University of Delhi & ANR Vs. Ram
Nath  INSC 81 (1 April 1963)
01/04/1963 GAJENDRAGADKAR, P.B.
GUPTA, K.C. DAS
CITATION: 1963 AIR 1873 1964 SCR (2) 703
E 1968 SC 554 (16,21) E 1970 SC1407 (1) R 1972
SC 763 (12) F 1976 SC 145 (9) O 1978 SC 548 (79,112,117,124,159,161) RF 1988
SC1182 (6) R 1988 SC1700 (5)
Industrial Dispute-Bus drivers in employ of
university Whether "workers"-Education institution, if an industry'
-Industrial Disputes Act, 1947 (14 of 1947), ss. 2 (g), 2 (j) 2 (s), 33c (2).
Appellant No. 1, the University of Delhi and
Appellant No. 2 Miranda House, a college affiliated to the University, are
institutions for education, the predominant activities of these being the
imparting of education. At the material time respondent No. 1 was employed as
bus driver under appellant No. 2. Both the respondents were discharged from
service by giving separate notices and on payment of one month's salary each in
lieu of notice. The respondents by separate petitions applied before the
industrial Tribunal for the award of retrenchment benefits. The appellants
resisted the petitions on the preliminary ground that they did not constitute
an "industry" under S. 2 (j) of the Industrial Disputes Act, 1947,
and that they were not "employees" under s. 2 (g) of the said Act and
therefore the application made by the respondents under S. 33 (c) (2) of the
Act were incompetent. The Tribunal rejected this contention and after
considering the merits passed an order in favour of the respondents directing
the appellants to pay Rs. 1050/to each one of respondents as retrenchment
The appellants appealed to this Court with
They contended in the appeal that the
Tribunal was in error in giving the definition of the word "industry"
under s. 2 (j) its widest denotation by adopting a mechanical and literal rule
of construction and it was urged that the policy of the Act clearly is to leave
educational Institutions out of the purview of the Act. The respondents'
contention was that s. 2 ( j ) had defined the word "industry" in
words of widest amplitude and there is no justification for putting any artificial
restraint on the meaning of the said word as defined.
704 Held that having regard to the fact that
the work of education is primarily and exclusively carried on with the
assistance of the labour and co-operation of teachers, the non-inclusion of the
whole class of teachers from the definition prescribed by 3. 2 (s) has an
important bearing and significance in relation to the problem under
consideration. It could not have been the policy of the Act that education
should be treated as industry for the benefit of a very minor and insignificant
number of persons who may be employed by educational institutions to carry on
the duties of the subordinate staff. Reading s. 2(g), (j) and (s) together it
is reasonable to hold that the work of education carried on by an educational
institution like the University of Delhi is not an industry within the meaning
of the Act.
In the main scheme of imparting education,
the subordinate staff with function like those of the respondents play such a
minor, subsidiary and insignificant part that it would not be reasonable to
allow the work of this subordinate staff to lend its industrial colour to the
principal activity of the University which is imparting education. From a
rational point of view it would be regarded as inappropriate to describe
education even as a profession. Education in its true aspect is more of a
mission and a vocation rather than a profession or trade or business, however
wide may be the denotation of the two latter words under the Act.
The appellants cannot be regarded as carrying
on an industry under s. 2 ( j ) and so the -application made by the respondents
against them under s. 33c (2) of the Act are held to be incompetent.
State of Bombay v. The Hospital Mazdoor Sabha
[1960) 2 S. C. R. 866, Lalit Hari Ayurvedic College Pharmacy Pilibhit. v. Lalit
Hari Ayurvedic College Pharmacy Workers Union, Pilibhit, A. I. R. 1960 S. C.
1261, The Ahmedabad Textile Industry a Research Association v. The State of
Bombay,  2 S. C. R . 481, The Federated State School Teachers'
Association of Australia v. State of Victoria'  41 _C. L. R. 569 and The
Corporation of the, City of Nagpur v. Its Employees,  2 S. C. R. 942,
CIVIL APPFLLATE JURISDICTION: Civil Appeals
Nos. 650 and 651 of 1962.
