# TATA MEMORIAL HOSPITAL WORKERS UNION v. TATA MEMORIAL CENTRE AND ANOTHER

- **Citation:** [2010] 9 S.C.R. 723
- **Court:** Supreme Court of India
- **Decided:** 2010-08-09
- **Case number:** Civil Appeal No. 6394 of 2010
- **Bench:** Altamas Kabir, Cyriac Joseph, H.L. Gokhale
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/tata-memorial-hospital-workers-union-v-tata-memorial-centre-and-another-26963
- **Pages:** 49

## Headnote

Maharashtra Recognition of Trade Unions and
A
B
Prevention of Unfair Labour Practices Act 1971:
C
s. 2(3) -
Tata Memorial Centre -
'Appropriate
Government' for -Determination of - Held: State Government
is the 'appropriate government' for Tata Memorial Centre for
the purpose of Industrial Disputes Act and MRTU and PULP
0
Act - TMC cannot be held to be functioning under authority
of the Central Governmen.t - Property dedicated to TMC will
be deemed to be vested in the Governing Council of TMCSociety though Central Government has not transferred it to
the Society- Day to day affairs of TMC and its property funds,
E
employment of its staff and their conditions of service are
administered and controlled by the Governing Council of
TMC -
Evidence establishes independent functioning of
TMC under its Governing Council - Industrial Disputes Act,
1947 - s. 2(a) - Labour laws.
Industrial Disputes Act, 1947 - s. 2(a) - Appropriate
Government - Concept of - Explained.
F
The appellant is a trade union registered under the
Maharashtra Recognition of Trade Unions and Prevention
G
of Unfair Labour Practices Act 1971 (M.R.T.U. & P.U.L.P.
Act, in short), and the employees of respondent no. 1 are
the members of the appellant-trade union. Respondent
no. 2-workers association is another trade union
723
H
724
SUPREME COURT REPORTS
[2010] 9 S.C.R.
A functioning under respondent no. 1. Respondent no. 2
filed applications before the industrial court seeking
cancellation of the recognition of the appellant union u/
s. 13 of the M.R.T.U. and P.U.L.P. Act and seeking its
substitution in place of the appellant union u/s. 14 of the
8 M.R.T.U. and P.U.L.P. Act. Respondent no. 1 raised an
objection in the written statement that the 'appropriate
government' for respondent no. 1 was the Central
Government and not the State Government and,
therefore, the proceedings under the M.R.T.U. and
c P.U.L.P. Act, were not maintainable. The industrial court
held that the 'appropriate government' for respondent no.
1 was the State Government and not the Central
Government; and the applications filed by respondent
no. 2 were held to be maintainable under the Act, though
0 the first application was not pressed and the second
application was dismissed on merits. Respondent no. 1
filed a writ petition. T.he Single Judge of the High Court
dismissed the same. The Division Bench of the High
Court allowed the appeal holding that the Central
Government was the 'appropriate government' for
E respondent no. 1 establishment for the purposes of
application of s. 2(3) of the M.R.T.U. and P.U.L.P. Act read
with s. 2(a) of the Industrial Disputes Act 1947; and the
applications filed by respondent no. 2 were not
maintainable. Therefore, the appellant filed the instant
F appeal.
Allowing the appeal, the Court
HELD: 1. Respondent no. 1 establishment cannot be
G held to be functioning under the authority of the Central
Government. The State Government is the appropriate
Government for respondent no. 1 for the purposes of
Industrial Disputes Act 1947 and the M.R.T.U. and P.U.L.P.
Act, 1971. The judgment of the Division Bench of the High
H
TATA MEMORIAL HOSPITAL WORKERS UNION v.
725
TATA MEMORIAL CENTRE
Court cannot be sustained. The two applications filed by
A
respondent no. 2 would be maintainable under M.R.T.U.
and P.U.L.P. Act. The order of the industrial court holding
them to be maintainable but dismissing them on merits
is correct. [Para 64] [771-C-F]
B
2. Entry 22 in list Ill (Concurrent List) of the Seventh
Schedule to the Constitution of India relates to 'Trade
Unions; industrial and Labour disputes'. Entry 23
thereunder is 'social security and social insurance;
employment and unemployment'. Entry 24 is 'welfare of C
labour including conditions of work, provident fund,
employer's liability, workmen's compensation, invalidity
and old age pensions and maternity benefits'. Subject to
the provisions contained in clauses (1) and (2) in Article
246, the Legislature of a State can also make

## Text

_Characters 0–39,851 of 95,164. This is a partial read: ask again with offset=39851 for what follows._

[2010] 9 S.C.R. 723
TATA MEMORIAL HOSPITAL WORKERS UNION
v.
TATA MEMORIAL CENTRE AND ANOTHER
(Civil Appeal No. 6394 of 2010)
AUGUST 9, 2010
[ALTAMAS KABIR, CYRIAC JOSEPH AND H.L.
GOKHALE, JJ.]
