IN THE HIGH COURT OF JUDICATURE AT BOMBAY. CIVIL APPELLATE JURISDICTION. WRIT PETITION NO. 4000 OF 2005. Kaivalyadham Shriman Madhava Yoga Mandir Samiti, Lonavala, Dist. Pune...... ....... Petitioner. Versus Kaivalyadham Employees Association, C/o Dr.J.M.Bhagwat, 3, Gulmohar Apartment, Bhangwadi, Lonavala, Dist. Pune....... ..... Respondent. Smt.Meena H. Doshi, Adv. For the petitioner. Shri Nitin A. Kulkarni, Adv. For the respondent. CORAM: A.P.DESHPANDE J, 27 th & 30 th April, 2007. ORAL JUDGMENT: The petitioner is a Society registered under the Societies Registration Act so also is a public trust governed and regulated by the provisions of Bombay Public Trust Act. According to the petitioner the petitioner primarily carries on research and allied work in the field of Yoga. The petitioner is a recipient of grants of Central Government so also the State Government. The petitioner claims that it has been receiving grants from the Central Government since prior to independence for promoting scientific research in Yoga. The activities 1 of the petitioner are regulated by articles of association framed by it. The apex body of the petitioner is known as the governing body and as the petitioner is receiving grants from the Central Government two members are nominated by the Central Government on the governing body of the petitioner since last many years. It is also the case of the petitioner that its work and activities are scrutinized and checked by Review Committee appointed by the Central Government and the Review Committee is directly under the control of Ministry of Education, Government of India. The petitioner also submits that the Review Committee makes various suggestions with a view to properly plan the activities of the petitioner for next five years. 2. The petitioner has five departments through which it carries on its activities and the said departments are (i) Scientific Research Department; (ii) Philosophy Laboratory Research Department; (iii) G.S.College of Yoga and Cultural Synthesis; (iv) Centralized Administrative Department and (v) SADT Gupta Yogic Hospital. According to the petitioner barring Yogic hospital all other departments are recipients of grants from the Government. In the backdrop of above referred facts it is contended by the petitioner that the Central Government has control over the activities of the petitioner and the reference made by the State Government in relation to the dispute of its employees to the Industrial Tribunal is incompetent. To 2 substantiate the said submission the petitioner also pointed out that the accounts of the petitioner are audited by Central Auditor General's Office, Government of India. It is also contended that the Government has control and supervision over the activities of the petitioner and the petitioner is recognized by All India Institute of Higher Education so also department of Scientific and Industrial Research under the scheme of Scientific and Industrial Research Organization. 3. The respondent is trade union registered under the Trade Unions Act which represents the employees working under the petitioner. Some of the employees came to be terminated from services by the petitioner and hence dispute came to be raised by the respondent- union and the said dispute came to be referred by the State Government to the Industrial Tribunal. The respondent- union contended before the Tribunal that the termination of the employees effected by the petitioner is mala fide and has been resorted to on account of various complaints made by workmen/union to the Central Government touching the administration of the petitioner. The respondent had submitted before the Tribunal that the petitioner was acting illegally in as much as it did not implement the reservation policy and was acting arbitrarily in extending the service tenure of one Shri Tiwari despite he having attained age of superannuation. Taking serious view of the complaints made by the workmen, it is claimed by 3 the respondent, before the Tribunal that the Central Government directed inquiries to be made and grants admissible to the petitioner were withheld and for that reason the services of employees were terminated mala fide. The Tribunal accepting the case of the respondent, that the termination of the employees was illegal, has allowed the reference in relation to some of the employees and aggrieved by the said award passed by the Industrial Tribunal the present writ petition has been filed. 4. The learned counsel Smt.Meena Doshi raised the following objections/points to the award passed by the Tribunal and urged that the award be quashed and set aside. 1) It is contended that the petitioner is not an industry within the meaning of definition of word “industry” under section 2(j) of the Industrial Disputes Act, 1947. 2) The reference made by the State Government was itself incompetent in as much as the appropriate Government in relation to the petitioner is the Central Government. The learned counsel for the petitioner places reliance on definition of the “appropriate Government” in section 2(a) of the Industrial Disputes Act 1947 and contended that assuming the petitioner to be an industry, as the industrial dispute is in relation to an 4 industry carried on under the authority of Central Government the appropriate Government would be the Central Government. 3) The retrenchment of the employees is in compliance with Rule 81 of the Industrial Disputes (Bombay) Rules, 1957 and the same is legal and proper. It is also submitted that on account of financial hardship the decision to retrench the employees had to be resorted to and the retrenchment is not mala fide as is contended by the respondent. 4) The respondent did not have subsisting and valid registration when the dispute was raised and as such the dispute was incompetent. The submission is that though the Union had registration prior in point of time, the same was withdrawn/ canceled at the relevant point of time i.e. when the dispute was raised. 