Skip to content
  • Facebook
  • X
  • Linkedin
  • WhatsApp
  • YouTube
  • Associate Journalism
  • About Us
  • Privacy Policy
  • 033-46046046
  • editor@artifex.news
Artifex.News

Artifex.News

Stay Connected. Stay Informed.

  • Breaking News
  • World
  • Nation
  • Sports
  • Business
  • Science
  • Entertainment
  • Lifestyle
  • Toggle search form
  • Access Denied World
  • Access Denied Sports
  • Elon Musk’s X challenges California’s content moderation law
    Elon Musk’s X challenges California’s content moderation law World
  • Access Denied Business
  • Much expected board meeting of Sir Ratan Tata Trust cancelled
    Much expected board meeting of Sir Ratan Tata Trust cancelled Business
  • Heart to Heart with Vijaynarain Rangarajan
    Heart to Heart with Vijaynarain Rangarajan Nation
  • US Army Tests Robot Dogs Armed With AI-Enabled Guns At Military Facility In Middle East: Report
    US Army Tests Robot Dogs Armed With AI-Enabled Guns At Military Facility In Middle East: Report World
  • Access Denied Sports
How Supreme Court’s new ruling changes the definition of ‘industry’ | Explained

How Supreme Court’s new ruling changes the definition of ‘industry’ | Explained

Posted on August 21, 2026 By admin


The story so far:

A nine-member Constitution Bench of the Supreme Court of India held that the nearly half-century-old interpretation of the term ‘industry’ will not automatically apply to the Industrial Relations Code (IRC), 2020, which came into force in November 2025 and replaced the legacy Industrial Disputes Act, 1947. This decision effectively severs the new labour regime from an expansive, worker-friendly precedent set in 1978, establishing a clean slate for future labour law disputes.

What constitutes an ‘industry’?

To understand the significance of this judgment, one must look back to the historic 1978 ruling in Bangalore Water Supply and Sewerage Board v. R. Rajappa.

Authored by Justice V.R. Krishna Iyer, that seven-judge Bench significantly broadened the definition of Section 2(j) under the 1947 Act. The 1978 judgment introduced the triple test, which classified systematic or organised operations based on employer-employee cooperation to provide goods or services for consumers as an industry.

This sweeping definition brought various activities, including hospitals, educational institutions, and municipalities, under the legal definition of an industry. The only exclusions were core sovereign functions of the state, such as defence, judiciary, and law enforcement. For nearly half a century, this judgment had enabled workers across diverse sectors to access legal recourse, enforce labour rights, and engage in collective bargaining against unfair practices.

The crux of the nine-judge Bench judgment

The Constitution Bench, led by Chief Justice of India Surya Kant, addressed the question whether the 1978 definition of ‘industry’ should govern Section 2(p) of the IRC.

The majority held that ‘industry’ under the IRC must be interpreted based on its own specific text and statutory context, unburdened by the legacy of the 1978 precedent. Chief Justice Kant noted that while the core principles of the 1978 ruling had stood the test of time, the 1978 judgment would no longer act as the “sheet anchor” for interpreting ‘industry’ under the IRC.

Pending cases under the 1947 Act will continue to be governed by the 1978 Bangalore Water Supply precedent. All future disputes governed by the new Industrial Relations Code will be interpreted afresh.

Differing points of view on the Bench

The nine-judge Bench reflected nuanced positions on the balance between worker protections and modern economic realities.

An opinion authored by Chief Justice Kant, and shared with Justices Satish Chandra Sharma, Alok Aradhe and Vipul M. Pancholi, held that the ‘triple test’ of 1978 Bangalore Water Supply and Sewerage Board case judgment will continue to be applied to pending industrial disputes.

The Chief Justice, however, found that the 1978 verdict could have been articulated differently and set down a “reformulated” triple test, which would operate prospectively. However, the possibility of using the recast triple test to determine if an operation was an industry or not under Section 2(j) of the repealed 1947 Act is non-existent as the new labour law, The Industrial Relations Code 2020, has already come into force. The Bench has unanimously made it clear that ‘industry’ under the 2020 Code will be “interpreted independently” to align with contemporary industrial dynamics, and not be burdened by the 1978 verdict.

Justices B.V. Nagarathna, Dipankar Datta, and Ujjal Bhuyan formed the minority view on the Bench that a re-evaluation of the 1978 judgment was “unwarranted”. Justice Nagarathna cautioned that altering the definition could create uncertainty and disrupt industrial peace.

Justice Nagarathna argued that the 1978 judgment had offered a broad based definition of ‘industry’. She highlighted that the judgment was a child of its time, when public sector workers were transitioning into private employment due to a changing industrial landscape inspired by privatisation, liberalisation and globalisation of the Indian economy.

Justice Bagchi supported the need for the reference to the nine-judge Bench, but expressed his inability to agree to a “reformulated” triple test. Justice Bagchi said an apprehension that the triple test conceived in the 1978 judgment converted any organised activity into an industry was misplaced.

The judge agreed with Justices Nagarathna that even the state could enter into seemingly non-sovereign functions. The concept of ‘sovereignty’ has itself undergone changes with the passage of time. Absence of a profit motive did not take an activity outside the realm of industry, he observed. He said it was unwise to “re-draft” Justice Iyer’s triple test. Justice Datta echoed the need for judicial consistency. Sharing his opinion with Justice Bhuyan, Justice Datta remarked that institutional credibility relies on respecting finality rather than perpetuating doubt over established law.

A step towards a new era

By severing the IRC from the 1978 precedent, the Supreme Court has set the stage for a new chapter in Indian labour law, leaving it to future courts to decide where the lines between employer authority and worker protections will ultimately be drawn.