Maharashtra Recognition of Trade Unions and
A
B
Prevention of Unfair Labour Practices Act 1971:
C
s. 2(3) -
Tata Memorial Centre -
'Appropriate
Government' for -Determination of - Held: State Government
is the 'appropriate government' for Tata Memorial Centre for
the purpose of Industrial Disputes Act and MRTU and PULP
0
Act - TMC cannot be held to be functioning under authority
of the Central Governmen.t - Property dedicated to TMC will
be deemed to be vested in the Governing Council of TMCSociety though Central Government has not transferred it to
the Society- Day to day affairs of TMC and its property funds,
E
employment of its staff and their conditions of service are
administered and controlled by the Governing Council of
TMC -
Evidence establishes independent functioning of
TMC under its Governing Council - Industrial Disputes Act,
1947 - s. 2(a) - Labour laws.
Industrial Disputes Act, 1947 - s. 2(a) - Appropriate
Government - Concept of - Explained.
F
The appellant is a trade union registered under the
Maharashtra Recognition of Trade Unions and Prevention
G
of Unfair Labour Practices Act 1971 (M.R.T.U. & P.U.L.P.
Act, in short), and the employees of respondent no. 1 are
the members of the appellant-trade union. Respondent
no. 2-workers association is another trade union
723
H
724
SUPREME COURT REPORTS
[2010] 9 S.C.R.
A functioning under respondent no. 1. Respondent no. 2
filed applications before the industrial court seeking
cancellation of the recognition of the appellant union u/
s. 13 of the M.R.T.U. and P.U.L.P. Act and seeking its
substitution in place of the appellant union u/s. 14 of the
8 M.R.T.U. and P.U.L.P. Act. Respondent no. 1 raised an
objection in the written statement that the 'appropriate
government' for respondent no. 1 was the Central
Government and not the State Government and,
therefore, the proceedings under the M.R.T.U. and
c P.U.L.P. Act, were not maintainable. The industrial court
held that the 'appropriate government' for respondent no.
1 was the State Government and not the Central
Government; and the applications filed by respondent
no. 2 were held to be maintainable under the Act, though
0 the first application was not pressed and the second
application was dismissed on merits. Respondent no. 1
filed a writ petition. T.he Single Judge of the High Court
dismissed the same. The Division Bench of the High
Court allowed the appeal holding that the Central
Government was the 'appropriate government' for
E respondent no. 1 establishment for the purposes of
application of s. 2(3) of the M.R.T.U. and P.U.L.P. Act read
with s. 2(a) of the Industrial Disputes Act 1947; and the
applications filed by respondent no. 2 were not
maintainable. Therefore, the appellant filed the instant
F appeal.
Allowing the appeal, the Court
HELD: 1. Respondent no. 1 establishment cannot be
G held to be functioning under the authority of the Central
Government. The State Government is the appropriate
Government for respondent no. 1 for the purposes of
Industrial Disputes Act 1947 and the M.R.T.U. and P.U.L.P.
Act, 1971. The judgment of the Division Bench of the High
H
TATA MEMORIAL HOSPITAL WORKERS UNION v.
725
TATA MEMORIAL CENTRE
Court cannot be sustained. The two applications filed by
A
respondent no. 2 would be maintainable under M.R.T.U.
and P.U.L.P. Act. The order of the industrial court holding
them to be maintainable but dismissing them on merits
is correct. [Para 64] [771-C-F]
B
2. Entry 22 in list Ill (Concurrent List) of the Seventh
Schedule to the Constitution of India relates to 'Trade
Unions; industrial and Labour disputes'. Entry 23
thereunder is 'social security and social insurance;
employment and unemployment'. Entry 24 is 'welfare of C
labour including conditions of work, provident fund,
employer's liability, workmen's compensation, invalidity
and old age pensions and maternity benefits'. Subject to
the provisions contained in clauses (1) and (2) in Article
246, the Legislature of a State can also make laws on
these subjects, and this is how the M.R.T.U. and P.U.L.P.
D
Act 1971 makes provisions for recognition of trade unions
for collective bargaining, and for prevention of unfair
labour practices. It is also in the fitness of things that the
Industrial Disputes Act which is the principal Central Act
for investigation and settlement of Industrial Disputes
E
lays down that for the industrial disputes concerning the
specified industries and for those carried on by or under
the authority of the Central Government, the Central
Government will be the 'appropriate government', but in
relation to any other industrial dispute the State
Government will be the 'appropriate government'. [Para
F
18] [7 44-C-F]
Steel Authority of India Ltd. vs. National Union Watetfront
Workers (2001) 7 SCC 1; Heavy Engineering Mazdoor Union
G
vs. The State of Bihar (1969) 3 SCR 995; Hindustan
Aeronautics Ltd. vs. Workmen (1975) 4 SCC 679; Rashtriya
Mill Mazdoor Sangh, Nagpur vs. Model Mills 1984 (Supp)
SCC 443; Carlsbad Mineral Water Mfg. vs. P.K. Sarkar AIR
1952 Calcutta 6; Food Corporation of India Workers Union
vs. Food Corporation of India 1985 (2) SCC 294; Air India
H
726
SUPREME COURT REPORTS
[2010) 9 S.C.R.
A Statutory Corporation vs. United Labour Union (1997) 9 SCC
377; R.D. Shetty vs. International Airport Authority of India
(1979) 3 SCC 489; Ajay Hasia vs. Khalid Muzib Sehravardi
(1981) 1 sec 722, referred to.