5) Lastly it is submitted that the retrenchment of the employees is in good faith and not a mala fide action. It will not be out of place to state at this juncture that the Industrial Tribunal had rejected the above referred objections and answered the reference in favour of the respondents. 5. As to Point No.1: The word “industry” is defined by section 2(j) of the Industrial Disputes Act which reads thus: 5 “2(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.” Before the Tribunal both the parties have placed on record number of documents and also led oral evidence. Before I proceed to consider the evidence touching the aspect as to whether petitioner is an industry, it would be apt to point out that the Tribunal has held that the petitioner is an industry as it satisfies the triple test as laid down by the Supreme Court of India in the case of Bangalore Water Supply & Sewerage Board, Etc., Etc., V/s A.Rajappa and Others, Etc., Etc., 1978 (1) LLJ 349 equivalent to AIR 1978 SC 548. The triple test laid down requires satisfying the following three conditions viz. i) a systematic activity must be carried on, ii) there must be cooperation between the employer and employee and iii) production and/or distribution of goods and services calculated to satisfy human wants and wishes. The Supreme Court has laid down in the said judgment that when the triple test is satisfied, prima facie, it is an industry. Profit- motive has been held to be not relevant for deciding the question. According to the petitioner the Supreme Court has not authoritatively decided the 6 question in the case of Bangalore Water Supply & Sewerage Board, (supra) but it is an expression of tentative opinion formed by the Supreme Court. To substantiate the submission reliance is sought to be placed on latest judgment of the Supreme Court in the case of Physical Research Laboratory V/s K.G.Sharma, 1997 LLR 401 equivalent to AIR 1997 SC 1855. Leaving that contention at that I turn to the evidence touching the aspect as to whether the petitioner is an industry or otherwise. The aims and objects of the petitioner are set out in the memorandum of association. Briefly stated it provides for establishment of colleges, yoga hospitals, research in scientific yoga, acceptance of grants, gifts, etc. to purchase or to take on lease land, building, playgrounds, to transfer, sell, mortgage or dispose of property and to deal with property in any other manner and to spend money on various activities of the Committee. With the help of evidence on record which is in the nature of prospectus of the college and pamphlets distributed by the hospital and health care center administered by the petitioner, the Tribunal has noticed that the petitioner has been charging registration fees, tuition fees and fees for participation in shibirs, seminars and health care centers. Different charges are prescribed for Indian citizens and Foreigners. Fees/charges are levied depending upon the nature of participation and the benefits extended. A given sum of amount is charged 7 depending upon the facilities provided. Persons/patients admitted to hospital are charged per day, Indians in rupees and Foreigners in dollars. After appreciating the evidence on record the Tribunal has found that not only the petitioner is carrying on systematic activity but it satisfies the triple test and the activities of the petitioner are also profit oriented and intended to make money. It is crystal clear from the evidence on record and it has been rightly so held by the Industrial Tribunal that all the departments/units of the petitioner are an inter dependent. Considering the evidence on record the Industrial Tribunal has recorded the finding of fact that the results of the research activities are periodically published and the petitioner receives monitory benefits there from. The petitioner has been found generating money from its systematic activities, though the learned counsel for the petitioner has emphatically tried to contend that yogic activities are only aimed at attending a given spiritual level by yoga. The said submission cannot be accepted for want of positive evidence in that regard. Had the intention of the petitioner been only to help people achieve a given spiritual level by means of yoga it would not charge money from every person who attaches with the activities of the petitioner. With the evidence of this nature on record, let us find out as to whether the activities of the present petitioner are similar or comparable with the activities found in the case of Physical 8 Research Laboratory V/s K.G.Sharma, (supra). The laboratory concerned, in the Supreme Court judgment, was a research institute established by Dr.Vikram Sarabhai for research in space and allied sciences and the same was financed mainly by Central Government by making a provision in this behalf in the union budget. The said research laboratory was not directly or indirectly carrying on any trade or business and its activities did not result into production or distribution of goods or services calculated to satisfy human wants and wishes. The knowledge acquired as a result of the research carried on by it was not sold but utilized for the benefit of the Government. The Supreme Court after considering the law on the point found that the Physical Research Laboratory (PRL institute) was one under the Government of India's department of spaces and was engaged in pure research in space science and thus proceeded to hold that the PRL institute is not an industry. The Supreme Court also endorsed the finding recorded by the Labour Court that the activities carried on by PRL institute cannot be said to be analogous to the carrying on trade, or business as it was found to be not producing or distributing services which are intended or meant for satisfying human wants and wishes as ordinarily understood. The case of the present petitioner cannot be compared with the activities of PRL institute which was considered by the Supreme Court in the above referred judgment. The finding 9 recorded by the Industrial Tribunal that the motive of the petitioner is to earn profit and the same stands substantiated by evidence on record. In this view of the matter I am in agreement with the view taken by the Industrial Tribunal that the petitioner is an industry within the meaning of section 2(j) of the Industrial Disputes Act and its activities are not comparable with the activities of PRL institute in the case of Physical Research Laboratory (supra). 