Appeals by special leave from the order dated
September 22, 1961 of the Labour Court, Delhi, in L C. A No. 479 of 1961.
705 M.C. Setalpad, K. K. Raizada. B. K. Jain
-and A. G. Ratnaparkhi, for the appellants.
Janardan Sharma, for the respondents.
S. P. Verma, for Intervener No. 1.
T. R. Bhasin, S. C. Malik Sushma Malik and
Bhejalal Malik, for intervener No. 2.
1963. April 1. The judgment of the Court was
delivered by GAJENDRAGADKAR J.-These two appeals by special leave arise out of
two petitions filed against the University of Delhi and Principal, Miranda
House, University College for Women, appellants 1 and 2, by two of their
employees Ram Nath and Asgar Masih, respondents 1 & 2 respectively, under
section 33C (2) of the Industrial Disputes Act, 1947 (14 of 1947) (hereinafter
called 'the -Act'). Appellant No. 2 which is the University College for women
is run by appellant No. 1, and so, in substance, the claim made by the two
employees was mainly against appellant No. 1. Ram Nath's case was that he had
been employed as driver by appellant No. 2 in October, 1949 and was served with
a notice on May 1, 1961, that since his services were no longer required, he
would be discharged from his employment on payment of one month's salary in
lieu of notice. Asgar Masih made substantially similar allegations. He bad been
employed in the first instance, by appellant No. 1 as driver but was then
transferred to appellant No. 2 on October 1, 1949. His services were similarly
terminated by notice on May 1, 1961 on payment of one month's salary in advance
in lieu of notice. It is common ground that appellant No. 1 found that running
the buses for the convenience of the girl students attending the college run by
appellant No. 2 resulted in loss, and so, it was 706 decided to discontinue
that amenity. Inevitably, the services of the two drivers had to be retrenched,
and so, there is no dispute that the retrenchment is genuine and there is no
element of mala fides or unfair labour practice involved in it. It is also common
ground that if the employees are workmen within the meaning of the Act, and the
work carried on by the appellants is an industry under s.
2(j), section 25F has not been complied with
and retrenchment amount payable under it has not been paid to the respondents.
The petitions made by the respondents were resisted by appellant No. 1 on the
preliminary ground that appellant No. 1 was not an employer under s. 2(g), that
the work carried on by it was not an industry under s. 2(j), and so, the
applications made under section 33C(2) were incompetent. The Tribunal has
rejected this preliminary objection and having considered the merits, has
passed an order in favour of the respondents directing the appellants to pay
Rs. 10,50/to each one of the respondents as retrenchment compensation. It is
the validity of this award that is challenged before us by the appellants, and
the only ground on which the challenge is made is that the work carried on by
appellant No. 1 is, not an industry under s.2(j).
Though the question thus raised by these two
appeals lies within a narrow compass, its importance is very great. If it is
held that the work of imparting education conducted by educational institutions
like the University of Delhi is an industry under s. 2(j), all the educational
institutions in the country may be brought within the purview of the Act and
disputes arising between them and their employees would be industrial disputes
which can be referred for adjudication under section 10 (1) of the Act and in
appropriate cases, applications can be made by the employees under s. 33C(2).
The appellants contend that the Tribunal was
in error in giving the definition of the word 'industry' under s. 2 (j) its
widest 707 denotation by adopting a mechanical and literal rule of construction
and it is urged that the policy of the Act clearly is to leave education and
educational. institutions out of the purview of the Act.
On the other hand, the respondents contend
that s. 2(j) has defined the word 'industry' deliberately in words of widest
amplitude and there is no justification for putting any artificial restrain on
the meaning of the I said word as defined. In support of this argument,
reliance is placed or the decision of this court in the State of Bombay v. The
Hospital Mazdoor Sabha (1). In that case, this Court observed that "as a
working principle, it may be stated that an activity systematically or
habitually undertaken for the production or distribution of goods or for the
rendering of material services to the community at large or a part of such
community with the help of employees is an undertaking.