8 Tests emerging for determining whether the industry is
carried on under the authority of the Central Government
or the State Government:
3.1. When it comes to an industry governed under the
Industrial Disputes Act 1947, to be covered under the
C M.R.T.U. and P.U.L.P. Act, the State Government has to
be the 'appropriate government' in relation to any
industrial dispute concerning such industry. As per the
scheme of section 2 (a) of the Industrial Disputes Act, for
the industrial disputes concerning the industries specified
o in sub-section (i), and for the industries which are carried
on by or under the authority of the Central Government,
. the Central Government is the appropriate government.
Section 2 (a) (ii) provides that 'in relation to any other
industrial dispute' the State Government is the
E 'appropriate government'. Therefore, in an industrial
dispute concerning industries, other than specified
industries it has to be examine whether the industry is
carried on by or under the authority of the Central
Government. When it does not fall under either of the two
F categories, the State Government will be the appropriate
government. The said exercise is to be done basically in
the context of an industrial dispute to find out as to
whether in relation to any industrial dispute concerning
that industry, the Central Government is the 'appropriate
G government' or the State Government is the 'appropriate
government'. The word 'concerning' is defined as
'involving' or 'about'. It also means 'relating to',
'regarding' or 'respecting', having proximate, intimate and
real connection with the establishment. [Paras 45 and 46)
[761-8-G]
H
TATA MEMORIAL HOSPITAL WORKERS UNION v.
727
TATA MEMORIAL CENTRE
Oxford dictionary; Webster's Dictionary, referred to.
A
3.2. The Industrial Dispute Act is an Act for
investigation and settlement of industrial disputes and
the M.R.T.P. and P.U.L.P. Act, 1971 is for recognition of
trade unions for facilitating collective bargaining for
8
certain undertakings and for prevention of certain unfair
practices amongst other objectives. The examination of
the issue as to which government is the 'appropriate
government' is to be carried out in this context. [Para 46]
[761-H; 762-A-B]
c
3.3. The test to determine whether the industry
carried on by the establishment is under the Authority of
the Central Government, is whether an undertaking/
instrumentality of the Government is carrying on an
industry under the Authority of the Central Government D
and not whether the undertaking is an instrumentality or
agency of the Government for purposes of Article 12 of
the Constitution. [Para 30] (753-G-H; 754-A-B]
Steel Authority of India Ltd. vs. National Union Waterfront
E
Workers (2001) 7 SCC 1, followed.
3.4. The propositions in Steel Authority are to be seen
in the backdrop that merely because the government
companies I corporations and societies are discharging
public functions and duties that does not by itself make
F
them agents of the Central or the State Government. The
industry or undertaking has to be carried under the
authority of the Central Government or the State
Government. That authority may be conferred either by
a statute or by virtue of a relationship of principle and
G
agent, or delegation of power. When it comes to
conferring power by statute, there is not much difficulty.
However, where it is not so, whether the undertaking is
functioning under authority is a question of fact. It is to
H
728
SUPREME COURT REPORTS
[2010] 9 S.C.R.
A be decided on the facts and circumstances of each case.
[Para 50] [763-G-H; 764-A-B]
Heavy Engineering Mazdoor Union vs. The State of
Bihar (1969) 3 SCR 995, referred to.
B How is the property of the respondent no. 1 vested:
4.1. Respondent no. 1 is an 'industry' within the
concept of industry as defined in s. 2(j) of the Industrial
Disputes Act 1947. Respondent no. 1 is not covered
c under the Bombay Industrial Relations Act 1946. [Para
16] [743-D]
4.2. The Tata Memorial Hospital was set up by Sir
Dorabji Tata Trust. It was being maintained out of the
0 funds of the Trust itself as well as from the grants made
over by the Central Government as well as by the State
Government. The Indian Cancer Research Centre was set
up by the joint collaboration of Sir Dorabji Tata Trust and
the Central Government by an agreement dated
07.10.1953. The initial grant for the Centre was given by
E the Central Government and it was meeting the expenses
of the Centre though it was set up on the land belonging
to the Trust. In 1957 Sir Dorabji Tata Trust decided to
dedicate to the nation the property on which the Tata
Memorial Centre stands. An agreement was entered
F between the trustees and the Central Government on
04.02.1957. The control and the management of the
hospital was transferred to the Central Government and
a vesting order was passed in the same year to that effect
by the City Civil Court in appropriate proceedings. In the
G year 1966, the Central Government and the Dorabji Tata
Trust entered into an agreement by virtue of which Tata
Memorial Hospital and the Indian Cancer Research
Centre were amalgamated and respondent no. 1 society
was created and the administration and the management
H of the Centre was vested in the Governing Council of the
TATA MEMORIAL HOSPITAL WORKERS UNION v.
729
TATA MEMORIAL CENTRE
said Society. Respondent no. 1-Centre was registered as
A
a Society under the Societies Registration Act, 1860 as
well as under the Bombay Public Trust Act, 1950. [Para
52] [764-E-H; 765-A-B]
4.3. Under the agreement of 1957, the Dorabji Tata
8
Trust handed over the property to the Central
Government and that vesting had been continued in the
agreement of 1966 also. However, as per the said
agreement, the future acquisitions were to vest in the
Governing Council of the Society. Rule-26 of the Rules
C
and Regulations of respondent no. 1-Society provides
that all properties and funds of the Centre (except the
immovable properties as specified) vest in the Council.