6. As to Point No.2: The learned counsel for the petitioner has contended that the appropriate Government for the petitioner- industry would be the Central Government as according to the learned counsel the petitioner is carrying on its activities under the authority of the Central Government whereas according to the learned counsel for the respondent the activities of the petitioner are not being carried out under the authority of the Central Government and hence the State Government has rightly made reference to the Industrial Tribunal. The issue involved is no longer res integra as the same is decided by Constitution Bench judgment of the Supreme Court in the case of Steel Authority of India Ltd. & Others v/s National Union Water Front Workers & Others , 2001 (91) FLR 182. The question that fell for consideration of the Supreme Court in the said judgment was as to what is the criteria to be applied to determine as to whether which of the Government would be the appropriate Government for making of 10 reference. After noticing conflict of opinion, between different benches including two, three Judges-Bench of the Supreme Court on the interpretation of the expression “appropriate Government” in section 2 (1)(a) of the Contract Labour (Regulation & Abolition) Act, 1970 and in section 2(a) of the Industrial Disputes Act a reference was made to larger bench and the bench of five Judges have decided the issue. The view taken by two Judges-Bench of the Supreme Court in the case of Heavy Engineering Mazdoor Union v/s State of Bihar & Others, 1969 II LLJ 549 equivalent to AIR 1970 SC 82 was followed by three Judges-Bench in the case of Hindustan Aeronautics Ltd. v/s Rashtriya Mill Mazdoor Sangh . Whereas the said view was departed from by three Judges-Bench in the case of Air India Statutory Corporation & Ors. V/s United Labour Union & Ors. The larger bench in the case of Steel Authority of India Ltd. & Ors. V/s National Union Water Front Workers & Ors., (supra) upheld the view taken in the case of Heavy Engineering Mazdoor Union , and Hindustan Aeronautics Ltd. (supra) and rejected the view taken in Air India 's case. The Supreme Court has interpreted the phrase “any industry carried on by or under the authority of Central Government” and to be more precise the later part of it viz. “under the authority of Central Government”. In para 28 of its judgment the Supreme Court made the following observations: 11 “28. From the above discussion, it follows that the phrase “any industry carried on under the authority of the Central Government” implies an industry which is carried on by virtue of, pursuant to, conferment of, grant of or delegation of power or permission by the Central Government to a Central Government company or other government company/undertaking. To put it differently, if there is lack of conferment of power or permission by the Central Government to a Government company or undertaking, it would disable such a company/undertaking to carry on the industry in question.” After holding that for interpretation of the said phrase support cannot be drawn from finding out as to whether the establishment is an undertaking which falls within the meaning of “State or other authorities” in article 12 of the Constitution it proceeded to hold in para 36 which is concluded in para 37 thus: “ 36. ...... ...... ...... ..... ...... In our view, the test which is determinative is: whether the industry carried on by the establishment in question is under the authority of the Central Government? Obviously, there cannot be one test for one part of definition of `establishment' and another test for another part. Thus, it is clear that the criterion is whether an undertaking/instrumentality of Government is carrying on an 12 industry under the authority of the Central Government and not whether the undertaking is instrumentality or agency of the Government for purposes of Article 12 of the Constitution, be it of Central Government or State Government.” 37. There cannot be any dispute that all the Central Government companies with which we are dealing here are not and cannot be equated to Central Government though they maybe `State' within the meaning of Article 12 of the Constitution. We have held above that being the instrumentality or agency of the Central Government would not by itself amount to having the authority of the Central Government to carry on that particular industry. Therefore, it will be incorrect to say that in relation to any establishment of a Central Government company/undertaking, the appropriate Government will be the Central Government. To hold that the Central Government is “the appropriate Government” in relation to an establishment, the court must be satisfied that the particular industry in question is carried on by or under the authority of the Central Government. If this aspect is kept in mind it would be clear that the Central Government will be the “appropriate Government” under the CLRA Act and the I.D. Act provided the industry in question is carried on by a Central Government company/an undertaking 13 under the authority of the Central Government. Such an authority may be conferred, either by a statute or by virtue of relationship of principal and agent or delegation of power. Where the authority, to carry on any industry for or on behalf of the Central Government, is conferred on the Government company/any undertaking by the statute under which it is created, no further question