Public Utility services under Industrial Dispute Act 1947

Updated: 11/08/2018

Every case of employment is not necessarily productive of an industry. Domestic employment, administrative services of public officials, service in aid of occupations of professional men, also discloses relationship of employers and employees but they cannot be regarded as in the course of industry.

INDUSTRIES WHICH MAY BE DECLARED TO BE PUBLIC UTILITY SERVICES UNDER SUB-CLAUSE (vi) OF CLAUSE (n) OF SECTION 2

  1. Transport (other than railways) for the carriage of passengers or goods, by land or water]
  2. Banking.
  3. Cement.
  4. Coal.
  5. Cotton textiles.
  6. Foodstuffs.
  7. Iron and Steel.
  8. Defence establishments.
  9. Service in hospitals and dispensaries.
  10. Fire Brigade Service.
  11. India Government Mints.

  12. India Security Press.
  13. Copper Mining.
  14. Lead Mining.
  15. Zinc Mining.
  16. Iron Ore Mining.
  17. Service in any oil-field.

18[Rep]
19. Service in the Uranium Industry.
20. Pyrites Mining.
21. Security Paper Mill, Hoshangabad.
22. Services in the Bank Note Press, Dewas.
23. Phosphorite Mining.
24. Magnesite Mining

Industry meaning

It observed that there were five tests laid down by the decisions of this Court in Madras Gymkhana Club Employees Union v. Management of the Madras Gymkhana Club. (1968) 1 SCR 742 and Cricket Club of India Ltd. v. Bombay Labour Union, (1969) 1 SCR 600 which were ‘required to be satisfied before an activity could be held to be an ‘industry’ and they were as follows:

“1. When the operation undertaken rests upon co-operation between employers and employees with a view to production and distribution of material goods or material services;

2. It must bear the definite character of trade or business or manufacture or calling or must be capable of being described as an Undertaking analogous to business or trade resulting in material goods or material services.

3. The activity to be considered as an ‘industry’ must not be casual but must be distinctly systematic;

4. The work for which labour of workmen is required, must be productive and workmen must be following an employment calling, or industrial avocation; and

5. When private individuals are the employers, the industry is run with capital and with a view to profits. (These two circumstances may not exist when Government or local Authority enters upon business, trade, manufacture or an undertaking analogous to trade).”

Electricity Supply

The business of an electricity supply undertaking, a public utility service, in pursuance of a license granted under the Electricity Act, 1910, is comprehensively controlled by the terms of that Statute. The terms on which a franchise is created and conferred are amenable to unilateral modification by Statute. The terms which are so amenable to unilateral alteration to the disadvantage of the licensee include the term pertaining to the quantification of the price payable for the take-over.

Material Service Test

Material services are not services which depend wholly or largely upon the contribution of professional knowledge, skill or dexterity for the production of a result. Such services being given individually and by individuals are services no doubt but not material services. Even an establishment where many such operate cannot be said to convert their professional services into material services. Material services involve an activity carried on through cooperation between employers and employees to provide the community with the use of something such as electric power, water, transportation, mail delivery, telephones and the like, In providing these services, there may be employment of trained men and even professional men, but the emphasis is not on what these men do but upon the productivity of a service organised as an industry and commercially valuable. Thus the services of professional men involving benefit to individuals according to their needs, such as doctors, teachers, lawyers, solicitors etc, are easily distinguishable from an activity such as transport service. The latter is of a commercial character in which something is brought into existence quite apart from the benefit to particular individuals. It is the production of this something which is described as the production of material services