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State of Bombay v/s Hospital Majdoor Sabha: Case Analysis

This is a landmark case which brought 'Hospitals' under the ambit of industry, defined under section 2(j) of Industrial Dispute act 1947.
  • 'Industry' means any systematic activity carried on by co-operation between an employer and his workmen (whether such workmen are employed by such employer directly or by or through any agency, including a contractor) for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes (not being wants or wishes which are merely spiritual or religious in nature).
  • The contentions were raised section 25H of the ID Act, 1947.
  • The writ of mandamus was issued by the defendant in Bombay high court under article 226 of the constitution of India.
  • Section 25 H of Industrial Disputes Act 1947

State Of Bombay & Others V. Hospital Majdoor Sabha

Citations : 1960 AIR 610, 1960 SCR (2) 866
Bench : J. Gahendragadkar, J P.B.
Petitioner : State of Bombay & ors.
Respondent : The hospital majdoor Sabha
Date of Judgement : 29-01-1960

Under this section the retrenched workmen are given preferences over the new person applying for the job.

Provided that re-employment in terms of section 25 H of the act requires a valid termination in the first place and hence constitutes a different cause of action and can only be dealt by labour court if the reference is to be made in this regard but not otherwise.

It cannot be stated as a matter incidental in issue to the dispute relating to termination supported by case law [Karnal Central Co - Operative Bank Ltd. V/s Presiding officer, industrial tribunal cum labour court.][1]

The Industrial Disputes act 1947 has now been included in one act named code on Industrial relations 2020, and the definition of industry in the new act is mentioned under section 2(p).

The group of hospitals, here in question are the five group of hospitals It seems that in 1835 Sir Robert Grant, the then Governor of Bombay, desired to begin an group for the purposes of imparting medical schooling in the Presidency of Bombay. His thought in that behalf used to be sanctioned by means of the Board of Directors of the East India Company and dollars amounting to Rs 44,000 were accrued for the purpose and an equal amount was contributed by means of the Directors to defray the price of development of the College building.

In 1843 the foundation of the Medical College building was once laid and the equal was once completed in 1845. About that time an notion of building a medical institution for the ill humans of all training and castes used to be mooted and Sir Jamsetjee Jeejibhoy offered donation and some contribution used to be made by means of the Government with which the JJ. Hospital was once constructed and it used to be formally opened on 15-5-1845.

Similarly the different 4 hospitals in the group have been built in path of time from donations Except for a small amount of Rs 10,000 the relaxation of the expenditure which is in the neighbourhood of Rs 27 lakhs is totally met by using the appellant out of the furnish sanctioned in the finances beneath the head "38-Medical".

The team is below the administrative control of the Surgeon-General of the appellant and its daily affairs are performed and controlled via the Superintendent who is a full -time worker of the appellant; the residential personnel which include the Resident Medical Officers, Assistant Medical Officers, Housemen, Nurses and others are all full-time personnel of the appellant and their salaries are drawn on the institution pay bills each and every month and paid completely by the appellant.

This group serves as a medical coaching ground for students of the Grant Medical College which is a Government Medical College run and managed by way of the appellant for imparting scientific sciences main to the Degrees of Bachelor of Medicine and Bachelor of Surgery of the Bombay University as nicely as a range of Post-Graduate qualifications of the stated University and the College of Physicians and Surgeons, Bombay; the crew is consequently run and managed via the appellant to provide clinical alleviation and to promote the fitness of the people of Bombay.

Writ Petition Article 226

Writ petition is basically an order to either direct or restrict something in the name of court, in wider aspect it is a remedy available to the people against the violation of their rights. Writs can be filed directly in Supreme court under Article 32 against the violation of fundamental rights ensured under constitution of India, it can also be filed in High Courts under Article 226 for the violation of all other constitutional rights as well as criminal and civil writs can be filed too.

Types Of Writs

There are 5 types of writs which are filed in Supreme court and High Court.
  • Habeas corpus meaning hereby to bring a body, this is a right mostly used for prisoner, in 'Sunil Batra v. Delhi Administration,' it was used for the violation of a right of a prisoner. Supreme court has also explained this writ in 'PS Sadashiv swami v state of Tamil Nadu, 1974.' Generally, the aggrieved files the writ of habeas corpus but in some cases court also allows his relative or friend to file on his behalf.
  • Mandamus; we command, this writ is issued to direct a public body or court to do something which comprise in their official duty. The Court laid down some essential elements of mandamus in the case : 'Mani shobhrej Jain v. State of Maharashtra' that there should a legal right in existence and the duty should be of public nature. This can be issued against the President or Governor.
  • Prohibition, this writ is filed to impose a restriction on a public body from doing something, this basically is a stay. In 'Govind Menon v. Union of India, AIR 1967' court stated the two conditions when one can issue Prohibition, these are:
    1. When there is excess of jurisdiction
    2. When there is absence of jurisdiction
  • Certiorari; to be certified this is a writ issued by apex court on the subordinate Courts to transfer the cases under them. This is issued when:
    • There is absence of jurisdiction
    • Excess of jurisdiction
    • Failure in the correct use of jurisdiction
    Hari Vishnu Kamath Vs. Ahmed Ishaq (AIR 1995 SC 233). The Supreme Court held that one can only issue the writ of certiorari to correct the errors apparent on the face of records, but not for the correction of an error of fact."
  • Quo-Warranto:
    by what authority, this writ can be issued to the person from acting in the public office which he is not entitled to.

