Case: Agrl.Produce Mkt.Committee Vs. Ashok Harikuni &amp; Anr Etc

We shall be referring about some of these cases in the later part of our judgment. This wide definition has given an opportunity to both employer and employee for raising issues, one trying to pull out of this definition, to be out of the clutches of the said Act, other bringing within it, to receive benefit under it. Because of width of the periphery of the word "industry" there is tug of war repeatedly between the two, in spite of various decisions of this Court. This situation has led this Court, in Bangalore Water-Supply and Sewerage Board, etc. v. R. Rajappa and others, 1978(3) SCR 207 to record with anxiety and suggesting Legislature for bringing a comprehensive Bill to clear the fog. It recordsview of the difficulty experienced by all of us in defining the true denotation of the term "industry" and divergence of opinion in regard thereto - as has been the case with this bench also - we think, it is high time that the Legislature steps in with a comprehensive bill to clear up the fog and remove the doubts and set at rest once for all the controversy which crops up from time to time in relation to the meaning of the aforesaid term rendering it necessary for larger Benches of this Court to be constituted which are driven to the necessity of evolving a working formula to cover particular cases.This led the Legislature to amend the definition of the word "industry" in Section 2(j) of the aforesaid Act, through amending Act in 1982 but left the said amendment to be given effect from the date to be notified by the Government. Since thereafter with the passage of 18 years in spite of observations of this Court in some cases during this inter magnum, (interregnum ?) the said amendment has not seen the light of the day leaving the situation in doldrum for the Courts to continue to give its shape. Inter-linked with it is also the word "sovereign" which is equally fluid as the word "industry". The word "sovereign" changes its complexion with the type of sovereignty a country is structured also with the change of political structure in view of changing socio-cultural heritage of any country. So defining what is sovereign, the Courts not only of this country but other countries as well have been battling to comprehend it since 19th century. This has gained importance in the industrial law as what constitute to be a sovereign function excludes within its ambit "industry" hence industrial law would have no application over it.

Court's reasoning:
21. In other words, it all depends on the nature of power and the manner of its exercise. What is approved to be "Sovereign" is defence of the country, raising armed forces, making peace or war, foreign affairs, power to acquire and retain territory. These are not amenable to the jurisdiction of ordinary civil Courts. The other functions of the State including welfare activity of State could not be construed as "sovereign" exercise of power. Hence, every governmental function need not be "sovereign". State activities are multifarious. From the primal sovereign power, which exclusively inalienably could be exercised by the Sovereign alone, which is not subject to challenge in any civil Court to all the welfare activities, which would be undertaken by any private person. So merely one is employee of statutory bodies would not take it outside the Central Act. If that be then Section 2(a) of the Central Act read with Schedule I gives large number of statutory bodies should have been excluded, which is not. Even if a statute confers on any statutory body, any function which would be construed to be "sovereign" in nature would not mean every other functions under the same statute to be also sovereign. The Court should examine the statute to severe (sever ?) one from the other by comprehensively examining various provisions of that statute. In interpreting any statute to find it is "industry" or not we have to find its pith and substance. The Central Act is enacted to maintain harmony between employer and employee which brings peace and amity in its functioning. This peace and amity should be the objective in the functioning of all enterprises. This is to the benefit of both, employer and employee. Misuse of rights and obligations by either or stretching it beyond permissible limits have to be dealt with within the framework of the law but endeavour should not be in all circumstances to exclude any enterprise from its ambit. That is why Courts have been defining "industry" in the widest permissible limits and "sovereign" functioning within its limited orbit.Thus merely an enterprise being statutory corporation, creature under a statute, would not take it outside the ambit of "industry" as defined under the Central Act. We do not find the present case falling under any exception laid down in the Bangalore Sewerage Board case (supra). The mere fact that some employees of the appellant are government servants would make no difference as the true test to find - has to be gathered from the dominant object for which functionaries are working. It cannot be doubted that the appellant is an undertaking performing its duties in a systematic and organised manner, regulating the marketing and trading of agricultural produce, rendering services to the community. In the present case, as we have recorded earlier, we are concerned only with those employees who are not government servants. Testing the dominant object as laid down in Bangalore Sewerage Board case (supra), we reach to inescapable conclusion that none of the activities of the Agriculture Produce Market Committee could be construed to be sovereign in nature. Hence we have no hesitation to hold that this corporation falls within the definition of "industry" under Section 2(j) of the Central Act.29. Section 2(a) of the Central Act defines `Appropriate Government in relation to any industrial disputes concerning any industry carried on by or under the authority of Central Government, or railway company etc. and refers to large number of corporations and corporate bodies which falls in the category of "industry". This indicates even Legislatures intends a very large arms of "industry", to include large number of enterprises to be industry to confer benefit to the employees working under it. In fact, several corporations conferred with statutory powers also curtails individual rights like, through levy of demurrages, detention charges in the warehousing corporation under the Warehouse Corporation Act; Regulation of entry into airport, ATC, levy and regulation of taxes and fees by the international airport authority. Assessment and levy of damages as well as penalties by authorities under the Employees State Insurance Act and Employees Provident Fund Act. Though each of the aforesaid corporations and statutory bodies are "industry". So one of the feeble submissions that curtailment of right of an individual could only be by the exercise of sovereign power has also no merit.So, sovereign function in the new sense may have very wide ramification but essentially sovereign functions are primary inalienable functions which only State could exercise. Thus, various functions of the State, may be ramifications of `sovereignty but they all cannot be construed as primary inalienable functions. Broadly it is taxation, eminent domain and police power which covers its field. It may cover its legislative functions, administration of law, eminent domain, maintenance of law and order, internal and external security, grant of pardon. So, the dichotomy between sovereign andfunction could be found by finding which of the functions of the State could be undertaken by any private person or body. The one which could be undertaken cannot be sovereign function. In a given case even in subject on which the State has the monopoly may also bein nature. Mere dealing in subject of monopoly of the State would not make any such enterprise sovereign in nature. Absence of profit making or mere quid pro would also make such enterprise to be outside the ambit of "industry" as also in State of Bombay and others case (supra).33. The last submission for the appellant is with reference to(3) of Section 59 of the said Act. The submission is, this excludes the application of the Central Act to the employees under the State Act.In view of the aforesaid settled legal principle the width of "industry" being of widest amplitude and testing it in the present case, in view of the preamble, Objects and Reasons and the scheme of the Act, theobject clearly being regulation and control of trading of agricultural produce, thusincluding its functionaries cannot be said to be performing functions which are sovereign in character. Most of its functions could be undertaken even by private persons. Thus the appellant would fall within the definition of "industry" under Section 2(j) of the Central Act. In view of this, we uphold that respondent employees are `workman under the Central Act as held by the Labour Court and confirmed by the High Court. The Labour Court has dealt with each individual case and came to the conclusion in favour ofwhich has also been confirmed by learned Single Judge and Division Bench of the High Court, which does not call for any interference