice if legal drafting is vagarious,   definitions   indefinite  and   court   rulings contradictory.    Is  it  possible,  that  the   legislative chambers are too preoccupied with other pressing business to listen  to  court  signals  calling  for  clarification   of ambiguous  clauses  ? A careful, prompt amendment.  of  Sec. 2(j)  would  have  preempted this  docket  explosion  before tribunals  and  courts.  This Court, perhaps more  than  the legislative and Executive branches, is deeply concerned with law’s  delays  and  to devise a prompt  delivery  system  of social justice. Though  the tailoring of a definition is the  sole  forensic job in this batch of appeals, dependent on which, perhaps, a few  thousand  other cases await  decision,  the  cycloramic semantics  of the simple  word ’industry’ and  the  judicial gloss  on it in a catena of cases, have led to an  avoidable glut of labour litigation where speedy finality and  working criteria are most desirable.  And this delay in disposal  of thousands  of, disputes and consequent partial paralysis  in the  industrial life is partly blamable on the absence of  a mechanism  of communication between the court and  the  law- making chambers. The  great  American judge, Justice Cardozo,  while  he  was Chief Justice of New York Supreme Court., made this point:               "The  Courts are not helped as they could  and               ought  to  be  in the  adaptation  of  law  to               justice.   The reason they are not  helped  is               because  there is no one whose business it  is               to     give    warning    that     help     is               needed. .. . . . . We must have a courier  who               will  carry  the tidings  of  distress........               Today   courts   and   legislative   work   in               separation and aloofness.  The penalty is paid               both in the wasted effort of production and in               the  lowered quality of the product.   On  the               one  side, the judges, left to  fight  against               anachronism and                225               injustice  by the methods of  judge-made  law,               are  distracted by the conflicting  promptings

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             of  justice  and  logic,  of  consistency  and               mercy,  and the output of their  labors  bears               the tokens of the strain.  On the other  side,               the  legislature, informed only  casually  and               intermittently  of the needs and  problems  of               the  courts, without expert or responsible  or               disinterested  or systematic advice as to  the               workings  of one rule or another, patches  the               fabric here and there, and mars often when  it               would  mend.  Legislature and courts move  ,on               in  proud and silent isolation.   Some  agency               must be found to mediate between them." The   grave  disquiet  about  arrears  in  courts  must   be accompanied  by deeper insights into newer methodology  than collection  of, statistics and minor reforms.   Appreciating the urgency of quick justice a component of social  justice, as  a  priority  item  on the  agenda  of  Law  Reforms  and suspecting  public unawareness of some essential aspects  of the problem, we make these painful observations. This  obiter  exercise  is  in  discharge  of  the   court’s obligation to inform the community in our developing country where  to look for the faults in the legal order and how  to take meaningful corrective measures.  The courts too have  a constituency  the nation-and a  manifesto-the  Constitution. That is the validation of this ,divagation. Back to the single problem of thorny simplicity : what is an ’industry’ ? Historically speaking, this Indian statute  has its beginnings in Australia, even as the bulk of our  corpus juris,  with a colonial favour, is a carbon copy of  English law.   Therefore,  in  interpretation,  we  may  seek  light Australasially,  and so it is that the precedents  of  this- court   have  drawn  on  Australian  cases  as  on   English dictionaries.  But India is India and its individuality,  in law  and  society, is attested by its National  Charter,  so that  statutory  construction  must  be  home-spun  even  if hospitable to alien thinking. The reference to us runs thus :               "One  should  have thought  that  an  activist               Parliament  by taking quick  policy  decisions               and by resorting to amendatory processes would               have simplified, clarified and de-limited  the               definition  of "industry", and, if we may  add               "workman".  Had this been done with aware  and               alert  speed  by the  legislature,  litigation               which is the besetting sin of industrial  life               could well have been avoided to a considerable               degree.  That consummation may perhaps  happen               on a distant day, but this Court has to decide               from day to day disputes involving this branch               of industrial law and give guidance by declar-               ing  what is an industry, through the  process               of interpretation and reinterpretation, with a               murky accumulation of case law.               Counsel  on both sides have chosen to rely  on               Safdar Jung each emphasising one part or other               of the decision as               226               supporting  his  argument.  Rulings  of  this-               Court  before  and  after  have  revealed   no               unanimity  nor  struck any unison and  so,  we               confess to our inability to discern any golden               thread running through the string of decisions               bearing on the issue at hand."               ".... the chance of confusion from the crop of               cases  in an area where the common man has  to

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             understand   and  apply  the  law   makes   it               desirable  that  there  should  be  a  compre-               hensive,  clear and conclusive declaration  as               to  what is an industry under  the  Industrial               Disputes Act as it now stands.  Therefore,  we               think  it necessary to place this case  before               the learned Chief Justice for consideration by               a  larger  Bench.   If  in  the  meantime  the               Parliament  does not act, this Court may  have               to illumine the twilight area of law and  help               the industrial community carry on smoothly               So,  the long and short of it is, what  is  an               industry?  Section 2 (j) defines it :               "   ’industry’  means  any  business,   trade,               undertaking,   manufacture   or   calling   of               employers  and includes any calling,  service,               employment,    handicraft,    or    industrial               occupation or avocation of workmen:" Let  us put it plain  The canons of construction  are  trite that we must read the statute as a whole to get a hang of it and  a holistic perspective of it.  We must have  regard  to the    historical   background,   objects    and    reasons, international    thought   ways,   popular    understanding, contextual   connotation  and   suggestive   subject-matter. Equally   important,  dictionaries,  while  not   absolutely binding, are aids to ascertain meaning.  Nor are we  writing on  a  tabula. rosa.  Since Banerjee,(1)  decided  a  silver jubilee  span  of  years ago, we have  a  heavy  harvest  of rulings  on what is an ’industry’ and we have to be   guided by  the  variorum  of criteria stated  therein,  as  far  as possible,  and  not  spring  a  creative  surprise  on   the industrial community by a stroke of freak originality. Another sobering sign.  In a world of relativity I where law and  life  interlace,  a search for  absolutes  is  a  self- condemned  exercise.  Legal concepts, ergo, are  relativist, and  to miss this rule of change and developmental stage  is to interpret oneself into error.  Yet  a  third  signpost.   The  functional  focus  of  this industrial legislation and the social perspective of Part IV of the Paramount Law drive us to hold that the dual goals of the Act are contentment of workers and peace in the industry and  judicial  interpretation  should  be  geared  to  their fulfilment,   not  their  frustration.   A   worker-oriented statute must receive a construction where conceptually.  the keynote thought must be the worker and the community, as the Constitution  has  shown concern for  them,  inter-alia,  in Articles 38, 39 and 43. (1)  [1953] S.C.R. 302.  227 A  look at the definition, dictionary in hand, decisions  in head   and  Constitution  at  heart,  leads  to  some   sure characteristics of an ’industry’, narrowing down the  twilit zone of turbid controversy.  An industry is a continuity, is an  organized  activity,  is a  purposeful  pursuit-not  any isolated adventure , desultory excursion or casual, fleeting engagement  motivelessly  undertaken.  Such  is  the  common feature   of  a  trade,  business,   calling,   manufacture- mechanical   or   handicraft   based-service,    employment, industrial  occupation  or avocation.  For  those  who  know English  and  are  not  given to  the  luxury  of  splitting semantic   hairs,  this  conclusion  argues   itself.    The expression ’Undertaking’ can not be torn off the words whose company it keeps.  If birds of a feather flock together  and noscitur  a sociis is a commonsense guide  to  construction, ’undertaking’   must  be  read  down  to  conform   to   the

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restrictive  characteristic shared by the society  of  words before  and  after.   Nobody will  torture  ’undertaking  in Section  2(j)  to  mean meditation  or  musheira  which  are spiritual  and aesthetic undertakings.  Wide  meanings  must fall  in line and discordance must be excluded from a  sound system.  From  Banerjee  to Safdar  Jung  and  beyond,  this limited  criterion has passed muster and we see  no  reason, after  all  the  marathon of argument, to  shift  from  this position.  Likewise,  an ’industry’ cannot exist without  co-operative endeavyour  between employer and employee.  No employer,  no industry;  no  employee,  no  industry-not  as  a   dogmatic proposition in economics but as an articulate major  premise of  the  definition  and the schema of the  Act,  and  as  a necessary  postulate  of industrial disputes  and  statutory resolution thereof. An  industry  is not a futility but geared to  utilities  in which the community has concern.  And in this mundane  world where law lives, now, economic utilities-material goods  and services,   not   transcendental  flights   nor   intangible achievements-are   the   functional   focus   of   industry. Therefore, no temporal utilities, no, statutory industry, is axiomatic.  If society, in its advance, experiences  subtler realities  and  assigns values to  them,  jurisprudence  may reach out to such collective good.  Today, not tomorrow,  is the  first charge of pragmatic law of western heritage.   So we are confined to material, not ethereal end products. This  much  flows from a plain reading of  the  purpose  and proviSion of the legislation and its western origin and  the ratio of all the rulings.  We hold these triple  ingredients to be unexceptionable. The  relevant constitutional entry speaks of industrial  and labour  disputes (Entry 22 List I Sch.  VII).  The  Preamble to  the Act refers to ’the investigation and  settlement  of industrial disputes’.  The definition of industry has to  be decoded in this background and our holding is  reinforced-by the  fact  that  industrial  peace,  collective  bargaining, strikes  and  lock-outs,  industrial  adjudications,   works committees  of employers and employees and the like  connote organised, systematic operations and collectivity of workmen co-operating  with  their employer in  producing  goods  and services for the community.  The betterment of the workmen’s lot, the avoidance of out-breaks blocking pro- 228 duction  and just and speedy settlement of disputes  concern the  community.  In trade and business, goods  and  services are for the community not for self-consumption. The  penumbral  area  arrives as we move  on  to  the  other essentials needed to make an organized, systematic activity, oriented  ,on productive collaboration between employer  and employee,  an industry as defined in Section 2(j).  Here  we have   to  be  cautious  not  to  fall  into  the  trap   of definitional  expansionism bordering on reducio ad  absurdum nor  to truncate the obvious amplitude of the  provision  to fit  it into our mental would of beliefs and  prejudices  or social   philosophy   conditioned   by   class    interests. Subjective wish shall not be father to the forensic thought, if  credibility with a pluralist community is a value to  be cherished.   "Courts  do  not substitute  their  social  and economic  beliefs for the judgment of  legislative  bodies". [See  (Constitution of the United States of America)  Corwin p.  xxxi].   Even so, this legislation has something  to  do with social justice between the ’haves’ and the  ’have-nots, and naive, fugitive and illogical cut-backs on the import of ’industry’  may  do injustice to  the  benignant  enactment.

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Avoiding  Scylla  and Charybdis we proceed to  decipher  the fuller import of the definition.  To sum up, the personality of the whole statute, be it remembered, has a welfare basis, it  being  a beneficial legislation which  protects  Labour, promotes  their  contentment  and  regulates  situations  of crisis  and  tension where production may  be  imperiled  by untenable strikes and blackmail lock-outs.  The mechanism of the  Act  is geared to conferment of regulated  benefits  to workmen  and resolution, according to a sympathetic rule  of law,   of  the  conflicts,  actual  or  potential,   between managements  and workmen.  Its goal is amelioration  of  the conditions  of  workers, tempered by a  practical  sense  of peaceful co-existence, to the benefit of both-not a  neutral position but restraints on laissez faire and concern for the welfare  of  the weaker lot.  Empathy with  the  statute  is necessary  to understand not merely its spirit but also  its sense.  One of the vital concepts on which the whole statute is built, is ’industry’ and when we approach the  definition in Section 2 (j), we must be informed by these values.  This certainly  does not mean that we should strain the  language of  the  definition  to import into it  what  we  regard  as desirable  in  an  industrial legislation, for  we  are  not legislating  de  novo  but-  construing  an  existing   Act. Crusading  for a new type of legislation with dynamic  ideas or  humanist justice and industrial harmony cannot be  under the  umbrella of interpreting an old,  imperfect  enactment. Nevertheless,   statutory  diction  speaks  for  today   and tomorrow; words are semantic seeds to serve the future hour. Moreover,  as  earlier  highlighted,  it  is  legitimate  to project  the value-set of the Constitution, especially  Part IV,  in  reading  the meaning  of  even  a  pre-Constitution statute.   The paramount law is paramount and Part  TV  sets out  Directive Principles of State Policy which  must  guide the judiciary, like other instrumentalities, in interpreting all legislation.  Statutory construction is not a  petrified process  and the old bottle may, to the extent language  and realism  permit  be filled with new wine.   Of  course,  the bottle should not break or lose shape.  229 Lord  Denning  has  stated the judges task  in  reading  the meaning of’ enactments:               "The English language is not an instrument  of               mathematical precision.  Our literature  would               be much poorer if it were He must set to  work               in  the  constructive  task  of  finding   the               intention  of Parliament and he must  do  this               not only from the language of the statute, but               also  from  a  consideration  of  the   social               conditions  which gave rise, to it and of  the               mischief  which it was passed to remedy ,  and               then he must supplement the written word so as               to  give ’force and life to the  intention  of               the   legislature..................  A   judge               should  ask himself the question, how, if  the               makers  of the Act had themselves come  across               this  ruck  in the texture of it,  they  would               have straightened it out ? He must then do  as               they would have done.  A Judge must not  alter               the material of which the Act is woven, but he               can and should iron out the creases."               The  duty  of the court is  to  interpret  the               words  that  the legislature has  used;  those               words may be ambiguous, but. even if they are,               the  power  and duty of the  court  to  travel               outside  them  on a voyage  of  discovery  are

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             strictly limited."               The Industrial Disputes-Malhotra, Vol.  1  pp.               44 & 45) We  may  start the discussion with the leading case  on  the point, which perhaps may be treated as the mariner’s compass for  judicial navigation B. N. Banerji v. R. P. Mukherjee  & Others (1954) S.C.R. 302)But  before setting sail.  let us  map  out  briefly  the  range  of  dispute  around   the definition.   ’Lord Denning in Automobile  Proprietary  Ltd. observed :-               "It  is true that ’the industry’  is  defined;               but  a  definition  is  not  to  be  read   in               isolation.  It must be read in the context  of               the  phrase which it defines,  realising  that               the  function  of  a  definition  is  to  give               precision  and certainty to a word  or  phrase               which would otherwise be vague and  uncertain-               but  not  to  contradict  it  or  supplant  it               altogether."               Hotel and Catering Industry Training Board  v.               Automobile  Proprietary Ltd. (1968)  1  W.L.R.               1526 at 1530. A  definition is ordinarily the crystallisation of  a  legal concept  promoting precision and rounding off blurred  edges but, alas, the definition in S- 2(j), viewed in  retrospect, has achieved the opposite.  Even so, we must try to clarify. Sometimes  active  interrogatories tell  better  than  bland affirmatives  and so marginal omissions notwithstanding,  we will string the points together in a few questions on  which we have been addressed. 230    A  cynical jurist surveying the forensic scene  may  make unhappy comments.  Counsel for the respondent Unions sounded that note.  A pluralist society with a capitalist  backbone, notwithstanding the innocuous adjective ’socialist’ added to the Republic by the Constitution (42nd Amendment Act,  1976) regards  profit-making  as  a  sacrosanct  value.    Elitist professionalism  and  industrialism  is  sensitive  to   the ’worker’ menace and inclines to exclude such sound and  fury as   ’labour  unrest’  from  its  sanctified  precincts   by judicially de-industrialising the activities of professional men and interest groups to the extent feasible.  Governments in  a mixed economy, share some of the habits of thought  of the  dominant class and doctrines like sovereign  functions, which  pull  out economic enterprises run by them,  come  in handy.  The latent love for club life and charitable devices and  escapist  institutions bred by  clever  capitalism  and hierarchical  social  structure,  shows  up  as  inhibitions transmuted   as  doctrines,  interpretatively  carving   out immunities  from  the  ’industrial’  demands  of  labour  by labelling many enterprises ’non-industries’.   Universities, clubs, institutes, manufactories and establishments  managed by  eleemosynary  or  holy  entities,  are  instances.   To, objectify doctrinally subjective consternation is casuistry. A counter-critic, on the other hand, may acidly contend that if judicial interpretation, uninformed by life’s  realities, were to go wild, every home will be, not a quiet castle  but tumultuous  industry, every research unit will grind  to;  a halt,  every god will face new demands, every  service  club will be tile venue of rumble and every charity choked off by brewing  unrest  and the salt of the earth as  well  as  the lowliest  and  the  lost  will  suffer.   Counsel  for   the appellants struck this pessimistic note.  Is it not  obvious from these rival thought ways that law is valued loaded that social  philosophy is an inarticulate interpretative tool  ?

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This is inescapable in any school of jurisprudence. Now  let  us itemise, illustratively, the  posers  springing from the competing Submissions, so that the contentions  may be concretised.               1. (a)Are  establishments,  run   without               profit motive. industries ?               (b)   Are Charitable institutions industries ?               (c)   Do undertakings governed by a no-profit-               no-loss   rule.   statutorily   or   otherwise               fastened,  fall within the definition in  Sec.               2(j) ?               (d)   Do,  clubs or other organisations  (like               the Y.M.C.A.) whose general emphasis is not on               profit-making but fellowship and self-service,               fit into the definitional circle ?               (e)   To  go to the core of the matter, is  it               an  inalienable ingredient of ’industry’  that               it should be plied with a commercial object ?               2.    (a) Should co-operation between employer               and employee               be direct in so far as it relates to the basic               service                 231               or  essential manufacture which is the  output               of the undertaking ?               (b)   Could  a lawyer’s chambers or  chartered               accountant’s  office,  a  doctor’s  clinic  or               other   liberal  profession’s  occupation   or               calling be designated an industry ?               (c)   Would a University or college or  school               or research               institute be called an industry ?               3. (a)Is   the  inclusive  part  of   the               definition  in  Sec.  2(j)  relevant  to   the               determination  of  an industry ? If  so,  what               impact does it make on the categories ?               (b)   Do  domestic service drudges  who  slave               without  respite-become ’industries’  by  this               extended sense ?               4.    Are   governmental  functions,   stricto               sensu,  industrial  and if not,  what  is  the               extent of the immunity of instrumentalities of               government ?               5.    What  rational  criterion exists  for  a               cut-back on the dynamic potential and semantic               sweep  of  the  definition,  implicit  in  the               industrial law of a progressive society geared               to  greater industrialisation  and  consequent               concern    for   regulating   relations    and               investigating  disputes between employers  and               employees  as industrial processes  and  rela-               tions  become more complex  and  sophisticated               and workmen become more right-conscious?               6.    As  the  provision  now  stands,  is  it               scientific  to define ’industry’ based on  the               nature-the  dominant nature of  the  activity,               i.e.  on the terms of the  work,  remuneration               and  conditions of service which bond  the-two               wings   together  into  an   employer-employee               complex ? Back   to   Banerji,  to  begin  at  the   very   beginning. Technically,  this Bench that hears the appeals now  is  not bound by any of the earlier decisions.  But we cannot  agree with  Justice  Roberts  of  the U.  S.  Supreme  Court  that ’adjudications  of the court were rapidly  gravitating  into

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the  same  class as a restricted railroad ticket,  good  for this  day and train only’ (See Corwin XVII).   The  present- even  the revolutionary present-does not break  wholly  with the  past but breaks bread with it, without being  swallowed by  it  and may eventually ,,wallow it.  While it  is  true, academically  speaking, that the court should be  ultimately right rather than consistently wrong, the social interest in the certainty of the, law is a value which urges  continuity where   possible,   clarification   where   sufficient   and correction  where  derailment, misdirection  or  fundamental flaw defeats the statute or creates considerable  industrial confusion.   Shri  M. K. Ramamurthy, encored by Shri  R.  K. Garg, argued emphatically that after Safdarjung, the law  is in  trauma and so a fresh look at the problem is ripe.   The learned  Attorney General and Shri Tarkunde, who  argued  at effective,  illuminating length, as well as Dr. Singhvi  and Shri  A. K. Sen who briefly and tellingly supplemented,  did not hide the fact 232 that  the  law is in Queer Street but sought  to  discern  a golden  thread  of sound principle which could  explain  the core  of  the rulings which peripherally  had  contradictory thinking.   In this situation, it is not wise, in our  view, to  reject  everything  ruled till date  and  fabricate  new tests,  armed with lexical wisdom or reinforced  by  vintage judicial  thought from Australia.  Banerji we take as  good, and  anchored  on  its  authority,  we  will  examine  later decisions  to  stabilize  the law  on  the  firm  principles gatherable therefrom, rejecting erratic excursions.  To  sip every  flower  and  change every hour  is  not  realism  but romance  which  must  not enchant the  court.   Indeed,  Sri Justice Chandrasekhara Iyer, speaking for a unanimous Bench, has  sketched the guidelines perceptively, if we may say  so respectfully.   Later cases have only added  their  glosses, not overruled it and the fertile source of conflict has been the bashyams rather than the basic decision.  Therefore, our task  is  not  to  supplant the  ratio  of  Banerji  but  to straighten  and strengthen it in its application, away  from different deviations and aberrations. Banerji.    The  Budge  Budge  Municipality  dismissed   two employees  whose  dispute was sponsored by the  Union.   The award of the Industrial Tribunal directed reinstatement  but the Municipality challenged the award before the High  Court and this Court on the fundamental ground that a municipality in discharging its normal duties connected with local  self- government is not engaged in any industry as defined in  the Act. A  panoramic  view of the statute  and  its  jurisprudential bearings  has been projected there and the essentials of  an industry decocted.  The definitions of employer (Sec.  2(g), industry [See. 2(j), industrial dispute [Sec. 2(k)]  workman [Sec.  2(a)],  are  a  statutory  dictionary,  not   popular parlance.  It is plain that merely because tie, employer  is a government department or a local body (and, a fortiori,  a statutory board, society or like entity the enterprise  does not  cease to be an ’industry’.  Likewise, what  the  common man  does  not consider as ’industry’ need  not  necessarily stand excluded from the statutory concept. (And vice versa.) The latter is deliberately drawn wider, and in some respects narrower,  as  Chandrasekhara, Aiyer, J.,  has  emphatically expressed:               "In  the  ordinary  or  non-technical   sense,               according to what is understood by the man  in               the  street,  industry or  business  means  as               undertaking  where  capital  and  labour   co-