Such an activity generally involves the
co-operation of the employer and the employees; and its object is the
satisfaction of material human needs. It must be organised or arranged in a
manner in which trade or business is generally organised or arranged. It must
not be causal nor must it be for oneself, nor for pleasures." The argument
is that the concept of 'service' which is expressly included in the definition
of 'industry' need not -be confined to material service and ought to be held to
include even educational or cultural service, and in that sense educational
work carried on by the University of Delhi held to be an industry.
Having regard to the fact that the word -, industry'
as defined in the Act takes within its sweep any calling or service or
employment, it cannot be denied that there is prima facie some force in the
argument urged by the respondents, but in testing the validity of this
argument, it will immediately become necessary to enquire whether the work
(1) 2 S. C. R. 866, 879.
708 carried on by an educational institution
can be said to be work carried on by it with the assistance of labour or cooperation
of teachers. The main function of educational institutions is to impart
education to students and if it is held that the impartings education' is
industry in reference to which the educational institution is the employer, it
must follow that the teachers who co-operate with the institution and assist it
with their labour in imparting education are the employees of the institution,
and so, normally, one would expect that the teachers would be employees who
would be entitled to the benefits of the Act.
The co-operation of the employer and the
employees, or, in other words, the co-operation between capital and labour to
which reference is always made by industrial adjudication must, on the
respondents' contention, find its parallel in the co-operation between the
educational institution and its teachers. It would, DO doubt, sound somewhat
strange that education should be described as industry and the teachers as
workmen within the meaning of the Act, but if the literal construction for
which the respondents contend is accepted, that consequence must follow. If the
scheme of the Act and the other relevant considerations necessarily lead to the
said consequence, the Court will have to accept the respondents' contention
notwithstanding the fact that it does not fit in with the generally accepted
sense of the word industry'.
Does the concept of co-operation between
teachers and their institution being treated as similar to the co-opration
between labour and capital fit in with the scheme of the Act ? That is
inevitably the next question which we must consider and in doing so, three
definitions will have to be borne in mind. Section 2 (g) (i) defines an
'employer' as meaning in relation to an industry carried on by or under the
authority of any department of the Central 709 Government or a State
Government, the authority prescribed in this behalf, or where no authority is
prescribed, the head of the department; and S. 2(g)(ii) provides that an
employer means in relation to an industry carried on by or on behalf of a local
authority,, the chief executive officer of that authority. If the work of
imparting education is an industry., the University of Delhi may have to be
regarded as an employer within the meaning of s. 2 (g). Section 2 (j) defines
an 'industry' as meaning any business, trade, undertaking, manufacture or
calling of employers and includes 'any calling,service, employment, handicraft,
or industrial occupation or avocation 'of workmen. It is unnecessary to comment
on this definition, because the precise scope of this definition is the very
subject matter of the dispute which we are, considering. 'That takes us to the
definition of "workman" prescribed by s. 2 (s). A workman under the
said definition means., inter alia, any person, including an apprentice,
employed in any industry to do any skilled or unskilled manual, supervisory,,
technical or clerical work for hire or reward. It is common ground that'
teachers employed by educational institutions, whether the said institutions
are imparting primary., secondary, collegiate or postgraduate education, are
not workmen under s. 2(s), and so, it follows that the whole body of employees
with whose co-operation the work of imparting education is carried on by
educational institutions do not fall within the purview of s. 2(s), and any
disputes between them and the -institutions which employed them are outside the
scope of the Act. In other words, if imparting education is an industry under
s. 2(j), the bulk of the employees being outside the purview of the Act, the
only disputes which can fall within the scope of the Act are those which arise
between such institutions and their subordinate staff, the members of which may
fall under s. 2(s). In our 710 opinion, having regard to the fact that the work
of education is primarily and exclusively carried on with the assistance of the
labour and co-operation of' teachers, the omission of the whole class of
teachers from the definition prescribed by s. 2(s) has an important bearing and
significance in relation to the problem which we are considering. It could not
have been the policy of the Act that education should be treated as industry
for the benefit of a very minor and insignificant number of persons who may be
employed by educational institutions to carry on the duties of the subordinate
staff. Reading ss. 2(g), (j) and (s) together, we are inclined to hold that the
work of education carried on by educational institutions like the University of
Delhi is not an industry within the meaning of the Act.
