TAMIL NADU MEDICAL SERVICES CORPORATION LIMITED versus TAMIL NADU MEDICAL SERVICES CORPORATION EMPLOYEES WELFARE UNION & ANR.
[2024] 5 S.C.R. 596, Supreme Court of India, 2024
Outcome: Unknown
Segment: Issues
[2024] 5 S.C.R. 596 : 2024 INSC 446
Tamil Nadu Medical Services Corporation Limited 
v. 
Tamil Nadu Medical Services Corporation Employees  
Welfare Union & Anr.
(Civil Appeal No. 6511 of 2024)
17 May 2024
[Sanjay Karol* and Prasanna Bhalachandra Varale, JJ.]
Issue for Consideration
Whether the Tamil Nadu Industrial Establishments (Conferment 
of Permanent Status to Workmen) Act, 1981 would apply to the 
parties; whether the Corporation can be termed as an industrial 
establishment as per the provisions of the Tamil Nadu Shops 
and Establishments Act, 1947; and whether the members of the 
Union would qualify as workmen and thus, would be eligible for 
permanent status u/s. 3 of the Act; and whether the suggestion to 
institute an ‘Industrial Disputes Claim’ questioning non-employment 
was sustainable, given that the Inspector of Labour had already 
passed orders in that regard.
Headnotes†
Tamil Nadu Industrial Establishments (Conferment of 
Permanent Status to Workmen) Act, 1981 – s. 2(3), 7 – 
Tamil Nadu Shops and Establishments Act, 1947 – ss. 
2(3), 2(6) – Employees of Government Corporation sought 
regularisation – Inspector of labour conferred permanent 
status to the workmen – High Court upheld the same and 
directed to provide employment to the employees – Cross 
appeals – Issue as regards, applicability of the 1981 Act to 
the parties – Corporation, if could be termed as an industrial 
establishment as per the 1947 Act – Members of the Union, 
if would qualify as
workmen and thus, would be eligible for 
permanent status u/s. 3 of the Act – High Court on remand, 
if could have ignored the order of the Inspector of Labour 
and suggested to institute an ‘Industrial Disputes Claim’ 
questioning non-employment:
Held: Activities conducted by the Corporation fall under those 
mentioned u/s. 2(3) of the 1947 Act – Construction work, which 
* Author
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597
Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu  
Medical Services Corporation Employees Welfare Union & Anr.
the Corporation, by its own admission, carries out, is also for non-
governmental bodies such as firms, companies, and individuals – 
Language of s. 7 of the 1981 Act implies that this Act shall not 
apply to those workmen who are engaged in the construction of 
buildings and the like or other construction work be it structural, 
mechanical, or electrical and thus, the establishments and its 
workmen engaged exclusively in the work of construction, shall 
be exempted – However, this would not allow the Corporation to 
wash its hands off the responsibilities or obligations under the 
Act, since the construction to be undertaken by the Corporation, 
is only one of the many activities to be undertaken by it – To take 
all the workers out of the purview of the Act, especially, when 
the said workers were not the ones undertaking construction, 
unwarranted – Employee having uninterruptedly continued in 
service for 480 days or more for 24 months, having been met, 
the Act would apply to the parties – Furthermore, the scope of 
remand was limited – Since the High Court concluded that the 
Act would apply, no reason for it to disturb the finding of the 
Inspector of Labour – It ought to have simply ordered that the 
order of Labour Inspector which concluded that members of 
Union be given permanent employment, be complied with. [Paras
21-25, 27, 28]
Case Law Cited
State of Karnataka v. Uma Devi [2006] 3 SCR 953 : (2006) 
4 SCC 1; Maharashtra State Road Transport Corporation v. 
Casteribe Rajya Parivahan Karmachari Sanghathana [2009] 13 
SCR 937 : (2009) 8 SCC 556; U.P. Power Corporation Limited 
& Anr. v. Bijli Mazdoor Sangh & Ors. [2007] 5 SCR 256 : (2007) 
5 SCC 755; ONGC Limited v. Petroleum Coal Labour Union & 
Ors. [2015] 5 SCR 474 : (2015) 6 SCC 494; Ajay Pal Singh v. 