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             operate  with  each other for the  purpose  of               producing  wealth  in  the  shape  of   goods,               machines, tools etc., and for making  profits.               The concept of industry in this ordinary sense               applied  even  to  a  ’culture,  horticulture,               pisciculture  and so on and so forth.   It  is               also  clear that every aspect of  activity  in               which  the  relationship of employer  and  em-               ployee  exists  or  arises  does  not  thereby               become an industry as commonly understood.  We               hardly think in terms of an industry, when  we               have  regard, for instance, to the rights  and               duties   of  master  and  servant,  or  of   a               Government and its secretariat, or the members               of the medical profession                 233               Working  in a hospital.  It would be  regarded               as absurd to think. so; at any rate the layman               unacquainted with advancIng legal concepts  of               what is meant by industry would rule out  such               a connotation as impossible.  There is nothing               however  to prevent a statute from giving  the               word  "industry"  and  the  words  "industrial               dispute" a wider and more comprehensive import               in  order  to meet the requirements  of  rapid               industrial progress and to bring about in               the interests of industrial peace and economy,               a   fair   and  satisfactory   adjustment   of               relations  between employers and workmen in  a               variety of fields of activity.  It is  obvious               that  the limited concept of what an  industry               meant in early times, must now yield place  to               an enormously wider concept so as to. take  in               various and varied forms of industry, so  that               dispute arising in connection with them  might               be  settled quickly without  much  dislocation               and  disorganisation of the needs  of  society               and  in a manner more adapted to  conciliation               and  settlement  than a determination  of  the               respective rights and liabilities according to               strict  legal procedure and  principles.   The               conflicts between capital and labour have  now               to  be determined more from the standpoint  of               status  than  of contract.   Without  such  an               approach, the numerous problems that now arise               for  solution  in  the  shape  of   industrial               disputes cannot be tackled satisfactorily  and               this  is  why every civilised  government  has               thought  of  the  machinery  of   conciliation               officers,   Boards  and  Tribunals   for   the               effective  settlement of  dispute."  (emphasis               added) The  dynamics  of industrial law, even if  incongruous  with popular  understanding, is this first proposition we  derive from Banerji :               "Legislation  had to keep pace with the  march               of  times and to provide for  new  situations.               Social  evolution  is a  process  of  constant               growth,   and  the  State  cannot  afford   to               standstill without taking adequate measure  by               means  of  legislation  to  solve  large   and               momentous   problems   that   arise   in   the               industrial field from day to day almost." The  second,, though trite, guidance that we get is that  we should  not  be  beguiled by  similar  words  in  dissimilar

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statutes,   contexts,   subject-matters   or   socioeconomic situations.   The  same  words may mean  one  thing  in  one context  and  another in a different context.  This  is  the reason  why decisions on the meaning of particular words  or collection of words found in other statutes are scarcely  of much  value when we have to deal with a specific statute  of our own; they may persuade, but cannot pressure. We  would only add that a developing country is  anxious  to preserve  the  smooth  flow  of  goods  and  services,   and interdict undue exploitation and, towards those ends  labour legislation is enacted and must receive liberal construction to fulfil its role. Let us get down to the actual amplitude and  circumscription of the statutory concept of industry’.  Not a narrow but  an enlarged  acceptation  is  intended; This  is  supported  by several considerations. Chandrasekhara Aiyar, J. observes 16-211SCI/78 234               "Do  the  definitions of  industry  industrial               dispute  and ’workman’ taken in  teh  extended               significance  or exclude it?  Though the  word               undertaking in the definition of industry-  is               wedged  in between business and trade  on  the               one  hand  and manufacture on  the  other  and               though therefore it might mean only a business               or   trade  undertaking,  still  it  must   be               remembered  that if that were so there was  no               need to use the word separately from  business               or  trade.   The wider   export  is  attracted               even  more clearly when we look at the  latter               part   of  the  definition  which  refers   to               Calling,  service,  employment  or  industrial               occupation    of   avocation   of    workmen".               "Undertaking"   in  the  first  part  of   the               definition   and  ’industrial  occupation   or               avocation  in the second part  obviously  mean               much  more than what is ordinarily  understood               by  trade  or business.   The  definition  was               apparently  intended  to ’include  within  its               scope  what  might not strictly  be  called  a               trade or business venture." So ’industry’ overflows trade and business.  Capital,  ordi- narily  assumed  to  be a component  of  ’industry’,  is  an expendable item so far as statutory ’industry’ is concerned. To  reach  this conclusion, the Court  referred  to  ’public utility service’ Sec. 2(n) and argued               "A  public utility service such  as  railways,               telephones  and the supply of power, light  or               water,to  the  public may be  carried  on.  by               private  companies or  business  corporations.               Even  conservancy  or  sanitation  may  be  so               carried  on, though after the introduction  of               local self-government this ’work has in almost               every country been assigned as a duty to local               bodies  like  our Municipalities  or  District                             Boards  or  Local Boards.  A dispute  in  thes e               services  between employers and workmen is  an               industrial dispute, and the proviso to section               10 lays down that where such a dispute  arises               and a notice under section 22 has been  given,               the   appropriate  Government  shall  make   a               reference  under  the  sub-section.   If   the               public  utility  service is carried  on  by  a

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             corporation  like a Municipality which is  the               creature of a state, and which functions under               the  limitations imposed by the statute,  does               it  cease to be an industry for this reason  ?               The  only ground on which one could  say  that               what  would  amount to the carrying on  of  an               industry  if  it is done by a  private  person               ceases to be so if the same  work, is  carried               on by a local body like a Municipality is that               in  the  letter  there  is  nothing  like  the               investment of any capital or the existence  of               a profit earning motive as there generally  is               in  a  business. But neither the one  nor  the               other  seems  a  sine  qua  non  or  necessary               element In the modern conception of industry ?               ,(emphasis added) Absence  of capital does not negative ’industry.  Nay,  even charitable   services  do  not  necessarily  cease   to   be ’industries definitionally although popularly charity is not industry.   Interestingly, the Learned Judge dealt with  the point.   After enumerating typical municipal  activities  he concluded 235               "Some of these functions may appertain to  and               prtake  of the nature of an industry  ,  while               others  may  not.  For instance,  there  is  a               necessary  element of distinction between  the               supply  of power and light to the  inhabitants               of   a   Municipality  and  the   running   of               charitable  hospitals and dispensaies for  the               aid  of the poor.  In ordinary  parlance,  the               former   might be regarded as an industry  but               not the latter.  The very idea underlying  the               entrustment  of  such duties or  functions  to               local  bodies is not to take them out  of  the               sphere   of   industry  but  to   secure   the               substitution  of  public  authorities  in  the               place  of private  employers and to  eliminate               the   motive  of  profit-making  as   far   as               possible.   the   levy  of   taxes   for   the               maintenance of the services of  sanitation and               the  conservancy  or the supply of  light  and               water is a method adopted and devised  to make               up   for   the  absence   of   capital.    The               undertaking  or the service will still  remain               with  the   ambit of what we understand by  an               industry though it is carried on with the  aid               of taxation, and no immediate material gain by               way of profit is envisaged." (emphasis added) The   contention  that  charitable  undertakings   are   not industries is, by this token, untenable. Another argument pertinent to our discussion is the sweep of the expression ’trade.  The Court refers, with approval,  to in-Bolton  Corporation  (143 A.C. 166) where  the  Law  Lord observed :               "Indeed   ’trade’   is   not   only   in   the               etymological  or dictionary sense, but in  the               legal  usage, a term of the widest scope.   It               is connected originally with the word  ’tread’               and indicates a way of life or an  occupation.               In  ordinary usage it may mean the  occupation               of  a small shopkeeper equally with that of  a               commercial  magnate.   It  may  also  mean   a               skilled  craft.  It is true that it  is  often               used   in  contrast  with  a  profession.    A

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             professional  worker would not  ordinarily  be               called  a tradesman, but the word  ’trade’  is               used   in  the  widest  application   to   the               appellation ’trade unions’.  Professions  have               their  trade unions.  It is also used  in  the               Trade   Boards  Act  to   include   industrial               undertakings.  I see no reason to exclude from               the operation of the Industrial Courts Act the               activities of local authorities, even  without               taking  into  account  the  fact  that   these               authorities  now carry on  portent  industrial               undertakings.    The   order   expressly   its               definition section that ’trade or  performance               of,  its functions by a It is true that  these               words  are used in Part III, which deals  with               ’recognized    terms   and    conditions    of               employment,  and in Part TV, which deals  with               ’departures  from  trade. practices’  in  ’any               industry  or undertaking’ and not in  Part  1,               which deals with ’national arbitration’ and is               the  part  material in this case, but  I  take               them as illustrating what modern               236               conditions involve-the idea that the functions               of  local  authorities  may  come  under   the               expression  ’trade or industry’.  I think  the               same may be said of the Industrial Courts  Act               and  of Reg. 58-AA, in both of which the  word               ’trade’  is used in the very wide  connotation               which  it  bears  in  the  modern  legislation               dealing   with   conditions   of   employment,               particularly   in  relation  to   matters   of               collective bargaining and the like". (emphasis               added) In  short, trade’ embraces functions of  local  authorities, even  professions,  thus departing   from  popular  notions. Another  facet of the controversy is next touched  upon-i.e. profit-making  motive  is not a sine quo non  of  ’industry’ functionally  or  definitionally.  For this,  Powers  J,  in Federated Municipal and Shire Employees’ Union of  Australia v.   Melbourne  Corporation(1)  was  quoted  with   emphatic approval  where  the  Australian High  Court  considered  an industrial legislation               "So  far  as  the question  in  this  case  is               concerned,  as  the  argument  proceeded   the               ground mostly relied upon (after the  Councils               were  held not to be exempt as  State  instru-               mentalities) was that the work was not carried               on by the municipal corporations for profit in               the  ordinary sense of the term,  although  it               would generally speaking be carried on by  the               Councils   themselves  to  save   contractors’               profits.  It  that argument  were  sufficient,               then a philanthropist who acquired a  clothing               factory and employed the same employees as the               previous  owner  had  employed  would  not  be               engaged  in  an  occupation  about  which   an               industrial   dispute   could  arise,   if   he               distributed the clothes made to the poor  free               of  charge or even if he distributed  them  to               the  poor at the bare cost of production.   If               the contention of the respondent is correct, a               private  company carrying on a ferry would  be               engaged  in  an industrial occupation.   If  a               municipal corporation carried it on, it  would

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             not  be industrial.  The same  argument  would               apply  to  baths,  bridge-building,  quarries,               sanitary  contracts, gas-making  for  lighting               streets  and public halls, municipal  building               of  houses or halls, I and many other  similar               industrial undertakings.  Even coalmining  for               use  on municipal railways or  tramways  would               not  be industrial work if the  contention  of               the  respondents is correct.  If the works  in               question are carried out by contractors or  by               private   individuals   it  is  said   to   be               industrial,  but  not  industrial  within  the               meaning of the Arbitration Act or Constitution               if  carried out by municipal  corporations.  I               cannot accept that view". (emphasis added) The  negation  of profit motive, as a telling  test  against ’industry is clear from this quote. (1)  26 C.L.R. 508.  237 All  the indicia of ’industry’ are packed into the  judgment which   condenses  the  conclusion  tersely  to  hold   that ’industries’  will cover ’branches of work that can be  said to be analogous to the carrying out of a trade or business’. The  case,  read  as  a  whole,  contributes  to  industrial jurisprudence,  with  special reference to the  Act,  a  few positive  facets and knocks down a few  negative  fixations. Governments  and  municipal  and statutory  bodies  may  run enterprises  which  do  not  for that  reason  cease  to  be industries.   Charitable activities may also be  industries. Undertakings,  sans profit motive, may well  be  industries. Professions  and  not  ipso facto out of  the  pale  of  in- dustries.  Any operation carried on in a manner analogous to trade  or business may legitimately be statutory  ’industry. The  popular limitations on the concept of industry  do  not amputate  the ambit of legislative generosity  in  Sec.2(j). Industrial peace and the smooth supply to the community  are among  the aims and objects the Legislature had in view,  as also the nature, variety range and areas of disputes between employers  and  employees.  These factors  must  inform  the construction of the provision. The limiting role of Banerji must also be noticed so that  a total view is gained.  For instance, ’analogous to trade  or business’  cuts  ,down  ’undertaking, a  word  of  fantastic sweep.    Spiritual   undertakings,   casual   undertakings, domestic  undertakings,  war  waging,  policing,  justicing, legislating,  tax collecting and the like are, prima  facie, pushed  out.   Wars  are  not  merchantable,  nor   justice, saleable,  nor  divine grace marketable.   So,  the  problem shifts  to what Is ’analogous to trade or business’.  As  we proceed  to  the  next  set  of  cases.  we  come  upon  the annotation  of other expressions like ’calling’ and  get  to grips  with  the  specific  organisations  which  call   for identification in the several appeals before us. At this stage, a close-up of the content and contours of the controversial  words  ’analogous etc., which  have  consumed considerable  time of counsel, may be taken.  To be fair  to Banerji.   With the path finding decision which  conditioned and canalised and fertilised subsequent  juristic-humanistic ideation,  we  must  show  fidelity  to  the  terminological exactitude  of the seminal expression used and search  care- fully for its import.  The prescient words are : branches of work that can be said to be analogous to the carrying out of a ’trade or business’.  The same judgment has negatived  the necessity for profit-motive and included charity  impliedly, has  virtually  equated  private sector  and  public  sector

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operations  and has even perilously hinted at  ’professions’ being ’trade?.- In this perspective, the comprehensive reach of ’analogous’ activities must be measured.  The  similarity stressed  relates  to  ’branches of  work’;  and  more;  the analogy  with trade or business is in the ’carrying out’  of the  economic  adventure.  So, the parity is  in  the  modus operandi,  in the working-not in the purpose of the  project nor in the disposal of the proceeds but in the  Organisation of  the  venture, including the relations  between  the  two limbs viz. labour and management.  If the mutual  relations, the 2 38 method of employment and the process of co-operation in  the carrying  out  of  the work bear close  resemblance  to  the organization  method remuneration, relationship of  employer and  employee  and the like  then it is  industry  otherwise not.   This  is  the kernel of  the  decision.  An  activity oriented,but motive based, analysis.    The landmark Australian case in 26 C.I.R. 508  (Melbourne Corporation)  which  was heavily relied on  in  Banerji  may engage us, That ruling contains dicta, early in the century, which  make Indian forensic fabianism sixty years  after  in the ’socialist’ Republic blush That apart the discussion  in the   leading  judgments  dealing  with  industry   from   a constitutional angle but relying on statute similar to  ours is   instructive  For instance, consider the  promptings  of profit  as a condition o industry. higgins j.  crushes  that credo thus: "The purpose of profit-making can hardly be  the criterion.   If  it  were the labourers  who  excavated  the underground passage for the  Duke of Portland’s whim, or the labourers   who  build  (for  pay) a tower  of  Babel  or  a pyramind, could  not beparties  to an ’industrial  dispute’. The worker-oriented perspective is underscored by Isaacs and Rich JJ.  It is at the same time as is perceived,  contended on  the  part  of  labour,  that  matters  even   indirectly prejudicially affecting the ,Workers are, within the  sphere of  dispute.  For, instance, at P. 70 (par. 175(4) (a),  one of the competing  contentions is thus stated, : "Long, hours proceed  from the competition of employer               with employer in  the same trade Employers ought to be  prevented from  competing  in  this  way at  the  expense.  of.  their workmen." (emphasis added) As a fact, in a later year,  Lord lamps of Hereford, in an award, held that one employer in  a certain  trade must confirm to the the practice, of  others. What  must be borne,, steadily in mind, as evidenced by  the nature of the claims made, is that the about of obtaining  a large  share  of  the  product  of  the  industry  and,   of exercising,  a  voice as to the,  general  conditions  under which  it  shall be carried on (par. 100) covers  all  means direct  and incidental without which the main object  cannot be  fully  or effectively attained.  Some of these  will  be particularized  but in the meantime it should be  said  that they  will, show in them solves, and from the’ character  of the  disputants this will be confirmed, that so long as  the operations are of capital and labour in co-operation for the satisfaction  of  material  human  needs,  the  objects  and demands  of labour are the same, whether the result  of  the operations  be  money  or  money’s  worth.   The  inevitable concern,  as it seems to us, from this is that in 1  894  it was  well,  understood that "trade disputes", which  at  one time  had a limited scope of action, without altering  their inherent  and  essential  nature, so  developed  as  to  be- recognised  better under the name of  "industrial  disputes’ ’or ’ "labour disputes," and to. be more and more founded on the practical view that human labour was not a more asset of

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capital  but  was a cooperating agency of  equal  dignity  a working partner-and entitled to consideration as such". The   same   two  judge        choose  to  impart   a   wide construction to the word ’industry   for they ask :’How  can we conformably to recog-  239 nized  rules of legal construction, attempt to limit, in  an instrument of self-government for this Continent, the simple and   comprehensive  words  "industrial  disputes"  by   any apprehension of what we might  imagine would be theeffect of a full liter construction, or by conjecturing what was in the  minds  of the framers of the constitution,  or  by  the forms  industrial  disputes  have,  more  recently  assumed? "Industrial  warfare", is no mere figure of speech.   It  is not  the  mere phrase, of theorists.  It  is  recognized  by the law as the, correct description of internal conflicts in industrial matters.  It was adopted by Lord Loreburn L.C. in Conway v. Wade (A) (1909) A.C., at p511.  Strikes and, lock- outs  are, by him, correctly described as "weapons".’  These arguments  hold good for the Indian industrial statute,  and so, Sec. 2(j) must receive             comprehensive literal force,  limited  only by some cardinal criteria.   One  such criterion,   in  the  monarchical  vocabulary   of   English Jurisprudence,  is  Crown  exemption,  reincarnating  in   a Republic   as   inalienable  functions   of   constitutional government.   No  government no order; no order; no  law  no rule of law ,no industrial relations.  So core functions  of the State are paramount  and paramountcy is paramountcy. but this  doctrinal exemption is not expansionist  but  strictly narrowed  of  necessitous functions.  Isaacs  and  Rich  JJ. dwell  on this  topic  and after quoting Lord Watson’s  test of  inalienable  functions of  a  Constitutional  government state: "Here we have the discrimen of Crown exemption.  If a municipality either [(1997) 1 Q,B. at pp. 70-71] is, legally empowered to perform and does perform any function  whatever the Crown, or (1997) 1 Q.B., at p. 71 is lawfully  empowered to   perform   and   does   perform   any   function   which constitutionally  is  inalienably a Crown function  as,  for instance  the administration of justice the municipality  is in  law, presumed to represent the Crown and  the  exemption applies,  Otherwise,  it is outside that exemption,  and  if impliedly exempted at all, some other principle must be  re- sorted  to.   The making and maintenance of streets  in  the municipality  is  not within either  proposition".  (Italics supplied). Now,  the  cornerstone  of industrial law is  well  laid  by Bannerji, supported by Lord Mayor of the, City of Melbourne, A  chronological survey of post-Banerji. decisions  of  this Court, with, accent on the juristic contributions registered by  them,  may  be methodical  Thereafter,  cases  in  alien jurisdictions and derivation of guidelines may be attempted, Even  here, we may warn ourselves that the literal  latitude of   the  words  in  the.  definition  cannot   In   allowed grotesquely  inflationary  play  but must be  read  down  to accord  with  the  broad industrial sense  of  the  nation’s economic community of which Labour is an, integral part.  To bend  beyond, credible limits is to break with facts  unless language leaves no, option.  Forensic inflation of the sense of  words shall not lead to an adaptational break-down  out- raging the good sense of even radical realists.  After  all, the Act has been drawn on an industrial canvas to solve  the problems of industry, not of chemistry.  A functional  focus and social, control desideratum must be in the mind’s eye of the judge. 240

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The two landmark cases, The Corporation of the City of. Nag- pur  v. Its Employees(1) and State of Bombay and  Others  v. The Hospital Mazdoor Sabha & Ors.(2) may now be analysed  in the  light of what we have just said.  Filling the  gaps  in the  Banerji decision and the authoritative  connotation  of the  fluid  phrase ’analogous to trade  and  business’  were attempted  in  this twin decisions.  To be analogous  is  to resemble  in functions relevant, to the subject, as  between like features of two apparently different things.  So,  some kinship through resemblance to trade or business, is the key to  the  problem,  if Banerji is the  guide  star.   Partial similarity  postulates  selectivity of  characteristics  for comparability.   Wherein  lies  the  analogy  to  trade   or business, is then the query. Sri  Justice Subba Rao, with uninhibited logic, chases  this thought  and reaches certain tests in  Nagpur  Municipality, speaking for a unanimous Bench.  We respectfully agree  with much of his reasoning and proceed to deal with the decision. If the ruling, were right, as we think it is, the riddle  of ’industry’  is resolved in some measure.   Although  foreign decisions,   words   and  phrases,   lexical   plenty.   and definitions from other legislations, were read before us  to stress the necessity of direct co-operation between employer and  employees in the essential product of the  undertaking, of  the need for the. commercial motive, of service  to  the community etc., as implied, inarticulately in the concept of ’industry’,  we  bypass them as but  marginally  persuasive. The  rulings of this Court, the language and scheme  of  the Act  and  the well-known canons of construction  exert  real pressure on our judgment.  And, in this latter process, next to  Banerji  comes Corporation of Nagpur which  spreads  the canvas wide and illumines the expression ’analogous to trade or  business’, although it comes a few days  after  Hospital Mazdoor Sabha decided by the same Bench. To  be sure of our approach on a wider basis let us  cast  a glance  at  internationally  recognised  concepts  vis-a-vis industry.   The  International Labour Organisation  has  had occasion to consider, freedom of association for labour as a primary right and collective bargaining followed by strikes, if  necessary,  as  a derivative right.   The  question  has arisen as to whether public servants employed in the crucial functions  of  the  government fall  outside  the  orbit  of industrial  conflict.   Convention  No.  98  concerning  the Application  of the Principles of the Right to Organise  and to Bargain Collectively, in Article 6 states               "This  Convention  does  not  deal  with   the               position  of  Public servants engaged  in  the               administration  of the State, nor shall it  be               construed  as  prejudicing  their’  rights  or               status in any way." (1)  [1960] 2 S.C.R. 942. (2)  [1960] 2 S.C.R. 866.  241 Thus, it is well-recognised that public servants in the  key sectors  of  Administration  stand  out  of  the  industrial sector.  The Committee ,of Experts of the ILO had  something to say about the carving out of the public servants from the general category. Incidentally,  it  may  be  useful  to  note  certain  clear statements  made by ILO on the concept of industry,  workmen and  industrial dispute, not with clear-cut legal  precision but  with  sufficient  particularity  for  general  purposes although  looked at from a different angle.  We  quote  from ’Freedom  of Association’, Second edition, 1976, which is  a digest of decisions of the Freedom of Association  Committee