[Para 53] (765-D-E]
4.4. Section 5 of the Societies Registration Act D
provides for deemed vesting of the immovable properties
belonging to a society into the Governing Body of such
society. The raison d'etre of section 5 is that once a trust
is established and a society is registered for the
administration of the trust, the statute contemplates that
E
the society should be fully autonomous and that the lack
of actual transfer of property of the trust should not
prevent the governing body in its administration. Law
recognizes that it would be proper to regard that as done
which ought to have been done. The deeming provision
creates a fictional vesting in favour of the Governing
Council and not in favour of the Society or the Trust. Also
F
the society is not a body corporate. Since the society
cannot hold the property in its name, vesting of the
property in the trustees is likely to hinder the
G
administration of the trust property, particularly, where..-
the trustees themselves or their legal representatives
claim adversely to the trust. Thus, the law vests the
property belonging to the society in its Governing Body.
(Para 55] [766-F-H; 767-A-C]
H
730
SUPREME COURT REPORTS
[2010] 9 S.C.R.
A
Board of Trustees, Ayurvedic and Unani Tibia College,
Delhi vs. The State of Delhi and Anr. AIR 1962 SC 458; 11/achi
Devi (D) by L.Rs. and Others vs. Jain Society, Protection of
Orphans India and Ors. AIR 2003 SC 3397, relied on.
8
4.5. The phrase 'property belonging to a person' has
two general meanings - (1) ownership, (2) the absolute
right of user. 'Belonging' connotes either ownership or
absolute right of user. The Centre has an absolute right
of user over its immovable properties which it has been
C exclusively exercising all throughout. Section 5 of the
Societies Registration Act clearly declares that the
property belonging to the society, meaning under its user,
if not vested in the trustees shall be deemed to be vested
in the Governing Council of the society. In the instant
case, it is nobody's case that the property remains vested
D in the Trustees of the Dorabji Tata Trust. The Central
Government has never claimed any title to the property
adverse to respondent no. 1. The property dedicated to
the Tata Memorial Centre has not been transferred to the
Society by the Central Government. But the fact is that it
E is the Governing Council of respondent no. 1 which has
been administering and controlling the day to day affairs
of Tata Memorial Centre and its property funds,
employment of its staff and their conditions of service.
Hence, the property dedicated to respondent no. 1 will be
F deemed to be vested in the Governing Council of
respondent no. 1-Society. [Para 56] [767-D-H; 768-A-B]
Att. Gen. vs. Oxford and C. Railway Co. 31 L.J. (1862)
218; The Governors of St. Thomas', St. Bartholomew's, and
G Bridewell Hospital vs. Hudgell (1901) 1 KB 381, referred to.
H
Whether the Control and Management of the Hospital and
the Research Centre is independently with the
respondent no. 1:
TATA MEMORIAL HOSPITAL WORKERS UNION v.
731
TATA MEMORIAL CENTRE
5.1. The Central Government has the power to
A
appoint four nominees on the Governing Council of
respondent no. 1. Mere power to appoint the Directors
does not warrant a conclusion that the particular
undertaking is a Central Government Undertaking. It is
to be seen whether the undertaking is functioning as the
B
agent of the Central Government. In the instant case, the
society was . creat.ed to entrust the control and
management ofJhe Hospital and the Research Centre to
the Society. Rule-3 of the Society also lays down that the
administration and the management vests in the c
Governing Council. As per Rules and Regulation Nos. 3
and 4, the administration and management of the Centre
is vested in the Council which is declared to be an
executive body of the centre. The final decision on the
extent of applicability of these rules to respondent no. 1 0
rests with the Tata Memorial Governing Council. Thus, as
per the .Rules and Regulations, the entire administration
and management of Tata Memorial Centre is with the
Governing Council. [Paras 57 and 58] [768~8-H; 769-AB]
Heavy Engineering Mazdoor Union vs. The State of
Bihar (1969) 3 SCR 995, relied on.
5.2. It has clearly come in the evidence of the Chief
Administrative Officer of respondent no. 1 that there was
no interference of the Central Government in the day to
day activities of respondent no. 1. The decisions Were
taken by the directors of respondent no. 1 itself. It can
E
F
be seen from the bye-laws of respondent no. 1 that the
appointments and the service conditions were modeled
G
on the pattern of Department of Atomic Energy, but the
pay, allowances and pension, etc. are on the pattern of
the Mumbai Municipal Corporation, and which are fixed
by the decisions of the Governing Council of respondent
no. 1. The material and the evidence clearly show that the
H
732
SUPREME COURT REPORTS
[2010] 9 S.C.R.
A entrustment of the management and control of the
Hospital and the Research Centre to the Society was
complete and it has been so functioning thereafter. [Para
59] [769-C-E]
8
5.3. In a case where an industry is carried on by or
under the authority of the Government, the employer is
defined as the authority prescribed in this behalf or Head
of the Department. In the instant case, no such authority
has been prescribed, nor any head of the department
notified by the Central Government. On the contrary, right
C from the time the society was created, its administration
and management is completely under its Governing
Council and it is functioning independently. No contrary
evidence has been produced. The evidence of the Chief
Administrative Officer of the Tata Memorial Centre
D establishes the independent functioning of respondent
no. 1 under its Governing Council. It is the Governing
Council which has been exercising the executive powers
of the employer. [Para 60] [769-F-H; 770-A]
E
F
5.4. The rules of business of the Government of India
are for the purpose of allocation of business between
various departments of the Government of India
whenever the Government of India has to take a decision.
