Reiterating the ratio decidendi of Bangalore Water Supply and Sewerage Board v. A. Rajappa [1978 AIR 548] and M/s Shantivan-II Cooperative Housing Society v. Smt. Manjula Govind Mahida Hon’ble Mumbai High Court held that the Co-operative Society does not fall under the ambit of the term ‘industry’ as defined under section 2(j) of The Industrial Disputes Act, 1947.

In the matter of M/s Arihant Siddhi Cooperative Housing Society Limited v. Pushpa Vishnu and Ors. a Coram consisting of Hon’ble Justice S. C. Gupte alone observed as following-

“As held by the Supreme Court in Bangalore Water Supply case when there are multiple activities carried on by an establishment, what is to be considered is the dominant function. In the present case, merely because the society charged some extra charges from a few of its members for display of neon signs, the society cannot be treated as an industry carrying on business of hiring out neon signs or allowing display of advertisement. In the premises, the impugned award of the Labor Court suffers from a serious error of jurisdiction.”

A writ petition was filed by the Cooperative Housing Society against an award passed by the Hon’ble Labor Court reinstating the Respondent No. 1 in the petition who was engaged as a watchman in the petitioner Cooperative Housing Society with full back wages. Hon’ble Labor Court held that- “. . .though the society was a co-operative housing society, it earned profits by way of additional income from its members and accordingly, fell within the definition of industry. . . . profit motive was proved and that the society could not be termed merely as a housing society.”

Therefore, while allowing the writ petition Hon’ble Bombay High Court cited a part of the M/s Shantivan-II Cooperative Housing Society v. Smt. Manjula Govind Mahida judgement- “. . .where there is a complex of activities, some of which may qualify the undertaking as an industry and some would not, what one has to consider is the predominant nature of services or activities. If the predominant nature is to render services to its own members and the other activities are merely an adjunct, by the true test laid down in the case of Bangalore Water Supply and Sewerage Board v. A. Rajjapa case, the undertaking is not an industry” and held that Co-operative Society is not an ‘industry’ under the scope of Industrial Disputes Act, 1947.


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Order: Arihant Siddhi Co-Op Hsg Soc Ltd Versus Pushpa Vishnu More and Ors