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of the Governing Body of the ILO:               "2.   Civil servants and other workers in  the               employ of the State.               250. Convention  No.  98, and  in  particular               Article 4 thereof concerning the encouragement               and   promotion  of   collective   bargaining,               applies  both  to the private  sector  and  to               nationalised  undertakings and public  bodies,               it   being  possible  to  exclude  from   such               application  public  servants engaged  in  the               administration of the State.               141st Report, Case No. 729, para. 15.,               251. Convention No. 98, which mainly concerns               collective bargaining, permits (Article 6) the               exclusion  of "public servants engaged in  the               administration   of  the  State".    In   this               connection,  the Committee of Experts  on  the               Application of Conventions and Recommendations               has  pointed  out that, while the  concept  of               public  servant may vary to some degree  under               the   various  national  legal  systems,   the               exclusion from the scope of the Convention  of               persons employed by the State or in the public               sector, who do not act as agents of the public               authority  (even though they may be granted  a               status identical with that of public officials               ,engaged  in the administration of the  State)               is contrary to the meaning of the  Convention.               The  distinction to be, drawn, accordingly  to               the  Committee, would appear to  be  basically               between  civil  servants employed  in  various               capacities   in   government   ministries   or               comparable  bodies on the’ one hand and  other               persons employed by the government, by  public               undertakings or by independent public corpora-               tions.               16th Report, Case No. 598, para. 377;               121st Report, Case No.635, para. 81;               143rd Report, Case No. 764, para. 87.               254. With  regard to a  complaint  concerning               the right of teachers to engage in  collective               bargaining,  the Committees, in the  light  of               the principles contained in Convention No.  98               ,drew   attention  to  the   desirability   of               promoting voluntary               242               collective  bargaining, according to  national               conditions,  with a view to the regulation  of               terms and conditions of employment.               118th Report, Case No. 573, para. 194.               255. The  Committee  has  pointed  out   that               Convention No. 98, dealing with the  promotion               of  collective bargaining, covers  all  public               servants  who  do  not act as  agents  of  the               public authority and consequently among these,               employers      of     the,     postal      and               telecommunications services.               139th Report, Case No. 725, para. 278.               256.  Civil aviation technicians working under               the jurisdictionof   the   armed   forces               cannot be considered, in view of the     nature               of their activities, as belonging to the armed               forces and as such liable to be excluded  from               the guarantees laid. down,, in Convention  No.               9  8; the rule contained in Article 4  of  the

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             convention  concerning collective  bargainings               should be applied. to them.               116th Report, Case No. 598, paras. 375-.378. This  divagation  was calculated only to  emphasise  certain fundamentals  in  international  industrial  thinking  which accord  with a wider conceptual acceptation for  ’industry’. The wings of the ’industry’ have been spread wide in section 2(j)  and  brought out in the decision in  Corporation  case ’was  concerned  with a dispute between  a  employees.   The major  issue considered  there the much disputed  expression analogous  to  the  carrying on of  a  trade  or  business". Municipal undertakings ’are ordinarily industries as  Baroda Borough Municiapality(1) held.   Even   so  the   scope   of ’industry’ was investigated by     the Bench in the City  of Nagpur  which  affirmed Banerji and Baroda.  The Court  took the viewthat  the words used in the definition were  prima facie  of  the widest import and declined  to  curtail,  the width        of meaning by invocation of noscitur a  sociis. Even  so,  the Court was disinclined of spread the  not  too wide  by expanding the elastic expressions calling,  service employment  and handicraft.  To ’be ’over-inclusive  may  be impractical  and  so  while  accepting  the  enlargement  of meaning  by  the device’ of inclusive definition  the  Court cautioned               "But such a wide meaning appears to over-reach               the objects for which the Act was passed.   It               is, therefore, necessary to limit its scope on               permissible grounds, having regard to the aim,               scope and the, object of the whole Act." After referring to the rule in Heydon’s case, Subba Rao,  J. proceeded to outline the ambit of industry thus               "The word ’employers’ in cl. (c) and the  word               employees’  in  cl.  (b)  indicate  that   the               fundamental basis for the application, of  the               definition is the existence of,. that (1)  [1957] S,C.R. 33.  243               relationship.   The  cognate  definitions   of               ’industrial   dispute  Act  as  well  as   its               preamble  show  that  the Act  was  passed  to               ’employer,  ’  employee’, also  support.   The               long  title   of the make  provision  for  the               promotion  of  industries   and  peaceful  and               amicable   settlement  of  disputes    between               employers   and  employees  in  an   organised               activity  by conciliation and arbitration  and               for  certain other purposes.  If the  preamble               is  read, with the, historical background  for               the  passing of the Act, it is  manifest  that               the ACt was introduced as an important step in               achieving  social justice.  The Act  seeks  to               ameliorate  the  service  conditions  of   the               workers  to provide a machinery for  resolving               their    conflicts   and  to  encourage    co-               operative  effort   in  the  service   of  the               community.  The history of labour  legislation               both in England   and India also shows that it               was aimed more of  ameliorate  the  conditions               of  service  of     the  labour  in  organised               activities  than  to any thing else.  The  act               was not intended to reach the personal service               which  do not depend upon the employment of  a               labour force. Whether the exclusion of personal services is warranted  may be examined a little later.

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The,  Court  proceeded  to carve out  the  negative  factor& which, notwithstanding the literal width of the language  of the definition, must, for other competing  reasons, be  kept out  of  the  scope  of  industry  For  instance,  sovereign functions of the State cannot be included although what such functions  are  has  been  aptly  termed  ’the  primary  and inalienable functions of a constitutional government’.  Even here  we  may point out the inaptitude of,  relying  on  the doctrine of regal powers, That has reference in this context to, the Crown’s liability in tort and has nothing to do with Industrial Law, In any case it is open to Parliament to make law which governs the  State’s relations with its employees. Articles  309  to,  311 of the Constitution  of  India,  the enactments  dealing  with  the  defence  Forces  and   other legislation  dealing with employment under statutory  bodies may,  expressly  or by necessary  implication,  exclude  the operation of the Industrial.  Disputes Act, 1947.  That is a question of interpretation and statutory exclusion; but,  in the absence of such provision of law, it may indubitably  be assumed  that the key aspects of public administration  like public justice. stand out of the circle of industry‘.   Even ’here,  as  has been brought out from the  excerpts  of  ILO documents,  it  is not every employee- who is  excluded  but only ’Certain categories primarily engaged and  supportively employed  in  the discharge of, the essential  functions  of constitutional  government.  In a limited way, this head  of exclusion has been recognised throughout. Although  we  are  not concerned in this  case  with  those, categories   of  employees  who  particularly   come   under departments  charged with the responsibility  for  essential constitutional  functions of government, it  is  appropriate to  state     that         if  there  are  industrial  units severable  from the  essential     functions and possess  an entity  of  their own it may be plausible to hold  that  the employees of those units are workmen 244                  . and those undertakings are industries.  A blanket  exclusion of every one of the host of employees engaged by  government in departmental falling under general rubrics like, justice, defence,  taxation,  legislature,  may  not  necessarily  be thrown out of the umbrella of the Act. We say no more except to  observe that closer exploration, not summary  rejection, is necessary. The  Court proceeded, in the Corporation of Nagpur case,  to pose  for itself the import of the words ’analogous  to  the carrying out of a trade or business’ and took the view  that the emphasis was more on to equate the other activities with trade or business’.  Obviously, non-trade operations were in many  cases  ’industry’.  Relying on the  Fabricated  Engine Drivers(1) Subba Rao, J., observed :               "It  is manifest from this decision that  even               activities  of a municipality which cannot  be               described  as  trading activities can  be  the               subject-matter of an industrial disputes." The true test, according to the Learned Judge, was concisely expressed  by Isaacs J., in his dissenting judgment  in  the Federated State School Teachers’ Association of Australia v. State of Victoria.(2)               "The material question is : What is the nature               of  ,  the  actual function  assumed-is  it  a               service  that  the State could  have  left  to               private  enterprise,  and, if  so,  fulfilled,               could such a dispute be ’industrial’ ?". Thus  the  nature of actual function and of the  pattern  of organised  ,activity  is decisive.  We will revert  to  this

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aspect a little later. It  is useful to remember that the Court rejected  the  test attempted by counsel in the case :               "It  is said that unless there is a  quid  pro               quo for the service it cannot be an  industry.               This  is the same argument, namely,  that  the               service  must be in the nature of trade  in  a               different garb" We  agree  with  this  observation  and  with  the   further observation  that there is no merit in the plea that  unless the  public who are benefited by the services pay  in  cash, the  services so rendered cannot be industry.   Indeed,  the signal  service rendered by the Corporation of Nagpur is  to dispel  the  idea of profit-making.  Relying  on  Australian cases  which held that profit-making may be  important  from the  income  tax  point  of  view  but  irrelevant  from  an industrial  dispute point of view, the Court approved  of  a critical passage in the dissenting judgment of Isaacs J., in the School Teachers’ Association case (supra) :               "The  contention sounds like an echo from  the               dark   ages,  of  industry  and  political   I               economy.......... Such disputes are not simply               a claim to share the material wealth......... (1)  (1913) 16 C.L.R. 245. (2)  (1929) 41 C.L.R. 569.  245               ’Monetary   considerations  for  service   is,               therefore,.  not essential  Characteristic  of               industry in a modern State."               Even according to the traditional concepts  of               English Law, profit has to be disregarded when               ascertaining   whether  an  enterprise  is   a               business :               "3.   Disregard  of  Profit.   Profit  or  the               intention  to make profit is not an  essential               part  of  the legal definition of a  trade  or               business;  and  payment  or  profit  does  not               constitute  a  trade or  business  that  which               would not otherwise be such".               (Halsbury’s  Laws of England,  Third  Edition,               Vol. 38, p. 11). Does the badge of industrialism, broadly understood, banish, from  its  fold, education ? , This  question  needs  fuller consideration,  as  it  has been raised  in  this  batch  of appeals and has been answered in favour of employers by this Court in the Delhi University case.(1) But since Subba  Rao, J.,  has  supportively cited Isaacs J. in  School  Teachers’ Association  (supra), which relates to the same problem,  we may,  even  here,  prepare the ground  by  dilating  on  the subject with special reference to the Australian case.  That learned Judge expressed surprise at the very question :               "The  basic  question  raised  by  this  case,               strange  as  it  may  seem,  is  whether   the               occupation of employees engaged in  education,               itself  universally  recognized  as  the   key               industry   to  all  skilled  occupations,   is               ’industrial’   within  the  meaning   of   the               Constitution". The  employers  argued that it was fallacious  to  spin  out ’industry’  from  ’education’ and the logic was  a  specious economic  doctrine. Issacs J., with unsparing sting  and  in fighting mood, stated and refuted the plea :               "The  theory was that society is  industrially               organised for the,production and  distribution               of   wealth   in  the   sense   of   tangible,

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             ponderable, corpuscular wealth, and  therefore               an "industrial dispute" cannot possibly  occur               except where there is furnished to the public-               the  consumers  by  the  combined  efforts  of               employers and employed, wealth of that nature.               Consequently,  say the employers,  "education"               not being "wealth" in that sense, there  never               can   be  an  "industrial   dispute"   between               employers   and   employed  engaged   in   the               avocation  of  education,  regardless  of  the               wealth derived by the employers from the joint               co-operation.               The  contention sounds like an echo  from  the               dark  ages of industry and political  economy.               It not merely ignores the constant currents of               life  around us, which is the real  danger  in               deciding questions of this nature, but it also               forgets the memorable industrial  organization               of  the  nations, not for  the  production  or               distribution, of material wealth, but for ser- (1)  [1964] 2 S.C.R. 703. 246               vices,  national  service as  the  service  of               organized industry               must   always   be.    Examination   of   this               contention will not only completely  dissipate               it,  but  will also serve to,  throw  material               light  on the question in hand  generally  the               contention is radically unsound for two  great               reasons.  It erroneously thereby unduly limits               the   meaning   of  the   terms   "production"               conceives  the object of  national  industrial               organization  and  "wealth when used  in  that               connection.   But  it  further  neglects   the               fundamental character of "industrial disputes"               as  a  distinct and  insistent  phenomenon  of               modern society.  Such disputes are not  simply               a  claim to share the material wealth  jointly               produced   and-capable  of   registration   in               statistics.   At  heart they are  a  struggle,               constantly  becoming more intense on the  part               of  the employed group engaged in  cooperation               with the employing group in rendering services               to  the  community  essential  for  a   higher               general  human  welfare,  to  share  in   that               welfare  in a  greater  degree................               That  contention,  if  acceded  to,  would  be               revolutionary...........    How    could    it               reasonably be said that a comic song or a jazz               performance, or the representation of  comedy,                             or a ride in tramcar or motor-bus, piloting  a               ship, lighting a I or showing a moving picture               is  more  "material"  as  wealth  instruction,               ’either  cultural or vocational ?  Indeed,  to               take on.- instance, a workman who travels in a               tramcar a mile from his home to his factory is               not more efficient for his daily task than  if               he  walked  ten yards, whereas  his  technical               training  has  a direct effect  in  increasing               output.   If  music  or  acting  or   personal               transportation is admitted to be  "industrial"               because  each is productive of wealth  to  the               employer as his business undertaking, then  an               educational  establishment stands on the  same               footing.  But if education is excluded for the

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             reason advanced, how are we to admit  barbers,               hairdressers, taxi-car drivers, furniture  re-               movers,  and  other occupations  that  readily               suggest  themselves  ?  And yet  the  doctrine               would  admit manufactures of  intoxicants  and               producers  of  degrading literature  and  pic-               tures,  because  these tire considered  to  be               "wealth".,  The  doctrine would  concede,  for               instance, that establishments for the training               of  performing dogs, or of monkeys  simulating               human   behaviour,  would   be   "industrial,"               because  one  would  have  increased  material               wealth that is, a more valuable dog or monkey,               in  the sense that one could exchange  it  for               more  money.   If parrots are  taught  to  say               "Pretty  Polly" and to dance on  their  perch,               that is, by concession, industrial, because it               is   the   production  of  wealth.    But   if               Australian  youths  are trained  to  read  and               write  their language correctly and  in  other               necessary  elements  of culture  and  vocation               making  them more efficient citizens,  fitting               them  with  more or less  directness  to  take               their place in the general industrial ranks of               the nation and to render the services required               by the community, that training is said not to               be  wealth  and  the  work  done  by  teachers               employed is said not to be industrial."  247 So long as services are part ’of ’the wealth of a nation-and it is obscurantist to object to it-educational services  are Wealth, are ’industrial’.  We agree with Isaacs J. More  closely analysed, We may ask ourselves, as  Isaacs  J. did, whether, if private scholastic establishments  ’carried ’on reaching on the same lines as the State schools,  giving elementary education free, and charging fees for the  higher subjects, providing the same curriculum and so on, by  means of employed teachers, would such dispute as we have here  be an  industrial  dispute ?.................. I  have  already indicated  my  view",  says Isaacs  J.  "that  education  so provided  constitutes  in itself an  independent  industrial operation  as a service rendered to the community.   Charles Dickens  evidently thought so When ninety years ago  Squeers called   his  school  "the  shop"  and  prided  himself   on Nickleby’s being "cheap" at pound 5 a year and  commensurate living  conditions.   The world has not  turned  back  since then.  In 1926 the Committee on Industry and Trade in  their report to the British Prime Minister, included among  "Trade Unions"  those called "teaching." It there appears  that  in 1897 there were six unions with a total membership of 45,319 and in 1924 there were seventeen unions with a membership of 1,94,946.  The true position of education in relation to the actively   operative   trades  is   not   really   doubtful. Education,  cultural  and vocational, is now  and  is  daily becoming  as much the artisan’s capital and tool, and  to  a great  extent  his safeguard against  unemployment,  as  the employers’  banking credit and insurance policy are part  of his  means to carry on the business.  There is at  least  as much reason for including the educational establishments  in the  constitutional power as "labour" services, as there  is to include insurance companies as "capital" services." We  have  extensively excerpted from  the  vigorous  dissent because  the  same position holds good for  India  which  AS emerging from feudal illiteracy to industrial education.  In Gandhi’s  India basic education and handicraft merge and  in

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the  latter  half of our century higher  education  involves field studies, factory training, house surgeoncy and  clini- cal  education,  and, sans such technological  training  and education  in  humanities,  industrial  progress  is   self- condemned.   If  education  and  training  are  integral  to industrial  and agricultural activities, such  services  are part  of  industry even if high browism may  be  unhappy  to acknowledge  it.   It is  a  class-conscious,  inegalitarian outlook  with an elitist aloofness which makes  some  people shrink   from   we   accepting   educational   institutions, vocational or other as industries.  The definition is  wide, embraces  training for industry which, in  truth,  ensconces all  processes of producing goods and services by  employer- employee   cooperation.    Education   is   the   nidus   of industrialization and Itself is industry. We may consider certain aspects of this issue while  dealing with  later  cases  of our Court.  Suffice it  to  say,  the unmincing  argument  of  Isaacs  J.  has  been  specifically approved  in Corporation on of Nagpur and  Hospital  Mazdoor Sabha (supra) in a different aspect. Now  we  revert to the more crucial part of  Corporation  of Nagpur.   It is meaningful to notice that in that case,  the Court, in its incisive 248 analysis,  department  by department of  variform  municipal services, specifically observed :               "Education Department : This department  looks               after the primary education, i.e.,  compulsory               primary  education  within the limits  of  the               Corporation. (See the evidence of Witness  No.               1).   This  service  can equally  be  done  by               private  persons.  This  department  satisfies               the  other  tests.   The  employees  of   this               department  coming  under  the  definition  of               "employees"  under the Act would certainly  be               entitled to the benefits of the Act." The  substantial break-through achieved by this decision  in laying  bare  the fundamentals of ’industry’  in  its  wider sense deserves mention.  The ruling tests are clear. 1.  The ’analogous’  species  of  quasitrade  qualify  for  becoming ’industry’ if the nature of the organized activity  implicit in  a trade or business is shared by them. (See p. 960.  the entire  organisational  activity).  It is not  necessary  to ’equate  the other activities with trade or business’.   The pith  and  substance of the matter is that  the  structural, organisational  engineering aspect, the  crucial  industrial relations like wages, leave and other service conditions  as well  as  characteristic business methods (not  motives)  in running the enterprise, govern the conclusion.  Presence  of profit motive is expressly negated as a criterion.  Even the quid  pro quo theory which is the same monetary object in  a milder version-has been dismissed.  The subtle  distinction, drawn  in lovely lines and pressed with emphatic  effect  by Sri Tarkunde, between gain and profit, between no profit no- loss  basis  having  different results in  the  private  and public sectors, is fascinating but, in the rough and tumble, and  sound and fury of industrial life, such  nuances  break down  and nice refinements defeat.  For the same reason,  we are  disinclined  to chase the differential  ambits  of  the first and the second parts of Sec. 2(j).  Both read together and  each viewed from the angle of employer or employee  and applied  in  its  sphere, as the  learned  Attorney  General pointed out, will make sense.  If the nature of the activity is para-trade or quasi-business, it is of no moment that  it is  undertaken in the private sector, joint  sector,  public

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sector,  philanthropic  sector  or  labour  sector  ’it   is industry’.   It is the human sector, the way  the  employer- employee  a  relations are set up and processed  that  gives rise   to   claims,   demands,   tensions,    adjudications, settlements truce and peace in industry.  That is the raison d’ etre of industrial law itself. Two  seminal  guidelines  of great  moment  flow  from  this decision 1.    the  primary and predominant  activity  test; and 2, the integrated activity test.    The         concrete application  of these two-fold tests is illustrated  in  the very case.  We may set out in the concise words of Subba Rao J., the   sum-up :               "The   result   of  the  discussion   may   be               summarised   thus   (1)  The   definition   of               "industry"  in the Act is very  comprehensive.               It is in two parts : one part defines it  from               the  standpoint of the employer and the  other               from  the standpoint of the employee.   If  an               activity falls under either part of the                249               definition, it will be an industry within  the               meaning  of  the  Act.  (2)  The  history   of               industrial   disputes  and   the   legislation               recognizes the basic concept that the activity               shall be an organised one and  not that  which               pertains  to private or  personal  employment.                             (3)  The regal functions described  as  primar y               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  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 discharged many               functions,  some  pertaining  to  industry  as               defined  in  the Act and  other  nonindustrial               activities,  the predominant functions of  the               department  shall  be the  criterion  for  the               purpose of the Act." By  these  tokens,  which  find  assent  from  us,  the  tax department  of the local body is ’industry’.  The reason  is this.               "The  scheme  of the Corporation Act  is  that               taxes  and  fees  are collected  in  order  to               enable  the  municipality  to  discharge   its               statutory  functions.   If  the  functions  so               discharged are wholly or predominantly covered               by  definition  of  "industry",  it  would  be               illogical  to exclude the tax department  from               the definition.  While in the case of  private               individuals or firms services are paid in cash               or   otherwise,   in  the   case   of   public               institutions, as the services are rendered  to               the  public,  the taxes  collected  from  them               constitute   a  fund  for   performing   those               services.  As most of the services rendered by

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             the municipality come under the definition  of               "industry",   we,   ,should  hold   that   the               employees  of  the  tax  department  are  also               entitled to the benefits under the Act. The  health  department of the municipality too is  held  in that case to be ’industry- a fact which is pertinent when we deal later with hospitals, dispensaries and health centres.                "This  department  looks  after   scavenging,               sanitation,  control of epidemics, control  of               food   adulteration  and  running  of   public               dispensaries.   Private institutions can  also               render these services.  It is said the control               of  food  adulteration  and  the  control   of               epidemics   cannot   be   done   by    private               individuals and institutions.  We do ’not  see               why.   There can be private medical  units  to               help   in   the  control  of   epidemics   for               remuneration.   Individuals may get  the  food               articles  purchased  by them examined  by  the               medical unit and take necessary action against                             guilty  merchants.   So  too,  they  can   tak e               advantage of such a unit to prevent  epidemics               by having 17-211. SCI/78 250 .lm15 necessary  inoculations  and advice.  This  department  also satisfies  the  other  tests  laid down by  us,  and  is  an industry within the meaning of the definition of  ’industry" in the Act." Even  the General Administration Department  is  ’industry’. Why ? "Every  big  company  with different sections  will  have  a general  administration department.  If the various  depart- ments  collated  with the department  are  industries,  this department would also be a part of the industry.  Indeed the efficient  rendering of all the services would  depend  upon the proper working of this department, for, otherwise  there would be confusion and chaos.  The state Industrial Court in this  case has held that all except five of the  departments of  the Corporation come under the definition of  "industry" and  if  so,  it  follows  that  this  department,   dealing predominantly  with  industrial  departments,  is  also   an industry.   Hence the employees of this department are  also entitled to the benefits of this Act." Running  right through are three tests : (a)  the  paramount and  predominant duty criterion (p. 971); (b)  the  specific service  being an integral, non-severable part of  the  same activity (P. 960) and (c)     the    irrelevance   of    the statutory duty aspect.               "It  is  said  that  the  functions  of   this               department   are  statutory  and  no   private               individual   can  discharge  those   statutory               functions.   The question is not  whether  the               discharge   of   certain  functions   by   the               Corporation   have  statutory   backing,   but               whether   those  functions  can   equally   be               performed   by   private   individuals.    The               provisions of the Corporation Act and the bye-               laws  prescribe  certain  specifications   for               submission  of plans and for the  sanction  of               the authorities concerned before the  building               is  put up.  The same thing can be done  by  a               co-operative society or a private  individual.