Facts Of The Case
  • There were two employees, Miss Vatsala Narayan and Mrs. Ruth Isaac who were employed in the JJ Hospitals group as ward servants in Bombay. A notice was served to them for their termination by JJ Hospital reason being the retrenchment from civil supplies department and in order to accommodate them in their place.
  • Mrs. Isaac and Ms. Narayan being the defendants of this case filed a writ of mandamus in Bombay high court against the termination notice. They contested the notice to be improper hence termination stands invalid.
  • High court of Bombay examined their contentions and adjudged that hospital did not fall under the ambit of 'industry' as defined under section 2 J of industrial disputes act, 1947. Therefore the termination notice held to be proper and termination of Miss Narayan and Mrs. Isaac stands valid, presided by justice Tendolkar.
  • An appeal was made in the court of appeal where the judgement of Justice Tendolkar was reversed and given in the favour of respondent. the appellate court said that the termination made in regards to the retrenchment in the civil department and the notice served for the same were not in compliance to section 25H and 25F of Industrial Disputes act, Therefore the termination is questionable and stands invalid.
  • State of Bombay applied and obtained a certificate of fitness from the Bombay high court to appeal against the orders in the supreme court of India.

Contentions made by Appellant:
  • Was the appellate court justified in deciding the termination and its non-compliance to the section 25F of the Industrial Disputes act 1947.
  • The provisions of section 2J i.e. the definition of industry applies to the hospital.

Contentions made by Defendant:
  • Their termination was made in order to secure another government employee because of the retrenchment in the civil supplies department and whose service has been longer comparatively. This is a wrongful preference given to them.
  • They have not even paid the retrenchment compensation

Issues Raised Before The Court
  1. Whether the provisions of the industrial disputes act are applicable to hospitals?
  2. Whether the definition of industry applies to the hospital or not?
  3. Whether the retrenchment order owing to termination of two employees is invalid under non- compliance of section 25F of the Industrial Disputes act?
  • The court said that any workmen should not be retrenched by the employer who has been working for an an year or more continuously under the employer in the industry without being paid the compensation of retrenchment which shall be equivalent to the salary of 14 days of an average pay of every completed year of service or any part thereof in excess of six months describes under section 25.
  • In order to determine the position of hospital in the definition of industry, the court visited to various words and their wider interpretations of the section 2(j) of Industrial Dispute act 1947, such as; 'undertaking' according to Halsbury dictionary, the primary meaning of undertaking is "exchange of goods for goods or goods for money" then 'business' means "anything which is an occupation different from pleasure", 'service' and 'calling' were also taken in note, to be wider than it is read. Therefore, court explicitly said that 'Hospitals cannot be excluded from industry' under the Industrial Disputes act 1947.
  • Furthermore, it said that the definition of Industry in section 2(j) does not say 'it means' per se whereas it gives a statutory definition in clause 1 and in the next clause it states what things may be included in industry, this makes the definition to be inclusive which suggests the wider interpretation of the definition by court.
  • Court excluded the sovereign actions from the purview of section 2(j) and said that, India is a welfare state and not being a capitalist economy, there has to be limit on the scope of section 2(j).
  • In determination of the group of hospitals is an undertaking as it treats people, provide cure and working for the welfare of people, the court said that any other hospital run by a private citizen which does the same work in addition to profit making would surely constitute into the purview of section 2(j), so, if an institution of similar nature falls within the definition of industry, why don't the hospital run by government, it has been already stated that profit making is immaterial in deciding the scope of industry.
  • The question of quid pro quo is also immaterial for deciding the ambit of industry under section 2(j), as per the Supreme Court.
  • Court quoted the judgment of Labour appellate tribunal in the case Shri vishuddhananda saraswati Marwari hospital v workmen 1952, where it said the hospital to come within the definition of industry.
  • Supreme court upheld the order passed by high court and said in favour of the writ petition issued by the respondent in high court, also dismissed the appeal with cost.

This suit proved to be a landmark judgement where the hospital group happened to be come within the purview of section 2(j) of the Industrial Disputes act 1947. The stance of state was wrong and unlawful. The Supreme Court of India, once again served justice to the workers.

Labourers has suffered from hundred years back, we finally have proper laws and execution in betterment of workplace and employees. In order to set up a positive and fruitful work place, not only the employees but the employers should feel good, hence, any law in the fields of labour should be in compliance with the employer � employee relationship.

  1. 1994 LLR 248(P&H)
Written By:
  1. Pallavi Tripathi
  2. Shashwat Ramesh Kumar

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