Having reached this conclusion, it may be
legitimate to observe that it is not surprising that the Act should have
excluded education from its scope, because the distinctive purpose and object
of education would make it very difficult to assimilate it to the position of
any trade, business or calling or service within the meaning of s. 2(j).
Education seeks to build up the personality of the pupil by assisting his
physical, intellectual, moral and emotional development.
To speak of this educational process in terms
of industry sounds so completely incongruous that one is not surprised that the
Act has deliberately so defined workman under s. 2(s) as to exclude teachers
from its scope. Under the sense of values recognised both by the traditional
and conservative as well as the modern and progressive social outlook, teaching
and teachers are, no doubt, assigned a high place of honour and it is obviously
necessary and desirable that teaching and teachers should receive the respect
that is due to them. -A proper sense of values would naturally hold teaching
and teachers in high esteem, though power or wealth may not be associated with
them. It cannot be denied 711 that the concept of social justice is wide enough
to include teaching and teachers, and the requirement that teachers should
receive proper emoluments and other amenities which is essentially based on
social justice cannot be disputed;
but the effect of excluding teachers from s.
2(s) is only this that the remedy available for the betterment of their
financial prospects does not fall under the Act. It is well known that
Education Departments of the State Governments as well as the Union Government,
and the University Grants Commission carefully consider this problem .and
assist the teachers by requiring the payment to them of proper scales of pay
and by insisting on the fixation of other reasonable terms and conditions of
service in regard to teachers engaged in primary and secondary education and
collegiate education which fall under their respective jurisdictions.
The position nevertheless is clear that any
problems connected with teachers and their salaries are outside the purview of
the Act, and since the teachers from the sole class of employees with whose
co-operation education is imparted by educational institutions, their exclusion
from the purview of the Act necessarily corroborates the conclusion that
education itself is not without its scope.
In this connection, it would be material to
examine the composition of the University of Delhi. This University has been
established and incorporated as a teaching and affiliating University under the
Delhi University Act, 1922 (No. 8 of 1922). The Organization of this University
consists of the Officers of the University, such as the Chancellor, the Pro Chancellor,
the Vice-Chancellor, the Treasurer, the Registrar, the Deans of Faculties and
others, and its authorities, such as the Court, the executive Council, the
Academic Council, the Finance Committee, the Faculties and others vide sections
8 and 17. These authorities are composed of the teachers in the University who
are classified as Professors, Readers 712 and Lecturers and other persons
interested in education. In other words., it is the officers of the University
and its respective authorities that constitute the Organization of the
University of Delhi. It is well known that this Organization does not
contribute capital of itself in carrying out its work of imparting higher
education. It receives grants from the Central Government, from the University
Grants Commission and from charitable donors and charitable institutions. It
also receives some income from tuition fees. But then it seems very difficult
to postulate that in the work of imparting education, the University of Delhi
contributes any capital as such. This work is carried on by the University with
the co-operation of all its teachers and it would sound inappropriate to hold
that this work is in the nature of a trade or business, or it amounts to
rendering of service which can be treated as an industry under the Act. What we
have said about the University of Delhi, would be equally true about all
educational institutions which are founded primarily for the purpose of
It is true that like all educational
institutions the University of Delhi employs subordinate staff and this
subordinate staff does the work assigned to it; but in the main scheme of
imparting education, this subordinate staff plays such a minor, subsidiary and
insignificant part that it would be unreasonable to allow this work to lend its
industrial colour to the principal activity of the University which is
imparting education. The work of promoting education is carried on by the
University and its teachers and if the teachers are excluded from the purview
of the Act, it would be unreasonable to regard the work of imparting education
as industry only because its minor, subsidiary and incidental work may seem to
partake of the character of service which may fall under s . 2(j).
713 It is well known that the University of
Delhi and most other educational institutions are not formed or conducted for
making profit; no doubt, the absence of profit motive would not take the work
of any institution outside s. 2 (j) if the requirements of the said definition
are otherwise satisfied.