Haryana Warehousing Corporation (2015) 6 SCC 321; Ranbir 
Singh v. S.K. Roy, Chairman, Life Insurance Corporation of 
India & Anr. [2022] 10 SCR 986 : (2022) SCC OnLine SC 
521 – referred to. 
List of Acts
Tamil Nadu Industrial Establishments (Conferment of Permanent 
Status to Workmen) Act, 1981; Companies Act, 1956; Tamil 
Nadu Shops and Establishments Act, 1947; Industrial Disputes 
Act, 1947.
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List of Keywords
Industrial Disputes Claim; Inspector of Labour; Industrial 
establishment; Members of the Union; Workmen; Permanent status 
to workmen; Regularisation; Commercial element; Construction 
work; Non-governmental bodies; Scope of remand.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 6511 of 2024
From the Judgment and Order dated 09.08.2019 of the High Court 
of Judicature at Madras in WP No.17133 of 2001
With
Civil Appeal No. 6512 of 2024
Appearances for Parties
S. Nandakumar, Basant R, Sr. Advs., Ms. Deepika Nandakumar, 
Naresh Kumar, K. K. Mani, V.M. Shivakumar, Ms. T. Archana, 
Raunak Arora, Rajeev Gupta, S. Janardanan, D. Kumanan, Ms. G. 
Indira, Ashwini Kumar, P. Gandepan, Ms. D. Poornima, Advs. for 
the appearing parties.
Judgment / Order of the Supreme Court
Judgment
Sanjay Karol, J.
1.	
Leave to appeal by special leave granted.
THE APPEALS
2.	
The cross appeals, one by the Tamil Nadu Medical Services 
Corporation Limited1 and the other by the Tamil Nadu Medical Services 
Corporation Employees Welfare Union2, question the judgment and 
order dated 9th August, 2019, passed by the High Court of Judicature 
at Madras in W.P.Nos.17133 of 2001 and 15241 of 2009 respectively. 
The position of the parties is in accordance with SLP(C)No.30005 
of 2019.
1	
Hereinafter ‘the Corporation’.
2	
Hereinafter ‘the Union’.
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599
Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu  
Medical Services Corporation Employees Welfare Union & Anr.
3.	
The impugned judgment came to be passed in Writ Petition 
No.17133/2001 which was directed against order dated 31st March, 
2001 of the Inspector of Labour, Circle-III, Chennai3, by which the claim 
of 53 workmen to be conferred permanent status in the Corporation 
was accepted, while the claim of 42 others was rejected.
4.	
W.P. No.15241 of 2009 was filed by 22 out of the said 53 workmen 
seeking a writ of mandamus to be granted employment in the 
Corporation as per the order of the Inspector of Labour. 
QUESTIONS BEFORE THIS COURT
5.	
The questions that this Court is to consider are –
(i)	
Whether the Tamil Nadu Industrial Establishments 
(Conferment of Permanent Status to Workmen) Act, 
1981 would apply to the parties?
(ii)	
Whether by way of the impugned judgment, the 
suggestion to institute an ‘Industrial Disputes Claim’ 
questioning non-employment was sustainable, given 
that the Inspector of Labour had already passed 
orders in that regard?
FACTS IN BRIEF
6.	
The Corporation was incorporated under the Indian Companies Act, 
1956 on 1st July, 1994. Its management is under the State of Tamil 
Nadu. It has employed various workmen in different capacities, 
including the appellants in the appeal arising out of SLP(C)No.2649 
of 2020. Such employees had sought regularization under the 
provisions of Tamil Nadu Industrial
Establishments (Conferment of 
Permanent Status to Workmen) Act, 19814. Such representations 
being unsuccessful, two Writ Petitions bearing Nos.17263 and 
17147 of 1998 were preferred before the learned Single Judge of 
the High Court. 
7.	
The learned Single Judge5, vide judgment and order dated 21st July, 
2000 passed the following directions:
3	
Hereinafter ‘Inspector of Labour’.
4	
Hereinafter ‘the Act’.
5	
Annexure P1, pg 61.
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“19….
1.	