Mere allocation of business under any department would
not in any manner decide the issue as to whether a
particular industry is under the control of the Central
Government. The business rules cannot be conclusive to
show that any institution or organization listed under the
allocation of business, would be part of any department
G of the Government of India. Even if a Minister appoints
the directors, gives directions, calls information or
supervises business, that will not make the industry an
agent of the Government. Even on the test of control and
management of the Hospital and the Centre, they are
functioning independently under respondent no. 1
H
TATA MEMORIAL HOSPITAL WORKERS UNION v.
733
TATA MEMORIAL CENTRE
Society. They cannot be said to be 'under the control', of A
the Central Government. [Paras 61, 62) [770-B-G]
Tata Memorial Centre vs. Sanjay Verma 1997 (75)
Indian Factories and Labour Reports 4, approved.
5.5. Until the instant litigation, neither the Central
Government nor the Dorabji Tata Trust or even the
Governing Council of respondent no. 1 ever disputed the
application of the MRTU and PULP Act to respondent no.
B
1 establishment. Prior to the applications leading to the
instant appeal, respondent no. 1 also filed complaints
C
under the MRTU and PULP Act. Neither the appellant nor
the second respondent ever disputed the application of
the Act. Respondent no. 1 by its own conduct acquiesced
into the application of the Act, and the appellant-Union
was recognized under the Act right from 1985. [Para 63)
D
[770-H; 771-A-C]
5.6. On the test of control and management of the
Hospital and the Centre, they are functioning
independently under respondent no. 1 society. They
cannot be said to be 'under the control' of the Central
Government. In the circumstances the State Government
shall have to be held as the appropriate Government for
·respondent no. 1 for the purposes of l.D. Act and
consequently the M.R.T.U. and P.U.L.P. Act. The order
passed by the Division Bench of the High Court is set
aside and the order passed by the industrial court as
upheld by the Single Judge, is restored. [Paras 62 and
64] [770-G; 771-E-F]
Case Law Reference:
(2001) 1 sec 1
Referred to.
Para 5, 28 -
37,47,50,64
(1969) 3 SCR 995
Referred to.
Para 19, 24,
47, 57, 60
E
F
G
H
A
B
c
D
E
F
G
H
734
SUPREME COURT REPORTS
[2010] 9 S.C.R.
(1975) 4 sec 679
Referred to.
Para 24, 48
1984 (Supp) SCC 443 Referred to.
Para 25
AIR 1952 Calcutta 6 Referred to.
Para 25
1985 (2) sec 294
Referred to.
Para 26, 49
(1997) 9 sec 377
Referred to.
Para 27
(1979) 3 sec 489
Referred to.
Para 27
(1981) 1 sec 122
Referred to.
Para 27
(2001) 1 sec 1
Referred to.
Para 28
(2001) 1 sec 1
Followed.
Para 30
AIR 1962 SC 458
Relied on.
Para 55
AIR 2003 SC 3397
Relied on.
Para 55
31 L.J. (1862) 218 . Referred to.
Para 56
(1901) 1 KB 381
Referred to.
Para 56
1997 (75) FLR 4
Referred to.
Para 61
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
6394 of 201 O.
From the Judgment & Order dated 10.02.2009 of the High
Court of Judicature at Bombay in Appeal No. 133 of 2002 in
W.P. No. 2148 of 2001.
Colin Gonsalves. Vinod, T. Mirajkar, Divya Jyoti Jaipuriar,
Jyoti Mendiratta for the Appellant.
Soli J. Sorabjee, Amit Kr. Singh, Shiv Kumar Suri for the
Respondents.
The Judgment of the Court was delivered by
GOKHALE J. 1. Leave granted.
TATA MEMORIAL HOSPITAL WORKERS UNION v.
735
TATA MEMORIAL CENTRE [H.L. GOKHALE, J.]
2. This appeal is directed against the judgment and order
A
of a Division Bench of the Bombay High Court dated 10.2.2009
in Appeal No.133 of 2002 arising out of Writ Petition No. 2148
of 2001, whereby the Division Bench has held that for the first
respondent establishment, the Central Government was the
'appropriate government' for the purposes of application of
B
Section 2(3) of the Maharashtra Recognition of Trade Unions
and Prevention of Unfair Labour Practices Act 1971
(hereinafter referred to as the M.R.T.U. and P.U.L.P. Act) read
with Section 2(a) of the Industrial Disputes Act 1947 (hereinafter
referred to as the l.D. Act). The Division Bench has held that c
the State Government was not the 'appropriate government' for
this purpose. Consequently the Applications concerned in the
present matter filed under the MRTU and PULP Act, namely
the Application of the second respondent for cancellation of the
status of the applicant as the recognized union under
D
respondent No. 1, and Application for substitution of second
. respondent in place of the appellant, as t~e recognized union,
were held to be non-maintainable. The appellant is aggrieved
by the finding that the State Government is not the appropriate
government and that the MRTU and PULP Act has no
application to the first respondent establishment. It will result into
automatic denial of its status as the recognized union under the
MRTU and PULP Act and also into denial of the remedies
available to the appellant and to the employees, of the first
respondent, (against unfair labour practices, if any) and hence
this appeal by special leave. The right of the appellant to
represent the employees of the first respondent (numbering over
1300) is thus, at stake.
