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1962 Supreme(SC) 60

SUPREME COURT OF INDIA
13th February, 1962
P.B. GAJENDRAGADKAR, A.K. SARKAR AND K.N. WANCHOO, JJ.
National Union of Commercial Employees and another, Appellants
Versus
M.R. Meher, Industrial Tribunal, Bombay and others. Respondents.
Bombay Incorporated Law Society, Intervener.
Civil Appeal No. 24 of 1961.
Advocates appeared
Mr. A. S. R. Chari, Senior Advocate, (Mr. K. R. Chaudhuri, Advocate, with him), for Appellants; Mr. S. T. Desai, Senior Advocate, (Mr. V. J. Merchant, Advocate of M/s. Gagrat and Co. with him), for Respondents Nos. 2 and 4 and the Intervener.

Advocates:
A.S.R.CHARI, K.R.CHAUDHARY, S.T.DESAI, V.J.MERCHANT

The definition of industry in Section 2(j) of the Industrial Disputes Act, 1947, is very wide, but a line must be drawn to exclude certain callings, services, or undertakings from its purview. The working test for determining whether an activity is an industry is whether it is 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.

Headnote:

INDUSTRIAL DISPUTE - DEFINITION OF INDUSTRY - SOLICITORS' FIRM - NOT AN INDUSTRY - CO-OPERATION BETWEEN EMPLOYER AND EMPLOYEES - ESSENTIAL FOR INDUSTRY - LIBERAL PROFESSIONS - NOT INDUSTRIES - INDUSTRIAL DISPUTES ACT, 1947, S. 2 (J).

Fact of the Case:

The appellants, a union of commercial employees, filed a dispute with the respondents, a firm of solicitors, over bonus and other matters. The dispute was referred to an Industrial Tribunal under the Industrial Disputes Act, 1947. The respondents raised a preliminary objection that their profession was not an industry within the meaning of the Act, and the Tribunal upheld the objection. The appellants challenged the Tribunal's decision in the High Court, which dismissed their petition.

Finding of the Court:

The Supreme Court held that the respondents' firm was not an industry within the meaning of Section 2(j) of the Industrial Disputes Act, 1947. The Court held that the definition of industry in Section 2(j) was very wide, but that a line had to be drawn to exclude certain callings, services, or undertakings from its purview. The Court held that the working test for determining whether an activity was an industry was whether it was 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.

Issues: Whether the respondents' firm was an industry within the meaning of Section 2(j) of the Industrial Disputes Act, 1947.

Ratio Decidendi: The Court held that the respondents' firm did not satisfy the working test for determining whether an activity was an industry. The Court held that the service rendered by a solicitor was essentially individual and that the work done by the firm's employees was not directly concerned with the service which the solicitor rendered to his client. The Court also held that the liberal professions, such as the legal profession, were not industries within the meaning of the Act.

Final Decision: The Court dismissed the appeal.

Judgement Key Points

Key Points: - The definition and scope of "industry" under Section 2(j) of the Industrial Disputes Act, 1947, as applied to liberal professions and solicitors' firms. (!) (!) (!) (!) - Whether a solicitors' firm constitutes an "industry" for the purposes of industrial disputes, considering the required co-operation between employer and employees and the direct nexus to professional service. (!) (!) - The judicial line to exclude certain callings or undertakings from the purview of "industry" despite the wide wording of Section 2(j), based on the Hospital Mazdoor Sabha and related reasoning. (!) (!) (!) (!)

Question 1?

Question 2?

Question 3?


Judgment

GAJENDRAGADKAR, J. : This appeal arises out of a dispute between the appellants the National Union of Commercial Employees & Anr., and the respondents Pereira, Fazalbhoy and Desai who constitute an Attorneys firm by name M/s. Pereira Fazalbhoy & Co, it appears that in August, 1957 the appellant wrote to the respondent firm setting forth certain demands on behalf of its employees. These demands related to bonus for the years 1955-56 and 1956-57 and to certain other matters. As the parties could not agree, the dispute was taken before the Conciliation Officer. The Conciliation Officer also failed to bring about a settlement and so he submitted his failure report to the Government of Bombay. Thereafter, the State Government referred the dispute in regard to the bonus for the two years 1956 and 1957 for adjudication before an Industrial Tribunal under S. 12 (5) of the Industrial Disputes Act (No. 14 of 1947) (hereinafter called the Act). Before the Tribunal, the respondents raised a preliminary objection. They urged that the profession followed by them was not an industry within the meaning of the Act, and so the dispute raised against them by the appellants was not an industrial dispute within the meaning of the Act ; the contention was that the dispute not being an industrial dispute under the Act, the reference made by the Government was incompetent and so, the Tribunal had no jurisdiction to adjudicate upon this dispute. The Tribunal upheld the preliminary objection and recorded its conclusion that it had no jurisdiction to adjudicate upon the dispute as it was riot an industrial dispute.

2. The order thus passed by the Tribunal was challenged by the appellants before the High Court at Bombay by Special Civil Application No. 2789 of 1958 filed under Arts. 226 and 227 of the Constitution. The High Court considered the rival contentions raised before it by the appellants and the respondents and came to the conclusion that the respondents firm did not constitute an industry and so the dispute between the said firm and its employees was not an industrial dispute which could validly form the subject-matter of a reference under the Act. In that view of the matter, the High Court held that the Industrial Tribunal was right in refusing to make an order on the reference and so the appellants writ petition was dismissed. The appellants then applied for and obtained a certificate from the High Court and it is with the said certificate that the present appeal has come to this Court; and the short question which it raises for our decision is whether the respondents firm which carries on the work of Solicitors in Bombay can be said to constitute an industry under S. 2 (j) of the Act.

3. In dealing with this question, it would be necessary to refer to the decision of this Court in the State of Bombay v. Hospital Mazdoor Sabha, 1960-2 SCR 866: Both parties agreed that the present dispute would have to be determined in the light of the decision of this Court in that case. Let us, therefore, indicate the effect of the said decision. In the Hospital Case, 1960-2 S C R 866 this Court had occasion to consider whether the services of workmen engaged as ward servants in the J. J. Group of Hospitals, Bombay, under State control were workmen and whether the Hospital Group itself constituted an industry under the Act or not. Both the questions were answered in the affirmative and in rendering those answers, the scope and effect of the definition of the word industry used in S. 2 (j) of the Act was considered. This Court held that the words used by S. 2 (j) in defining industry in an inclusive manner were of wide import and had to be read in their wide denotation. Even so, this Court stated:

"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 from its purview, if all the words used are given their widest meaning, all servi























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