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             Co-operative societies and private individuals               can allot lands for building houses in accord-               ance with the conditions prescribed by law  in               this regard.  The services of this  department               are therefore analogous to those of a  private               individual  with the difference that  one  has               the statutory sanction behind it and the other               is governed by terms of contracts." Be  it  noted  that even co-operatives are  covered  by  the learned Judge although we may deal with that matter a little later. The  same  Bench  decided both  Corporation  of  Nagpur  and Hospital  Mazdoor  Sabha.  This latter case may  be  briefly considered  now.  It repels the profit motive and  quid  pro quo theory as having any hearing on the question.  The wider import  of  Sec. 2(j) is accepted but  it  eXpelS  essential ’sovereign activities from its’ scope.  251 It is necessary to note that the hospital concerned in  that case was run by Government for medical relief to the people. Nay  more.   It had a substantial educational  and  training role.               "This  group  serves as  a  clinical  training               group  for  students  of  the  Grant   Medical               College which is a Government Medical  College               run and managed by the appellant for imparting               medical  sciences  leading to  the  Degree  of               Bachelor  of Medicine and Bachelor of  Surgery               of  the Bombay University as well  as  various               Post-Graduate   qualifications  of  the   said               University  and the College of Physicians  and               Surgeons,  Bombay; the group is thus  run  and               managed  by the appellant to  provide  medical               relief and to promote the health of the people               of Bombay." And  yet the holding was that it was an  Industry.   Medical education, without mincing words, is ’industry’.  It has  no vulgarising  import  at all since the term  ’industry  as  a technical one for the purpose of the Act, even as a  master- piece of painting is priceless aft but is ’goods’ under  the Sales   Tax  Law,  without  any  philistinic  import.    Law abstracts  certain  attributes  of  persons  or  things  and assigns Juridical values without any pejorative  connotation about other aspects.  The Court admonishes that :               "Industrial adjudication has necessarily to be               aware of the current of socioeconomic  thought               ground;  it must recognise that in the  modern               welfare State healthy industrial relations are               a  matter  of  paramount  importance  and  its               essential  function is to assist the State  by               helping  a  solution  of  industrial  disputes               which  constitute a distinct  and  persistent,               phenomenon of modern industrialised States. II               attempting   to  solve   industrial   disputes               industrial  adjudication does not  and  should               not  adopt  a doctrinaire approach.   It  must               evolve  some  working  principles  and  should               generally   avoid  formulating   or   adopting               abstract   generalisations.  Nevertheless   it                             cannot  harm back to old age notions about  th e               relations between employer and employee or  to               the  doctrine  of  laissez  faire  which  then               governed the regulation of the said relations.               That is why, we think in construe in the  wide

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             words  used  in  Section  2(j)  it  would   be               erroneous   to  attach  undue  importance   to               attributes  associated with business or  trade               in  the popular mind in days gone by.  "  (pp.               875-6)               Again, this note is reported on a later page               "Isaacs J. has uttered a note of caution  that               in dealing with industrial disputes industrial               adjudicators  must  be  conversant  with   the               current  knowledge  on the  subject  and  they               should  not  ignore the constant  currents  of               life  around  them  for  otherwise  it   would               introduce   a  serious  infirmity   in   their               approach.  Dealing     with    the     general               characteristics of industrial  enterprise  the               learned  Judge observed that  they  contribute               more  or  less to the general welfare  of  the               community." p. 883) 252 A conspectus of the clauses has induced Gajendragadkar J. to take  note  of  the impact of  provisions  regarding  public utility service also :               "f  the  object and scope of the  statute  are               considered  there  would be no  difficulty  in               holding that the relevant words of wide import               have been deliberately used by the Legislature               in  defining  "industry" in  Sec.  2(j).   The               object  of the Act was to make  provision  for               the investigation and settlement of industrial               disputes,  and  the extent and  scope  of  its               provisions  would  be realised if we  bear  in               mind  the definition of  "industrial  dispute"               given by Sec. 2(k), of " wages" by Sec. 2(rr),               "workman" by S. 2(s), and of "employer" by  s.               2(g).   Besides,  the definition of  a  public               utility service prescribed by S. 2(m) is  very               significant.  One has merely to glance at  the               six  categories  of  public  utility   service               mentioned by s. 2(m) to realise that the  rule               of construction on which the appellant  relies               is inapplicable in interpreting the definition               prescribed by s. 2(j) " (p. 875)               The positive delineation of ’industry’ is  set               in these terms               activity   systematically    or     habitually               undertaken for the production  or distribution               of  goods  or for the  rendering  of  material               service to the community at large or a part of               such  community with the help of employees  is               an  undertaking.  Such an  activity  generally               involves  the cooperation of the employer  and               the   employees;   and  its  object   is   the               satisfaction of material human needs.  It must               be organised or arranged in a manner in  which               trade  or business is generally  organised  or               arranged.   It must not be casual nor must  it               be  for  oneself nor for pleasure.   Thus  the               manner  in which the activity in  question  is               organised  or arranged, the condition  of  the               co-operation between employer and the employee               necessary  for its success and its  object  to               render  material service to the community  can               be regarded as some of the features which  are               distinctive  of  activities to which  s.  2(j)               applies.   Judged by this test there would  be

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             no  difficulty  in holding that the  State  is               carrying  on an undertaking when it  runs  the               group of Hospitals in question." (p. 879)               Again,               "It  is  the character of the  activity  which               decides   the  question  as  to  whether   the               activity in question attracts the provision of               Sec.  2(j);  who  conducts  the  activity  and               whether  it is conducted for profit or not  do               not make a material difference." (p. 878) By  these  tests even a free or charitable  hospital  is  an industry.   That  the court intended such  a  conclusion  is evident :               "If  that be so, if a private citizen  runs  a               hospital  without charging any fees  from  the               patients treated in it, it would                 253               nevertheless  be an undertaking under s.  2(j)               Thus the character of the activity involved in               running  a hospital brings the institution  of               the hospital within s. 2(j)" The  ’rub’ with the ruling, if we may with  great  deference say   so,  begins  when  the  Court  inhibits  itself   from effectuating the logical thrust of its own crucial ratio :               ".......... though S. 2 (j) uses words of very               wide denotation, a line would have to be drawn               in  a fair and just manner, so as  to  exclude               some  callings, services or undertakings.   If               all  the  words used are  given  their  widest               meaning,  all services and all callings  would               come  within  the purview of  the               definition; even service rendered by a servant               purely  in  a personal or domestic  matter  or               even  in  a casual way would fall  within  the               definition.  It is not and cannot be suggested               that in its wide sweep the, word "service"  is               intended to include service howsoever rendered               in  whatsoever  capacity  and  for  whatsoever               reason.   We must, therefore,  consider  where               the line should be drawn and what  limitations               can  and  should  be  reasonably  implied   in               interpreting  the wide words used in s.  2(j);               and  that  no doubt is  a  somewhat  difficult               problem to decide."(p.876) What  is  a ’fair and just manner’ ? It must be  founded  on grounds Justifiable by principle derived from the statute if it   is  not  to  be  sublimation  of   subjective   phobia, rationalization  of  interests or  judicialisation  of  non- juristic negatives.  And this bunch, in our respectful view, has  been proved true not by positive pronouncement  in  the case but by two points suggested but left open.  One relates to  education  and the other to professions.  We  will  deal with them in due course. Liberal Professions When  the  delimiting line is drawn to whittle down  a  wide definition,  a  principled  working test,  not  a  projected wishful  thought, should be sought.  This conflict  surfaced in the Solicitor’s case (1962 Supp. (3) S.C.R. 157).  Before us  too,  a  focal point of contest was as  to  whether  the liberal-   professions  are,  ipso  facto,   excluded   from "Industry’.   Two grounds were given by  Gajendragadkar,  J. for  over-ruling  Sri  A. S. R.  Chari’s  submissions.   The doctrine of direct co-operation and the features of  liberal professions   were  given  as  good  reasons  to   barricade professional enterprises from the militant clamour for  more

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by  lay labour.  The learned judge expressed himself on  the first salvational plea :               "When in the Hospital case this Court referred               to   the  Organisation  of   the   undertaking               involving  the  co-operation  of  capital  and               labour  or the employer and his employees,  it               obviously meant the co-operation essential and               necessary   for  the  purpose   of   rendering               material   service  or  for  the  purpose   of               production.   It  would be realised  that  the               concept  of  industry  postulates  partnership               between  capital  and labour  or  between  the               employer and his employees.  It is under  this               partnership that the employer contributes  his               capital               254               and  the employees their labour and the  joint               contribution  of  capital  and  labour   leads               directly to the production which the  industry               has in view.  In other words, the co-operation               between  capital  and labour  or  between  the               employer and his employees which is treated as               a  working  test in  determining  whether  any               activity  amounts to an industry, is  the  co-               operation  which is directly involved  in  the               production  of  goods or in the  rendering  of               service.   It cannot be suggested  that  every               form  or  aspect of human  activity  in  which               capital and labour co-operate or employer  and               employees  assist each other is  an  industry.               The distinguishing feature of an industry.  is               that  for the production of goods or  for  the               rendering  of  service,  co-operation  between               capital and labour or between the employer and               his  employees  must  be direct  and  must  be               essential." pp. 163-164 Co-operation to  which               the  test refers must be co-operation  between               the  employer  and  his  employees  which   is               essential for carrying out the purpose of  the               enterprise  and the service to be rendered  by               the enterprise should be the direct outcome of               the  combined efforts of the employer and  the               employees.               The   second   reason   for   exoneration   is               qualitative.   ’Looking at this question in  a               broad  and  general  way, it is  not  easy  to               conceive  that a liberal profession like  that               of an attorney could have been intended by the               Legislature  to fall within the definition  of               "industry" under s. 2(j).  The very concept of               the  liberal professions has its  own  special               and distinctive features which do not  readily               permit   the   inclusion   of   the    liberal               professions   into   the   four   corners   of               industrial  law.   The essential basis  of  an               industrial  dispute  is that it is  a  dispute               arising   between   capital  and   labour   in               enterprises  where capital and labour  combine               to  produce commodities or to render  service.               This  essential basis would be absent  in  the               case   of  liberal  professions.    A   person               following a liberal profession does not  carry               on  his  profession of his employees  and  the               principal,  if not the sole, capital which  he               brings  into his profession is his special  or

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             peculiar    intellectual    and    educational               equipment.   That is why on broad and  general               considerations  which  cannot  be  ignored,  a               liberal    profession   like   that   of    an               attorney"must,  we  think,  be  deemed  to  be               outside  the  definition of  ’industry"  under               section 2(j)". pp. 167-168 Let  us  examine  these two tests.   In  the  sophisticated, subtle,   complex,   assembly-line  operations   of   modern enterprises,   the   test  of   ’direct’   and   ’indirect’, ’essential’  and  ’inessential’, will snap  easily.   In  an American  automobile manufactory, everything  from  shipping iron  ore  into and shipping care out of  the  vast  complex takes  place  with myriad major and minor jobs.   A  million administrative,  marketing and advertising tasks  are  done. Which, out of this maze of chores, is direct?  A battle  may be  lost if winter-wear were shoddy.  Is the army  tailor  a direct contributory ?  255 An  engineer may lose a competitive contract if  his  typist typed  wrongly  or  shabbily or despatched late.   He  is  a direct  contributory to the disaster.  No lawyer  or  doctor can  impress client or court if his public relations job  or home work were poorly done, and that part depends on smaller men,  adjuncts.   Can the great talents  in  administration, profession,  science  or art shine if a secretary  fades  or faults  ?  The  whole theory of direct  co-operation  is  an improvisation which, with great respect, hardly impresses. Indeed,  Hidayatullah,  C.J.,  in  Gymkhana  Club   Employee Union(1)  scouted  the argument about direct  nexus,  making specific reference to the Solicitors’ case :               "........  The  service  of  a  solicitor  was               regarded  as  individual  depending  upon  his               personal qualifications and ability, to  which               the  employees did not contribute directly  or               essentially.  Their contribution, it was held,               had  no  direct or essential  nexus  with  the               advice  or  services.   In  this  way  learned               professions were excluded."               To   nail   this   essential   nexus   theory,               Hidayatullah, C.J., argued               "What   partnership  can  exist  between   the               company  and/or Board of Directors on the  one               hand  and the menial staff employed  to  sweep               floors  on the other ? What direct and  essen-               tial nexus is there between such employees and               production  ?  This proves that what  must  be               established  is the existence of  an  industry               viewed from the angle of what the employer  is               doing and if the definition from the angle  of               the  employer’s occupation is  satisfied,  all               who   render  service  and  fall  within   the               definition of workman come within the fold  of               industry irrespective of what they do.   There               is then no need to establish a partnership  as               such  in the production of material  goods  or               material  services.   Each  person  doing  his               appointed  task in an Organisation will  be  a               part of industry whether he attends to a  loom               or merely polishes door handles.  The fact  of               employment as envisaged in the second part  is               enough  provided there is an industry and  the               employee   is   a   workman.    The    learned               professions are not industry not because there               is  absence  of such partnership  but  because

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             viewed  from  the  angle  of  the   employer’s               occupation, they do not satisfy the test." Although   Gajendragadkar   J.  in  Solicitor’s   case   and Hidayatullah,  J. in Gymkhana case agreed that  the  learned professions  must be excluded, on the question of direct  or effective   contribution   in   partnership,   they   flatly contradicted each other.  The reasoning on this part of  the case  which  has  been  articulated  in  the  Gymkhana  Club Employees Union (supra) appeals to us.  There is no need for insistence upon the ,principle of partnership, the  doctrine of direct nexus or the contribution of values by  employees. Every employee in a professional office, ,be he a  paralegal assistant or full-fledged professional employee or, (1)  [1968] 1 S.C.R. 742. 256 down the ladder, a mere sweeper or janitor, every-one  makes for  the success of the office, even the mali  who  collects flowers and places a beautiful bunch in. a vase on the table spreading fragrance and pleasantness around.  The failure of anyone can mar even the success of everyone else.  Efficient collectivity  is  the essence of professional  success.   We reject  the  plea  that a member of  a  learned  or  liberal profession,  for that sole reason, can self-exclude  himself from operation of the Act. The  professional immunity from Labour’s demand  for  social justice because learned professions have a halo also  stands on  sandy  foundation and, perhaps, validates G.  B.  Shaw’s witticism  that an professions are conspiracies against  the laity.  After all, let us be realistic and recognise that we live  in an age of experts alias professionals, each  having his   ethic,   monopoly,   prestige,   power   and   profit. Proliferation of professions is a ubiquitous phenomenon  and none but the tradition bound will agree that theirs is not a liberal  profession.   Lawyers  have  their  code.   So  too medicos  swearing by Hippocrates, chartered accountants  and company secretaries and other autonomous nidi of know-how. Sociological critics have tried to demythologize the learned professions.   Perhaps they have exaggerated.  Still  it  is there.   The politics, of skill, not service of the  people, is  the current orientation, according to a recent  book  on ’Professions For the People’:               "The  English  professions in  the  eighteenth               century  were an acceptable successor  to  the               feudal ideal of landed property as a means  of               earning  a  living.  Like landed  property,  a               professional "competence" conveniently  "broke               the   direct  connection  between   work   and               income......  (Reader,  1966, P.  3)  for  the               gentryman.   A  professional  career  provided               effects, aristocratic, protective  coloration,               and  at  the same time enabled one to  make  a               considerable sum of money without sullying his               hands  with  a "job" or  "trade".   One  could               carry  on  commerce by sleigh  of  hand  while               donning   the   vestments   of    professional               altruism.   To  boot,  one  could  also   work               without  appearing to derive  income  directly               from it. As Reader explains :               "The  whole subject of payment ....  seems  to               have    caused    professional    men    acute               embarrassment,  making  them  take  refuge  in               elaborate concealment, fiction, and  artifice.               The  root of the matter appears to lie in  the               feeling  that  it  was  not  fitting  for  one               gentleman   to   pay  another   for   services

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             rendered,  particularly  if the  money  passed               directly.   Hence,  the  device  of  paying  a               barrister’s  fee to the attorney, not  to  the               barrister himself.  Hence, also the convention               that in many professional dealings the  matter               of  the  fee was never  openly  talked  about,               which  could  be  very  convenient,  since  it               precluded  the client or patient from  arguing               about   whatever   sum   his   advisor   might               eventually  indicate as a  fitting  honorarium               (1966, p. 37).  The                 257               established professions-the law, medicine, and               the clergy-held (or continued to hold) estate-               Eke positions               The   three  ’liberal  professions’   of   the               ’eighteenth  century  were the  nucleus  about               which the professional class of the nineteenth               century  was to form.  We have seen that  they               were   united   by  the  bond   of   classical               education;  that their broad  and  ill-defined               functions   covered  much  that  later   would               crystallise   out   into   now,   specialised,               occupations;  that each,  ultimately,  derived               much  of  its standing  with  the  established               order in the State.... (1966, p. 23)"               In    the    United    States,    professional               associations are guilds in modern dress.               ,,Modern    professional   associations    are               organizational  counterparts  of  the  guilds,               They     are    occupational     self-interest               organisations.  In as much as the  professions               still  perform  custom  work  and  exercise  a               monopoly  of  training and  skill,  the  guild               analogy  is  plausible.  However,  aspects  of               economic   history   lead   to   a   different               conclusion.    There  has  been  a  shift   of               emphasis  on  the part of  professionals  from               control  over  the quality of the  product  or               service, to control of price." Indeed,  in America, professionals advertise, hold a  strict monopoly,  charge heavy fees and wear humanitarianism as  an altruist  mask.   In  England a Royal  Commission  has  been appointed  to go into certain aspects of the working of  the legal profession. The observer, in a leading article ’WIGS ON THE GREEN" dated 15 February, 1976, wrote :               "In  preparing  for the challenge of  a  Royal               Commission, lawyers ought to realise how  deep               public disillusionment goes, how the faults of               the legal system are magnified by the  feeling               that the legal profession is the most powerful               pressure   group-some  would  say   a   mutual               protection society-in the land, with its loyal               adherents  in Westminster, Whitehall,  and  on               the  bench, like a great freemasonry  designed               to protect the status quo.               It  robs  the client of the benefits  of  free               competition  among barristers for his  custom.               It confirms his impression that Her  Majesty’s               courts,  which he rightly regards as  part  of               the  service  the  State  offers  to  all  its               citizens,  are a private benefit  society  for               lawyers.               The  fees  that  lawyers  are  paid,  and  the

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             services  that they give in return, must  also               be studied.  A recent survey suggested that in               one  criminal court 79 per cent of  barristers               in   contested  cases  and  96  per  cent   in               uncontested cases saw their               258               clients  only on the morning of  the  hearing.               How much is that worth ?               For  Britain  at present has  a  legal  system               which Often looks as anachronistic as its wigs               and  gowns, a system in which  solicitors  are               plentiful in well-to-do areas, and  inaccessi-               ble  in less fashionable districts;  in  which               the  law appears suited only to  the  property               rights  of the middle class, but oblivious  of               the  new  problems of poorer  and  less  well-               educated  people,  who need  help  with  their               broken marriages or their  landlord-and-tenant               disputes.  Sooner rather than later, the legal               system  must  be made to appear  less  like  a               bastion of privilege, more like a defender  of               us all." The  American  Medical  Association has come  in  for  sharp social criticism and litigative challenge.  Which architect, engineer  or  auditor has the art to  make  huts,  landscape little  villages  or bother about small units  ?  And  which auditor  and  company secretary has not  been  Pressured  to break with morals by big business ? Our listening posts  are raw life. The  Indian Bar and Medicine have a high social  ethic  upto now.   Even  so, Dabolkar(1) cannot be ignored as  freak  or recondite.   Doctors  have  been  criticised  for   unsocial conduct.   The  halo  conjured up in  the  Solicitor’s  case hardly serves to ’de-industrailise’ the professions.   After all,  it is not infra dig for lawyers,  doctors,  engineers, architects,   auditors,   company   secretaries   or   other professionals  to regard themselves as workers in their  own sphere  or employers or suppliers of specialised service  to society.   Even  justicing  is  service  and,  but  for  the exclusion from industry on the score of sovereign functions, might qualify for being regarded as ’industry’.  The plea of ’profession’ is irrelevant for the industrial law except  as expression of an anathema.  No legal principle supports it. Speaking generally, the editors of the book Professions  for the People earlier mentioned state :               "Jethro  K.  Lisberman (1970, p.  3)  warns  :               "Professionals  are  dividing the  world  into               spheres, of influence and erecting large signs               saying  "experts at work here, do not  proceed               further." He shows that via such mechanisms as               licensing,   self-regulation,  and   political               pressure  the  profession are  augmenting  the               erosion  of democracy.  Professional  turf  is               now ratified by the rule of law.  If there  is               the   case,   it  represents   a   significant               development  :  the  division  of  labour   in               society   is   again   moving   towards    the               legalisation of social status quo occupational               role s." All  this  adds  up  to  the  decanonisation  of  the  noble professions.    Assuming   that  a   professional   in   our egalitarian  ethos   is like any other man  of  common  clay plying a trade or business, we cannot assent to the cult  of the elite in carving out islands of exception to ’industry’, (1)  A.I.R. 1976.  S.C. 242