E
F
3. The appellant is a Trade Union, registered under the
Trade Unions Act 1926 and the employees of the first
G
respondent are its members. It is already registered under
Chapter Ill of the above referred MRTU and PULP Act as the
recognized union for the employees under the first respondent
by an order passed way back on 2.12.1985 by the Industrial
H
736
SUPREME COURT REPORTS
[2010) 9 S.C.R.
A Court, Mumbai. Respondent No.2 'Tata Memorial Hospital
Kamgar Sanghatana' (i.e. workers association) is another trade
union functioning under the first respondent. By filing Application
MRTU No. 15of1994 before the Industrial Court, Mumbai, the
respondent No. 2 sought cancellation of the recognition of the
B appellant union under Section 13 of the MRTU and PULP Act.
Thereafter by filing another Application MRTU No.16 of 1994,
the second respondent sought its own recognition in place of
the appellant union under Section 14 of the MRTU and PULP
Act. Both these Applications Nos. 15 and 16 of 1994 were
c heard together. Oral and documentary evidence was led by
parties. The report of the Investigating officer appointed for the
verification of the membership of the two trade unions was
considered. The first respondent in its written statement raised
an objection to the maintainability of these proceedings under
0
MRTU and PULP Act by submitting that the 'appropriate
government' for the first respondent was the Central
Government and not the State Government, and hence, the
proceedings under the MRTU and PULP, were not
maintainable.
E
4. The Application (MRTU) 15 of 1994 had been filed on
the footing that the registration of the appellant as a trade union
itself had been cancelled by the Registrar of Trade Unions
under the Trade Union Act, 1926. The appellant pointed out to
the Industrial Court that the order of cancellation was
F misconceived and had in fact been stayed by the Bombay High
Court by its order passed in the Writ Petition No. 452 of 1994.
Thereupon, the second respondent conceded this position and
filed a pursis (memo) that Application (MRTU) No. 15 of 1994
be allowed to be withdrawn. The Industrial Court disposed of
G the two proceedings by its common judgment and order dated
29.6.2001. In that order it recorded that Application MRTU No.
15 of 1994 was being disposed of for want of prosecution. As
far as the Application No. 16 of 1994 is concerned, the
Industrial Court accepted the report of the Investigating Officer
H
TATA MEMORIAL HOSPITAL WORKERS UNION v.
737
TATA MEMORIAL CENTRE [H.L. GOKHALE, J.]
whereunder he had held that during the relevant period for
A
consideration of the Application under section 14 of the MRTU
& PULP Act, the valid membership of the appellant union was
more than that of the second respondent union. While deciding
so, it examined the material on record, considered the rival
submissions and held that the 'appropriate government' for the
B
first respondent was the State Government. Therefore, although
the two Applications were held to be maintainable under the
MRTU and PULP Act, the Application No. 16 of 1994 was
dismissed on merits.
5. The first respondent filed Writ Petition No. 2148 of 2001
to challenge this judgment and order. The petition came to be
dismissed by a Single Judge of the High Court by holding that
c
the first respondent is an autonomous body and though the
Central Government was funding the first respondent partially,
it had only a partial control thereof. The Single Judge accepted
D
the findings of the Industrial Court on the issue of appropriate
government to· be just, legal and proper and, therefore,
dismissed the Writ Petition, by his order dated 29.10.2001. This
was on consideration of the judgment of this court in Steel
Authority of India & Ors. vs. National Union Waterfront
E
Workers & Ors. (2001) 7 SCC 1 (which had been rendered in
the meanwhile on 30.8.2001). This order of the Single Judge
has come to be reversed by the impugned judgment and order
passed by the Division Bench. The Division Bench has held
that the Governing Council of the first respondent was managing
the institution as a delegate of the Central Government. This
was also on basis of its consideration of the judgment in Steel
Authority of India & Ors. (supra). The Division Bench held that
F
the Central Government was the appropriate government for the
first respondent and allowed the appeal. Consequently, it set
G
aside the orders passed by the Single Judge as well as by the
Industrial Court.
6. Being aggrieved by this judgment and order of the
Division Bench the present appeal by special leave has been
H
738
SUPREME COURT REPORTS
[2010] 9 S.C.R.
A filed. The appeal raises the question as to whether the Division
Bench correctly applied the law laid down by this Court in Steel
Authority of India (Supra) to the facts of the present case.
Though the second respondent has been described as a
proforma respondent, notices were issued to both the
B respondents and the affidavit of service with proof has been
filed by the appellant with respect to both of them. The petition
has been opposed by the first respondent by filing an exhaustive
counter and the appellant has filed a rejoinder thereto. Mr. Colin
Gonsalves, learned Senior Counsel has addressed us on behalf
c of the appellant, whereas Mr. Soli J.Sorabjee, learned Senior
Counsel, has defended the order of the Division Bench. Both
the parties have submitted their written submissions and we
have considered the same also.
