Supreme Court's 9-judge Bench To Decide On Definition Of 'Industry' Under Industrial Disputes Act

The Supreme Court will commence hearing arguments on the scope of the definition of “industry” under Section 2(j) of the Industrial Disputes Act, 1947 from 17 March 2026.

A Bench of Chief Justice Surya Kant, Justice Joymalya Bagchi and Justice Vipul Pancholi today said, "This is the first matter before a nine-judge bench...we are starting the Constitution Benches with this matter..".

The bench said that many issues emerge for consideration, including, but not limited to:

1. Whether tests laid down by the Justice VR Krishna Iyer in Bangalore Water Supply case to determine if any undertaking or enterprise falls within the definition of 'industry' lay down the correct law and whether the Industrial Disputes (Amendment) 1982, and the Industrial Relations Code 2020 have any legal impact on the interpretation given?
2. Whether social welfare activities and schemes or other enterprises undertaken by the Government Departments or their instrumentalities can be construed to be industrial activities for the purpose of Section 2(j)?
3. What are the State activities which will be covered and whether such activities will fall outside the purview of Section 2(j)?

The nine-judge bench will consider the correctness of Bangalore Water-Supply & Sewerage Board v R. Rajappa (1978), in which a seven-judge bench had endorsed a wide definition. The definition allowed a large number of institutions and its employees to receive protection under the Industrial Disputes Act.

The question was referred to a larger bench in May 2005 by a Constitution Bench of five-judges in State of Uttar Pradesh vs. Jai Bir Singh.

In the said case supreme court had noted that though section 2(j) used words of very wide denotation, a line would have to be drawn in a fair and just manner so as to exclude some services or undertakings. It has thus called for the court to reconsider where the line should be drawn and what limitations can and should be reasonably implied in interpreting the wide words used in section 2(j).

"In construing the definition clause and determining its ambit, one has not to lose sight of the fact that in activities like hospitals like hospitals and education, concepts like right of the workers to go on `strike' or the employer's right to `close down' and `lay off' are not contemplated because they are services in which the motto is `service to the community'. If the patients or students are to be left to the mercy of the employer and employees exercising their rights at will, the very purpose of the service activity would be frustrated.", the Supreme Court had further said in Jai Bir Singh.

Pressing demands of the competing sectors of employers and employees and the helplessness of legislature and executive in bringing into force the Amendment Act compel us to make this reference, it had then said.

In January 2017, a seven-judge bench, led by then CJI T.S. Thakur stated that a Bench of nine-judges will hear the case. The Supreme Court's decision in this matter will clarify a question that has been pending before it for over 20 years.

Case Title: STATE OF U.P. Vs JAI BIR SINGH

Bench: CJI Kant, Justice Bagchi and Justice Pancholi

Hearing Date: February 16, 2026