The Tamil Nadu Industrial Establishments (Conferment 
of Permanent Status to Workmen) Act, 1981 (Tamil 
Nadu Act 46 of 1981) is applicable to the second 
respondent corporation.
2.	
The ‘Inspector’ having jurisdiction over the second 
respondent is directed to inspect and verify the 
records of the second respondent corporation and 
pass appropriated orders under Sec.3 of the said 
Act with regard to the claim made by the members 
of the petitioner Union;
3.	
The ‘Inspector’ is also directed to consider the claim 
made by the petitioner Union regarding employment 
on Saturdays to the members of the petitioner Union;
4.	
The ‘Inspector’ is further directed to determine the 
above referred questions within three months from 
the date of a copy of this order after affording an 
opportunity of being heard to both parties; and
5.	
Till an order is passed by the ‘Inspector’ as stated 
above, status quo as on date shall be maintained by 
both parties. Writ petitions are allowed to the extent 
mentioned above. No costs. All the miscellaneous 
petitions are closed.” 
8.	
Pursuant to the above order, the Inspector of Labour passed order 
dated 31st March, 20016, wherein the following issues were framed :
“ISSUES
(a)	 Whether the act pertaining to conferment of permanent 
status of Workmen could be made applicable to the 
respondent Establishment?
(b)	 Whether the authorized office under the aforesaid 
act being Labour
Inspector has got the authority to 
try this case?
6	
Annexure P3, pg.98.
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601
Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu  
Medical Services Corporation Employees Welfare Union & Anr.
(c)	
If, the respondent’s Management is covered by the 
Jurisdiction of the aforesaid Act what is the nature 
of relief that could be awarded to the petitioners?”
9.	
The Inspector of Labour concluded that G. Sumathi and 52 other 
workmen were in the service of the Corporation continuously for 
480 days over a period of 24 months and accordingly they could be 
granted permanent status. 
10.	 It is against this order that the judgment and order impugned before 
us, eventually came to be passed. An appeal assailing the order dated 
21st July, 2000 and, an independent writ petition was filed against the 
order dated 31st March, 2001 of the Inspector of Labour, and Division 
Bench vide order dated 10th December 20097 in such proceedings, 
confirmed both these orders and the Corporation was directed to 
provide employment to the Respondents, such as those who were 
before the Court as petitioners (original writ petitioners) in those 
proceedings. Against such confirmation of the order of the Inspector 
of Labour, Civil Appeal Nos. 6567 and 6568 of 2012 were preferred.
11.	 Hence, this Court on 29th March 2010 while issuing notice, stayed the 
operation of the impugned judgment. Subsequently, on 10th March, 
2016, while allowing the appeal, this Court remanded the matter to 
the High Court, thus-
“3. It has been submitted that while
deciding the writ 
petitions and the connected matters, the High Court did not 
consider the fact whether the aforesaid Act is applicable 
to the members of the respondent-Union and the said 
submission appears to be correct. 
4. In the afore-stated circumstances, the impugned 
judgment is set aside and the matters are remanded 
to the High Court for considering the same afresh in 
accordance with law. We are sure that the High Court 
will hear the matters afresh and decide the same in 
accordance with law. 
5. Interim order dated 29th March, 2010 granted by this 
Court shall continue till the High Court modifies the same 
after hearing the concerned parties…”
7	
page 205 of paper book.
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THE IMPUGNED JUDGMENT 
At this juncture, it is worth clarifying that the dismissal of the 
Writ Appeal Nos.1430 & 1431 of 2000 was not challenged 
before this Court and what was challenged was the dismissal of 
W.P.No.17133/2001 and the directions in W.P.No.15241/2009, 
which took on Civil Appeal Nos.6567 and 6568 of 2012, wherein 
the Court remanded the matter. 
12.	 Pursuant to the above order of remand, The High Court in its 
judgment, recorded its agreement with the judgment of the learned 
Single Judge, reproduced supra. It was observed that the learned 
Single Judge had extensively examined the constitution of the 
management of the Corporation, the nature of activities conducted 
by it, et cetera and then concluded that the Act would apply on the 
ground that it was an industrial establishment under Section 2(3)
(e) of the Act, and that they (the learned Division Bench) concur 
with the same. 