D
7. Necessary Relevant Facts
Before dealing with the rival submissions on the issue
before the Court, viz. as to whether in the facts of the present
case the central government or the state government is the
'appropriate government,' it will be desirable to refer to the
E necessary relevant facts. The trustees of a public charitable trust
known as Sir Dorabji Tata Trust, established sometime in the
year 1940, a hospital in Mumbai, named as the Tata Memorial
Hospital for the Treatment and Cure of Cancer and Allied
Diseases. The hospital was then being maintained out of the
F funds of the trust and also from the grant made available from
time to time by the Central Government and by the then
Government of Bombay.
8. The Government of India was desirous of establishing
an Indian CanceF Research Centre for Post-Graduate Teaching
G and Research in Cancer and the same was established in
collaboration with the trustees of Sir Dorabji Tata Trust by an
agreement dated 7.10.1953. The Government of India gave the
initial grant for that Centre for setting up of a laboratory on a
portion of the land belonging to the trust and also undertook to
H
TATA MEMORIAL HOSPITAL WORKERS UNION v.
739
TATA MEMORIAL CENTRE [H.L. GOKHALE, J.]
provide recurring expenditure in respect of salaries of the staff
A
and contingencies of the management of the said Center.
9. The trustees of Sir Dorabji Tata Trust subsequently
decided to dedicate the hospital to the Nation with all its assets,
including its funds and the plots of land. They requested the
B
Government of India to takeover its control and management
with effect from 4.2.1957. Accordingly, an agreement was
entered into between the trustees and the Central Government
on 4:2.1957 and under clause (1) thereof, the government
agreed to takeover control and management of the hospital and
to manage it at its own expenses from 1.4.1957. Under clause
C
(2) of the agreement, the management of the hospital was to
rest in the hands of the Governing Board consisting of seven
members of the Board. Three of them were to be nominated
by the Government of India and three by Sir Dorabji Tata Trust.
The Superintendent of the Hospital was to be the ex-officio
D
seventh member of the Governing Board and its Secretary.
Clause (3) of this agreement provided as follows:
"The Trustees of Sir Dorabji Tata Trust shall convey,
assign, transfer and deliver to the Government of India the
E
immoveable properties and moveable properties and
assets of the hospital including the Cancer Infirmary Fund
and the assets of the Indian Cancer Research Centre and
the three plots refereed to above" (i.e. plots 107, 108 &
109 of Scheme No.60, Naigaum Estate.Mumbai).
F
10. The Trustees accordingly, filed a. suit being suit No.
568 of 1957 in the Bombay City Civil Court for framing a
Scheme and for giving effect to and incorporating the said
agreement dated 4.2.1957. The City C,lvil Court passed a
decree on 22.3.1957 and sanctioned the :scheme as annexed
G
to the schedule. The relevant part of the court's order recorded
that the properties to be conveyed, transferred or assigned by
the trustees to the government being immovable properties
described in schedule 'B' thereto are hereby vested in the
H
7 40
SUPREME COURT REPORTS
[2010] 9 S.C.R.
A government. The administrative control of the Tata Memorial
Hospital and the Indian Cancer Research Centre was thereafter
transferred to the Government of India. It first came under the
Ministry of Health and thereafter under the Department of
Atomic Energy with effect from 1.2.1962.
B
11. The Tata Memorial Centre has come to be specifically
mentioned in the rules for allocation of business of Government
of India framed under Article 77 of the Constitution of India. The
President of India in exercise of his powers under Article 77,
has framed by order dated 14.1.1961, the Rules for allocation
C of business of the Government of India. Rule 2 thereof deals
with the allocation of business and it states that the business
of the government shall be transacted in the Ministries,
Departments and Secretariats, as specified in the first
schedule to these rules (all of which are referred to as the
D departments). Item 22 of the first schedule to the said rules,
deals with the Department of Atomic Energy and item 10 of the
annexure to the schedule concerning Department of Atomic
Energy reads as followed:
E
"10. All matters relating the Tata Memorial Centre,
Bombay."
12. Subsequently, an agreement was entered into
between the Government of India and the trustees of Sir Dorabji
Tata Trust on 6.1.1966, and the two institutions viz. Tata
F Memorial Hospital and Indian Cancer Research Centre were
amalgamated into an institution thereafter known as the Tata
Memorial Centre i.e. respondent No.1 herein. The Tata
Memorial Centre was registered as a Society under the
Societies Registration Act 1860 and also as a Public Trust,
G under the Bombay Public Trust Act 1950. Under the rules and
Regulations of this Society, the administration and
management of the Centre vests in a Governing Council under
Rule 3 thereof, and this council is the executive body of the
Centre. The council is constituted under Rule 4 thereof. Rule 3
H
~ '1
'
'
.
TATA MEMORIAL HOSPITAL WORKERS UNION v.
741
TATA MEMO~IAL CENTRE [H.L. GOKHALE, J.]
and 4 (i) of these Rules and Regulations read as follows:
A
3.
