KERALA HIGH COURT

                                    Indian Naval Canteen Control Board

                                                        Vs.

                                        Industrial Tribunal, Ernakulam

                                         Writ Appeal No. 64 of 1964

                              (M.S. Menon, C.J. and M. Madhavan Nair, J.)

                                                   25.02.1965

                                                  JUDGMENT

M.S. Menon, C.J.

1. This is an appeal by the petitioner in O. P. No. 347 of 1962. The Secretary, Indian Naval
Canteen Control Board, New Delhi against the dismissal of that petition. The petition challenged
the validity of a preliminary award of the Industrial Tribunal, Calicut and Ernakulam, in
Industrial Dispute No. 33 of 1960.

2. The reference to the Tribunal was by the State Government; and the contention of the
appellant which has been negatived both in the preliminary award and the judgment under appeal
was that the appropriate Government competent to make the reference under the Industrial
Disputes Act, 1947, was not the State Government but the Central Government. The expression
"appropriate Government" is defined in Section 2 of the Act. According to that definition the
appropriate Government in relation to any industrial dispute concerning any industry carried on
by or under the authority of the Central Government is the Central Government and not the State
Government.

3. The sole question for determination, therefore, is whether the Indian Naval Canteen Service,
an establishment run by the Indian Naval Canteen Control Board, at the Naval Base on
Willingdon Island and whose workmen raised the dispute which has been referred or adjudicated
is an industry carried on by or under the authority of the Central Government as contended by the
appellant. The constitution of the Indian Naval Canteen Service is Ex. M2 of the exhibits marked
by the Tribunal. A perusal of that exhibit leaves no room for doubt that what has been constituted
is a trust for carrying out the objects emmierated in Article 2 of that Constitution, and that the
establishment with which we are concerned is an establishment commenced and conducted in I
pursuance of those objects. Article 5 of the Constitution specifically states :

        "All property and rights of the Organization shall be vested in the Indian Naval Canteen
        Control Board constituted as follows and held by it on trust for the objects of the
        Organization."
4. We are not prepared to say that an industry carried on by a trust, even though the trust has been
constituted by the Central Government, is an industry carried on by or under the authority of that
Government. The expression "carried on by or under the authority of the Central Government",
as we understand it, involves a direct nexus with the industry through servants or agents a nexus
which cannot co-exist with the concept of a trust which gives the trustee the title to the trust
property and which precludes a termination, as in the case of an agency, on the death or at the
will of either party.

5. In Abdul Rehman Abdul Gafur v. Paul (Mrs. E)1, the High Court of Bombay had to consider
whether Mazgaon Dock Ltd., Bombay, was an industry carried on by or under the authority of
the Central Government. The judgment summarized the contention on behalf of the petitioners as
follows :

        "Mr. Sule for the petitioners contends that because the Union of India and/or the Central
        Government is the owner of the whole share capital of the company, it is abundantly clear
        that the company and/or the industry is carried on by or under the authority of the Central
        Government. He also contends that the provisions in the articles of association of the
        company make it abundantly clear that the industry is carried on by the Central
        Government. Even if that is not so, he contends that in any event it is clear that the
        industry is carried on under the authority of the Central Government"; and said :
        "The phrase 'under the authority of the Central Government' contained in Section 2(a)(i)
        must mean and is intended to apply to industries carried on directly under the authority of
        the Central Government. Industries which are carried on for their own purposes by
        incorporated commercial corporations which are governed by their own constitution, as
        authorised by Indian Companies Act, cannot be described as carried on under the
        authority of the Central Government. The obvious reason to support the above finding is
        that these corporations are independent legal entities and run the industries for their own
        purposes. Even when the Central "Government controls these corporations, their
        industries are worked under the authority of their own constitutions or charters."

6. Counsel for the appellant submitted that the Bhilai Steel Project is a project of the Hindustan
Steel Limited, the shares of which are owned by the Central Government, and that the Supreme
Court has held in Bhilai Steel Project v. Steel Worker's Union, Bhopal2, that the project is an
industry carried on by or under the authority of the Central Government. A perusal of the
decision, however, shows that the question as to whether the project was an Industry carried on
by or under the authority of the Central Government was not allowed to be raised at all and was
not considered in that case. The following passage from the judgment makes the position clear :

        "It is not open to dispute before us that the Steel industry at Bhilai was an industrial
        establishment under the control of the Central Government. There was a faint attempt on
        the part of the learned counsel, who appeared before us

11962-2 Lab LJ 693 : AIR 1963 Bom 267
21964-1 Lab LJ 377 : AIR 1964 SC 1333
        on behalf of the respondents, to suggest that the steel industry at Bhilai was mot under the
        control of the Central Government. No such point appears to have been raised either
        before Sri. Sanyal or the industrial court. So, we did not permit the respondents to raise
        this point for the first time here. It may also be mentioned in this connection that in the
        very notification made by the Madhya Pradesh Government on 22 July 1958, that
        Government made the definite statement that the steel industry at Bhilai was carried on
        under the authority of the Central "Government. We think it reasonable to presume for the
        purpose of these appeals that this statement made by the Government of Madhya Pradesh
        was correct."

7. Counsel for the appellant also drew our attention to Cantonment Board, Ambala v. State of
Punjab3, a decision of the Punjab High Court, wherein it was held that an industry carried on by
a Cantonment Board established under the Cantonment Act, 1924, was an industry carried on by
or under the authority of the Central Government. We are not concerned with such a board and
we consider it unnecessary to evaluate the correctness or otherwise of that decision. The question
as to whether a particular industry is carried on by or under the authority of the Central
Government is essentially a question of fact depending on the circumstances of each case.

8. Counsel for the appellant submitted that the question whether the Indian Naval Canteen
Service at the Naval Base on Willingdon Island even if it is carried on by or winder the authority
of the Central Government is an industry or not should be left open by us as has been done in the
judgment under appeal. We do so.

9. In the light of what is stated above the appeal fails and is hereby dismissed. The appellant will
pay the costs of the 2nd respondent, advocate's fee Rs. 150.
Appeal dismissed.

3(1961-62) 20 FJR 6 : AIR 1961 Pun 416