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259 The  more  serious argument of exclusion urged to  keep  the professions out of the coils of industrial disputes and  the employees’  demands backed by agitations ’red in  tooth  and claw’  is  a  sublimated  version  of  the  same   argument. Professional expertise and excellence with its  occupational autonomy,  ideology, learning, bearing and  morality,  holds aloft  a  standard  of  service  which  centres  round   the individual   doctor,  lawyer,  teacher  or  auditor.    This reputation  and  quality  of special service  being  of  the essence,  the  co-operation  of the  workmen  in  this  core activity of professional offices is absent.  The clerks  and stenos, the bell-boys and doormen, the sweepers and  menials have  no art or part in the soul of  professional  functions with its higher code of ethic and intellectual  proficiency, their  contribution being peripheral and low-grade, with  no relevance  to  the clients’ wants  and  requirements.   This conventional  model  is open to the  sociological  criticism that  it is an ideological clock conjured up by highborn,  a posture  of  noblesse oblige which is incongruous  with  raw life  especially  in the democratic third  world  and  post- industrial societies.  To hug the past is to materialise the ghost.   The paradigms of professionalism are gone.  In  the large   solicitors’  firms,  architects’  offices,   medical polyclinics and surgeries, we find a humming industry,  each section doing its work with its special flavour and  culture and code, and making the end product worth its price.  In  a regular  factory you have highly skilled  technicians  whose talent  is of the essence, managers whose ability  organizes and  workmen  whose coordinated input is,  from  one  angle, secondary,  from  another, significant.  Let us  look  at  a surgery  or walk into a realtor’s firm.  What  physician  or surgeon  will not kill if an attendant errs or clerk  enters wrong or dispenses deadly dose ? One such disaster somewhere in  the assembly line operations and the clientele  will  be scared despite the doctor’s distilled skill.  The lawyer  is no  better and just cannot function without the  specialised supportive  tools  of  paraprofessionals  like  secretaries, librarians,  and  law-knowing  steno-typists  or  even   the messengers   and   telephone   girls.    The   mystique   of professionalism  easily melts in the hands of modern  social scientists  who have (as Watergate has shown in America  and has  India had its counterpart?) debunked and  stripped  the professional  emperor naked.  ’Altruism’ has  been  exposed, cash  has overcome craft nexus and if professionalism  is  a mundane  ideology, then "profession" and "professional"  are sociological  contributions  to the pile.  Anyway,  in-  the sophisticated   organization   of   expert   services,   all occupations  have  central skills, an occupational  code  of ethics,  a group culture, some  occupational-authority,  and some  permission  to monopoly practice from  the  community. This incisive approach makes it difficult to ’caste-ify’  or ’class-ify’ the ’liberal professions as part and beyond  the pale of ’industry’ in our democracy.  We mean no  disrespect to  the  members  of the  professions.   Even  the  judicial profession  or administrative profession cannot  escape  the winds  of social change.  We may add that the modern  world, particularly the third world, can hope for a human  tomorrow only  through professions for the people, through  expertise at  the service of the millions.  Indian primitivism can  be banished  only by pro bono publico professions in the  field of law, medicine, education, engineering and what not.   But hat  radicalism  does  not  detract  from  the  thesis  that ’industry’ does 260

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not  spare  professionals.  Even so, the widest  import  may still  self-exclude  the little moffusil lawyer,  the  small rural  medico or the country engineer, even though  a  hired sweeper or factotum assistant may work with him.  We see  no rationale  in  the  claim to carve  out  islets.   Look.   A solicitor’s  firm or a lawyer’s firm becomes successful  not merely  by  the  talent of a single lawyer but  by  the  co- operative  operations  of several specialists,  juniors  and seniors.   Likewise  the  ancillary  services  of  competent stenographers,  paralegal  supportive services  are  equally important.   The  same test applies  to  other  professions. The,  conclusion  is  inevitable that  contribution  to  the success  of the institution-every professional unit  has  an institutional good-will and reputation-comes not merely from the  professional  or specialist but from  all  those  whose excellence  in  their respective parts makes for  the  total proficiency.   We have, therefore, no doubt that  the  claim for  exclusion  on  the  score  of  liberal  professions  is unwarranted  from a functional or definitional  angle.   The flood-gates of exemption from the obligations,under the  Act will be opened if professions flow out of its scope. Many  callings  may  clamour  to  be  regarded  as   liberal professions.  In an age when traditions have broken down and the old world professions of liberal descent have begun.  to resort to commercial practices (even legally, as in America, or  factually, as in some other countries)  exclusion  under this new label will be infliction of injury on the statutory intent and effect. The  result of this discussion is that the solicitors’  case is wrongly decided and must, therefore, be’ over-ruled.   We must  hasten,  however,  to repeat that  a  small  category, perhaps  large in numbers in the muffasil, may not  squarely fall within the definition of industry.  A single lawyer,  a rural  medical  practitioner or urban doctor with  a  little assistant and/or menial servant may ply a profession but may not  be  said to run an industry.  That is not  because  the employee  does  not  make a  contribution  nor  because  the profession  is  too  high to be classified  as  a  trade  or industry with its commercial connotations but because  there is  nothing like organised labour in such  employment.   The image  of  industry  or  even quasi-industry  is  one  of  a plurality  of  workmen,  not an isolated  or  single  little assistant or attendant.  The latter category is more or less like  personal avocation for livelihood taking some paid  or part-time from another.  The whole purpose of the Industrial Disputes  Act is to focus on resolution of  industrial  dis- putes  and  regulation of industrial relations  and  not  to meddle   with  every  little  carpenter  in  a  village   or blacksmith  in a town who sits with his son or assistant  to work for the customers who trek in.  The ordinary  spectacle of  a cobbler and his assistant or a cycle repairer  with  a helper, we come across in the payments of cities and  towns, repels  the  idea of industry and industrial  dispute.   For this  reason,  which applies all along the  line,  to  small professions, petty handicraftsmen, domestic servants and the like,  the solicitor or doctor or rural engineer, even  like the  butcher, the baker and the candlestick maker,  with  an assistant or without, does not fall within the definition  261 of  industry.  In regular industries, of course, even a  few employees  are  enough  to  bring  them  within  sec.  2(s). Otherwise automated industries will slip through the net. Education We  will now move. on to a consideration of education as  an industry.try.  If the triple tests of ’systematic  activity,

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co-operation between employer and employee and production of goods and services were alone to be applied, a University, a college,  a research institute or teaching institution  will be  an industry.  But in University of Delhi(1) it was  held that  the  Industrial Tribunal was wrong  in  regarding  the University as an industry because it would be  inappropriate to   describe   education   as   an   industrial   activity. Gajendragadkar J. agreed in his. judgment that the employer- employee test was satisfied and cooperation between the  two was  also  present.   Undoubtedly, education  is  a  sublime cultural  service,  technological training  and  personality builder.  A man without education is a brute and no body can quarrel   with  the  proposition  that  education,  in   its spectrum, is significant service to the community.  We  have already given extracts from Australian Judge Issacs J.,  to, substantiate  the  thesis  that  education  is  not   merely industry but the mother of industries.  A philistinic, illi- terate society will be not merely uncivilised but  incapable of   industrialisation.   Nevertheless  Gajendragadkar   J., observed : "It  would, no doubt, sound somewhat strange that  education should be described as industry and the teachers as  workmen within   the  meaning  of  the  Act,  but  if  the   literal construction for which the respondents contend is  accepted, that  consequence must follow." Why is it strange to  regard education  as an industry ? Its respectability ?  Its  lofty character  ? Its professional stamp ? Its cloistered  virtue which  cannot be spoiled by the commercial implications  and the  raucous voices of workmen ? Two reason conclusion  that imparting education is an industry.  The first ground relied on  by  the Court is based upon the  preliminary  conclusion that  teachers  are not ’workmen’ by  definition.   Perhaps, they  are not are given  to  avoid the because  teachers  do not  do manual work or technical work.  We are not too  sure whether  it  is proper to disregard, with  contempt,  manual work  and  separate it from education, nor are we  too  sure whether  in our technological universe, education has to  be excluded.   However, that may be a battle to be waged  on  a later  occasion  by  litigation and we  do  not  propose  to pronounce on it at present.  The Court, in the University of Delhi,  proceeded on that assumption viz. that teachers  are not workmen, which we will adopt to test the validity of the argument.’) The reasoning of the Court is best expressed  in the words of. Gajendragadkar, J. :               "It is common ground that teachers employed by               educational  institutions,  whether  the  said               institutions are imparting primary, secondary,               collegiate or postgraduate education, are  not               workmen under s. 2(s), and so, it follows that               the  whole  body of employees with  whose  co-               operation the (1)  [1961] 2 S.C.R. 703. 262 .lm15 work  of  imparting education is carried on  by  educational institutions  do not fall within the purview of s. 2(s)  and any  disputes  between  them  and  the  institutions   which employed  them are outside the scope of the Act.   In  other words, if imparting education is an industry under S.  2(j), the  bulk of the employees being outside the purview of  the Act,  the only disputes which can fall within the  scope  of the Act are those which arise between such institutions  and their  subordinate  staff, the members of  which"  may  fall under  s.  2 (s) In our opinion, having regard to  the  fact that  the  work of education is  primarily  and  exclusively

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carried  on  with  the  assistance of  the  labour  and  co- operation  of teachers, the omission of the whole  class  of teachers,  from the definition prescribed by s. 2(s) has  an important  bearing  and  significance  in  relation  to  the problem  which we are considering.  It could not  have  been the  policy of the Act that education should be  treated  as industry  for the benefit of a very minor and  insignificant number  of  persons  who  may  be  employed  by  educational institutions  to  carry  on the duties  of  the  subordinate staff.   Reading  ss,  2(g), (j) and (s)  together,  we  are inclined  to hold that the work of education carried  on  by educational institutions like the University of Delhi is not an industry within the meaning of the Act." The  second  argument which appealed to the Court  to  reach its conclusion is that : "the distinctive purpose and object of  education would make it very difficult to assimilate  it to the position of any trade, business or calling or service within  the  meaning of sec. 2(j)." Why so ? The  answer  is given by the learned judge himself :               "Education  seeks to build up the  personality               of  the  pupil  by  assisting  his   physical,               intellectual, moral and emotional development.               To speak of this educational process in  terms               of industry sounds so. completely  incongruous               that  one  is not surprised that the  Act  has               deliberately so defined workmen under S.  2(s)               as to exclude teachers from its scope.   Under               the  sense  of values recognised both  by  the               traditional  and conservative as well  as  the               modern   and   progressive   social   outlook,               teaching and teachers are, no doubt,  assigned               a  high  place of honour and it  is  obviously               necessary  and  desirable  that  teaching  and               teachers  should receive the respect  that  is               due  to them.  A proper sense of values  would               naturally  hold teaching and teachers in  high               esteem,  though  power or wealth  may  not  be               associated  with  them.  It cannot  be  denied               that  the  concept of social justice  is  wide               enough  to include teaching and teachers,  and               the  requirement that teachers should  receive               proper emoluments and other amenities which is               essentially based on social justice cannot  be               disputed; but the effect of excluding teachers               ’from  s.  2(s) is only this that  the  remedy               available   for   the  betterment   of   their               financial  prospects does not fall  under  the               Act.    It  is  well  known   that   Education               Departments  of the State Governments as  well               as the Union Government, and the University                263               Grants  Commission  carefully  consider   this               problem  and assist the teachers by  requiring               the  payment to them of proper scales  of  pay               and  by  insisting on the  fixation  of  other               reasonable terms and conditions of service  in               regard  to  teachers engaged  in  primary  and               secondary  education and collegiate  education               which  fall under their  respective  jurisdic-               tions.   The  position nevertheless  is  clear               that any problems connected with teachers  and               their salaries are outside the purview of  the               Act,  and  since the teachers  form  the  sole               class   employees  with   whose   co-operation               education    is   imparted   by    educational

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             institutions, their exclusion from the purview               of   the  Act  necessarily  corroborates   the               conclusion   that  education  itself  is   not               without its scope."               Another  reason  has  also  been  adduced   to               reinforce this conclusion :               other educational institutions are not  formed               or conducted for making profit; no doubt,  the               absence  of profit motive would not  take  the               work of any institution outside S. 2(j) if the               requirements   of  the  said  definition   are               otherwise satisfied.  We have referred to  the               absence of profit motive only to emphasise the               fact   that  the  work  undertaken   by   such               educational  institutions  differs  from   the               normal concept of trade or business.   Indeed,               from  a  rational point of view, it  would  be               regarded   as   inappropriate   to    describe               education even as a profession.  Education  in               its  true  aspect  is more  a  mission  and  a               vocation rather than a profession or trade  or               business,  however wide may be the  denotation               of  the two latter words under the Act.   That               is  why we think it would be  unreasonable  to               hold   that   educational   institutions   are               employers  within the meaning of s.  2(g),  or               that  the work of teaching carried on by  them               is   an  industry  under  s.   2(j),   because               essentially,  the creation of a  well-educated               healthy   young  generation  imbued   with   a               rational progressive outlook on life which  is               the  sole aim of education, cannot at  all  be               compared  or  assimilated  with  what  may  be               described as an industrial process." The Court was confronted by the Corporation of Nagpur  where it had been expressly held that the education department  of the  Corporation was service rendered by the department  and so  the subordinate menial employees of the department  came under  the definition of employees and would be entitled  to the  benefits  of the Act.  This was explained away  by  the suggestion that "the question as to whether educational work carried  on by educational institutions like the  University of Delhi which have been formed primarily and solely for the purpose of imparting education amounts to an industry within the meaning of s. 2(j), was not argued before the Court  and was not really raised in that form." 264 We dissent, withutmost     deference,     from     these propositions and are inclined to hold,as the Corporation  of Nagpur held, that. education is industry, and as Isaacs  J., hold, in the Australian case (supra), that education is pre- eminently service. The, actual decision in University of Delhi was supported by another ground, namely, that the predominant activity of the university  was  teaching and since teachers  did  not  come within the purview of the, Act, only the incidental activity of  the  subordinate staff could fall within its  scope  but that could not alter the predominant character of the insti- tution. We may deal with these contentions in a brief way, since the substantial  grounds on which we reject the  reasoning  have already been set out elaborately.  The premises relied on is that  the  bulk. of the employees in the university  is  the teaching  community.   Teachers are not workmen  and  cannot raise  disputes under the Act.  The subordinate staff  being

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only a minor category of insignificant numbers, the institu- tion  must be excluded, going by the  predominant  character test.  It is one thing to say that an institution is not  an industry.  It is altogether ,another thinking to say that  a large  number of its employees are not  workmen’ and  cannot therefore,  avail  of  the  benefits of  the.   Act  so  the institution  ceases to be an industry.  The test is not  the predominant  number  of  employees  entitled  to  enjoy  the benefits  of  the  Act.  The true test  is  the  predominant nature of the activity.  In the case of the university or an educational  institution, the nature of the activity is,  ex hypothesis  education which is a service to  the  community. Ergo,  the university is an industry.  The error  has  crept in,  if we may so say with great respect, in mixing  up  the numerical  strength of the personnel with the nature of  the activity. Secondly  there  are  a number of other  activities  of  the University Administration, demonstrably industrial which are severable   although   ancillary  to   the   main   cultural enterprise.   For  instance, a university may have  a  large printing press as a separate but considerable establishment. It may have a large fleet of transport buses with an army of running   staff.   It may have a  tremendous  administrative strength of officers     and  clerical cadres.  It may  have karamcharis  of various hues. As the Corporation  of  Nagpur has effectively ruled, these operations, viewed in severally or  collectively, may be treated as industry.  It  would  be strange,  indeed,  if a university has 50  transport  buses, hiring   drivers,   conductors,   cleaners   and    workshop technicians.  How are they to be denied the benefits of  the Act,  especially when their work is separable from  academic teaching,  merely  because the buses are owned by  the  same corporate  personality ? We find, with all  defence,  little force  in  this process of nullification of  the  industrial character of the University’s multi-form operations. The  next argument which has appealed to the Court  in  that case is that education develops the personality of the pupil and   this  process,  if  described  as   industry,   sounds grotesque.   We are unable to appreciate the force  of  this reasoning, if we may respectfully say so.  It is  265 true that our social values assign a high place of honour to education,  but how does it follow from this that  education is  not  a service the sequitur is not  easily  discernible. The  pejorative  assumption seems to be that  ’Industry’  is something  vulgar, interior, disparaging And should  not  be allowed  to sully the sanctified subject of  education.   In our  view,  industry is a noble term and embraces  even  the most  sublime activity.  At any rate, in  legal  terminology located in the statutory definition it is not  money-making, it is not lucre-loving, it is not commercialising, it is not profit  hunger.  On the other hand, a team of  painters  who produce  works  of art and sell them or an  orchestra  group winch  travels  and  performs  and makes  money  may  be  an industry  if  they employ supportive staff  of  artistes  or others.   There  is  no regarding  touch  about  ’industry’, especially  in  the light of Mahatma  Gandhi’s  dictum  that ’Work   is  Worship’.   Indeed  the,  colonial   system   of education, which divorced book learning from manual work and practical training, has been responsible for the  calamities in that field.  For that very reason, Gandhiji and Dr. Zakir Hussain propagated basic education which used work as  modus operandi  for  teaching.  We have hardly any  hesitation  in regarding education as an industry. The final ground accepted by the Court is that education  is

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a mission and vocation, rather than a profession or trade or business.   The  most that one can say is that  this  is  an assertion which does not prove itself.  Indeed, all life  is a mission and a man without a mission is spiritually  still- born.  The high mission of life is the manifestation of  the divinity  already  in  man.   To  christen  education  as  a mission,  even  if  true,  is not to  negate  its  being  an industry.  We have to look at educational activity from  the angle of the Act, and so viewed the ingredients of education are  fulfilled.   Education is, therefore, an  industry  and nothing can stand in the way of that conclusion. It  may well be said by realists in the cultural field  that educational  managements  depend  so  much  on  governmental support and some of them charge such high fees that  schools have become trade and managers merchants.  Whether this will apply to universities or not, schools and colleges have been accused, at least in the, private sector, of being tarnished with trade motives. Let us trade romantics for realities and see.  With  evening classes, correspondence courses, admissions unlimited,  fees and  government  grants  escalating,  and  certificates  and degrees for prices, education legal, medical, technological, school  level or collegiate-education-is riskless trade  for cultural   ’entrepreneurs  and  hapless  posts   of   campus (industrial) unrest.  Imaginary assumptions are  experiments with untruth. our  conclusion  is that the University of  Delhi  case  was wrongly  decided  and that education can be and is,  in  its institutional form, an industry. 18-211SCI/78 266 Are Charitable Institutions Industries ? Can  charity  be ’industry’ ? This paradox can  be  unlocked only by examining the nature of the activity of the charity, for  there  are  charities and charities.   The  grammar  of labour  law in a pluralist society tells us that the  worker is  concerned  with wages and conditions  of  service,  the. employer  with output and economies and the  community  with peace,  production  and stream of supply.  This  complex  of work,  wealth and happiness, firmly grasped,  will  dissolve the  dilemma of the law bearing on  charitable  enterprises. Charity  is  free; industry is business.  Then how ?  A  lay look  may scare; a legal look will, see; a social look  will see  through a hiatus inevitable in a sophisticated  society with organizational diversity and motivational dexterity. If  we mull over the major decisions, we get a hang  of  the basic   structure  of  ’industry’  in  its  legal   anatomy. Bedrocked  on the groundnorms, we must analyse the  elements of   charitable   economic  enterprises,   established   and maintained for satisfying human wants.  Easily, three  broad categories  emerge more may exist.  The  charitable  element enlivens  the  operations  at  different  levels  in   these patterns  and the legal consequences fences  are  different, viewed  from  the  angle  of  ’industry’.   For   income-tax purposes,  Trusts Act or company law or registration law  or penal  code requirements the examination will be  different. We  are  concerned  with  a  benignant  disposition  towards workmen and a, trichotomy of charitable enterprises run  for producing  and/or  supplying goods and  services,  organised systematically and employing workmen, is scientific. The  first  is  one where the enterprise,  like  any  other, yields  profits  but they are siphoned  off  for  altruistic objects.   The second is one where the institution makes  no profit but hires the services of employees as in other  like businesses but the goods and services, which are the output,

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are made available, at low or no cost, to the indigent needy who  are priced out of the market.  The third is  where  the establishment  is oriented on a humane mission fulfilled  by man  who work, not because they are paid wages, but  because they  share  the  passion  for  the  cause  and  derive  job satisfaction  from  their contribution.  The first  two  are industries,  the  third not.  What is the test  of  identity whereby  these  institutions with  eleemosynary  inspiration fall or do not fall under the definition of industry ? All   industries   are   organised,   systematic   activity. Charitable adventures which do not possess this feature,  of course, are not industries.  Sporadic or fugitive strokes of charity do ’not become industries.  All three  philanthropic entities,  we have itemised, fall for consideration only  if they involve co-operation between employers and employees to produce and/or supply goods and/or services.  We assume, all three  do.  The crucial difference is over the  presence  of charity in the quasi business nature of the activity.   Shri Tarkunde,  based on Safdarjung, submits that, ex  hypothesi, charity frustrates commerciality and thereby deprives it  of the character of industry. 267 It is common, ground that the first category of charities is disqualified   for  exemption.   If a business  is  run  for production and or supply of   goods and services with an eye ’on profit, it is plainly an industry.  The  fact  that  the whole or substantial part of the profits so earned     is diverted for purely charitable purposes does not affect  the nature.  of  the economic activity which  involves  the  co- operation  of  employer  and employee  and  results  in  the production  of  goods  and services.  The  workers  are  not concerned  about the destination of the profits.  They  work and  receive  wag  leas.  They axe treated  like  any  other workman  in  any  like industry.  All  the  features  of  an industry, as spelt out from the definition by the  decisions of  this  Court,  are fully  present  in  those’  charitable businesses.  In short, they are industries.  The application of the income for philanthropic purposes, instead of filling private coffers, makes no difference either to the employees of to the character of the activities.  Good Samaritans  can he clever industrialists. The  second  species  of charity  is  really  an  allotropic modification of the first.  If a kind-hearted businessman or high-minded  industrialist or service-minded operator  hires employees  like his non-philanthropic counter-parts and,  in co-operation  with  them,  produces and  supplies  goods  or services to the lowly and the lost, the needy and the ailing without  charging them any price or receiving  a  negligible return,  people regard him as of charitable disposition  and his  enterprise  as  a charity.  But then,  so  far  as  the workmen  are  concerned, it boots little  whether  he  makes available  the products free to the poor.   They  contribute labour  in return for wages and conditions of service.   For them  the charitable employer is exactly like a  commercial- minded  employer.   Both exact hard work, both  pay  similar wages,  both  treat them as human machine cogs  and  nothing more, The material difference between the commercial and the compassionate employers is not with reference to the workmen but with reference to the recipients of goods and  services. Charity  operates  not vis-a-vis the workmen in  which  case they will be paying a liberal wage and generous extras  with no  prospect of strike.  The beneficiaries of the  employees charity are the indigent consumers.  Industrial law does not take   note  of  such  extraneous  factors   but   regulates industrial  relations  between employers and  employers  and

