(Guest Post by Saurabh Bhattacharjee, Assistant Professor of Law at NUJS, Kolkata)
The constitution of a seven-judge bench of the Supreme Court to
examine whether the decision of Bangalore
Water Supply and Sewerage Board (BWSSB) v A.S. Rajapppa[1]
requires a reference to a larger bench[2]
has reopened the vexed question of defining ‘industry’ in industrial and labour
law. The formation of a larger bench is a much-belated response to the request
of a 5-judge bench of the Court in State
of Uttar Pradesh v Jaibir Singh[3]
for a larger bench for reconsideration of the BWSSB verdict. The
majority judgment in the BWSSB case, authored by Justice Krishna Iyer, had
famously laid down the ‘Triple Test’ wherein any systematic activity, organised
by cooperation between employer and employee for the production and/or
distribution of goods and services would be considered an industry under
Section 2(j) of Industrial Disputes Act, 1947 (IDA). The only exception the
Court had recognised pertained to sovereign functions. Even though this
judgment held sway as the ruling authority for almost three decades, in an
astonishing decision in 2005, the Jaibir
Singh bench held that the opinion of Justice Krishna Iyer could not be
treated as an authoritative precedent and asked for a reference to a larger
bench.
After
more than a decade, the seven-judge bench has finally been constituted and the
Bench, after concluding the hearing last week, has reserved its decision.[4]
News-reports on the hearing indicate that the Bench appears to be favourably
disposed towards referring the matter to a nine-judge bench. As we await its
decision, I revisit the critique of BWSSB put forth by
the 5 judge-bench and examine the arguments of the petitioners before the
seven-judge bench in the Jaibir Singh
case. In this series of two posts, I present the following arguments: 1) that
Jaibir Singh’s assertion that the Triple Test did not have the support of the
majority of judges of the BWSSB Bench was based on an erroneous reading of the
separate opinions in that case, 2) that the reliance placed by the petitioners
before the seven-judge bench on the analogy with Supreme Court’s recall of the
NEET Order to plead that BWSSB decision is not a judgment in eye of law ignores
the difference between the two cases, 3) that abandoning the Triple Test for
a more restrictive interpretation of
industry, without enacting parallel employee-protection legislation would be
regressive and 4) that while Triple Test provides an accessible and coherent
framework for defining industry, certain aspects of the BWSSB verdict do
require further clarification. In this process, I submit that a reference
should be made to a nine-judge bench. However, the larger bench should refrain
from discarding the Triple Test but should instead clarify some of those
questions left unanswered by the BWSSB case.
Not the First Assault on BWSSB
Prior to the BWSSB decision, different benches of the Supreme Court
had grappled with the wide amplitude of the terms listed in section 2 (j),
leading to, what Justice Krishna Iyer described as, a “zigzag course of
landmark cases.”[5] In
laying down the Triple Test in BWSSB, Justice Iyer adopted a functional
approach and carved out a coherent and yet simple framework for the definition
of industry that could be applied across different activities. It also very
demonstrably advanced the statutory intent of extending legal protection to a
wider constituency of workers.
Yet,
the judgment had come under attack from several quarters even before the Jaibir Singh case. In fact, the
Parliament amended section 2 (j) in 1982 and took certain activities out of the
purview of the word ‘industry’.[6]
While the amended definition still awaits notification, a 2 judge-bench
decision in Coir Board, Ernakulam v
Indira Devi P.S.[7]
launched another salvo by calling for reconsideration of the BWSSB decision by
a larger bench. Justice Sujata Manohar observed that the expansive definition
of the industry might have done more damage than good.[8]
But
the decision of Jaibir Singh was a
frontal assault on the BWSSB judgment. As mentioned earlier, the case suggested
that the BWSSB majority opinion did not even constitute an authoritative
precedent. This claim was based on the following propositions: a) that judges
delivered different opinions at different points of time without perusing the
opinion of other judges on the bench and Beg C.J. who wrote a separate opinion
delivered in haste, only concurred with the conclusion that the BWSSB is an
industry and not with other assertions in the majority opinion and b) that all
the opinions had called for legislative intervention, while suggesting that
their opinions were meant to provide a workable solution till the legislature
stepped in.[9]
BWSSB and Stare Decisis
It
is my submission that this argument of the Jaibir
Singh bench is profoundly misplaced and ignores the commonality between the