13.	 It was further observed that since no appeal stood preferred after 
the writ appeals against the order of the learned Single Judge, were 
dismissed, the order of the Inspector of Labour had become final. 
On independent analysis with respect to the application of the act 
on the Corporation, it was observed as under: 
“50. However on independent analysis of the facts, we 
categorically hold that the provisions of Tamil Nadu Act, 
46 of 1981 are applicable to TNMSC Management, in 
view of the fact that, TNMSC Management is
an industrial 
establishment as defined under section 2(3)(e) of the Act 
and that it is an establishment as defined under section 2 
(6) of Tamil Nadu Act, 36 of 1947. By the above reasoning 
be conclusively hold that TNMSC Management is an 
industrial establishment and is covered under the provisions 
of Tamil Nadu Act, 46 of 1981.”
SUBMISSIONS OF THE PARTIES 
14.	 We have heard the learned counsel for the parties and perused 
the written submission. On behalf of the appellant, it has been 
submitted :-
a)	
That the order dated 10th March, 2016 of this Court was not 
complied with. The specific plea of the appellant that the Act
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603
Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu  
Medical Services Corporation Employees Welfare Union & Anr.
as also the Tamil Nadu Shops and Establishments Act, 19478 
would not be applicable to the appellant. However, the same 
was not considered by the High Court. The only manner in 
which the said Act could be applicable was that the Corporation 
would fall under the definition of ‘commercial establishment’ 
under Section 2(3) of the 1947 Act.
b)	
That the impugned judgment did not analyze whether any of 
the activities of the Corporation fell under Section 2(3) of the 
1947 Act. Section 7 of the Act exempts such of those industrial 
establishments, that are engaged in construction activities 
and since some of the activities of the Corporation, include 
construction, the Corporation would be exempt.
c)	
That most of the 53 employees who are appellants in Appeal 
arising out of SLP(C)No.2649 of 2020, who were directed to 
be given permanent status by the Inspector of Labour, have 
obtained other profitable employment and the Corporation 
cannot be forced to grant permanent status. 
15.	 The respondent-Union has submitted –
(a)	 That the Corporation is attempting to distinguish the status of the 
respondents by applying the ratio of State of Karnataka v. Uma 
Devi9 after having exploited them for years together as temporary 
employees. Reliance has been placed on Maharashtra State 
Road Transport Corporation v. Casteribe Rajya
Parivahan 
Karmachari Sanghathana10 and particularly, paragraphs 32 
to 36 thereof. 
(b)	 Relying on U.P. Power Corporation Limited & Anr. v. Bijli 
Mazdoor Sangh & Ors.11, it is submitted that the industrial 
adjudicator, although can vary terms of employment, but 
cannot do anything violative of Article 14 and if the case at 
hand is covered by the concept of regularization, the same 
Rule applies. 
8	
Hereinafter 1947 Act.
9	
[2006] 3 SCR 953 : (2006) 4 SCC 1
10	
[2009] 13 SCR 937 : (2009) 8 SCC 556
11	
[2007] 5 SCR 256 : (2007) 5 SCC 755
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(c)	
Relying on ONGC Limited v. Petroleum Coal Labour Union 
& Ors.12 and Ajay Pal Singh v. Haryana Warehousing 
Corporation13, it is urged that the powers of Industrial and 
Labour Courts were not in consideration in Uma Devi (supra). 
(d)	 A tabular chart has been provided in respect of the 12 appellants 
in the Appeal arising out of SLP(C)No.2649 of 2020 and it is 
submitted that since the Inspector of Labour vide its order has 
declared the eligibility of the said workmen for grant of permanent 
status, there falls no requirement to raise an industrial dispute 
questioning the non-employment. Such of those respondents 
who have reached the age of superannuation would be entitled 
to compensation in lieu of regularization as recognized in Ranbir 
Singh v. S.K. Roy, Chairman, Life Insurance Corporation 
of India & Anr.14. 