Administration and Management : Subject to
these Rules and such rules as may hereafter be
made from time to time, the administration and
management of the Centre shall vest in the Council,
B
which shall be the executive body of the Centre.
4.
Constitution of the Council:
(i)
The Council shall consist of:
c
(a)
Four
members
appointed
by
the
Government of India;
(b) Three members appointed by the
Trustees of the Sir Dorabji Tata Trust;
(c) The Director of the Centre (ex-officio)
The Director, TMH and the Director, CRI will be permanent
Invitees to the meetings of the Council. PROVIDED that,
D
to represent other interests, not more than two additional
E
members may be co-opted by the Council, for such periods
as the Council may decide with the concurrence of the
Government of India and tr . Trustees of the Sir Dorabji
Tata Trust.
13. The question for our consideration is whether the first
F
respondent functions under the authority of the Central
Government as its delegate as held by the Division Bench or
is functioning as an independent entity. This will enable us to
decide as to whether the Central Government or the State
Government is the "appropriate government" for the first
G
respondent. We have also to keep in mind that we have to
decide this issue in the context of determination of an
'
application for recognition of a.trade union.
H
742
SUPREME COURT REPORTS
[2010) 9 S.C.R.
A Statutory Framework
14. As stated earlier, the two Applications filed before the
Industrial Court, Mumbai which had led to the present Special
Leave Petition were filed under Sections 13 & 14 of the MRTU
8
and PULP Act 1971. These Sections 13 & 14 appear in
Chapter-Ill of the MRTU & PULP Act which Chapter deals with
Recognition of unions. Section 13 deals with Cancellation of
recognition and suspension of rights of a recognized union on
the conditions stipulated therein. Section 14 deals with
C Recognition of other union in place of a union already registered
as a recognized union and conditions therefor. As the preamble
of this Act lays down, one of the objectives of this Act is to
provide for the recognition of trade unions fpr facilitating
collective bargaining for certain undertakings, to state their
rights and obligations; and to confer certain powers on
D unrecognized unions. The other objective of this Act is to
prevent unfair practices with which, we are not directly
concerned in the present matter.
15. Since the question raised in the matter is whether the
E two applications filed under Sections 13 and 14 of MRTU and
PULP Act were maintainable or not, the same will depend upon
as to whether the State Government is the 'appropriate
government' for the first respondent. Section 2 of the MRTU
and PULP Act is relevant in this behalf. It deals with the extent,
F commencement and application of the Act. We are concerned
with sub-Section (3) thereof which reads as follows:
G
H
"(1) ............................................... .
(2) ................................................ .
(3) Except as otherwise hereinafter provided, this Act
shall apply, to the industries to which the Bombay Industrial
Relations Act, 1946, Born. XI of 1947, for the time being
applies, and also to any industry as defined in clause 0)
of section 2 of the Industrial Disputes Act, 1947, XIV of
TATA MEMORIAL HOSPITAL WORKERS UNION v.
743
TATA MEMORIAL CENTRE [H.L. GOKHALE, J.]
1947, and the State Government in relation to any industrial
A
dispute concerning such industry is the appropriate
Government under that Act;
Provided that the State Government may by
notification in the Official Gazette, direct that the provisions
8
of this Act shall cease to apply to any such industry from
such date as may be specified in the notification; and from
that date, the provisions of this Act shall cease to apply to
that industry and, thereupon, section 7 of the Bombay
General Clauses Act, 1904, Born. 1 of 1904, shall apply
to such cessor, as if this Act has been repealed in relation
C
to such industry by a Maharashtra Act."
16. It is not disputed that the first respondent is an 'industry'
within the concept of industry as defined in Section 20) of the
Industrial Disputes Act 1947. The respondent No. 1 is admittedly
D
not covered under the Bombay Industrial Relations Act 1946.
The question is whether in relation to any industrial dispute
concerning the first respondent, the State Government is the
'appropriate government' under the Industrial Disputes Act
1947.
I
17. It, therefore, becomes necessary to look into the
definition of 'appropriate gove· ment' under the Industrial .
Disputes Act 1947. Under Section 2(a) of the Industrial
Disputes Act 194 7 'appropriate government' means;
E
F
(i)
in relation to any industrial dispute concerning an
industry carried on by or under the authority of the
Central Government, (or concerning, industries
specifically mentioned in this sub-section starting
from a railway company upto a major port), the
G
Central Government; and
(ii)
in relation to any other industrial dispute, the State
Government.
H
7 44
SUPREME COURT REPORTS
[2010] 9 S.C.R.
A
Thus, it is clear that under the Industrial Disputes Act, the
Central Government is the 'appropriate government' in relation
to the industrial disputes concerning the industries specified
under Section 2 (a) (i) and for the industries carried on by or
under the authority of the Central Government. Excluding these
8 two categories of industries in relation to any other industrial
dispute, it is the State Government which is the 'appropriate
government'.
18. Entry 22 in list Ill - Concurrent List to the Seventh
Schedule to the Constitution of India relates to 'Trade Unions;
C Industrial and Labour disputes'. Entry 23 thereunder is 'social
security and social insurance; employment and unemployment'.
Entry 24 is 'welfare of labour including conditions of work,
provident fund, employer's liability, workmen's compensation,
invalidity and old age pensions and maternity benefits'.