Harinagar Cane Farm & Ors Vs.
State of Bihar & Ors  INSC 65 (21 March 1963)
21/03/1963 GAJENDRAGADKAR, P.B.
GUPTA, K.C. DAS
CITATION: 1964 AIR 903 1964 SCR (2) 458
CITATOR INFO :
E 1968 SC 554 (15,21) R 1971 SC2422 (25) R
1972 SC 763 (12)
Industrial Dispute-Agricultural operation, if
constitutes "Industry"-Industrial Disputes Act 1947 (14 of 1947) s.
The appellant in appeal C. A. No. 31 of 1961
is a private limited company registered under the Indian Companies Act.
It mainly produces sugarance. It also
produces wheat, paddy etc., for sale in the market. Further it undertakes
contract works for maintaining tram lines, weigh bridge, etc. The appellant in
the other appeal has been purchased by Harinagar Sugar Mills Ltd. and since
then is functioning as a department of the said Mills.
459 An industrial dispute raised by the
workmen of the respective appellants had been referred by respondent No. 1 the
State of Bihar to an industrial tribunal for adjudication. The appellants moved
the Patna High Court under Art. 226 on the ground that the agricultural
operations carried on by the appellantsdid not constitute art industry and
therefore respondent No. 1had no jurisdiction to refer the dispute for
adjudication. The High Court repelled this contention and rejected the
petition. The present appeals have been filed by way of special leave granted
by this Court.
It was contented on behalf of the appellant
that the legislative history for the past 50 yearin this country including Art.
43 of the Constitution and the relevant entries in the constitution show that a
sharp distinction is drawn between industry on the one hand and agriculture on
the other and that where, the legislature wants to include agriculture within
tile scope of industrial legislation it makes a specific and express provisions
on that behalf.
The respondents relying on s. 2(g) of the Minimum
Wages Act, 1948, contended that this important statutory enactment for the
benefit of workers expressly includes within its purview workmen employed in
agriculture. It was con. tended on the other side that the word ,industry' in
s. 2(j) in its broad connotation would include agriculture and the legislature
had intended to exclude agriculture from the scope of s. 2 (j) it would have
expressly done so.
Held that in dealing with industrial matters
industrial adjudication should referain from enunciating any general principles
or adopting any doctrinaire considerations and therefore the large question as
to whether all agricultural operations are included within the definition of s.
2 (j) is not decided in this case.
On examination of the facts of these cases
before the court it is found that the appellants are limited companies which
have been formed, inter alia, for the express purpose of carrying on trade or
business, they have invested a large amount of capital for carrying on their
agricultural operations in order to make profit and the workmen employed by the
appellants contribute to the production of agricultural commodities which bring
in profit. In these circumstances even the narrow concept of trade or business
is satisfied and the agricultural operations carried on by the appellants fall
within the definition of "industry" in s. 2 (j).
460 Case Law reviewed.
D.N. Banerji v. P. R. Mukherjee,  S. C.
R. 302. The State of Bombay v. The Hospital Mazdoor Sabha,  2 S.
C. R. 866, The Ahmedabad Textile Industry
Reseach Association v. The State of Bombay,  2 S. C. R. 480, National
Union of Commercial Employees v. M. R. Meher, Industrial Tribunal, Bombay,
 Supp. 3 S. C. R. 157, referred to.
CIVIL APPELLATE JURISDICTION Civil Appeals
Nos. 349 of 1962 and 31 of 1961.
Appeals by special leave from the judgment
and order dated November 18, 1959, of the Patna High Court in Misc. judl.
Cases No. 287 and 498 of 1958.
Ganpat Rai and Lalit Kumar, for the appellant
(in C. A. No. 349 of 1962).
M.C. Setalvad, and Naunit Lal, for the
appellant (in C. A. No. 31 of 1961).
D. Goburdhun, for respondent (in C. A. No.
349 of 62).
M. K. Ramamurthi, S. C. Agarwala, D. P. Singh
and R.K. Gary, for respondent No. 3 (in C. A. No. 349 of 1962).
S.P. Varma, for respondent No. 1 (in C. A.
No. 31 of 1961).
P. K. Chatterjee, for respondent No. 3 (in C.
A. No. 31 of 1961).
1963. March 21. The judgment of the Court was
delivered by GAJENDRAGADKAR J.-The short question which arises in these appeals
is whether the agricultural operations carried on by the two appellants
respectively constitute an industry within the meaning 461 of s. 2 (j) of the
Industrial Dispute Act, 1947 (No. 14 of 1947) (hereinafter called 'the Act').
An industrial dispute raised by the workmen of the two respective appellants
had been referred for adjudication by respondent No. 1, the State of Bihar, to
an Industrial Tribunal under s. 10 (1) of the Act. Both the appellants then
moved the Patna High Court for an appropriate writ under Art. 226 of the
Constitution on the ground that the agricultural operations carried on by them
did not constitute an industry under the Act, and so, respondent No. 1 had no
jurisdiction to make the impugned orders of reference under s. 10 of the Act.