We have referred to the absence of profit
motive only to emphasis the fact that the work undertaken by such educational
institutions differs from the normal concept of trade. or business. Indeed,
from a rational point of view, it would be regarded as inappropriate to
describe education even as a profession. Education in its true aspect is more a
mission and a vocation rather than a profession or trade or business, however
wide may be the denotation of the two latter words under the Act. That is why
we think it would be unreasonable to hold that educational institutions are
employers within the meaning of s. 2 (g), or that the work of teaching carried
on by them is an industry under s. 2(j), because, essentially, the creation of
a well-educated, healthy young generation imbued with a rational progressive
outlook on life which is the sole aim of education, cannot at all be compared
or assimilated with what may be described as an industrial process. Therefore,
we are satisfied that the University of Delhi and the Miranda College for Women
run by it cannot be regarded as carrying on an industry under s. 2(j), and so,
the applications made by the respondents against them under s. 33 C(2) of the
Act must be held to be incompetent.
It still remains to consider some of the
decisions which have been cited at the Bar before us in these appeals. The
first decision to which reference must be made is the case of the Hospital
Mazdoor Sabha (1). In that case, this Court considered somewhat elaborately the
implications of the definition prescribed by s. 2 (j), but it was expressly
stated that the Court was not then expressing any opinion (1) L1960] 2 S. C. R.
714 on the question as to whether running an
educational institution would be an industry under the Act. A similar statement
was made in the case of Lalit Hari Ayurvedic College Pharmacy Pilibhit v. Lalit
Hari Ayurvedic College Pharmacy Workers Union, Pilibhit (,). Having held that
on the broad facts proved in -that case, there was no doubt that the activity
of the appellant was an undertaking under s. 2(j), the Court proceeded to add
that it was not called upon to decide whether running an educational
institution would be an industry under the Act.
In the Ahmedabad Textile Industry's Research
Association v.The State of Bombay (2), while discussing the question as to the
character of the work undertaken by the Research Association, this Court took
the precaution of observing that the activities of the Association had little
in common with the activities of what may be called a purely educational
institution. It would thus be noticed that in holding that the Research
Association was carrying on an industry, this Court emphasized the fact that
its work was distinct. and separate from the work of an institution which
carries on purely educational activities. The question thus left open has been
raised by the present appeals for our decision.
It is, however, argued by the respondents
that in the Hospital Mazdoor Sabha case (3), this Court in terms, has approved
of the minority judgment of Isaacs j. in The Federated State School Teachers'
Association of Australia v. The State of Victoria (4), and since Isaacs J. held
that the dispute raised by the teachers in that case amounted to an industrial
dispute, it would follow that this Court by implication, has expressed its
concurrence with the conclusion of Isaacsj. This argument is not (1) A.I.R.
1960 S.C. 1261.
(3)  2 S.C.R. 866,879.
(2)  2 S.C.R. 48 1.
(4) (1929) 41 C. L.R. 569.
715 well founded. It is true that in the
Hospital Mazdoor Sabha case (1), this Court expressed its general approval with
the social philosophy to which Isaacs J. gave expression in his dissenting
judgment in dealing with the scope and effect of the definition prescribed by
s. 2 (j) in our Act ; but it deliberately took the precaution of making a
specific statement that though the general views expressed by Isaacs J.
appeared to the Court to be acceptable, the Court should not be understood as
having concurred in his final conclusion in, regard to the character of
educational activities carried on by educational institutions. The observation
made in the judgment leaving open that question was not a casual or an
accidental observation; it was made deliberately to avoid a possible argument
in future that the said judgment impliedly accepted the conclusion of Isaacs J.
Therefore, the approval given to the general
views expressed by Isaacs, J. in that case does not necessarily mean that his
final conclusion was accepted.
Let us then briefly notice the effect of the
decision of the Australian High Court in the case of the Federated State School
Teachers' Association of Australia (2). The dispute in that case was in regard
to the wages and conditions of service and it had been raised by teachers
employed by the States in their various schemes of national education and a
point which arose for decision was whether the educational activities of the
States carried on under the appropriate statutes and statutory regulations of
each State relating to education constituted an industry within the meaning of
section 4 of the Commonwealth Conciliation and Arbitration Act, 1904-28. The
majority decision was that the occupation of the teachers so employed was not
an " industrial" occupation, and that the dispute which existed
between the States and the teachers employed by them was, therefore, not an
"industrial dispute" (1) E1960J 2 S.C.R. 866, 879.
