Definition of “Industry” | Arguments Matrix

On 19 March, a nine-judge Constitution Bench led by Chief Justice Surya Kant reserved judgement on the scope of the definition of “industry”, under Section 2(j) of the Industrial Disputes Act, 1947. The Court was considering the correctness of Bangalore Water Supply and Sewerage Board v. R. Rajappa (1978), which gave an expansive interpretation to it. This resulted in the inclusion of work that is not considered “industry” in the traditional sense. 

Over three days, the Court considered the validity of the “triple test,” the scope of sovereign functions, the relevance of commercial character and whether subsequent legislation like the 1982 Amendment and the Industrial Relations Code, 2020 can help with interpretation. The Bench heard concerns around precedent, worker protection and the consequences of narrowing the definition.

In this matrix, we summarise the key points of arguments emerging from the hearings.