The High Court has repelled this contention
and has held that the agricultural operations carried on by the appellants
respectively constitute an industry, and so, the two impugned orders of
reference are perfectly valid under s. 10. It is against these orders passed by
the Patna High Court in the two petitions filed by the respective appellnts
that they have come to this Court by special leave; and the short question
which falls for our decision is in regard to the applicability of s. 2 (j) of
the Act to the appellant's operations in question.
M/s. Motipur Zamindari Co. (Pvt.) Ltd., which
is the appellant in C. A. No. 31 of 1961 is a private limited company
registered under the Indian Companies Act. It mainly produces sugarcane for
sale to Motipur Sugar Factory Private Ltd., Motipur, Muffarpur, in pursuance of
an agreement under the provisions of the Bihar Sugar Factories Control Act,
1937, and the rules framed thereunder. It also produces wheat, paddy and other articles
for sale in the market either to the consumers or to wholesale dealers.
Besides, it undertakes contract work of the
Motipur Sugar Factory, such as maintaining tramlines, maintaining weigh bridge
at Paharchak, operating lake-pumps, loading and unloading of canes and letting
buildings on hire.
462 M/s. Harinagar Cane Farm which is the
appellant in C. A. No. 349 of 1962), had been purchased by the Harinagar Sugar
Mills Ltd., in March, 1956, and since then is functioning as a department of
the said Mills. It is a subsidiary concern of the Mills and a part of the
Organisation of the Mills itself. Thus, the Mills through this section produces
sugar for its own purpose, It is in the background of this character of the
respective appellants that the question raised by the present appeals has to be
Mr. Setalvad for the appellants contends that
in determining the question as to whether s. 2 (j) of the Act includes
agricultural operations, it would be necessary to bear in mind certain general
considerations. He concedes that the words used in s. 2 (j), if they are
liberally construed in their fullest amplitude, may perhaps be wide enough to
include agriculture and agricultural operations; but he emphasises the fact
that the legislative history for more than (50 ) years in this country shows
that a sharp distinction is drawn between industry on the one hand and
agriculture on the other. In this connection, lie relies on the provisions of
Art. 43 of the Constitution which refers to workers classified as agricultural,
industrial, or otherwise when it provides that the State shall endeavour to
secure, by suitable legislation or economic organisation or in any other way,
to all worker a living wage and other amenities specified in the said Article.
The argument is, when referring to workers, the Con stitution has recognised a
difference between agricultural workers on the one hand and industrial workers
on the other. It is also pointed out that the same distinction is made in the
relevant entries in the different Lists of the Seventh Schedule. Entries 14 and
18 in the State List, for instance, refer respectively to agriculture,
includingagricultural education and research, projection against pests and
prevention of plant diseases, and land, that is to say, rights in or 463 over
land, land tenures including the relation of landlord and tenant, and the
collection of rents; transfer and alienation of agricultural land; land
improvement and agricultural loans; colonization, whereas Entry 24 refers to
industries subject to the provisions of entries 7 and 52 of List 1. Reliance is
also placed on Entry 22 in the Concurrent List which relates to Trade Unions;
industrial and labour disputes. The argument is that agriculture has been left,
in the main, to the jurisdiction of the State Legislatures and in doing so, a
distinction has been recognised between agriculture on the one hand and
industry on the other. It is further suggested that where the legislature wants
to include agriculture within the scope of its industrial legislation, it makes
a specific and express provision in that behalf; and in support of this
argument, reliance is placed on the provisions of s. 3(19) of the Bombay
Industrial Relations Act, 1946 (No. XI of 1994).
Section 3(19) which defines an industry,
provides that 'industry' means, inter alia, agriculture and agricultural
operations. Mr. Setalvad, therefore, argues that if this broad distinction
between agriculture and industry is borne in mind, it should not be difficult
to exclude agricultural operations from t purview of s. 2(j) of the Act. He has
also askes us to take into account the fact that if we were to hold that all
agriculture and agricultural operations fell within s. 2 (j), it may have an
incalculable impact upon the agricultural economy of this country. There is, no
doubt, considerable force in this argument.
On the other hand, it has been urged by the
respondents that it would be erroneous to suggest that the industrial law
enacted by the Act intends to exclude from application of its beneficent
provisions agriculture and agricultural operations. In support of this
argument, reliance is placed on the provisions of the Minimum Wages Act (No. 11
Section 2 (g) of this Act defines
"scheduled employment" 464 as meaning an employment specified in the
Schedule, or any process or branch of work forming part of such employment;
and when we turn to part 11 of the Schedule,
it expressly provides: employment in agriculture, that is to say, inter alia,
in any form of farming including the cultivation and tillage of the soil, dairy
farming the production, Cultivation, growing and harvesting of any agricultural
or hortiCultural commodity. This shows that one of the important statutory
enactments Passed for the benefit of workers expressly includes with in its
purview workers employed in agriculture as defined in part II of the Schedule.