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workmen and workmen and workmen.  From the point of view  of the workmen there is no charity.  For him charity must begin at home.  From these strands of thought flows the conclusion that the ’second group may legitimately and legally be  des- cribed as industry.  The fallacy in the contrary  contention lies  in  shifting  the  focus  from  the  worker  and   the industrial  activity  to the disposal of  the  end  product. This  law has nothing to do with that.  The  income-tax  may have, social opinion may have. Some  of the appellants may fall under the  second  category just  described.   While we are not investigating  into  the merits  of  those  appeals, we may as well  indicate,  in  a general way, that the Gandhi 268 Ashram, which employs workers like spinners and weavers  and supplies cloth or other handicraft at concessional rates  to needy rural consumers, may not qualify for exemption.   Even ’so  particular  incidents  may have to  be  closely  probed before  pronouncing  with precision upon the nature  of  the activity.   If cotton or yarn is given free to  workers,  if charkhas are made available free for families, if fair price is  paid  for the net product and substantial  charity  thus benefits the similar undertakings and commercial  adventures do.   To  qualify  for closely into  the  character  of  the enterprise.   If employees are hired and their services  are rewarded  by  wages-whether on cottage industry  or  factory basis-the  enterprises become industries, even if some  kind of  concession is shown and even if the motive  and  project may  be  to encourage and help Door families and  find  them employment.   A compassionate industrialist is  nevertheless an  industrialist.   However,  if  ,raw  material  is   made available  free and the finished product is fully paid  for- rather exceptional to imagine-the conclusion may be hesitant but  for  the  fact  that  the  integrated   administrative, purchase, marketing advertising and other functions are like in  trade and business.  This makes them industries.   Noble objectives,  pious  purposes,  spiritual  foundation,%   and developmental projects are no reason not to implicate  these institutions as industries. We now move on to economic activities and occupations of  an altruistic character falling under the third category. The  heart  of trade or business or  analogous  activity  is organisation  with  an  eye on  competitive  efficiency,  by hiring  employees, systematisiig processes, producing  goods and  services needed by the community and obtaining  money’s worth  of  work from employees.  If such be  the  nature  of operations  and  employer-employee relations which  make  an enterprise  an industry, the motivation of the  employer  in the  final  disposal of products or profits  is  immaterial. Indeed  the  activity is patterned on  a  commercial  basis, judged  by  what other similar undertakings  and  commercial adventures do.  To qualify for exemption from the definition of  ’industry’  in  a case where  there  are  employers  and employees and systematic activities and production of  goods and  services,  we  need a  totally  different  orientation, organisation  and method which will stamp on the  enterprise the  imprint , of commerciality.  Special emphasis, in  such cases,  must  be  placed on the central  fact  of  employer- employee  relations.   If a philanthropic  devotion  is  the basis  for the charitable foundation or  establishment,  the institution  is beaded by one who  wholeheartedly  dedicates himself  for  the  mission  and  pursues  it  with  passion, attracts Others into the institution,. not for wages but for sharing   in  the  cause  and  its  fulfillment,  then   the undertaking  is not ’industrial’.. Not that the presence  of

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charitable  impulse.  extricates the  institution  from  the definition  in  Sec.  2(j) but that  there  is  no  economic relationship  such as is found in trade or business  between the  head who employs and the others who emotively flock  to render  service.  In one sense, there are no  employers  and employees but crusaders all.  In another sense, there is  no wage basis for the employment but voluntary par-  269 ticipation  in the production, inspired by lofty ideals  and unmindful  of remuneration, service conditions and the  Eke. Supposing there I Ashram or Order with a guru or other head. Let  us  further  is  an assume that  there  is  a  band  of disciples, devotees or priestly subordinates in the-  Order, gathered  together for prayers, ascetic practices,  bhajans, meditation and worship.  Supposing, further, that  outsiders are  also  invited daily or occasionally, to  share  in  the spiritual  proceedings.   And, let us assume  that  all  the inmates  of the Ashram and members of the  Order,  invitees, guests, and other outside participants are fed, accommodated and  looked  after by the institution.  In such a  case,  as often happens, the cooking and the cleaning, the  bed-making and.  service’ may often be done, at least substantially  by the  Ashramites  themselves.  They may  chant  in  spiritual ecstasy  even  as material goods and services are  made  and served.  They may affectionately look after the guests, and, all  this they may do, not for wages but for the  chance  to propitiate the Master, work selflessly and acquire spiritual grace.  It may well be that they may have surrendered  their lucrative employment to come into the holy institution.   It may also be that they take some small pocket money from  the donations  or takings of the institution.  Nay  more,  there may be a few scavengers and servants, a part-time auditor or accountant employed on wages.  If the substantial number  of participants in making- available goods and services, if the substantive  nature  of  the  work,  as  distinguished  from trivial items, is rendered by voluntary wageless sishyas, it is  impossible to designate the institution as an  industry, notwithstanding a marginal few who are employed on a regular basis  for  hire.   The  reason  is  that  in  the  crucial, substantial  and substantive aspects of  institutional  life the nature of the relations between the participants is non- industrial.    Perhaps,   when  Mahatma  Gandhi   lived   in Sabarmati,   Aurobindo   had   his   hallowed   silence   in Pondicherry,  the inmates belonged to this chastened  brand. Even  now, in many foundations, centres,  monasteries,  holy orders  and Ashrams in the East and in the  west,  spiritual fascination pulls men and women into the precincts and  they work tirelessly for the Maharishi or Yogi or Swamiji and are not wage earners in any sense of the term.  Such people  are not workmen and such institutions are not industries despite some menials and some professionals in a vast complex  being hired.   We  must look at the predominant character  of  the institution and the nature of the relations resulting in the production  of  goods  and  services.   Stray   wage-earning employees  do not shape the soul of an institution  into  an industry, It  now remains to make a brief survey of the precedents  on the point.  One case which is germane to the issue is Bombay Pinjrapole(1).  A Bench of this Court considered the earlier case-law, including the decisions of the High Courts bearing on  humane activities for the benefit of sick animals.   Let there  be  no  doubt that kindness  to  out  dumb  brethren, especially  invalids,  springs from the highest  motives  of fellow feeling.  In the land of the Buddha and Gandhi no one dare argue to the contrary.  So let there be no mistaking

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(1)  [1972] 1 S.C.R. 202 270 our  compassionate attitude to suffering creatures.   It  is laudable   and  situations  dedicated  to  amelioration   of conditions  of animals deserve encouragement from the  State and affluent philanthropists.  But these considerations have no   bearing  on  the  crucial  factors  which  invoke   the application of the definition in the Act as already set  out elaborately  by  us.  "The manner in which the  activity  in question  is  organised or arranged, the  condition  of  the cooperation between the employer and the employee  necessary for its success and its object to reader material service to the community" is a pivotal factor in the  activity-oriented test  of  an ’industry’.  The compassionate motive  and  "he charitable  inspiration are noble but extraneous.   Indeed’, medical  relief  for  human beings made  available  free  by regular  hospitals,  run by government  or  philanthropists, employing  doctors  and supportive staff  and  business-like terms, may not qualify for exemption from industry.  Service to  animals  cannot be on a higher footing than  service  to humans.  Nor is it possible to contend that love of  animals is religious or spiritual any more than love of human-beings is. A pinjrapole is no church, mosque or temple.  Therefore, without   going  into  the  dairying  aspects,  income   and expenditure and other features of Bombay Pinjrapole, one may hold  that the institution is an industry.  After  all,  the employees  are engaged, on ordinary economic terms and  with conditions of service as in other business institutions  and the  activities  also have organisational  comparability  to other   profit-making  dairies  or  Pinjrapoles.   What   is different is the charitable object.  What is. common is  the nature of the employer employees relations.  The conclusion, notwithstanding  the  humanitarian overtones, is  that  such organisations  are  also industries.  Of course,  in  Bombay Pinjrapole the same conclusion was reached but on  different and,  to some extent faulty reasoning.  For, the  assumption in  the  judgment of Mitter J., is that if the  income  were mostly  from  donations and the treatment  of  animals  were free,  perhaps such charity, be it a hospital for humans  or animals, may not be an industry.  We agree with the holding, not because Pinjrapoles have commercial motives but because, despite  compassionate objectives, they share  business-like orientation  and  operation.   In this  view,  section  2(j) applies. We may proceed to consider the applicability of Sec. 2(j) to institutions  whose  objectives  and  activities  cover  the research field in a significant way.  This has been the bone of  contention in a few cases in the past and in one of  the appeals argued at considerable length and with  considerable force by Shri Tarkunde who has presented a panoramic view of the entire subject in his detailed submissions.  An  earlier decision  of  this Court, The Ahmedabad  Textile  Industries Research  Association(1)case  has taken the view  that  even research institutes are roped in by the definition but later judicial thinking at the High Court and Supreme Court levels has  leaned more in favour of exemption where  profit-motive has been absent.  The Kurji Holy Family Hospital(2) was held not to be an industry because it was a (1)  [1961] 2 S.C.R. 480. (2)  [1971] 1 S.C.R. 177.  271 non-profit-making  body  and its work was in the  nature  of training, research and treatment.  Likewise in  Dhanrajgirji Hospital  v. Workmen(1) a bench of this Court held that  the charitable  trust which ran a hospital and  served  research

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purposes  and training of nurses was not an  industry.   The High  Courts  of  Madras  and Kerala  have  also  held  that research  institutes  such  as the  Pasteur  Institute,  the C.S.I.R. and the Central Plantation Crops Research Institute are  not  industries.   The basic decision  which  has  gone against  the Ahmedabad Textile case is the Safdarjung  case. ’We  may briefly examine the rival view-points, although  in substance we have already stated the correct principle.  The view  that commends itself to us is plainly in  reversal  of the  ratio of Safdarjung which has been wrongly decided,  if we may say so with great respect.                           Research Does  research  involve collaboration between  employer  and employee  ? It does.  The employer is the  institution,  the employees  are  the scientists,  para-scientists  and  other personnel.  Is scientific research service ?  Undoubtedly it is.   Its  discoveries  are valuable  contributions  to  the wealth  of the nation.  Such discoveries may be sold  for  a heavy price in the industrial or other markets.   Technology has  to  be  plate  for  and  technological  inventions  and innovations may be patented and sold.  In our scientific and technological age nothing has more cash value, as intangible goods  and  invaluable  services,  than  discoveries.    For instance,  the  discoveries of Thomas Alva Edison  made  him fabulously  rich.  It has been said that his brain  had  the highest cash value in history for he made the world  vibrate with  the miraculous discovery of recorded,  sound.   Unlike most inventors, he did not have to wait to get his reward in heaven;  he received, it munificently on this gratified  and grateful earth, thanks to conversion of his inventions into, money a plenty.  Research benefits industry.  Even though  a research  institute  may be a separate  entity  disconnected from the many industries which funded the institute  itself, it  can  be  regarded  as  an  Organisation,  propelled   by systematic   activity,  modeled  on   co-operation   between employer and employee and calculated to throw up discoveries and inventions and useful solutions which benefit individual industries and the nation in terms of goods and services and wealth.   It  follows that research institutes,  albeit  run without profit-motive, are industries. True  Shri  Tarkunde  is  right  if  Safdarjung  is  rightly decided.   The concluding portions of that decision  proceed on   the  tooting  that  research  and  training   have   an exclusionary  effect.   That reasoning, as we  have  already expounded, hardly has our approval. Clubs  : Are clubs industries ? The wide words used in  Sec. 2(f)  if  applied without rational  limitations,  may  cover every   bilateral   activity  even   spiritual,   religious, domestic, conjugal, pleasurable or political.     But functional  circumscriptions spring from the  subject-matter and  other cognate. considerations already set out early  in this judgment.      Industrial  law, any law,  may  insanely run amok if limitless (1) A.I.R.     1975 S.C. 2232. 272 lexical liberality were to inflate expressions into bursting point  or  proliferate odd judicial arrows which  at  random sent,  hits many an irrelevant mark the  legislative  archer never meant.  To read down words to yield relevant sense  is a  pragmatic  art,  if care is taken  to  eschew  subjective projections masked as judicial processes.  The true test  as we  apprehend  from  the  economic  history  and  functional philosophy  of  the  Act  is  based  on  the  pathology   of industrial   friction  and  explosion   impeding   community production and consumption and imperiling peace and welfare.

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This social pathology arises from the exploitative potential latent in organized employer-employee relations.  So,  where the  dichotomy  of employer and workmen in  the  process  of material  production  is present, the  service  of  economic friction and need for conflict resolution show up.  The  Act is meant to obviate such conformation and ’industry’  cannot functionally  and  defunctionally exceed this  object.   The question is whether in a club situation-or of a co-operative or  even  a monastery situation, for that matter  a  dispute potential of the nature suggested exists.  If it does, it is an  industry,  since the basic elements  are  satisfied.  If productive  cooperation  between employer  and  employee  is necessary,  conflict between them is on the cards, be  it  a social  club,  mutual benefit society,  pinjarapole,  public service or professional office.  Tested on this  touchstone, most  clubs will fail to qualify for exemption.   For  clubs gentlemen  clubs proprietary clubs service clubs  investment clubs,  sports  clubs,  art clubs military  clubs  or  other brands  of recreational associations- when x-rayed from  the industrial angle project a picture on the screen typical  of employers hirings employees for wages for rendering services and/or  supplying goods on a systematic basis  at  specified hours.    There  is  a  co-operation  the  club   management providing the  capital,    the raw materialthe  appliances and auxiliaries       and      the cooks,    waiters,   bell boys, pickers bar maids or other servants making available enjoyable eats, pleasures and other permissible services for price paid by way of subscriptions  or bills charged.  The  club life’ the warm company, the enrichment of the spirits  and freshening of the mind are there But theseblessings    do not  contradict  the co-existence of an  ’industry’  in  the technical sense.  Even tea-tasters, hired for high wages, or commercial   art   troupes  or   games   teams   remunerated fantastically, enjoy company, taste, travel and games;  but, elementally,  they  are  workmen with  employers  above  and together  constitute  not merely  entertainment  groups  but industries under the Act.  The protean  hues of        human organization   project   delightfully   different    designs depending upon the  legal      prism and the  filtering process used. No one can value  of  club life;  neither  can anyone blink at the legal result of the organization. The  only  ground  to  extricate clubs  from  the  coils  of industrial  law  (except specific  statutory  provision)  is absence  of employer employee co-operation on the-  familiar luring-firing  pattern.   Before we  explain  this  possible exemption and it applies to many clubs at the poorer  levels of society we must meet another submission made by  counsel. Clubs  are exclusive; they cater to needs and  pleasures  of members,  not  of  the community as  such  and  this  latter feature  salvages  them  from  the  clutches  of  industrial regulation.  We do not agree,  273 Clubs are open to the public for membership subject to their own  bye-laws  and rules.  But any member of  the  community complying with those conditions and waiting for his turn has reasonable  chance of membership.  Even the  world’s  summit club-the  United  Nations has cosmic membership  subject  to vetoes,  qualifications, voting and what not.  What we  mean is that a club is not a limited partnership but formed  from the  community.  Moreover, even the most exclusive clubs  of imperial  vintage and class snobbery admit  members’  guests who are not specific souls but come  from the  unrefused community or part of     a community. Clubs       speaking generally are social institutions enlivening community  life and are the fresh breath of relaxation in a fadedsociety.

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They serve a section and answer the doubtful test of serving the community.  They are industry. We  have  adverted  to  a possible  category  of  clubs  and associations  which may swim out of the  industrial  pool-we mean   self   serving   clubs,  societies   or   groups   or associations.  Less fashionable but more numerous in a poor, populous,  culturally hungry country with  democratic  urges and youthful vigour is this species.  Lest there should be a rush  by the clubs we have considered and dismissed  to  get into  this proletarian brood if we may so describe  them  to identify, not at all to be pejorative,-we must elucidate. It  is  a  common phenomenon in parts of  our  country  that workers,  harijans, student youth at the lower rung  of  the socioeconomic  ladder  weaker sections like women  and  low- income,  groups  quench  their cultural  thirst  by  forming gregarious organisations mainly for recreation.  A few books and  magazines, a manuscript house magazine  contributed  by and circulated among members, a football or volley ball game in the evenings-not golf, billiards or other expensive games a  music  or drama group, an annual day, a  competition  and pretty  little  prizes  and family  get  together  and  even organising  occasional meetings inviting V.I.Ps.-these  tiny yet    luscent   cultural   balls   dot   our    proletarian cheerlessness.   And these hopeful organisms,  if  fostered, give a mass spread for our national awakening for those  for whom no developmental bells yet toll Even  these people’s organs cannot be non-industries  unless one  strict  condition  is fulfilled.   They  should  be-and usually are-self-serving.  They are poor men’s clubs without the wherewithal of a Gyankhana or C.C.I. which reacted  this court  for adjudication.  Indeed, they rarely reach a  court being  easily priced out of our expensive  judicial  market. These self-service clubs do not have hired employees to cook or serve, to pick or chase balls, to tie up nets or  arrange the  cards table, the billiards table, the bar and the  bath or  do  those elaborate business management  chores  of  the well-run  city  or  country clubs.   The  members  come  and arrange  things for themselves.  The secretary,  an  elected member,  keeps  the  key.  Those  interested  in  particular pursuits  organise those terms themselves.  Even  the  small accounts  or clerical items are maintained by one member  or other.  On special evenings all contribute efforts to make a good 19-211 SCI/78 274 show, excursion, joy picnic or anniversary celebration.  The dynamic  aspect is self-service.  In such an institution,  a part-time  sweeper or scavenger or  multi-purpose  attendant may  sometimes exit.  He may be an employee.  This  marginal element  does  not transform a little  association  into  an industry.  We have projected an imprecise profile and  there may  be  minor variations.  The central thrust of  our  pro- position is that if a club or other like collectivity has  a basic  and  dominant self-service mechanism,  a  modicum  of employees  at the periphery will not metamorphose it into  a conventional  club whose verve and virtue are taken care  of by paid staff, and the members’ role is to enjoy.  The small man’s  Nehru Club (Gandhi Granthasala, Anna  Manram,  Netaji Youth  Centre,  Brother Music Club, Muslim Sports  Club  and like  organs often named after natural or provincial  heroes and  manned  by members themselves as contrasted  with  +,he upper  bracket’s Gyamkhana Club, Cosmopolitan Club,  Cricket Club  of, India, ’National Sports Club of India whose  badge is  pleasure paid for and provided through skilled or  semi- skilled  catering  staff.  We do not deal with  hundred  per

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cent  social service clubs which meet once in a way, hire  a whole  evening  in  some hotel, have no  regular  staff  and devote  their energies and resources also to social  service projects.   There ire many brands and we need not deal  with every  one.   Only  if  they  answer  the  test  laid   down affirmatively they qualify. The  leading cases on the point are Gyamkhana and C.C.I.  We must deal with them before we conclude on this topic. The Madras Gymkhana Club, a blue-blooded, members’ club  has the  socialite  cream of the city on its rolls.   It  offers choice  facilities for golf, tennis and billiards,  arranges dances,    dinners   and   refreshments,   entertains    and accommodates guests and conducts tournaments for members and nonmembers.   These are all activities richly  charged  with pleasurable  service.  For fulfilment of these  objects  the club  employs officers, caterers, and others  on  reasonable salaries.   Does  this club become an industry ?  The  label matters  little; the substance is the thing.  A  night  club for priced nocturnal sex is a lascivious ’industry’.  But  a literary  club,  meeting weekly to read or  discuss  poetry, hiring  a venue and running solely by the self-help  of  the participants, is not.  Hidayatullah C.J., in Gymkhana  ruled that the club was not an ’industry’.  Reason ? ’An  industry is  thus  said to involve cooperation between  employer  and employees for the object of satisfying material human  needs but  not for oneself nor for pleasure nor  necessarily-  for profit.’               "It  is not of any consequence that there  is.               no  profit motive because that  is  considered               immaterial.  It is also true that the  affairs               of the club are organised in the way  business               is orgainsed, and that there is production  of               material  and other services and in a  limited               way production of material goods mainly in the               catering department.  But these  circumstances               are  not truly representative in the  case  of               the  club  because  the services  are  to  the               members themselves for their own pleasure  and               amusement and the               275               material goods are for their consumption.   In               other words, the club exists for its  members.               No  doubt occasionally strangers also  benefit               from its services, but they can only do so  on               invitation  of  members.  No one  outside  the               list  of  members has the advantage  of  these               services   as  of  right.   Nor   can   these,               privileges  be  bought.   In  fact  they   are               available only to members or through members.               If  today  the  club were  to  stop  entry  of               outsiders,   no   essential  change   in   its               character  vis-a-vis  the members  would  take               place.  In other words, the circumstances that               guests are admitted is irrelevant to determine               if  the  club is an industry.  Even  with  the               admission  of  guests  being  open  the   club               remains  the same, that is to say, a  member’s               self-serving   institution.   No   doubt   the               material  needs or wants of a section  of  the               community  is  catered  for but  that  is  not               enough.  This must be done as part of trade or               business or as undertaking analogous to  trade               or  business.   This  element  is   completely               missing in a members’ club’ Why  is the, club not an industry ? It involves  cooperation

