1998 JTR(SC) 174
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1998(1) Supreme 503
Supreme Court of India
S.B. Majmudar & M. Jagannadha Rao, J
All India Radio -Appellant
versus
Shri Santosh Kumar & Anr. etc. -Respondents
Civil Appeal No. 2423 of 1989
With
Civil Appeal No. 2135 of 1993
And
Civil Appeal Nos. 775-776 of 1998
(Arising out of SLP (C) Nos. 7722-7722-A of 1993)
Decided on 5-2-1998
Counsel for the Parties :
For the Appellant : Ms. K. Amareswari, Sr. Advocate, A. Subba Rao, Hemant Sharma, S.K. Dwivedi, P. Parmeswaran, C.V. Subba Rao, Advocates.
For the Respondents : R. Venkataramani, Sr. Advocate, Ms. K. Sarada Devi, Ranbir Yadav, M.P. Jha, Ram Ikbal Roy, Advocates.
Important Point
All India Radio and Doordarshan are industries within the meaning of Section 2(j) of Industrial Disputes Act.
Act Referred :INDUSTRIAL DISPUTES ACT : S.2(j)
(A) Section 2(j) of the Industrial Disputes Act, 1947, defines the expression industry for the purposes of determining whether an entity engaged in commercial or sovereign activities falls within the scope of industrial dispute legislation. The present appeals invoke this provision to ascertain whether All India Radio and Doordarshan, being entities that discharge both content broadcasting and public service functions, are to be characterised as industries within the meaning of the Act. The analysis under this section requires a clear delineation between sovereign governmental functions, which are exempted, and commercial or utility-type operations, which are covered, as elucidated in the earlier decision of this Court in the Bangalore Water Supply case and subsequently reaffirmed in the Telecom case.
(B) The core legal principle is that an entity cannot escape the definition of industry merely because it is owned by the State or performs some public service, unless its activities are confined exclusively to sovereign functions. Commercial activities such as broadcasting advertisements and telecasting serials for fees fall outside the sovereign domain and attract the provisions of the Industrial Disputes Act. The adjudication further underscores that where statutory definitions are operative and unambiguous, prior contrary interpretations rendered in older precedents do not bind the Court if they have been expressly overruled.
Facts of the case:
The respondents were employees of All India Radio and Doordarshan Kendras, performing roles such as clerks, linemen, watchmen, and casual fitter-cum-watchmen. The appellants had challenged termination orders and nonregularisation of these employees before authorities constituted under the Act, and the orders of termination were set aside with directions for regularisation. Writ petitions filed by the appellants in the High Court were dismissed, leading to these appeals questioning whether the entities could be characterised as industries under Section 2(j) of the Act.
Findings of Court:
The Court found that All India Radio and Doordarshan discharge significant commercial functions, including telecasting advertisements and serials for payment, and are not confined to sovereign governmental duties. Relying on the overruled decisions, the Court held that both entities fall within the definition of industry under Section 2(j) of the Act. The termination orders were found to be violative of Section 25-F of the Act, and the appeals were consequently dismissed with directions to reinstate the respondents with full benefits.
Issues:
Whether entities owned by the State and engaged in mixed commercial and public service activities qualify as industries within the meaning of Section 2(j) of the Industrial Disputes Act, 1947, and whether the orders of termination passed against their employees were legally valid.
Ratio Decidendi:
The commercial activities carried on by All India Radio and Doordarshan, such as broadcasting advertisements and serials for revenue, extend beyond sovereign functions and bring them within the ambit of industry as defined in Section 2(j) of the Act. Consequently, the adjudicating authorities under the Act were required to apply the provisions of the Act, including Section 25-F, and their orders setting aside termination and directing regularisation were binding.
Result:
The appeals are dismissed, interim stay orders are vacated, and the respondents are to be reinstated in their original posts with all consequential benefits, subject to the appellants implementing the orders within the stipulated time.
(A) Section 2(j) of the Industrial Disputes Act, 1947, defines the expression industry for the purposes of determining whether an entity engaged in commercial or sovereign activities falls within the scope of industrial dispute legislation. The present appeals invoke this provision to ascertain whether All India Radio and Doordarshan, being entities that discharge both content broadcasting and public service functions, are to be characterised as industries within the meaning of the Act. The analysis under this section requires a clear delineation between sovereign governmental functions, which are exempted, and commercial or utility-type operations, which are covered, as elucidated in the earlier decision of this Court in the Bangalore Water Supply case and subsequently reaffirmed in the Telecom case.
(B) The core legal principle is that an entity cannot escape the definition of industry merely because it is owned by the State or performs some public service, unless its activities are confined exclusively to sovereign functions. Commercial activities such as broadcasting advertisements and telecasting serials for fees fall outside the sovereign domain and attract the provisions of the Industrial Disputes Act. The adjudication further underscores that where statutory definitions are operative and unambiguous, prior contrary interpretations rendered in older precedents do not bind the Court if they have been expressly overruled.
Facts of the case:
The respondents were employees of All India Radio and Doordarshan Kendras, performing roles such as clerks, linemen, watchmen, and casual fitter-cum-watchmen. The appellants had challenged termination orders and nonregularisation of these employees before authorities constituted under the Act, and the orders of termination were set aside with directions for regularisation. Writ petitions filed by the appellants in the High Court were dismissed, leading to these appeals questioning whether the entities could be characterised as industries under Section 2(j) of the Act.