Published – August 21, 2026 09:36 am IST



Source link

Business Tags:industry definition, industry definition 1978 verdict, industry definition under new labour code, supreme court industry definition

Post navigation

Previous Post: AI reshapes India’s IT services sector contracts as clients demand more for less
Next Post: AAP targets Centre over spike in sugar prices

Related Posts

  • Access Denied Business
  • Pilot rest norms: DGCA seeks implementation timeline from airlines
    Pilot rest norms: DGCA seeks implementation timeline from airlines Business
  • Indian regulator finds Adani offshore investors in disclosure rules violation: Report
    Indian regulator finds Adani offshore investors in disclosure rules violation: Report Business
  • Access Denied Business
  • Manufacturing growth slipped in November to joint 11-month low
    Manufacturing growth slipped in November to joint 11-month low Business
  • WEF 2026: India readies power-packed presence before global elite
    WEF 2026: India readies power-packed presence before global elite Business

More Related Articles

Failure to disclose foreign assets, income to invite ₹10L penalty: I-T dept Failure to disclose foreign assets, income to invite ₹10L penalty: I-T dept Business
Adani Enterprises Says No Disclosure Required On US Regulator Report Business
Recommendation from Group of Ministers awaited for GST exemption on health, life insurance Recommendation from Group of Ministers awaited for GST exemption on health, life insurance Business
Access Denied Business
Rupee trades in narrow range against U.S. dollar in early trade Rupee trades in narrow range against U.S. dollar in early trade Business
RBI Issues Revised Classification Valuation Guidelines For Investment Portfolio Of commercial banks RBI Issues Revised Classification Valuation Guidelines For Investment Portfolio Of commercial banks Business
SiteLock

Archives

  • October 2026
  • September 2026
  • August 2026
  • July 2026
  • June 2026
  • May 2026
  • April 2026
  • March 2026
  • February 2026
  • January 2026
  • December 2025
  • November 2025
  • October 2025
  • September 2025
  • August 2025
  • July 2025
  • June 2025
  • May 2025
  • April 2025
  • March 2025
  • February 2025
  • January 2025
  • December 2024
  • November 2024
  • October 2024
  • September 2024
  • August 2024
  • July 2024
  • June 2024
  • May 2024
  • April 2024
  • March 2024
  • February 2024
  • January 2024
  • December 2023
  • November 2023
  • October 2023
  • September 2023
  • August 2023
  • July 2023
  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022

Categories

  • Business
  • Nation
  • Science
  • Sports
  • World

Recent Posts

  • India sourced more than two-thirds of its August oil imports from just three countries
  • She got the token, but gold ring was denied on ‘technical grounds’
  • Kremlin says Russia restarts diesel exports after deal with Trump
  • Chief Minister to launch water taxis, kayaks in Muziris on Oct. 4
  • Tech Mahindra Q2 profit jumps 33%

Recent Comments

  1. MerleEsozy on UP Teacher Who Asked Students To Slap Muslim Classmate
  2. hETRtxRDsALjPmoDyIQPomm on UP Teacher Who Asked Students To Slap Muslim Classmate
  3. Davidbrurf on UP Teacher Who Asked Students To Slap Muslim Classmate
  4. MerleEsozy on UP Teacher Who Asked Students To Slap Muslim Classmate
  5. MerleEsozy on UP Teacher Who Asked Students To Slap Muslim Classmate
  • Access Denied
    Access Denied Nation
  • Andhra Cricket Association announces ₹25 lakh cash award for Nitish Kumar Reddy
    Andhra Cricket Association announces ₹25 lakh cash award for Nitish Kumar Reddy Sports
  • Access Denied Sports
  • Investigators Recover Plane Black Boxes From Washington Air Crash
    Investigators Recover Plane Black Boxes From Washington Air Crash World
  • DRDO Develops India’s Lightest Bulletproof Vest Against Highest Threat Level
    DRDO Develops India’s Lightest Bulletproof Vest Against Highest Threat Level Nation
  • Access Denied
    Access Denied Nation
  • India’s Predicted XI vs Zimbabwe, 1st T20I: Top Three Slots Confirmed. Who Will Be The Wicketkeeper?
    India’s Predicted XI vs Zimbabwe, 1st T20I: Top Three Slots Confirmed. Who Will Be The Wicketkeeper? Sports
  • Access Denied Business

Editor-in-Chief:
Mohammad Ariff,
MSW, MAJMC, BSW, DTL, CTS, CNM, CCR, CAL, RSL, ASOC.
editor@artifex.news

Associate Editors:
1. Zenellis R. Tuba,
zenelis@artifex.news
2. Haris Daniyel
daniyel@artifex.news

Photograher:
Rohan Das
rohan@artifex.news

Associate Journalists
1. Subrata Paul - AN/2020/01
2. Quamruz Zaman - AN/2021/22
3. Ahmed Sha - AN/2021/035
4. Ajay Kumar Shaw - AN/2021/39
5. Tahqiqul Hoda - AN/2021/21

Artifex.News offers Online Paid Internships to college students from India and Abroad. Interns will get a PRESS CARD and other online offers.
Send your CV (Subjectline: Paid Internship) to internship@artifex.news

Links:
Associate Journalism
About Us
Privacy Policy

News Links:
Breaking News
World
Nation
Sports
Business
Entertainment
Lifestyle

Registered Office:
72/A, Elliot Road, Kolkata - 700016
Tel: 033-22277777, 033-22172217
Email: office@artifex.news

Editorial Office / News Desk:
No. 13, Mezzanine Floor, Esplanade Metro Rail Station,
12 J. L. Nehru Road, Kolkata - 700069.
(Entry from Gate No. 5)
Tel: 033-46011099, 033-46046046
Email: editor@artifex.news

Copyright © 2023 Artifex.News Newsportal designed by Artifex Infotech.