arises. But, if it is not so, the question that arises is whether there is any conferment of authority on the Government company/any undertaking by the Central Government to carry on the industry in question. This is a question of fact and has to be ascertained on the facts and in the circumstances of each case.” It is as such clear that an authority may be conferred either by a statute or by virtue of relationship of principal and agent or delegation of power. In the present case no such authority has been conferred by the statute and the petitioner does not even claim an authority as an agent of the Central Government. The petitioner cannot bind the Central Government as an agent and if this be so, then it is for the petitioner to show that there is any conferment of authority on it to carry on the industry in question and as held by the Apex Court this is a question of fact. The Industrial Tribunal has rightly held that the petitioner who is carrying on some of its activities by receiving grants 14 from the Central Government cannot be termed as an industry which is being run under the authority of the Central Government. There is no authority expressed or implied from the Central Government for various activities of the petitioner and thus the point needs to be answered against the petitioner. Nomination of two persons on the Governing Body of the petitioner by the Central Government or for that matter inspection and auditing of the accounts by the Central Auditor General's Office cannot bestow on the petitioner the status of an industry being carried on under the authority of the Central Government. Learned counsel for the petitioner has also placed reliance on some judgments of the Bombay High Court but I choose not to refer to them as the said judgments follow the law laid down in Air India's case which view has been rejected in a decision rendered in the case of Steel Authority of India's case. 7. As to Point No.3: It is next contended by the learned counsel for the petitioner that the Industrial Tribunal has erred in law in holding that the retrenchment effected is in breach of Rule 81 of the Industrial Disputes (Bombay) Rules. Having regard to the pleadings of the respondent this issue has to facets viz; (i) that the petitioner ought to have prepared a combined seniority list of all its employees in a given cadre who were working in at Lonavala (Head Office) and its branches at Delhi, Bhopal and Rajkot. The grievance of the respondent 15 is that the seniority list of employees working at Lonavala alone was displayed and for no reason or cause the employees from Delhi, Bhopal and Rajkot are not included in the seniority list. The other objection is to the effect that initial dates of appointment of the employees, whose names are covered in the list, were not displayed. The Industrial Tribunal has upheld both the contentions of the respondent and found fault with the seniority list so published as violative of rule 81. The intention behind mandating publication of seniority list under Rule 81 is to secure compliance of principle of last come first go and to facilitate retrenchment of junior most employee. In a given cadre the seniority list is expected to be correctly and fully prepared and displayed so as to enable the aggrieved party to raise objection thereto. Rule 81 of the Industrial Disputes (Bombay) Rules reads thus: “81. Maintenance of seniority list of workmen. - The employer shall prepare a list of all workmen in the particular category from which retrenchment is contemplated arranged according to the seniority of their service in that category and cause a copy thereof to be posted on a notice board in a conspicuous place in the premises of the industrial establishment at least seven days before the actual date of retrenchment.” The seniority list was published at Exh.C-62 whereas the final list came to be published at Ex.C-52. It is the case of the petitioner that no one 16 objected to the provisional list and no objections were raised, whereas according to the respondent the employees were denied fair opportunity to object to the seniority list as in the first place it did not include the names of the employees working in branches and in the second place the list did not have material particulars to raise valid objections. Touching the first submission that non inclusion of names of employees working at branches has vitiated the seniority list at Ex.62, let us examine the pleadings. It is categorically pleaded in para 7 by respondent before the Industrial Tribunal in its statement of claim that the said establishment of the petitioner at Lonavala has its branches at Delhi, Bhopal and Rajkot. It is then stated that the employees of the petitioner are appointed at Lonavala and thereafter they are transferred to the respective branches and hence common seniority list of all the employees working at all the places ought to have been prepared by the petitioner and retrenchment ought to have been made on the basis of the said common seniority list. In reply filed before the Industrial Tribunal by the petitioner the above referred contentions are replied in the following manner: “Not a single person's services have been terminated, were transferred from any other branch to Lonavala. They were appointed at Lonavala and therefore their seniority needs to be considered at Lonavala.” 17 What is relevant to notice is that the averments touching the transfer are not at all denied. Just because no employee sought to be retrenched is transferred from any of the branches to Lonavala cannot be a reason for not preparing a combine seniority list of persons working in given cadre if the services were transferable, whether as a matter of fact they were transferred or otherwise. It is not the case of the petitioner that no employee appointed at a given place is transferred to any other branch and vice-versa. If services of an employee working in cadre are transferable then obviously a combine seniority list