(2)  41 C.L.R. 569.
716 within section 51 of the Constitution.
According to the majority decision, "If the carrying on a system. of
public education is not within the sphere of industrialism, those who confine
their efforts to that activity cannot be engaged in an industry or in an
industrial occupation or pursuit." (pp. 575-576). The argument that if the
said activity was carried on by a private person, it would be described as a
business, trade or industry, was repelled with the answer that "'a private
person could no more carry on this system of public education that he could
carry on His Majesty's Treasury or any of the other executive departments of
Government; and if he were authorized to do So, which was almost inconceivable,
then he would no more carry on an industry than the State does now." (p.
575). Rich J., who concurred with the majority opinion, observed that
"teaching does not, like banking and insurance, play a part in the scheme
of national industrial activity" (p. 591) and he rejected the view
expressed by Isaacs, J., that education played a direct part in the promotion
of industry, because he thought that an industrial system could exist without
national education. "The existence of human beings," observed the
learned judge, --'is no doubt necessary but it is absurd' to suggest that
everything that goes to make the man forms a part of the community industrially
organised with a view to the production and distribution of wealth." (p.
592). Isaacs, J., however, struck a strong note of dissent. With the general
observations made by Isaacs, J., in regard to the scope of industrial disputes
this Court has already expressed its concurrence., but, with respect, it is not
easy to accept the theory of the learned judge that education provided by the
State in that case constituted in itself an independent industrial operation as
a service rendered to the community (p. 588). Similar comment falls to be made
in regard to another observation of the learned judge that there is at least as
much reason for including the educational 717 establishments in the
constitutional power as labour services, as there is to include insurance
companies as capital services. The learned Judge thought that "in that
compound process, two facts emerge with respect to education. One is that
industrial education is less and less left to apprenticeship systems and the
other is that the efficiency of the worker is generally directly affected by
his education." (pp. 588 & 589). We are inclined to think that the
comment made by Rich, J., on this _reasoning of Isaacs, J., is not without
There is, besides, another point which has to
be borne in mind in appreciating the effect of this Australian decision.
Under the Commonwealth Conciliation and
Arbitration Act, 1904-34, the definition of the word "'employee" is
wider than that of the definition of the word "'workman" under s. 2
(s) of our Act. The "employee' under the Australian Act means any employee
in any industry and includes any person whose usual occupation is that of
employee in any industry.
It would appear that teachers would fall
under the definition . of employees' and so, the definitions of the words
"industry", "industrial disputes" and "industrial
matters" would naturally be wide enough to take in the cases of disputes
raised by teachers in regard to industrial matters, such as wages, hours
relating to work, retrenchment and others. Thus, it is clear that the main
difficulty which arises from the definition of workman prescribed by s. 2(s) in
our Act did not arise under the definition of employee in the Australian Act,
and that is undoubtedly one important point of distinction. Therefore, we do
not think that much assistance can be drawn from the minority decision of
Isaacs, J., in answering the problem which the appellants have raised before us
in the present appeals..
The respondents, however, contend that there
is a recent decision of this Court which supports 718 the view taken by the
Tribunal that the work carried on by the appellants amounts to an industry
under s. 2(j). In The Corporation of the City of Nagpur V. Its Employees, (1)
the question which arose for the decision of this Court was whether and to what
extent the municipal activities of the Corporation of Nagpur City fell within
the term "industry" as defined by s. 2(14) of the C.P. and Berar
Industrial Disputes Settlement Act, 1947. It appears that disputes has arisen
between the Corporation and its employees in various departments and in an
adjudication by the State Industrial Court it was held that the Corporation and
all its departments were covered by the definition of "industry"
prescribed by s.2(14). The award thus passed by the State Industrial Court was
challenged by the Corporation before the High Court by a writ petition under
Art. 226 of the Constitution. The High Court rejected the Corporation's plea
that its activities did not constitute an-industry-, but remanded the case to
the Industrial Court for determining which of the departments of the
Corporation fell within the definition. After remand, the Industrial Court
found all the departments of the Corporation to constitute an industry, except
five. Against the said award, the Corporation came to this Court by special
leave. No appeal was, however, preferred by the employees in respect of the
five departments which were excluded from s.2(14) by the award. The appeal
preferred by the Corporation failed and this Court added that the finding of
the Industrial Court excluding five departments from the definition under
s.2(14) need not be examined, since it had not been challenged by the
employees. That, in substance, is the decision of this Court.