Findings of Court:
The Court found that All India Radio and Doordarshan discharge significant commercial functions, including telecasting advertisements and serials for payment, and are not confined to sovereign governmental duties. Relying on the overruled decisions, the Court held that both entities fall within the definition of industry under Section 2(j) of the Act. The termination orders were found to be violative of Section 25-F of the Act, and the appeals were consequently dismissed with directions to reinstate the respondents with full benefits.
Issues:
Whether entities owned by the State and engaged in mixed commercial and public service activities qualify as industries within the meaning of Section 2(j) of the Industrial Disputes Act, 1947, and whether the orders of termination passed against their employees were legally valid.
Ratio Decidendi:
The commercial activities carried on by All India Radio and Doordarshan, such as broadcasting advertisements and serials for revenue, extend beyond sovereign functions and bring them within the ambit of industry as defined in Section 2(j) of the Act. Consequently, the adjudicating authorities under the Act were required to apply the provisions of the Act, including Section 25-F, and their orders setting aside termination and directing regularisation were binding.
Result:
The appeals are dismissed, interim stay orders are vacated, and the respondents are to be reinstated in their original posts with all consequential benefits, subject to the appellants implementing the orders within the stipulated time.
Order
Leave granted in the S.L.Ps.
2. In this group of appeals, the common question which arises for our consideration is to the effect whether the appellant-All India Radio and Doordarshan, as the case may be, are ‘industries’ within the meaning of the said term as defined by Section 2(j) of the Industrial Disputes Act, 1947 (‘the Act’ for short).
3. The respondent-employees were either clerks or linemen/watchmen and other casual workers working at the relevant time as employees of either All India Radio or Doordarshan Kendras. In Civil Appeal No. 2423 of 1989 respondent No. 1 was Grade-II Clerk in Chattarpur Station of All India Radio. In Civil Appeal No. 2135 of 1993 respondent-workman was casual Fitter-cum-Watchman working at Doordarshan Kendra T.V. Relay Centre Dwarka, Gujarat, while the contesting respondents in civil appeals arising out of S.L.P. (C) Nos. 7722/7722A of 1993 were daily-rated workmen working at Doordarshan Kendra, Ranchi. They had challenged their orders of termination or non-regularisation before the authorities constituted under the Act. Their termination orders were set aside and regularisation was granted, as the case may be, to the concerned respondents with consequential benefits. The writ petitions filed before the High Court by All India Radio or Doordarshan Kendra, as the case may be, were dismissed and that is how they are before us in these appeals.
4. The solitary contention canvassed before us by the learned senior counsel for the appellants is to the effect that All India Radio and Doordarshan Kendra discharge sovereign functions of the State and they are not industries within the meaning of Section 2(j) of the Act. Now, it has to be kept in view that as held by a Constitution Bench of this Court consisting of seven learned Judges in the case of Bangalore Water Supply and Sewerage Board etc. v. A. Rajappa & Ors. etc.1 , save and except the sovereign functions, all other activities of employers would be covered within the sweep of term ‘industry’ as defined under Section 2(j) of the Act. The functions which are carried on by All India Radio and Doordarshan cannot be said to be confined to sovereign functions as they carry on commercial activity for profit by getting commercial advertisements telecast or broadcast through their various kendras and stations by charging fees. Looking to the functions of Doordarshan and its set up, as seen from Annexure-1 (annexed to S.L.P. (C) Nos. 7722-7722A of 1993), being the extracts from Doordarshan Manual Vol. I, it cannot be said that the functions carried on by them are of purely sovereign nature. Day in and day out advertisements are being telecast and even serials are being telecast on payment of appropriate charges and on which there cannot be any dispute. Same is the position with All India Radio. However, learned senior counsel for the appellants vehemently relied upon a decision of this Court in the case of Bombay Telephone Canteen Employees Association, Prabhadevi Telephone Exchange v. Union of India & Anr.2. It is true that in that case a Bench of two learned Judges took the view that the telephone exchanges run by the Central Government were discharging sovereign functions and, therefore, the employees working in the canteen run by such telephone exchanges cannot be said to be working in ‘industry’ as defined under Section 2(j) of the Act. However, the said decision has been expressly over-ruled by a judgment of a three Judge Bench of this Court in the case of General Manager, Telecom v. A. Srinivasa Rao & Ors.3. In that case, Chief Justice Verma speaking for the three Judge Bench in paragraph 7 of the Report has expressly over-ruled the said decision. In that decision other decision in Sub-Divisional Inspector of Post v. Theyyam Joseph & Ors.4, is also over-ruled. It has been held in the said decision that the ratio of the Constitution Bench judgment in Bangalore Water Supply (supra) holds the field and the amendment to the definition of Section 2(j) as made in 1982 is not still brought in force and so long as the amending definition does not come into force the decision in Bangalore Water Supply (supra) will hold the field. Consequently, it must be held that the appellant-All India Radio as well as Doordarshan are industries within the meaning of Section 2(j) of the Act and the said definition is operative being applicable at present and as existing on the Statute Book as on date.
5. We may mention that so far as the question of illegality of the orders of termination is concerned, on the facts found by the authorities below it is to be held that the termination orders were violative of Section 25-F of the Act and on which, in fairness to the learned senior counsel for the appellants, no submission was raised before us for consideration. Similarly regularisation of services was also not challenged on merits. As a result of this discussion the appeals are dismissed. Interim stay orders are vacated. The respondents concerned will be reinstated in service with all the benefits available to them under the impugned orders. The appellants shall reinstate the respondents concerned within six weeks from today and implement the orders passed by the authorities below within that time. It is obvious that the reinstatement will be on the same post in which the respondents were working prior to the impugned termination orders.
Appeal dismissed.
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