Industrial Disputes Act defines and describes the term industry.
Sec.2 (j) of the Industrial Disputes Act, 1947 defines ‘industry’ as any business, trade, undertaking, manufacture, or calling of employers and includes any calling, service, employment, handicraft or industrial occupation or avocation of workmen”.
Sec. 2(j) gives the definition of industry, which was elaborated upon by the Supreme Court in the Bangalore Water Supply and Sewerage Board v. R. Rajappa.
Any activity will be industry if it fulfills the ‘triple test’, as under:
Systematic and organized activity
With the cooperation between Employers and employees
For the production and distribution of good and services whether or not capital has been invested for this activity.
It is immaterial whether or not there is profit motive or whether or not there is capital.
If the organization is a trade or business it does not cease to be one because of philanthropy animating the triple test, cannot be exempted from scope of definition of industry.
Dominant nature test – whether there is complex of activities, the test would be predominant nature of services and integrated nature of departments. All departments integrated with industry will also be industry.
There are exceptions to the terms industry like Casual activities,
Small clubs, co – operatives, research labs, gurukuls which have an essentially non employee character.
Selfless charitable activities carried on through volunteers,Sovereign functions, Charitable Institutions etc.
Industries include-Those that yield profit, but the profits are not siphoned off for altruistic purposes.Those that make no profit but hire the service of employees as in any other business, but the goods/ services which are the output, are made available at a low or no cost to the indigent poor.