Bombay HC: Co-operative Society is not Industry u/Industrial Dispute Act

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June 29, 2018

Case name: M/s. Arihant Siddhi Co.Op. Hg. Soc. Ltd. v. Pushpa Vishnu More & Ors.

Date of Judgment: June 28, 2018

One of the seminal issue addressed by the High Court of Bombay in the case was whether “Co-operative Society” is an Industry under the Industrial Dispute Act?

In the case, the petition challenged award passed   by   the   Labour Court, whereby the Respondent was reinstated with full wages and continuity in service was ordered. The Petitioner challenged the Labour Court’s order on the ground   that   the Petitioner against whom the Award was passed is not an “Industry” within the  meaning of Section 2(j) of the Industrial Disputes Act.

The High Court of Bombay in view of the precedents on the issue has categorically stated in the case that a Co-operative Society is not an “Industry” under the Industrial Dispute Act.

Other observations made by the High Court in the case are:

  • The High Court made reference to the case of M/s. Shantivan­II Co-op Hsg. Society v. Smt. Manjula Govind Mahida, wherein it was held that such society is not an industry.
  • The Court further observed that where there is a complex of activities, some of which may qualify undertaking as an industry and some would not, what one has to consider is the predominant feature of services or activities.
  • If the predominant nature is to render services to its own members and the other activities are merely adjunct, by the true test laid down in Bangalore Water Supply and Sewage Board v. A. Rajappa, the undertaking  is not an industry.
  • That the society was thereby earning income and, in the premises could not be termed as a mere housing society.
  • That as held by the Supreme Court in Bangalore Water Supply case, when there are multiple activities carried on by an establishment, what is to be considered is the dominant function.
  • With reference to the facts of the present case, the High Court opined that the impugned award of the Labour Court suffered from a serious error of jurisdiction.

The entire case can be accessed here.