ANALYSIS AND CONSIDERATION
16.	 The relevant provisions for the adjudication of the present dispute 
are reproduced below for ease of reference :-
2. Definitions. - In this Act, unless the context otherwise 
requires,-
x              x              x               x                x
(3) “industrial establishment” means-
(a)	  …….; or
(b)	 …….; or
(c)	
……..; or
(d)	 ……..; or
(e)	 an establishment as defined in clause (6) 
of section of the Tamil Nadu Shops and 
Establishments Act, 1947 (Tamil Nadu Act 
XXXVI of 1947); or
(f)	
………; or
12	
[2015] 5 SCR 474 : (2015) 6 SCC 494
13	
(2015) 6 SCC 321
14	
[2022]
10 SCR 986 : 2022 SCC OnLine SC 521
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Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu  
Medical Services Corporation Employees Welfare Union & Anr.
(g)	 any other establishment which the 
Government may, by notification, declare 
to be an industrial establishment for the 
purpose of this Act.
(4) “workman’, means any person employed in any 
industrial establishment 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 includes a badli workman, but does not 
include any such person,-
(a)	 who is employed in the police service or as an 
officer or, other employee of a prison; or
(b)	 who is employed mainly in a managerial or 
administrative capacity; or
(c)	
who, being employed in a supervisory capacity, 
[draws wages exceeding three thousand and 
five hundred rupees per mensem] or exercises 
either by the nature of the duties attached to 
the office or by reason of the powers vested in 
him, functions mainly of a managerial nature.
x              x              x               x                x
3. Conferment of permanent status to workmen. - (1) 
Notwithstanding anything contained in any law for the 
time being in force every workman who is in continuous 
service for a period of four hundred and eighty days in 
a period of twenty-four calendar months in an industrial 
establishment shall be made permanent.
(2) A workman shall be said to be in continuous service 
for a
period if he is, for that period, in uninterrupted 
service, including service which may be interrupted 
on account of sickness or authorised leave or an 
accident or a strike, which is not illegal, or a lock-out 
[xxx], or a cessation of work which is not due to any 
fault on the part of the workman.
[Explanation [I]. - [For the purposes of computing the 
continuous service referred to in sub-sections (1) and (2),
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a workman shall be deemed to be in continuous service 
during the days on which] -
(i) he has been laid-off under an agreement or 
as permitted by standing orders made under the 
Industrial Employment (Standing Orders) Act, 1946 
(Central Act XX of 1946) or under any other law 
applicable to the industrial establishment;
(ii) he has been on leave with full wages, earned in 
the course of this employment; and
(iv) in the case of a female, she has been on 
maternity leave; so however, that the total period of 
such maternity leave does not exceed twelve weeks.
[Explanation II. - For the purpose of this section, Law’ 
includes any award, agreement, settlement, instrument 
or contract of service whether made before or after the 
commencement of this Act.]”
(Emphasis supplied)
17.	 The core issue here is the application of the Act to the Corporation 
qua the employees and their Union. In order to examine the same, 
what is to be considered is as to whether the Corporation can 
be termed as an industrial establishment as per the provisions 
reproduced supra and whether the members of the Union would 
qualify as workmen and therefore would be eligible for permanent 
status under Section 3 of the Act. 
18.	 The High Court considered this question in line with Section 2(3)
(e), as above, i.e., the definition of ‘establishment’ provided under 
section 2(6) of the 1947 Act. It reads thus –
“2. Definitions- In this Act, unless there is
anything 
repugnant in the subject or context-
x                 x                 x                 x
(6) ‘establishment’ means a shop. commercial establishment, 
restaurant, eating-house, residential hotel, theatre or any 
place of public amusement or entertainment and includes 
such establishment as the 1 [State] Government may by
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607
Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu  
Medical Services Corporation Employees Welfare Union & Anr.
notification declare to be an establishment for the purposes 
of this Act;”
19.	 For an establishment to be covered under the definition thereof 
under the 1947 Act, unless it is one of those specifically mentioned, 
it must satisfy being a commercial establishment which is defined 
under Section 2(3) which is as under -
“(3) ‘commercial establishment´ means an establishment 
which is not a shop but which carries on the business of 
advertising, commission, forwarding or commercial agency, 
or which is a clerical department of a factory or industrial 
undertaking or which is an insurance company, joint stock 
company, bank, broker’s office or exchange and includes 
such other establishments as the State Government may 
by notification declare to be a commercial establishment 
for the purposes of this Act.”
