Judgment:
S.A. Bobde, J.
1. By this petition, the employer has challenged the Judgment and Order of the Fifth Labour Court, Mumbai in Reference (IDA) No. 175 of 1996 holding the respondent No. 1's termination to be illegal and directing payment of Rs. 1,25,000/- towards compensation. The learned Labour Court rejected the prayer for reinstatement with full back wages.
The respondent No. 1 was working as an office boy with the petitioner. He had been employed from the year 1989. The services of the respondent were terminated orally on 16.2.1995. Termination was apparently due to the offensive behaviour of the respondent and mistakes at work. The petitioner terminated his services having lost confidence in. him. A dispute regarding this, was referred to the Labour Court.
2. The petitioner is a Private Limited Company comprising of about 4 Directors, who are brothers. The petitioner company works as a commission agent for procurement of cement for their customers. The customers place orders on them on telephone and the petitioners place orders on the cement companies for despatch of the cement directly to the customers. Thus, the work of trading is carried out by the Directors themselves. Being a small company more in the nature of a firm, the company had employed two workmen. According to the company they are part time workers. However, whether the workers are full time or part time does not make difference in the present case. One of the workmen was the respondent No. 1 who used to serve tea in the premises and also carried bills to the customers and is said lo have collected cheques from the customers. There is no evidence that he directly participated in the trading, activity except that he indirectly supported it, as stated above.
3. The main contention on behalf of the Petitioner is that the petitioner is not an industry within the meaning of the I.D. Act and therefore a Reference under it was not tenable. The learned Counsel for the petitioner submitted that the petitioner company is in the nature of a small firm doing the business of trading. It employed only two workmen both of whom were not involved in the main trading activity of the firm. There was as such no organised labour which co-operated with the employer for the purpose of doing business and therefore could not be described as an Industry within the meaning of the I.D. Act. He relied on the Judgment of the Division Bench of this Court in Umashankar Jaswal v. Royal Auto Centre. : 2007 (113) FLR 1128 (Bom.) In this case, this Court held that a proprietary concern which supplied automobile spare parts to the parties outside Maharashtra and lead engaged the services of two people only one described as a Trainee, was not an industry within the meaning of the Act. This Court relied on earlier decisions in Firm Tulsiram Sadanand Sarda v. Assistant Collector of Labour, Nagpur 1961 (I) LLJ 1960 and the judgment of the Supreme Court in Bangalore Water Supply : 1978 (36) FLR 266 (SC) and came to the conclusion that the activity in question was not an industry. In the earlier Judgment of the Division Bench of this Court, it was held that:
In order to constitute an industry, the establishment should be engaged In an activity which is predominantly carried on by employment of organised labour force for the production or distribution of goods or for rendering of material services to the community at large or a part of such community. An activity pertaining to or in relation to private and personal employment, it was held therein, would have to be excluded from the definition of industry. The employment of the workman in that case was of a nature of a private and personal employment in a shop for doing miscellaneous odd jobs. The Court held that the establishment was not an 'industry' within the meaning of the said Act.'
In Bangalore Water Supply case, the Supreme Court observed that the factors which would constitute an Industry are (i) systematic activity, (ii) organised by co-operation between employer and employee, and (iii) production and/or distribution of goods and services calculated to satisfy human wants and desires. Having regard to the aforesaid position in law, Division Bench concluded as follows:
Applying the test which was laid down by the Supreme Court, it cannot be said that the Labour Court or the learned Single Judge was in error in holding that the establishment of the respondent-employer did not fulfil' the ingredients necessary for an 'industry' within the meaning of Section 2(j) of the Act. The facts on record show that there were only two employees viz. the appellant and one person who was engaged as a trainee. The nature of the business consisted of a small shop dealing with automobile spare parts. The material on record has not established the existence of an organised or systematic activity comprised of cooperation between the employer and employee on a scale necessary to fulfil the definition of the expression 'industry', The activity of the respondent-.employer was essentially a family run business and in which, one or at the most two employees, were engaged for doing work of a marginal nature. The fact that the proprietor's son shared a table space does not alter the position. There was nothing like organised labour. The judgment of the Delhi High Court in Om Prakash Jhumman Lal's case (supra) was rendered before the decision in Bangalore Water Supply (supra), and, therefore, has not considered the exception, which was carved out, by the Supreme Court.
Applying the ratio of the decision of the Division Bench, I am of the view that Undertaking of the petitioner cannot be described as an Industry within the meaning of I.D. Act. The petitioner is basically a family run business which did not engage more than two employees for doing incidental work. No co-operation between the employer and the employee in the main activity of the petitioner i.e. which is trading and the activity does not suggest the existence of any organised labour for carrying on a business. There is no organised or systematic activity comprised of co-operation between the employer and employee on a scale, necessary to fulfil the definition of the expression 'industry', vide Bangalore Water Supply case.
4. At this juncture, it may be noted that the learned Counsel for the respondent No. 1 submitted that there wore seven workmen in the petitioner's employment. The Respondent has not led any reliable evidence to establish that. On the contrary, it appears that the petitioner's witness has stated in his evidence that there are other companies in the premises where those other workmen are employed. There is thus no evidence on record to show that the petitioner company employed seven workmen.
5. In this view of the matter, Rule is made absolute in terms of prayer Clause (a).
At the request of the learned Counsel for the respondents, it is ordered that the petitioner shall not withdraw the compensation deposited in this Court for a period of eight weeks from today.