majority opinion of Justice Krishna Iyer and the separate but concurring
opinions of Chief Justice Beg and Justice Chandrachud. The common ground
between these opinions was not merely restricted to the final holding that the
Bangalore Water Supply and Sewerage Board is an industry but also to the Triple
Test. This can be inferred from the following observation by Justice Beg in Paragraph
165 of the judgment: “…I am in agreement with the conclusions of my learned
brother Krishna Iyer and I also endorse his reasoning almost wholly.” This
makes it abundantly clear that he agreed with the core rationale of the
majority opinion too. The only major point of departure between the two
opinions, as is evidenced by Paragraph 163, pertained to the nomenclature and
scope of the sovereign function exception. Justice Beg observed “I do not feel
happy about the use of the term ‘sovereign’ here. I think that the term
‘sovereign’ should be reserved, technically and more correctly, for the sphere
of ultimate decisions.” However, Justice Beg did not express any disagreement
on the substance or the rationale of the Triple Test. Justice Chandrachud’s separate
opinion too sounded a discordant note on the appropriateness of the sovereign
function exception. He reasoned that such an exception could not be squared
with the functional approach to defining industry that the Triple Test
espoused.[10]
However as with CJ Beg, Justice Chandrachud also did not express any difference
with the Triple Test. Therefore, it is submitted that the Triple Test – the
core tenet of the majority opinion of the BWSBB decision – indeed had the
support of the five out of the seven judges in the Bench. The common ground
between the three opinions on the Triple Test did therefore constitute a
binding ratio. It was consequently incorrect to infer that there was no
authoritative precedent merely based on the few differences between the three
opinions.
Similarly,
the claim that all the opinions desired legislative intervention to clarify the
legal position on definition of industry and that the Triple Test was devised
as a stopgap standard is a non-sequitur. The judges might have indeed sought
statutory amendments, but until such amendments are brought into force, the
ratio of the case would be a binding precedent. That the plurality of opinions
saw their decision as a temporary measure aimed at holding the field till
Parliament’s involvement does not detract from the operation of the rule of stare decisis and the ratio decidendi upon which the decision is based, shall remain law under Article
141 of the Constitution.
Comparison with Recall of NEET Order and Fallacy of
False Analogy
One of the main arguments, reportedly forwarded by the petitioners
before the seven-judge bench centres around the claim that the judges on the
majority in the BWSSB and Justice Beg did not have the opportunity to peruse
the dissenting opinion. Consequently, the case was analogous to the recall of
order on NEET exam in a review petition in Medical
Council of India v Christian Medical College,[11]
Vellore because “there was no discussion among the members of the Bench before
pronouncement of the judgment.” Based on this comparison, it has been argued
that the BWSSB decision does not form a judgment in the eyes of the law because
of the circumstances of the case. However, this analogy is thoroughly misplaced
and disregards the differences between the two cases. The operative part of the
decision in the Medical Council of India case also referred to the neglect of
binding precedents by the majority decision in the NEET judgment. Therefore,
the lack of discussion between the judges of the Bench did not form the sole
reason for the recall. Ignorance of past precedents also contributed to the
recall. In contrast, there has not been any question whatsoever of BWSSB overlooking
binding precedents. Therefore, the reasons for the Medical Council of India order do not apply to the BWSSB at all and
the attempt to draw an equivalence between the two cases is fallacious at
best.
(You can read Part-II here)
(You can read Part-II here)
[1] (1978) 2 SCC 213
[2] SC to revisit Justice Krishna
Iyer’s Landmark Judgment in Bangalore Water Supply case on Thursday,
LiveLaw.in, Nov. 16, 2016, available at http://www.livelaw.in/sc-revisit-justice-krishna-iyers-landmark-judgment-bangalore-water-supply-case-thursday/
[3] (2005) 5 SCC 1
[4] SC May Refer the 1978 Bangalore Water Supply Judgment for
Reconsideration by a Nine-Judge Bench, LiveLaw.in, Nov. 17, 2017, http://www.livelaw.in/sc-may-refer-1978-bangalore-water-supply-judgment-reconsideration-nine-judge-bench/
[5] Supra n.1, paragraph 1
[7] (1998) 3 SCC 259
[8] Ibid., paragraph 19
[9] Supra n.3, paragraphs
21-29
[10] Supra n.1, paragraph 179
[11] Order dated April 11, 2016, Review Petition (C)Nos.2159-2268 Of 2013,
available at https://indiankanoon.org/doc/33592071/
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