20.	 The affidavit dated 16th September, 2009 filed by the Corporation 
before the High Court records that the actual turnover for the year 
2007-2008 is Rs.27.5 crores, vis-à-vis, the value of drugs distributed 
being at Rs.186.60 crores. The order of the Inspector of Labour 
records as under -
“Further the respondent advanced the arguments that 
the Tamil Nadu Medical Services Corporation is not 
functioning with any profit motive, that quality argues are 
being obtained from quality manufacturing and supplied 
the same to the
consumers without obtaining any service 
charges and therefore, the respondent’s establishment is 
not attending to any commercial duty and while perusing all 
the aforesaid factors and also the audited balance sheets 
of the respondents filed on behalf of the petitioner i.e. for 
the years 1994-95, 1995-96 and 1996-97 it is seen that 
for the year 1994-95 the profit to the tune of Rs.6.96 lakhs 
and for 1995-96 Rs.8.44 lakhs and for 1996-97 Rs.1.84 
lakhs had been obtained. Therefore it is clearly seen that 
the respondent’s establishment has no profit intention as 
mentioned by the respondent is not at all true.”
21.	 For any establishment to be commercial, it has to be established 
that the activities undertaken by it are for making some monetary
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gain. Commercial in the most rudimentary sense means buying or 
selling of goods in exchange of money. As the above reproduced, 
uncontroverted paragraph (also recorded by the High Court) 
establishes, the commercial element was not absent. 
22.	 Further, it was submitted that the activities conducted by the 
Corporation did not fall under those mentioned under Section 2(3) 
of the 1947 Act. This submission too, is difficult to accept. The 
construction work, which the Corporation, by its own admission, 
carries out, is also for non-governmental bodies such as firms, 
companies, and individuals. It would be apposite to refer to the 
observations of the High Court in this regard, in particular, paragraphs 
37 and 38 of the impugned decision, which, for ease of reference 
are reproduced below :
“37. TNMSC Management is a company registered under 
the Indian Companies Act, 1956 which is wholly owned 
by the Government of Tamil Nadu. The objects of the 
company as seen from the memorandum of articles of 
association are as follows :
“(1) To buy or otherwise acquire all kinds and varieties 
of generic and patent medicines, drugs, mixtures, 
formulations, tablets, pills, powders, pharmaceutical 
and medical products, needles, syringes, injectables, 
vaccinesr sera, immunogens, phylacogens, chemicals 
and surgical dressings, kits and instruments and to 
sell or supply to various hospitals and other health 
centres.
(ii) To
purchase, distribute, assemble, install, maintain 
or otherwise deal in all types of capital equipments 
and instruments required in hospitals.
(iii)To undertake designing and construction of 
Hospitals and or other buildings for Government, 
or for any other person including local authorities, 
corporations, societies, trusts, companies, firms and 
individuals.
(iv)To establish modern warehouses and Engineering 
workshops to manufacture, assemble, repair or 
otherwise maintain various medical equipments,
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Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu  
Medical Services Corporation Employees Welfare Union & Anr.
surgical instruments, diagnostic equipments, fire-
fighting equipments, furniture and – fittings including, 
hospital furniture and also to undertake civil and other 
general maintenance of hospitals.
(v)To establish research and development centres and 
institutes for medical and para-medical personnel for 
imparting training in various Techno-Managerial fields.”
(Emphasis supplied)
38. It is also seen that TNMSC Management has 
warehouses in channel and in all the District Headquarters. 
These warehouses are used for storing of medicines 
and drugs. It has been specifically held as a fact by the 
Inspector of Labour in the order dated 31.03.2001, that 
TNMSC Management had earned profit of Rs.6.95 lakhs 
in the year 1994-95, Rs.8.44 lakhs in the year 1995-96 
and Rs.1.84 lakhs in the year 1996-97. Consequently, 
any contention raised that it is run on a “no profit basis” 
has to be rejected.”