Similarly, it is urged that where the
legislature wants to exclude agriculture from the scope of industrial
legislation, it sometimes takes care to make a specific provision in that
behalf; and this argument is sought to be supported by reference to s. 4 of the
Australian Commonwealth Conciliation and Arbitration Act, 1901, which defines
an "'industrial dispute" as meaning a dispute in relation to industrial
matters.................................. extending beyond the limits of any
one State including disputes in relation to employment upon State railway or to
employment in industries carried on by or under the control of the Commonwealth
or a State or any public authority constituted under the Commonwealth or a St
ate; but it does not include dispute relating to employment in any
agricultural, viti-cultural, horticultural, or dairying persuit. The argument
is that the word 'industry, in its broadest connotation which is intended by s.
2(j) would include agriculture, and if the Legislature had intended that
agriculture should be excluded from the scope of the said definition, it would
have adopted the precedent of the Australian law while enacting s. 2(i).
According to this argument, the provisions of
s. 3(19) of the Bombay Act are merely clarificatory and they indicate that the
legislature made an 465 express provision for including agriculture in order to
avoid any doubt in the matter. The respondents, therefore, contend that there
is no reason why the Court should limit or circumscribe the broad and wide
meaning of the word 'industry' as defined in s. 2 (j).
The respondents also relied on the provisions
contained in cl. (iii) of the explanation to s. 25 A of the Act in support of
the argument that agriculture must be deemed to be included within the meaning
of s. 2 (j). Section 25A occurs in Chapter V-A which deals with lay-off and
retrenchment. It lays down that the provisions contained in ss. 25C to 25E in
the said Chapter will not apply to the industrial establishments specified by
cls. (a) and (b) of s. 25A (1) and the explanation defines what industrial
establishment means in ss. 25A, 25C, 25D and 25E. Clause (iii) of this
explanation shows that the expression "industrial establishment" in
the relevant provisions means a plantation as defined in cl. (f) of s. 2 of the
Plantations Labour Act, 1951 (69 of 1951). When we turn to the provisions of
this section we find that a "plantation' means any plantation to which the
said Act applies either wholly or in part, and includes other establishments
which it is unnecessary to refer-. Section 1, sub-s. (4) indicates to what
plantations the said Act applies. It is thus clear that the plantations to
which the Plantations Labour Act, 1951 applies are expressly included within
the expression ",industrial establishments as explained -by the
explanation to s. 25A of the Act. The argument is that this explanation
indicates that agriculture of which plantations are a part, is not intended to
be excluded from the operation of the Act.
In dealing with the present appeals, we do not
propose to decide the large question as to whether ;ill agriculture and
operations connected with it are 466 included within the definition of s. 2
(j). As we have repeatedly emphasised, in dealing with industrial matters,
industrial adjudication should refrain from enunciating any general principles
or adopting any doctrinaire considerations. It is desirable that industrial
adjudication should deal with problems as and when they arise and confine its
decisions to the points which strictly arise on the pleadings between the
parties. If in reaching any conclusion while dealing with the narrow aspect
raised by the parties before it, industrial adjudication has to evolve some
principle, it should and must, no doubt, attempt to do so, but in evolving the
principle, care should be taken not to lay down an unduly general or broad
proposition which may affect facts and circumstances which arc not before
industrial adjudication in the particular case with which it is concerned.
Bearing in mind the importance of adopting this approach in dealing with
industrial matters, we propose to deal with the narrow question as to whether
agricultural operations carried on by the two appellants constitute an industry
under s. 2 (j) or not. appellate here is no doubt that for carrying , on the
agricultural operations, the appellants have invested a large amount of
capital, and it is not disputed that the appellants have invested capital for
carrying on their agricultural operations for the purpose of making profits. It
is also common ground that the workmen employed by the appellants in their
respective operations contribute to the production of agricultural commodities
which bring in profit to the appellants. Therefore, even the narrow traditional
requirements of the concept of trade or business are, in that sense, satisfied
by the agricultural operations of the appellants.
