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2026 Supreme(Online)(MP) 2591
IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR
Vivek Jain, J
Veer Singh Parihar – Appellant
Versus
The State Of Madhya Pradesh – Respondent
MISC. PETITION No. 2402 of 2021 | MISC. PETITION No. 502 of 2024
For the Appellants/Petitioners: Ashok Kumar Chourasia, Rajneesh Gupta
For the Respondents: Rajneesh Gupta, Ashok Kumar Chourasia
A statutory commission performing welfare activities is an 'industry' under Section 2(j) of the Industrial Disputes Act, 1947, as welfare functions are not sovereign functions, and employees performing ministerial tasks are entitled to protection against illegal retrenchment.
Headnote:The case involves the application of the Industrial Disputes Act, 1947, specifically Section 2(j) regarding the definition of 'industry' and Sections 25-B and 25-F concerning illegal retrenchment. A workman, appointed in 2007 and terminated orally in 2014, challenged his termination as illegal retrenchment. The employer, a statutory commission, contended that it was not an 'industry' as it performed sovereign/welfare functions and that the appointment was co-terminus with a commission member. The court found that the commission's activities are welfare-oriented and not sovereign, thus qualifying as an industry for its ministerial staff. The primary issue was whether a statutory commission performing welfare functions falls within the definition of 'industry' under Section 2(j) of the ID Act. The court reasoned that "sovereign functions have to be strictly understood" and welfare activities by statutory bodies do not qualify for exemption. Applying the triple test from the Bangalore Water-Supply case, the court held that the commission cannot avoid the mandatory provisions of the ID Act for employees performing menial or administrative functions. The impugned award of the Labour Court is modified to the extent that the Petitioner would be entitled to reinstatement without backwages till the date of this Order.
ORDER
These two petitions have been filed challenging the same award passed by the Labour Court, one at the instance of the workman and another at the instance of the employer, therefore, they are being heard together and are being decided by this common order.
The proceedings under the Industrial Disputes Act were initiated by the workman on the ground that he had submitted an application before the Assistant Labour Commissioner under Section 10 of the Industrial Disputes Act, 1947, (ID Act for short) on 16.10.2014, but despite that, since conciliation proceedings have not been concluded, therefore, he filed a statement of claim before the labour court on 10.12.2014. In the said statement of claim, it was contended that he was initially appointed in the establishment of MP State Women's Commission in March 2007 and on 13.09.2014, he has been terminated by oral order, which amounts to a illegal retrenchment. It was contended by him that the workman was not paid any retrenchment compensation, though having put in more than 7 years of service, and therefore, he is entitled to be reinstated in service with back wages, as he is a victim of illegal retrenchment and is entitled to protection of Section 25-B and Section 25-F of ID Act. The said application was contested by the employer on the ground that the workman was not appointed on any vacant post, but he was appointed as per exigencies of administration on co-terminus basis against choice quota of one member, namely Ms. Vandana Mandavi, who was appointed as a member of the commission and from 16.11.2016 he has been paid on collector rates on daily wages. It was contended in the reply that his tenure was co-terminous with the tenure of member Ms. Vandana Mandavi and it does not amount to any illegal retrenchment as his appointment was co-terminous with the member and at present the said member is not functioning in the Commission. On the date of filing of reply, there was in fact no Member and Chairman in the commission, and no requirement of work was available in the commission.
Another objection was taken that MP Woman’s Commission does not fall within the definition of Section 2-j of Industrial Disputes Act and therefore it is not an industry, being not a profit making venture but being a statutory Commission. It is also not an undertaking even if it is not a business undertaking, and hence it does not fall within the definition of industry and undertaking by any stretch of imagination being a statutory Commission constituted under MP Rajya Mahila Ayog Adhiniyam 1995 .
The Labour Court by the impugned award dated 26-02-2021 has said that the commission falls within the definition of industry as per section 2-j of ID Act and held that the termination of services of workman amounts to illegal retrenchment and is entitled to be reinstated in service without back wages but held that since no vacant post is available then as and when the post falls vacant, the workmen be reinstated on priority basis. The aforesaid award has been criticized by both the parties. The Commission is aggrieved by the said award to the extent that the dispensation of services of the workmen has been held to be illegal retrenchment and he has been held to be a workman and the Commission has been held to be industry which are the findings against the Commission whereas the workman is aggrieved by the position that ultimately despite giving all findings in favour of the workman but he has not been given the benefit of reinstatement. It was vehemently argued by counsel for the workman before this Court that the tenure of member of commission is only 3 years but the workman was allowed to work for as many as 7 years and therefore the employer/commission cannot take the plea of his appointment being co-terminus with the tenure of member but he was allowed to work much beyond the tenure of the member, even if it is accepted that he was appointed on choice post by the member of Commission. As he wo