23.	 It was argued that the Corporation’s activities included construction 
and therefore it would be exempt from the application of the Act. 
Section 7 reads thus-
“7. Act not to apply to workmen employed in certain 
industrial establishment. – Nothing contained in this 
Act shall apply to workmen employed in an industrial 
establishment engaged in the construction of buildings, 
bridges, roads, canals, dams or other construction work
whether structural, mechanical or electrical.”
The language of the provision is clear. It implies that this act shall 
not apply to those workmen who are engaged in the construction 
of buildings and the like or other construction work be it structural, 
mechanical, or electrical. Therefore, those establishments and their 
workmen shall be exempt, who are engaged exclusively, in the work 
of construction. The objectives of the Corporation, which have been 
reproduced15 in the affidavit of the Union before the High Court, state:-
15	
Page 137 of the paperbook in SLP (c) 2649 of 2020

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“
x
x
x
iii) To undertake the designing and construction of hospitals 
and other buildings for the Government, or any other person 
including local authorities, corporations, societies, trusts, 
companies firms and individuals. 
…”
24.	 This, however, in our view would not allow the Corporation to wash 
its hands off the responsibilities or obligations under the Act, since 
the construction to be undertaken by the Corporation, is only one of 
the many activities to be undertaken by it. To take all the workers out 
of the purview of the Act, especially, when the said workers, like the 
members of the respondent union, were not the ones undertaking 
construction is unwarranted. 
25.	 It was further argued that many of the persons directed to be granted 
permanent employment by the order of the Inspector of Labour have 
found profitable employment elsewhere, and as such the SLP on 
their behalf should be dismissed. We cannot accept this submission. 
Simply because some of the persons involved in the employment 
dispute have allegedly found other employment, that does not 
justify a dismissal of others’ claims. Per the written submissions of 
the appellants in the appeal arising out of SLP(C)No.2649 of 2020, 
twelve appellants have approached this court. And therefore, it must 
be seen to its logical conclusion.
26.	 It was argued before the Courts below that the respondents had 
not continued in service after a certain point in time, however, the 
said argument was not accepted and
we find no reason to take a 
different view on fact which since the year 1997 remains proven and 
recognized by the Courts. 
27.	 As such, both requirements, of the establishment being covered 
under the definition of industrial establishment as provided and 
that of the employee having uninterruptedly continued in service 
for 480 days or more for 24 months, having been met we have no 
hesitation in holding that the Act would apply to the parties to the 
present dispute.
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Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu  
Medical Services Corporation Employees Welfare Union & Anr.
28.	 The next question to be considered is whether the High Court on 
remand, could have ignored the order of the Inspector of Labour and 
suggested that the employees raise an industrial dispute questioning 
their non-employment. The reason for remand, as is seen from the 
judgment dated 10th March, 2016, was that the High Court had not 
considered that the Act would be applicable to the parties, which 
were the very same as the parties before us. In other words, the 
scope of remand was limited. The order of the Inspector of Labour 
was passed under the Act. Since the High Court concluded that the 
Act would apply, there was no reason for it to disturb the finding 
of the Inspector of Labour and, therefore, it ought to have simply 
ordered that the order of Inspector of Labour which concluded that the 
members of the respondent-Union be given permanent employment, 
be complied with. When an issue stands already decided and such 
decision does not suffer from any vice of authority or jurisdiction 
then, putting those who enjoy an order in their favour through the 
wringer once more of having to re-establish their claim, this time 
before the authority under the Industrial Disputes Act, 1947, would 
be unjustified. 
29.	 The appeal filed by the Corporation (Appeal arising out of SLP(C)
No.30005 of 2019) is, in terms of the above,
dismissed and the appeal 
filed by the respondent-Union through its President, G. Sumathi 
(Appeal arising out of SLP(C)No.2649 of 2020) is accordingly allowed 
with all consequences in favour of the respondent-employees, under 
the law, to follow. 
Pending application(s), if any, shall stand disposed of. 
Result of the case: Appeal filed by the Corporation dismissed. 
Appeal filed by the Union allowed.
†Headnotes prepared by: Nidhi Jain