What is more important in the present appeals
is that the appellants are limited companies which have been formed, inter
alia, for the express purpose 467 of carrying on agricultural trade or
business. We have noticed how the agricultural operations carried on by the
appellants are within their objects, and so, there is no difficulty whatever in
holding that the said operations are organised by the appellants and carried on
by them as a trade or business would be carried on by any trader or
businessman. When a company is formed for the purpose of carrying on an
agricultural operation, it is carrying on trade or business and a plea raised
by it that this organised trade or business does not fall within s. 2 (j)
simply and solely for the reason that it is an agricultural operation, cannot
be sustained. Incidentally, it may be relevant to refer to the fact that in
resisting the argument urged by its workmen against the competence of Mr. Sinha
to appear for it, the appellant Motipur Zamindari Co., Ltd., stated before the
Tribunal that the Sugar Mills Association of which Mr. Sinha happens to be an
office-bearer is connected 'With the industry in which the Zamindari Co., is
engaged, and so, Mr. Sinha had a right to represent the management of the
appellant in the proceedings before the Tribunal. In other words, it is
significant that the appellant expressly admitted that it was a part of the
industry, the Association of which had employed Mr. Sinha as its office-bearer.
Apart from this aspect, however, we have no hesitation in holding that the High
Court was right in coming to the conclusion that the agricultural operations
carried on by the two respective appellants are an industry under s. 2 (j).
Before we part with these appeals, we may
refer to four decisions of this Court where this question has been considered.
In D. N. Baneerji v. P. -B. Mukherjee (1), this Court had occasion to examine
the full significance and import of the words "industy'and industrial
dispute' as defined by s. 2 (j) and (k) of the Act. It has been urged by the
respondents that this decision supports their argument that (1) 
468 s.2 (j) includes all agriculture and
agricaltural operations, and in support of this proposition, they have invited
our attention to the statement in the judgment delivered by Chandrasekhara
Aiyar J., where it is observed that the concept of industry in the ordinary
nontechnical sense applies even to agriculture, horticulture, pisci-culture and
so on and so forth. We are not impressed by this argument.
The context in which this sentence occurs
shows that the Court was there dealing with the ordinary nontechnical sense
according to what is understood by the man in the street as the denotation of
the word 'industry' or business, and so, the observations made in that
connection cannot be taken to amount to the broad and unqualified proposition
that agriculture of all kinds is included in S. 2 (j). The decision in that
case was that disputes that might arise between municipalities and their
employees in branches of work that can be said to be analogous to the carrying
on of a trade or business, fall under s. 2(k) of the Act. It is in the light of
this decision that the observations on which the respondents rely must be read.
In the State of Bombay v. The Hosptial
Mazdoor Sabha (1), this Court has had occasion to examine elaborately the
implications of the concept of industry as defined by s. 2 (j). But it may be
pointed out that one of the considerations which weighed with this Court in
dealing with the dispute raised by the appellant in that case was that in the
first Schedule to the Act which enumerates industries which may be declared as
public utility service under s. 2 (a) (vi), three entries had been added by Act
36 of 1956.
One of these was services in hospitals and
dispensaries, and so, it was clear that after the addition of the relevant
entry in the First Schedule it would not have been open to anybody to suggest
that service in hospitals does not fall under s. 2 (j).
In The Ahmedabad Textile Industry's Research
Association v. The State of Bombay (2), this Court (1)  2 S.C.R. 866,
(2)  2 S.C.R. 480, 469 held that the
activities of the Research Association amounted to an industry, because the
manner in which the Association had been organised showed that the undertaking
as a whole was in the nature of business and trade organised with the object of
discovering ways and means by which member-mills may obtain larger profits in
connection with their industries. In other words, though the work was one of
research and in that sense, of an intellectual type, it had been so organised
as to form part of or a department of the textile industry itself. That is why
it was held that the appellant in that case was an employer and his activity
was an industrial activity within the meaning of s. 2 (j).
On the other hand, the decision in the case
of National Union of Commercial Employees v. M. R. Mehar, Industrial Tribunal,
Bombay (1), was cited, where this Court was called upon to consider whether the
office of a solicitor's firm was an employer and the work carried on in his
office an industry under s. 2 (j) : it was held that though the work of
Solicitor is, in a loose sense, business, it could not be treated as an
industry under s. 2 (j) because the essential attribute of an industrial
dispute was lacking in such case;
the essential basis of an industrial dispute,
it was observed, is that it is a dispute arising between capital and labour in
enterprises where capital and labour combine to produce commodities or to
render service, and that could hardly be predicated about a liberal profession
like that of a Solicitor. A person following a liberal profession cannot be
said to carry on his profession in any rational sense with the active
co-operation of his employees, because it is well-known that the main capital
which a person following a liberal profession contributes is his special or
peculiar intellectual and educational equipment. It is on these grounds that
the Act was held to be inapplicable to a solicitor's firm. We have referred to
these decisions only to emphasise the point that this (1)  Supp. 3 S.C,R.
470 Court has consistently refrained from
laying down unduly broad or categorical propositions in dealing with the
somewhat difficult disputes which the definition contained in s. 2 (j) raises
before industrial adjudication. In the present case, the dispute raised lies
within a narrow compass and it is on that narrow basis that we have decided it.
In the result, the appeals fail and are
dismissed with costs.