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of  employer  and employees, organised like in a  trade  and calculated  to, supply pleasurable utilities to members  and others.   The learned Judge agrees that ’the material  needs or  wants of. a section of the community is catered for  but that  is not enough.  This must be done as part of trade  or business  or  as  an  undertaking  analogous  to  trade   or business.  This element is completely missing in a  members’ club. ’This  element’?  What element makes it analogous to  trade? Profit motive ? No, says the learned judge.  Because it is a self serving institution ? Yes ? Not at all.  For, if it  is self-service then why the expensive establishment and  staff with  high salary bills ? It is plain as day-light that  the club  members do nothing to produce the goods  or  services. They  are  rendered by  employees who work for  wages.   The members merely enjoy club life, the geniality of company and exhilarating  camaraderie, to the accompaniment of  dinners, dance, games and thrills.  The ’reason’ one may discover  is that  it  is  a members’ club in the sense  that  ’the  club belongs  to  members  for the time being  on  its,  list  of members  and that is what matters.  Those members  can  deal with  the  club  as  they  like.   Therefore,  the  club  is identified with its members at a given point of time.  Thus, it cannot be said that the club has an existence apart  from the members’. We are intrigued by this reason.  The ingredients  necessary for  an industry are present here and yet it is  declared  a non-industry   because the club belongs to members only.   A company  belongs  to the shareholders only;  a  co-operative belongs to the share members only; a firm of experts belongs to the partners only.  And yet, if they employ workmen  with whose co-oppration goods and services are made available  to a section of the community and the operations are  organised in  the manner typical of business method and  Organisation, the  conclusion is irresistible that an ’industry’  emerges. Likewise, the 276 members of a club may own the institution and become the em- ployers  for  that reason.  It is  transcendental  logic  to jettison the inference, of an ’industry’ from such a factual situation  on  the ingenious plea that a  club  ’belongs  to members  for the time being and that is what  matters’.   We are  inclined to think that that just does not  matter.  The Gymkhana case, we respectfully hold, is wrongly decided. The Cricket Club of India(1) stands in a worse position.  It is a huge undertaking with activities wide-ranging, with big budgets, army of staff and profit-making adventures. Indeed, the,members’  share  in  the gains of these  adventures  by getting money’sworth by cheaper accommodation, free  or low priced tickets forentertainment   and    concessional refreshments; and yet Bhargava J,speaking  for  the  Court held this mammoth industry a non-Industry.Why’   is   the promotion  of sports and games by itself a legal reason  for excluding  the organisation from the category of  industries if  all the necessary ingredients are present?  Is the  fact that  the residential facility is exclusive for  members  an exemptive  factor?  Do not the members share in the  profits through  the invisible process of lower charges ?  When  all these services are rendered by hired employees, how can  the nature of the activity be described as self-service, without taking  liberty with reality ? A number of  utilities  which have  money’s  worth,  are  derived  by  the  members.    An indefinite  section of the community entering as the  guests of the members also share in these services.  The  testimony of the activities can leave none in doubt that this colossal

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’club’  is  a vibrant collective  undertaking  which  offers goods and services to a section of the community for payment and there is co-operation between employer and employees  in this project.  The plea of non-industry is unpresentable and exclusion  is  possible only by straining  law  to  snapping point   to   salvage   a   certain   class   of    socialite establishments.   Presbyter is only priest writ large.  club is industry manu brevi. Co-operatives. Co-operative  societies  ordinarily cannot,  we  feel,  fall outside  Sec. 2 (j) After all, the society, a legal  person, is  the employer.  The members and/or others  are  employees and  the activity partakes of the nature of  trade.   Merely because Co-operative enterprises deserve State encouragement the definition cannot be distorted.  Even if the society  is worked by the members only, the entity (save where they  are few  and  self-serving) is an industry because  the  member- workers are paid wages and there can be disputes about rates and  different  scales of wages among  the  categories  i.e. workers and workers or between workers and employer.   These societies   edit  societies,  marketing   Co-operatives,   , producers’  or  consumers’ societies or  apex  societies-are industries. Do  credit unions, organised on a cooperative  basis,  scale the definitional walls of industry ? They do.  The  judgment of  the  Australian High Court in The Queen v.  Marshall  Ex Parte Federated Clerks Union (1)  [1969] 1 S.C.R. 600. 277 of  Australia(1)  helps  reach this  conclusion.   There,  a credit  union,  which was a co-operative  association  which pooled  the  savings of small people and made loans  to  its members  at low interest, was considered from the  point  of view  of  industry.   Admittedly, they  were  credit  unions incorporated  as co-operative societies and the thinking  of Mason  J.,  was that such institutions  were  industrial  in character.  The industrial mechanism of society according to Starke J, included "all those bodies ’of men associated,  in various degrees of competition and cooperation, to win their living by providing the community with some service which it requires’ Mason J., went a step further to hold that even if such  credit unions were an adjunct of industry, they  could be regarded as industry. It  is  enough, therefore, if the activities carried  on  by credit  unions can accurately be described as incidental  to industry  or to the organized production, transportation  or distribution  of  commodities  or other  forms  of  material wealth.   To our minds the evidence admits of no doubt  that the  activities  of  credit unions are  incidental  in  this sense. This  was sufficient, in his view, to conclude  that  credit unions  constituted  an  industry under  an  Act  which  has resemblance  to our own.  In our view, therefore,  societies are industries. The Safdarjung Hospital Case. A  sharp bend in the course of the Law came when  Safdarjung was decided.  The present reference has come from that  land mark  case and, necessarily, it claims our close  attention’ Even  so, no lengthy discussion is called for,  because  the connotation  of ’industry’ has already been given by  us  at sufficient  length  to  demarcate  out  deviation  from  the decision in Safdarjung. Hidayatullah  C.  J., considered the facts  of  the  appeals clubbed   together  there  and  held  that  all  the   three institutions  in the bunch of appeals were  not  industries.

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Abbreviated reasons were given for the holding in regard  to each   institution,  which  we  may  extract   for   precise understanding :               "It is obvious that Safdarjung Hospital is not               embarked on an economic activity which can  be               said  to  be analogous to trade  or  business.               There  is no evidence that it is more  than  a               place where persons can get treated.  This  is               a part of the functions of Government and  the               Hospital is run as a Department of Government.               It  cannot,  therefore,  be  said  to  be   an               industry.               The   Tuberculosis   Hospital   is   not    an               independent institution.  It is a part of  the               Tuberculosis   Association  of   India.    The               hospital   is  wholly  charitable  and  is   a               research  institute. The dominant  purpose  of               the Hospital is research and training, but  as               research and training cannot be given  without               beds  in  a hospital, the  hospital  is,  run.               Treatment  is  thus  a part  of  research  and                             training.     In   these   circumstances    th e               Tuberculosis  Hospital cannot be described  as               industry. (1)  [1975] 132 C.L.R. 595. 278               The objects of the Kurji Holy Family  Hospital               are  entirely charitable.  It carries on  work               of  training  research  and  treatment.    Its               income   is   mostly   from   donations    and               distribution   of   surplus  as   profit.   is               prohibited.   It is, therefore, clear that  it               is not an industry as laid down in the Act." Even a cursory glance makes it plain that the learned  Judge took      the  view that a place of treatment  of  patients, run as a department of   government,  was  not  an  industry because it was a part of the functions of the government. We cannot  possibly agree that running a hospital, which  is  a welfare activity and not a sovereign function, cannot be  an industry.  Likewise, dealing with the Tuberculosis  Hospital case,  the learned Judge held that the hospital  was  wholly charitable and also      was    a    research     institute. Primarily, it was an institution for research and  training. therefore, the Court concluded, the institution could not be described  as  industry. Non sequitur.’  Hospital  facility, research products and training services are surely  services and hence industry    It  is  difficult  to  agree  that   a hospital  is  not an industry. In the third  case  the  same factors plus the prohibition of profit are relied on by  the Court. We find it difficult to hold that absence of, profit, ,or   functions.   of  training  and  research,   take   the institution out of the scope of industry.      Although  the facts of the three appeals considered  in Safdarjung  related  only  to hospitals  with  research  and training component, the bench went extensively into a survey of the earlier precedents and crystallisation  of   criteria for designating industries. After stating that    trade  and business have a wide connotation, Hidayatullah, C. J.,  took the view that professions must be excluded from the ambit of industry; "A   profession   ordinarily  is   an   occupation requiring  intellectual  skill, often  coupled  with  manual skill. Thus a teacher uses purely intellectual skill,  while a painter uses both. In any event,   they ate not engaged in an occupation  inwhich  employers  and          employees

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cooperate in the production orsale  of  commodities  or arrangement for their production   or  sale or  distribution and their services cannot be described as material service". We are unable to agree with this rationale.  It is difficult to  understand  why a school or a painting  institute  or  a studio which uses the services of employees and renders  the service to the community cannot be regarded as an  industry. What  is more baffling is the subsequent string  of  reasons presented by the learned Judge :               "What  is meant by ’material  services’  needs               some  explanation too.  Material services  are               not  services which depend wholly  or  largely               upon  the contribution of  professional  know-               ledge kill or dexterity for the production  of               a   result.    Such   services   being   given               individually  and by individuals are  services               no  doubt but not material services.  Even  an               establishment  where many such operate  cannot               be   said   to  convert   their   professional               services-into  material  services.    Material               services   involve  an  activity  carried   on               through co-operation       279               between employers and employers and  employers               to provide the community with the use    of               something such as electricpower,   water,               transportation  maildelivery telephones   and               the like. In providing the services there  may               be employment   of   trained  men   and   even               professional  men but the emphasis is  not  on               what these men do but upon the productivity of               a   service  organised  as  an  industry   and               commercially  valuable.  Thus the services  of               professional men involving benefit to  indivi-               duals  according  to  their  needs,  such   as               doctors,  teachers, lawyers,  solicitors  etc.               are  easily distinguishable from  an  activity               such as transport service.   The latter is  of               a  commercial character in which something  is               brought  into existence quite apart  from  the               benefit to particular individuals.  It is  the               production   of   this  something   which   is               described   as  the  production  of   material               services.’ With the greatest respect to the learned Chief Justice,  the arguments strung together in this paragraph are too numerous and subtle for us to imbibe.  It is transcendental to define material  services as excluding professional  services.   We have  explained  this position at some length  elsewhere  in this judgment and do ’not feel the need to repeat.  Nor  are we  convinced  that Gymkhana and Cricket Club of  India  are correctly  decided.  The learned Judge placed accent on  the non-profit making members club as being outside the pale  of trade or industry.  We demur to this proposition. Another  intriguing  reasoning in the judgment is  that  the Court  has stated "it is not necessary that there must be  a profit motive but the enterprises must be analogous to trade or  business  in  a commercial  sense".   However,  somewhat contrary  to this reasoning we find, in the concluding  part of the judgment, emphasis on the non-profit making aspect of the  institutions.   Equally puzzling is  the  reference  to "commercial sense" what precisely doer, this expression mean ?  It is interesting to note that the word "commercial"  has more  than one semantic shade.  If it  means  profit-making, the  reasoning is self,contradictory.  If it merely means  a

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commercial  pattern  of organisation, of hiring  and  firing employees,  of indicating the nature  of  employer-employee, relation as in trade or commercial house, then the  activity oriented approach is the correct one.  On that footing,  the conclusions reached in that case do not follow.  As a matter of fact, Hidayatullah, C.J.,  bad  in Gymkhana turned  down, the  test  of commerciality : "Trade is only one  aspect  of industrial  activity..........  ......  This  requires   co- operation in some form between employers and workmen and the result  is directly the product of this association but  not necessarily  commercial".   Indeed, while dealing  with  the reasoning  in  Hospital Mazdoor Sabha he observes  :  "If  a hospital, nursing home or a dispensary is ran as a business, in  a  commercial  way, there may be found  elements  of  an industry there".  This facet suggests either profit  motive, which  ’has, been expressly negatived in the very  case,  or commercial-type  of  activity, regardless of  profit,  which affirms the test which we have accepted, namely, that  there must  be  employer--employee relations more or less  on  the pattern of 280 trade  or business.  All that we can say is that  there  are different.  strands of reasoning in the judgment  which  are somewhat  difficult  to, reconcile.  Of  course,  when  the, learned  judge states that the use of the first schedule  to the Act depends on the condition precedent of the  existence of an industry, we agree.. But, that by itself does not mean that a hospital cannot be regarded as an industry, profit-or no profit, research or no research.  We have adduced  enough reasons  in the various portions of this judgment to  regard hospitals,  research  institutions and training  centres  as valuable material services to the community, qualifying  for coming within sec. 2(j).  We must plainly state that  vis-a- vis  hospitals,  Safdarjung was wrong and  Hospital  Mazdoor Sabha was right. Because  of  the problems of  reconciliation  of  apparently contradictory  stands  of reasoning in Safdarjung  we  find, subsequent  cases of’ this Court striking  different  notes. In  fact,  one  of us (Bhagwati  J.),  in  Indian  Standards Institution  (1)  referred,  even at  the  opening,  to  the baffling,  perplexing question which, judicial ventures  had not solved. We fully  endorse the observations of the  Court in I.S.I. :               "So infinitely varied and many-sided is  human               activity  and with the incredible  growth  and               progress in all branches of knowledge and ever               widening areas of experience at all levels, it               is  becoming so diversified and  expanding  in               so.  many  directions hitherto  unthought  of,               that no rigid and doctrinaire approach can  be               adopted in considering this question.  Such an               approach would fail to measure up to the needs               of   the  growing  welfare  state   which   is               constantly  engaged  in  undertaking  new  and               varied  activities  as  part  of  its   social               welfare  policy.   The  concept  of  industry,               which  is  intended  to be  a  convenient  and               effective  tool  in the  hands  of  industrial               adjudication  for  bringing  about  industrial               peace and harmony, would lose its capacity for               adjustment and change.  It would be  petrified               and robbed of its dynamic content.  The  Court               should,  therefore, so far as  possible  avoid               formulating  or adopting  generalisations  and               hesitate to cast the concept of industry in  a

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             narrow  rigid mould which would not permit  of               expansion as and when necessity arises.   Only               some  working principles may be evolved  which               would furnish guidance in determining what are               the attributes or characteristics which  would               ordinarily  indicate  that an  undertaking  is               analogous to trade or business". Our  endeavour in this decision is to provide  such  working principles.  This Court, within a few years of the enactment of  the  salutary  statute, explained the  benign  sweep  of ’industry’ in Banerji which served’ as beacon in later years Ahmedabad  Textile  Research acted on it,  Hospital  Mazdoor Sabha and Nagpur Corporation marched in its sheen.  The  law shed  steady  light on industrial  inter-relations  and  the country’s.  tribunals  and courts settled down to  evolve  a progressive  labour jurisprudence, burying the bad  memories of laissez faire and bitter struggles. (1)  [1976] 2 S.C.R. 138.  281 in  this  field  and  nourishing  new  sprouts  of  legality fertilised  by  the seminal ratio in Banerji  Indeed,  every great judgment is not merely an adjudication of an  existing lis  but an appeal addressed by the present to the  emerging future.  And here the future responded, harmonising with the human  escape hopefully projected by Part IV of the  Consti- tution.   But the drama of a nation’s life, especially  when it   confronts  die-hard  forces,  develops  situations   of imbroglio  and tendencies to back-track.  And  Law  quibbles where  Life wobbles.  Judges only read signs  and  translate symbols in the national sky.  So ensued An era of islands of exception dredged up by judicial process.  Great clubs  were privileged  out, liberal professions swam to safety,  educa- tional institutions, vast and small, were helped out, divers charities, ,disinclined to be charitable to their own weaker workmen,  made pious pleas and philanthropic appeals  to  be extricated.   A  procession of decisions  Solicitors’  case, University  of Delhi, Gymkhana Club, Cricket ’Club of  India (supra)  Chartered  Accountants(1) climaxed  by  Safdarjung, carved  out sanctuaries.  The six-member  bench-the  largest which   sat  on  this  court  conceptually  to   reconstruct ’industry’,  affirmed  and  reversed,  held  profit   motive irrelevant but upheld charitable service ,as exemptive,  and in   its  lights  and  shadows,  judicial  thinking   became ambivalent  and industrial jurisprudence landed itself in  a legal quagmire.  Pinjrapoles sought salvation and  succeeded in  principle  (.Bombay Panjrapole), Chambers  of,  Commerce fought   and   failed,   hospitals   battled   to    victory (Dhanrajgirji Hospital), standards institute made a vain bid to  extricate  (I.S.I. Case), research institutes,.  at  the High  Court  level,  waged and won  non-industry  status  in Madras and Kerala.  The murky legal sky paralysed  tribunals and courts and administration and then came, in consequence, this reference to a larger bench of seven judges. Banerji, ’amplified by Corporation of Nagpur, in effect  met with  its Waterloo in Safdarjung.  But in this  latter  case two  voices could be heard and subsequent  rulings  zigzaged and   conflicted   precisely  because   of   this   built-in ambivalence.  It behaves us, therefore, hopefully to abolish blurred  edges, illumine penumbral areas and over-rule  what we regard as wrong.  Hesitancy, half-tones and hunting  with the hounds and running with the hare can claim heavy penalty in the shape of industrial confusion, adjudicatory  quandary and  administrative perplexity at a time when the nation  is striving  to promote employment through  diverse  strategies which  need  for their smooth fulfillment, less  stress  and

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distress,  more  mutual understanding and trust based  on  a dynamic  rule  of  law  which  speaks  clearly,  firmly  and humanely.  If the salt of law lose its savour of progressive certainty  wherewith shall it be salted ? So we  proceed  to formulate  the  principles, deducible from  our  discussion, which  are  decisive,  positively  and  negatively,  of  the identity  of  ’industry’  under  the  Act.   We  speak,  not exhaustively but to the extent covered by the debate at  the bar  and, to that extent, authoritatively, until  over-ruled by a larger bench or superseded by the legislative branch. (1)  [1963] 1 L.L.J. 567 (culcutta). 282 1.   ’Industry’,  as defined in Sec, 2 (j) and explained  hi Banerji, has a wide import. (a)  Where  (i) systematic activity, (ii) organized  by  co- operation  between  employer and employee, (the  direct  and substantial element is chimerical) (iii) for the  production and/or  distribution  of goods and  services  calculated  to satisfy  human wants and wishes (not spiritual or  religious but  inclusive  of material things or  services  geared  to, celestial  bliss  e.g. making, on a large scale,  prasad  or food),   prima  facie,  there  is  an  ’industry’  in   that enterprise. (b)  Absence  of  profit  motive  or  gainful  objective  is irrelevant,  be the venture in the public, joint private  or other sector. (c)  The  true focus is functional and the decisive test  is the  nature  of the activity with special  emphasis  on  the employer-employee relations. (d)  If the Organisation is a trade or business, it does not cease  to,  be  one because of  philanthropy  animating  the undertaking. 11.  Although sec. 2(j) uses, words of the widest  amplitude in  its  two  limbs, their meaning cannot  be  magnified  to overreach itself. (a)  ’Undertaking’    must   suffer   a    contextual    and associational shrinkage as explained in Banerji and in  this judgment,  so  also, service, calling and  the  like.   This yields the inference that all organized activity  possessing the  triple  elements in I (supra), although  not  trade  or business,  may still be ’industry’ (provided the  nature  of the  activity,  viz.  the  employer-employee  basis,   bears resemblance  to  what we find in trade  or  business.   This takes  into the- fold of ’industry’  undertakings,  callings and  services  adventure ’analogous to the  carrying  on  of trade   or   business’.   All  features,  other   than   the methodology  of carrying on the activity viz. in  organizing the  co-operation  between  employer  and  employee  may  be dissimilar.  It does not matter, if off the employment terms there is analogy. III.  Application of these guidelines should not stop  short of  their  logical reach by invocation of creeds,  cults  or inner sense of incongruity or other sense of motivation  for or  resultant of the economic operations.  The  ideology  of the Act being industrial peace, regulation and resolution of industrial disputes between employer and workmen, the  range of  this  statutory ideology must inform the  reach  of  the statutory definition.  Nothing less, nothing mom. (a)  The consequences are (i) professions, (ii) Clubs  (iii) educational institutions (iiia) co-operatives, (iv) research institutes  (v) charitable projects and (vi)  other  kindred adventures,  if  they fulfil the triple tests  listed  in  I (supra), cannot be exempted from the scope of sec. 2 (j). (b)  A  restricted  category  of  professions,  clubs,   co- operatives and even Gurukulas and little research labs,  may

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qualify for exemption if  283 in  simple ventures substantially and going by the  dominant nature criterion substantatively, in single simple ventures, no  employees  are  entertained  but  in  minimal   matters, marginal  employees  are hired without destroying  the  non- employee character of the unit. (c)  If  in a pious or altruistic mission many employ  them- selves, free or for small honoraria, or likely return mainly by  sharing  in  the  purpose  or  cause,  such  as  lawyers volunteering to run a free legal services clinic or  doctors serving  in  their spare hours in a free medical  centre  or ashramites working at the bidding of the holiness,  divinity or  like central personality and the services  are  supplied free or at nominal cost and those who serve are not  engaged for  remuneration  or on the basis of  master  and  servant, relationship, then, the institution is not an industry  even if  stray  servants, manual or technical, are  hired.   Such eleemosynary or like undertakings alone are exempt-not other generosity, compassion, developmental passion or project. IV The    dominant nature test : (a)  where  a complex of activities, some of  which  qualify for exemption  others  not, involves employees on the  total undertaking,  some  of  whom are not  ’workmen’  as  in  the University  of  Delhi  Case  or  some  departments  are  not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of  the  departments  as explained  in  the  Corporation  of Nagpur,  will be true test.  The whole, undertaking will  be ’industry’   although  those  who  are  not   ’workmen’   by definition may not benefit by the status. (b)  Notwithstanding   the   previous   clauses,   sovereign functions, strictly understood, alone qualify for exemption, not the welfare activities or economic adventures undertaken by government or statutory bodies. (c)  Even in departments discharging sovereign functions, if there   are  units  which  are  industries  and   they   are Substantially severable, then they can be considered to come within sec. 2(j). (d)  Constitutional  and  competently  enacted   legislative provisions  may  well  remove  from the  scope  of  the  Act categories which otherwise may be covered thereby. We  over-rule Safdarjung, Solicitors’ case, Gymkhana,  Delhi University,  Dhanrajgirji Hospital and other  rulings  whose ratio  runs counter to the principles enunciated above,  and Hospital Mazdoor Sabha is hereby rehabilitated. We conclude with diffidence because Parliament which has the commitment to the political nation to legislate promptly  in vital  areas  like  industry and trade  and  articulate  the welfare  expectations  in  the conscience’  portion  of  the constitution,  has  hardly  intervened  to  restructure  the rather  clumsy,  vaporous and tall-aud-dwarf  definition  or tidy up the scheme although Judicial thesis and anti-thesis, disclosed  in  the two decades long decisions,  should  have produced a legislative 284 synthesis  becoming  of  a  welfare  State  and  Socialistic Society, in a world setting where I.L.O. norms are advancing and  India  needs updating.  We feel confident,  in  another sense,  since counsel stated at the bar that a bill  on  the subject  is  in the offing.  The rule of law, we  are  sure, will run with the rule of Life-Indian Life-at the  threshold of the decade of new development in which Labour and Manage- ment,  guided by the State, will constructively partner  the better production and fair diffusion of national wealth.  We

