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Informist, Thursday, Aug. 20, 2026

 

NEW DELHI – The Supreme Court's nine-judge Constitution Bench Thursday held that its nearly half-a-century-old worker-friendly definition of industry would not apply to the new Industrial Relations Code, 2020. The previous definition, which includes government departments, hospitals, universities and welfare bodies, has been refined, and this will apply prospectively in pending disputes concerning the Industrial Disputes Act, 1947. 

 

The apex court held that the reference to revisit its old case was valid. However, the reformulated test of industry would operate only prospectively, and is not intended to displace the governing legal position with respect to pending proceedings, the top court said. "Consequently, all matters presently pending before courts, tribunals, labour authorities or other fora under the Industrial Disputes Act, 1947 may be adjudicated in accordance with the triple test as laid down in Bangalore Water Supply(case)," said the Bench, led by Chief Justice of India Surya Kant. 

 

A 1978 judgment of the top court had given a broad interpretation to "industry" under Section 2(j) of the 1947 Act. The apex court had held that an activity would generally fall within the definition where there was an organised and systematic activity, cooperation between employer and employee, and production or distribution of goods and services calculated to satisfy human wants and wishes. It had broadened its interpretation of industry to cover welfare bodies and liberal professions, irrespective of profit motive.  End  

 

Reported by Surya Tripathi

Edited by Avishek Dutta

 

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