1. Termination of employee services and claim for regularization based on non-compliance with Section 25-F of the Industrial Disputes Act, 1947. (Para 2 )
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1995 Supreme(SC) 324
SUPREME COURT OF INDIA
N.P.Singh : P.B.Sawant
State Of U.P.
Versus
Arun Kumar Singh
Case No. : of 1995
Date of Decision : 3/6/95
Important Points
A rural development agency entrusted with implementing government schemes does not constitute an 'industry' under the Industrial Disputes Act, 1947, and therefore, the statutory provisions regarding termination of service do not apply to its employees.
Subject
Labour Law - Industrial Disputes
Act Referred
Headnote
(A) Industrial Disputes Act, 1947 - Section 25-F - U.P. Industrial Disputes Act - Definition of 'industry' - Termination of services - Whether a rural development agency entrusted with the implementation of various government schemes constitutes an 'industry' - Such an agency is only entrusted with the work of carrying on different schemes and cannot be described as an industry within the meaning of the Act - Provisions of the said statutes are not applicable to such entities. (Paras 2 and 3)
Facts of the case:
The services of an employee were terminated by a rural development agency. The lower court had held that the agency was an industry and that the termination was invalid due to non-compliance with the requirements of Section 25-F of the Industrial Disputes Act, 1947, subsequently directing the regularization of the employee's services.
Findings of Court:
The rural development agency is not an industry as it is merely entrusted with the execution of various government schemes. Consequently, the provisions of the Industrial Disputes Act, 1947 and the state's industrial disputes legislation do not apply to the facts of the case.
Issues: Whether a rural development agency tasked with implementing government schemes falls within the definition of an 'industry' under the Industrial Disputes Act, 1947.
Ratio Decidendi: An entity whose primary function is the implementation of government schemes is not an 'industry' under the Industrial Disputes Act, 1947; therefore, statutory protections regarding termination of service under the Act are not applicable.
Result: Appeal allowed.
Facts of the case:
The services of an employee were terminated by a rural development agency. The lower court had held that the agency was an industry and that the termination was invalid due to non-compliance with the requirements of Section 25-F of the Industrial Disputes Act, 1947, subsequently directing the regularization of the employee's services.
Findings of Court:
The rural development agency is not an industry as it is merely entrusted with the execution of various government schemes. Consequently, the provisions of the Industrial Disputes Act, 1947 and the state's industrial disputes legislation do not apply to the facts of the case.
Issues: Whether a rural development agency tasked with implementing government schemes falls within the definition of an 'industry' under the Industrial Disputes Act, 1947.
Ratio Decidendi: An entity whose primary function is the implementation of government schemes is not an 'industry' under the Industrial Disputes Act, 1947; therefore, statutory protections regarding termination of service under the Act are not applicable.
Result: Appeal allowed.
Legal Category Hierarchy
Table of Contents
2. Whether the District Rural Development Agency constitutes an industry under the Industrial Disputes Act, 1947, rendering the termination of services invalid. (Para 2 )
3. The District Rural Development Agency is entrusted with implementing various schemes and does not function as an industry. (Para 3 )
4. An agency entrusted solely with the implementation of government schemes is not an industry within the meaning of the Industrial Disputes Act. (Para 3 )
5. Impugned order set aside and matter remitted to the High Court for decision according to law. (Para 3 )
6. Does the District Rural Development Agency qualify as an industry under the Industrial Disputes Act, 1947?
No, because the agency is only entrusted with the work of carrying out different schemes, such as the Jawahar Rozgar Yojana, and therefore cannot be described as an industry. (Para 3 )
7. What is the legal consequence if an entity is not classified as an industry under the Industrial Disputes Act?
If an entity is not an industry, the provisions of the Industrial Disputes Act and related state statutes, such as the U.P. Industrial Disputes Act, do not apply to the case. (Para 3 )
(1) DELAY condoned. Special leave granted.
(2) HEARD counsel on both sides. We find that the High court has proceeded on a wrong footing that the District Rural Development Agency is an industry, and since the provisions of Section 25-F of the Industrial Disputes Act, 1947 (hereinafter referred to as the Act) were not complied with, the termination of the services of the respondent-employee was invalid. The High court has also erred in directing regularisation of the employee in the service.
(3) ACCORDING to us, the District Rural Development Agency is only entrusted with the work of carrying on different schemes entrusted to it including the Jawahar Rozgar Yojana. Hence it cannot be described as industry within the meaning of the Act or the U.P. Industrial Disputes Act. Hence, the provisions of the said statutes do not apply to the facts of the present case. The High court should, therefore, decide the question falling for consideration in the present case on the basis that the provisions of the said statutes are not applicable. The impugned order is, therefore, set aside and the matter is remitted to the division bench of the High court for decision according to law in the light of the above observations. The appeal is allowed accordingly with no order as to costs.