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have  stated  that,  save the  Bangalore  Water  Supply  and Sewerage Board-appeal, we are not disposing of the others on the  merits.  We dismiss that appeal with costs  and  direct that  all  the others be posted before a smaller  bench  for disposal on the merits in accordance with the principles  of Law herein laid down.                            ORDER We  are in respectful agreement with the view  expressed  by Krishna Iyer, J. in his critical judgment that the Bangalore Water Supply and Sewerage Board appeal should be  dismissed. We  will  give  our reasons later  indicating  the  area  of concurrence and divergence, if any, on the various points in controversy on which our learned Brother has dwelt. CHANDRACHUD, C. J.-By a short order dated February 21, 1978, which  I  pronounced  on behalf of  myself  and  my  learned Brethren’ Jaswant Singh and Tulzapurkar, I had expressed our agreement  with the view taken--by Brother Krishna  lyer  on behalf of himself and three other learned Brethren that  the Bangalore   Water  Supply  &  Sewerege  Board’s  appeal   be dismissed.   I  had stated that the area of  concurrence  or divergence with the rest of the judgment will, if necessary, be indicated later. I have now the added advantage of knowing the divergent view expressed  by Jaswant Singh and Tulzapurkar, JJ. on  certain aspects of the matter.  Almost every possible nuance of  the question  as to what is comprehended within  "Industry"  and what ought to be excluded from the sweep of that  expression has  received  consideration in the two  judgments.   Having given  a further thought to the frustrating question  as  to what  falls  within  and without the  statutory  concept  of ’industry’ I am unable to accept, respectfully, the basis on which  Jaswant  Singh and Tulzapurkar,  JJ.  have  expressed their dissent. Section  2(j) of the Industrial Disputes Act, 1947,  defines ’industry’ to mean-               "any business, trade, undertaking, manufacture               or  calling  of  employers  and  includes  any               calling,  service, employment, handicraft,  or               industrial  occupation or avocation  of  work-               men". These  are words of wide import’ as wide as the  legislature could have possibly made them.  The first question which has engaged the attention of every court which is called upon to consider whether a parti-  285 cular  activity  is ’industry’ is  whether,  the  definition should  be permitted to have its full sway embracing  within its  wide sweep every activity which squarely  falls  within its terms or whether, some limitation ought not be read into the definition so as to restrict its, scope as reasonably as one may, without doing violence to the supposed intention of the  legislature.  An attractive argument based on  a  well- known   principle  of  statutory  interpretation  is   often advanced  in support of the latter view.  That principle  is known  as  ’noscitur  a  sociis’  by  which  is  meant  that associated words take their meaning from. one another.  That is  to say, when two or more words which are susceptible  of analogous  meaning  are coupled together,  they  take  their colour from each other so that the width of the more general words  may square with that of words of  lesser  generality. An  argument  based  on  this  principle  was  rejected   by Gajendragadkar,  J., while speaking on behalf of the  Court, in State of Bombay & Others v. The Hospital Mazdoor Sabha  & Others(1).   A  group  of five hospitals called  the  J.  J. Hospital,  Bombay,  which is run and managed  by  the  State

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Government in order to provide medical relief and to promote the  health  of the people was held in that case  to  be  an industry. The  Court  expressed its opinion  in  a  characteristically clear  tone  by saying that if the object and scope  of  the Industrial  Disputes Act are considered, there would  be  no difficulty in holding that the relevant words of wide import have  been deliberately used by the legislature in  defining ’industry’  in section 2 (j) of the Act.  The object of  the Act,  the  Court  said,  was  to  make,  provision  for  the investigation and settlement of industrial disputes, and the extent and scope of its provisions would be realised if  one were to bear in mind the definition of ’industrial  dispute’ given  by s. 2(k), of ’wages’ by s. 2(rr), ’workman’  by  s. 2(s),  and of ’employer by s. 2(g).  The Court also  thought that in deciding whether the State was running an  industry, the  definition  of ’public utility service’  prescribed  by section  2(n)  was very significant and one  bid  merely  to glance  at  the six categories of  public  utility  services mentioned  therein to realise that in running the  hospitals the State was running an industry.  "It is the character  of the activity which I decides the question as to whether  the activity in question attracts the provision of section 2(j); who conducts the ’activity", said the Court.  "-and  whether it  is  conducted for profit or not do not make  a  material difference. But  having thus expressed its opinion in a  language  which left  no  doubt as to its meaning, I the Court  went  on  to observe  that though section 2(j) used words of a very  wide denotation,  "It  is clear" that a line, would  have  to  be drawn  in  a  fair and just manner so  as  to  exclude  some callings,  services or undertakings from the scope,  of  the definition.   This was considered ’necessary because if  all the  words  used in the definition were given  their  widest meaning, all services and all callings would come within the purview  of the definition including services rendered by  a person  in  a purely personal or domestic capacity or  in  a casual manner.  The Court then undertook for examination (1)  [1960] 2 S.C.R. 866. 286 what  it  euphemistically  called  "a  somewhat   difficult’ problem to decide and it proceeded to, draw a line in  order to ascertain what limitations could and should be reasonably implied in interpreting the wide words used in section 2(j). I consider, with great respect, that the problem is far  too policy-oriented  to  be satisfactorily settled  by  judicial decisions.  The Parliament; must step in and legislate in  a manner which will leave no doubt as to its intention.   That alone  can  afford a satisfactory solution to  the  question which  has  agitated  and perplexed  the  judiciary  at  all levels. In the Hospital Mazdoor Sabha (supra) the Court rejected, on concession,  two  possible  limitation  on  the  meaning  of ’industry’ as defined in section 2(j) of the Act :  firstly, that no activity can be an industry unless accompanied by  a profit  motive and secondly, that investment of  capital  is indispensable for treating an activity as an industry.,, The Court  also rejected, on examination, the limitation that  a quid pro quo for services rendered is necessary for bringing an  activity  within  the terms of  section  2(j).   If  the absence  of  profit  motive was  immaterial,  the  activity, according  to the Court, could not be excluded from  section 2(j)  merely because the person responsible for the  conduct of  the  activity  accepted no return and  was  actuated  by philanthropic  or charitable motives.  The Court  ultimately

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drew  a  line  at the point where  the  regal  or  sovereign activity of the Government is undertaken and held that  such activities of the Government as have been pithily  described by Lord Watson as "the primary and inalienable functions  of a constitutional Government", could be stated negatively  as falling  outside  the scope of section 2(j).   The  judgment concludes with the summing-up that, as a working  principle, an activity systematically or habitually undertaken for  the production or distribution of goods or for the rendering  of material  services  to the community at large or a  part  of such community with the help of employees is an. undertaking within the meaning; of section 2(j);- that such an, activity generally involves the co-operation of the employer and  the employees; that the activity must not be casual nor must  it be for oneself nor for pleasure, but it must be organised or arranged in a armor in which trade or business is  generally organised;  and  thus,- the manner in which an  activity  is organised or arranged and the, form and the effectiveness of the  cooperation  between  the  employer  and  employee  for producing  a  desired result and for rendering  of  material services to. the community become distinctive of  activities falling within the terms of ’section 2(j).  Seeds of, many a later  judgment  were sown by, these imitations  which  were carved  out by the Court in order to reduce the width  of  a definition which was earlier described as having been  deli- berately  couched by the legislature in words of the  widest amplitude. These  exceptions  which  the  Court  engrafted,  upon   the definition of ’industry’ in section 2(j) in order to give to the  definition  the  merit of,  reasonableness,  became  in course  of  time as many categories of  activities  exempted from the operation of the definition clause.  To an extent., it  seems to me clear that though the decision in  Hospital’ Mazdoor Sabha (supra) that a Government run hospital was  an industry  proceeded  upon  the  rejection  of  the  test  of ’noscitur a sociis, it is 287 this  very principle which constitutes the rationale of  the exceptions  carved out by the Court.  It was said  that  the principle  of ’noscitur a sociis’ is applicable in cases  of doubt  and since the language of the definition admitted  of no  doubt,  the principle had no application.   But  if  the language  was  clear,  the definition had to  be  given  the meaning which the words convey and there can be no scope for seeking exceptions.  The contradiction, with great  respect, is  that  the  Court rejected the test  of  ’association  of words’ while deciding whether the Government-run hospital is an  industry  but accepted that very test  while  indicating which  categories  of  activities  would  fall  outside  the definition.   The  question then is : If there is  no  doubt either  as  to  the  meaning  of  the  words  used  by   the legislature  in section 2(j) or on the question  that  these are words of amplitude, what justification can one seek  for diluting  the  concept  of  industry  as  envisaged  by  the legislature ? On  a  careful  consideration of the question I  am  of  the opinion that Hospital Mazdoor Sabha was correctly decided in so  far as it held that the J. J. group of hospitals was  an industry  but,  respectfully, the same, cannot  be  said  in regard  to  the view of the Court  that  certain  activities ought  to  be  treated as  falling  outside  the  definition clause. One  of the exceptions carved out by the Court is in  favour of  activities undertaken by the Government in the  exercise of its inalienable functions under the Constitution, call it

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regal,   sovereign  or  by  any  other  name.   I   see   no justification  for  excepting  these  categories  of  public utility activities from the definition of ’industry’.  If it be  true  that one must have. regard to the  nature  of  the activity and not to who engages in it, it seems to me beside the  point to enquire whether the activity is undertaken  by the State, and further, if so., whether it is undertaken  in fulfilment  of the State’s constitutional obligations or  in discharge  of  its  constitutional functions;  In  fact,  to concede-  the  benefit  of  an  exception  to  the   State’s activities which are in the nature of sovereign functions is really  to  have  regard not so much to the  nature  of  the activity  as to the consideration who engages in that  acti- vity; for, sovereign functions can only be discharged by the State  and  not  by  a  private  person.   If  the   State’s inalienable  functions  are excepted from the sweep  of  the definition  contained  in  section  2(j),  one  shall   have unwittingly  rejected  the fundamental test that it  is  the nature of the activity which ought to determine whether  the activity  is  an  industry.  Indeed, in  this  respect,.  it should  make  no  difference whether, on the  one  hand,  an activity is undertaken by a corporate body in. the discharge of  its statutory functions or, on. the other, by the  State itself in the exercise of its inalienable functions.  If the water   supply  and  sewerage  schemes  or   fire   fighting establishments  run by a Municipality can be industries,  so ought to be the manufacture of coins and currency, arms  and ammunition  and  the winning of oil and uranium.   The  fact that  these latter kinds of activities are, or can only  be, undertaken  by the State does not furnish any answer to  the question  whether  these activities  are  industries.   When undertaken  by  a private individual  they  are  industries. Therefore,   when   undertaken  by  the  State,   they   are industries.   The nature of the activity is the  determining factor and that does not change according to who  undertakes it.  Items 8, 11, 288 12,  17  and  18 of the First  Schedule  read  with  section 2(n)(vi)  of the Industrial Disputes Act render  support  to this  view.   These  provisions  which  were  described   in Hospital  Mazdoor Sabha as ’very significant’ at least  show that,  conceivably,  a Defence Establishment,  a  Mint  or.a Security  Press can be an industry even though  these  acti- vities  are, ought to be and can only be undertaken  by  the State in the discharge of its constitutional obligations  or functions.   The  State  does not trade  when  it  prints  a currency  note or strikes a coin.  And yet, considering  the nature of the activity, it is engaged in an industry when it does so. That   leads   to  the  consideration   whether   charitable enterprises  can at all be industries.  Viewing the  problem from  the angle from which one must, according to  me,  view the State’s inalienable functions, it seems to me to  follow logically  that a systematic activity which is organised  or arranged in a manner in which trade or business is generally organised or arranged would be an industry despite the  fact that it proceeds from charitable motives.  It is the  nature of the activity that one has to consider and it is upon  the application  of  that  test  that  the  State’s  inalienable functions  fall  within the definition of  ’industry’.   The very  same principle must yield the result that just as  the consideration  as to who conducts an activity is  irrelevant for  determining whether the activity is an industry, so  is the  fact  that the activity is charitable in nature  or  is undertaken   with  a  charitable  motive.   The  status   or

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capacity, corporate or constitutional, of the employer would have,  if  at all, closer nexus, than his motive,  with  the question whether the activity is an industry.  And yet  that circumstance, according to me, cannot affect the decision of the  question.  The motive which propels an activity is  yet another  step  removed  and,  ex  hypothesi,  can  have   no relevance  on the question as to what is the nature  of  the activity.   It  is never true to say that the nature  of  an activity is charitable.  The  subjective motive force of  an activity can be charity but for    the  purpose of  deciding whether an activity is an industry one has   to look at  the process involved in the activity, objectively.  The    argument that  he  who does charity is not doing  trade  or  business misses the point because the true test is whether the  acti- vity, considered objectively, is organised or arranged in  a manner  in which trade or business is normally organised  or arranged.   If  so,  the activity would be  an  industry  no matter  whether  the  employer  is  actuated  by  charitable motives  in  undertaking it.  The jural  foundation  of  any attempt  to except charitable enterprises from the scope  of the  definition  can only be that such enterprises  are  not undertaken  for  profit.   But then  that,  clearly,  is  to introduce  the  profit-concept  by a side  wind,  a  concept which,  I suppose, has been rejected consistently  over  the years.   If any principle can be said to be settled  law  in this  vexed  field it is this : the  twin  consideration  of profit  motive  and  capital investment  is  irrelevant  for determining whether an activity is an industry.   Therefore, activities which are dominated by charitable motives, either in  the  sense that they involve the rendering  of  free  or near-free  services or in the sense that the  profits  which they  yield  are diverted to charitable  purposes,  are  not beyond the pale of the definition in section 2(j).  It is as much beside the point to in-  289 quire  who  is the employer as it is to inquire why  is  the activity  undertaken  and what the employer  does  with  his profits, if any. Judged  by these tests, I find myself unable to  accept  the broad formulation that a Solicitor’s establishment cannot be an  industry.  A Solicitor, undoubtedly, does not  carry  on trade or business when he acts for his client or advises him or  pleads for him, if and when pleading is  permissible  to him.   He  pursues  a  profession  which  is  variously  and justifiably  described  as learned, liberal or  noble,  But, with  great respect, I find it difficult to infer  from  the language  of the definition in section 2(j), as was done  by this Court in The National Union of Commercial Employees and Another  v.  M. R. Meher, Industrial  Tribunal,  Bombay  and Others,(1)  that the legislature could not have intended  to bring  a liberal profession like that of an attorney  within the  ambit  of  the definition  of  industry.   In  Hospital Mazdoor  Sabha  (supra) the Court while evolving  a  working principle  stated  that  an  industrial  activity  generally involves,  inter alia, the cooperation of the  employer  and the employee.  That the production of goods or the rendering of material services to the community must be the direct and proximate result of such cooperation is a further  extension of  that  principle  and it is broadly  by  the  application thereof  that  a Solicitor’s establishment is  held  not  to attract the definition clause.  These refinements are,  with respect, not warranted by the words of the definition, apart from  the  consideration  that in  practice  they  make  the application  of the definition to concrete  cases  dependent upon a factual assessment so highly subjective as to lead to

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confusion  and uncertainty in the understanding of the  true legal   position.   Granting  that  the  language   of   the definition is so wide that some limitation ought to be  read into  it,  one  must  stop  at  a  point  beyond  which  the definition  will  skid  into a domain  too  rarefied  to  be realistic.  Whether the cooperation between the employer and the employee is the proximate cause of the ultimate  product and  bears  direct nexus with it is a test which  is  almost impossible  of application with any degree of  assurance  or certitude.   It will be as much true to say that  the  Soli- citor’s Assistant, Managing Clerk, Librarian and the  Typist do  not directly contribute to the intellectual end  product which  is a creation of his personal professional  skill  as that,  without  their active assistance and  cooperation  it will  be  impossible for him to function  effectively.   The unhappily state of affairs in which the law is marooned will continue   to  baffle  the  skilled  professional  and   his employees  alike  as also the Judge who has to  perform  the unenviable  task of sitting in judgment over the  directness of  the cooperation between the employer and  the  employee, until  such time as the legislature decides to manifest  its intention  by  the  use of  clear  and  indubious  language. Beside  the  fact that this Court has so  held  in  National Union of Commercial Employees, (supra) the legislature  will find a plausible case for exempting the learned and  liberal professions  of  Lawyers,  Solicitors,  Doctors,  Engineers, Chartered  Accountants and the like from the,  operation  of industrial laws.  But until that happens, I consider that in the  present  state of the law it is difficult  by  Judicial interpretation  to  create  exemptions  in  favour  of   any particular class. (1)  [1962] Supp. 3 S.C.R. 157. 290 The case of the clubs, on the present definition, is  weaker still;  and  not  only do I  consider  that  the  definition squarely covers them, except to the limited extent indicated by  Brother  Krishna  Iyer in his judgment,  but  I  see  no justification  for  amending the law so as to  exclude  them from  the operation of the industrial laws.  The  fact  that the  running  of clubs is not a calling of the club  or  its managing  committee,  that the club has no  existence  apart from  its  members, that it exists for  its  members  though occasionally strangers also take the benefit of its services and that even with the admission of guests the club  remains a  members’  self-serving  institution, seems  to  me,  with respect,  not  to touch the core of the  problem.   And  the argument that the activity of the clubs cannot be  described as trade or business or manufacture overlooks, with respect, that  the  true  test can only be whether  the  activity  is organised  or  arranged  in a manner in  which  a  trade  or business is normally organised or arranged.  I have  already said enough on that question. On  the remaining aspects of the case I have nothing  useful to  add to the penetrating analysis of the problem  made  by Brother Krishna Iyer in his judgment. JASWANT SINGH, J. It may be recalled that in the order dated February  21,  1978  pronounced  by  our  learned   brother, Chandrachud,  J.  (as he then was) on  ’behalf  of  himself, brother  Tulzapurkar and myself, expressing  our  respectful agreement  with  the view expressed by our  learned  brother Krishna  Iyer  that the Bangalore Water  Supply  &  Sewerage Board  appeal  be  dismissed, it was stated  that  we  would indicate  the  area of concurrence and divergence,  if  any, later on.  Accordingly, we proceed to do that now. The  definition  of  the term  "industry"  as  contained  in

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Section 2(j) of the Industrial Disputes Act which is in  two parts  being vague and too wide as pointed out by Beg,  C.J. and Krishna lyer, J., we have struggled to find out its true scope  and  ambit in the light of plethora of  decisions  of this Court which have been laying down fresh tests from time to time making our task an uphill one.  However, bearing  in mind the collocation of the terms in which the definition is couched  and  applying  the doctrine of  noscitur  a  sociis (which,  as pointed out by this Court in State of  Bombay  & Ors.  v.  The Hospital Mazdoor Sabha & Ors.(1)  means  that, when  two or more words which are susceptible  of  analogous meaning are coupled together they are understood to be  used in  their cognate sense.  They take as it were their  colour from each other, that is, the, more general is restricted to a sense analogous to a less general.  Expressed differentlY, it  means  that  the  meaning of  a  doubtful  word  may  be ascertained by reference to the meaning of words  associated with  it, we are of the view that despite the width  of  the definition it could not be the intention of the  Legislature that  categories 2 and 3 of the charities alluded to by  our learned  brother Krishna Iyer in his judgment, hospital  run on  charitable  basis or as a part of the functions  of  the Government   or   local  bodies  like   municipalities   and educational and research institutions (1)  [1960] 2 S.C.R. 866.  291 whether run by private entities or by Government and liberal and  learned professions like that of doctors,  lawyers  and teachers,  the  pursuit  of  which  is  dependent  upon   an individual’s  own  education, intellectual  attainments  and special  expertise  should  fall  within  the  pale  of  the definition.  We are inclined to think that the definition is limited  to  those activities systematically  or  habitually undertaken on commercial lines by private entrepreneurs with the   cooperation  of  employees  for  the   production   or distribution  of  goods, or for the  rendering  of  material services  to  the  community  at large or  a  part  of  such community.  It is needless to emphasise that in the case  of liberal  professions, the contribution of the usual type  of employees employed by the professionals to the value of  the end  product  (viz.  advice and  services  rendered  to  the client)  is  so  marginal that the  end  product  cannot  be regarded  as the fruit of the cooperation between  the  pro- fessional’and his employees. It  may be pertinent to mention in this connection that  the need for excluding some callings, services and  undertakings from  the purview of the aforesaid definition has been  felt and  recognised  by  this  Court from  time  to  time  while explaining the scope of the definition of "industry".   This is evident from the observations made by this Court in State of  Bombay  &  Ors. v. The Hospital  Mazdoor  Sabha  &  Ors. (supra), Secretary, Madras Gymkhana Club Employees Union  v. ’Management  of  the  Gymkhana  Club(1)  and  Management  of Safdarjung  Hospital, New Delhi V. Kuldip Singh  Sethi  (2). Speaking  for  the Bench in State of Bombay &  Ors.  v.  The Hospital  Mazdoor Sabha & Ors. (supra),  Gajendragadkar,  J. (as he then was) observed in this connection thus :               "It  is  clear, however, that though  s.  2(j)               uses  words  of very wide denotation,  a  line               would  have  to be drawn in a  fair  and  just               manner  so as to exclude some  callings,               services  or undertakings.  If all  the  words               used  are  given  their  widest  meaning,  all               services  and all callings would  come  within               the  purview of the definition;  even  service

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             rendered by a servant purely in a personal  or               domestic matter or even in a casual way  would               fall  within  the definition.  It is  not  and               cannot be suggested that in its wide sweep the               word "service" is intended to include  service               however  rendered in whatsoever  capacity  and               for  whatsoever reason.  We  must,  therefore,               consider  where the line should be  drawn  and               what limitations can and should be  reasonably               implied in interpreting the wide words used in               s.  2(j);  and  that no doubt  is  a  somewhat               difficult problem to decide." (1)  [1968] 1 S.C.R. 742. (2)  [1971] 1 S.C.R. 177. 292 In  view  of  the difficulty experienced by  all  of  us  in defining  the  true denotation of the  term  "industry"  and divergence of opinion in regard thereto-as has been the case with  this  bench also-we think, it is high  time  that  the Legislature  steps in with a comprehensive bill to clear  up the  fog and remove the doubts and set at rest once for  all the controversy which crops up from time to time in relation to the meaning of the aforesaid term rendering it  necessary for  larger benches of this Court to be,  constituted  which are driven to the necessity of evolving a working formula to cover particular cases. S.R.             Appeal dismissed. SCI/78-2500-GIPF. 293