It would be noticed that the main argument which
was urged on behalf of the Corporation was that its activities were regal or
governmental in Character, and so, it was entirely outside the purview of the
(1)  2 S.C.R. 942.
719 Berar Act. This argument was carefully
examined. It was conceded that the regal functions described as primary and
inalienable functions of the State are outside the purview of the Berar Act and
if they are delegated to a Corporation, they would be excluded from s. 2 (14),
but the Court held that these, regal functions must be confined to legislative
power, administration of law and judicial power. That is how the broad and main
argument urged by the Corporation was rejected. Dealing with the work carried
on by the several departments of the Corporation, this Court observed that if a
service rendered by an individual or a private person would be an industry, it
would equally be an industry in the hands of a corporation, and it held that if
a department of a municipality discharges many functions, some pertaining to
industry as defined in the Act and other non-industrial activities, the
predominant functions of the department shall be-the criterion for the purposes
of the Act. Amongst the departments which were then examined was the education
department under which the corporation looked after the primary education of
the citizens within its limits. In connection with this department, it was
observed that the service rendered by the department could be done by private
persons, and so, the subordinate menial employees of the department came under
the definition of employees and would be entitled to the benefits of the Act.
Reading the judgment as a whole there can be
no doubt that the question as to whether educational work carried on by
educational institutions like the University of Delhi which have been formed
primarily and solely for the purpose of imparting education amounts to an
industry within the meaning of s.2 (14), was not argued before the Court and
was not really raised in that form. The main attack against the award proceeded
on the basis that what the 720 Corporation was doing through its several
departments was work which could be regarded as regal or governmental, and as
such, was outside the purview of the Act, and that argument was rejected. The
other point which is also relevant is that one of the tests laid down by this
Court was that if a department was carrying on predominantly industrial
activities, the fact that some of its activities may not be industrial did not
matter. Applying the same test to the Corporation as a whole, the question was
examined and the inclusion of the education department in the award was upheld.
It would thus be clear that if the test of the character of the predominant
activity of the institution which was applied to the Corporation is applied to
the University of Delhi, the answer would be plainly against the respondents.
The predominant activity of the University of Delhi is outside the Act, because
teaching and teachers connected with it do not come within its purview, and so,
the minor and incidental activity carried on by the subordinate staff which may
fall within the purview of the Act cannot alter the predominant character of
It would be recalled that in the case of the
Hospital Mazdoor Sabha (1), the question about educational institutions was
deliberately and expressly left open, and if the said question was intended to
be decided in the case of the Corporation of the City of Nagpur (2), naturally
more specific arguments would have been urged and the problem would have been
examined in all its aspects. Incidentally, we may add that the Bench that left
the question open in the case of Hospital Mazdoor Sabha (1) was the same Bench
which heard the case of the Corporation of the City of Nagpur and the two matters
were argued soon after each other, though the judgment in the first case was
delivered on January 29, 1960, and that in the latter case on (1)  2
S.C.R. 866, 879.
(2)  2 S.C. R. 942.
721 February 10, 1960. We are making these observations with a view to emphasize the fact that the question which has been
raised for our decision in the present appeals was not raised, nor argued, in
the case of the Corporation of the City of Nagpur and cannot, therefore, be
said to have been decided even incidentally only by reason of the fact that
amongst the departments which were held to have been properly included in the
award was the education department of the Corporation. If we had been satisfied
that the said judgment had decided this point, we would either have followed
the said decision, or would have referred the question to a larger Bench.
In the result, the appeals are allowed,, the
orders passed by the Industrial Tribunal arc set aside and the petitions filed
by the respondents under s. 33 C (2) of the Act are dismissed. There would be
no order as to costs.