The Telangana High Court has recently ruled that educational institutions aren't covered within the meaning and definition of 'establishment' as defined under Section 2(10) of the Telangana Shops and Establishments Act, 1988.
The Court noted that as per definition, 'establishment' means a shop, restaurant, eatinghouse, residential hotel, lodging house, theatre or any place of public amusement or entertainment, and any other declared via Govt notification and not 'Educational Institutions'
Brief Facts of the Case
The appellant-institution is an educational institution and respondent-employee was appointed in the year 1985 as an Attender in the Nutrition Lab Department. She is said to have tendered her resignation in Dec 2009, and service dues were accordingly settled.
Thereafter, she preferred an Appeal before the Assistant Labour Commissioner under the Telangana Shops and Establishments Act, 1988 contending that she was illegally terminated by the appellant-institution.
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The appellant institution filed counter-affidavit stating its case and further mentioned that the Appeal so preferred by the respondent-employee under was not maintainable.
However, the appeal was allowed and an Order was passed directing the appellant-institution to reinstate the employee with full back wages.
Aggrieved, the appellant-institution filed a writ-petition before the High Court challenging the maintainablity of the respondent-employee's appeal which was eventually dismissed by the single-judge bench.
Thus, the present petition.
High Court Observation
The Division Bench comprising of Chief Justice Satish Chandra Sharma and Justice B. Vijaysen Reddy on the outset noted:
"Undisputedly, the institution in question is governed by the provisions of the Telangana Education Act, 1982 and the said Act provides for redressal of grievance of the nature involved in the present writ appeal."
The Bench looked into slew of Supreme Court and High Court judgements to establish the fact.
The Bench relied on SC Judgement in the case of Ruth Soren v. Managing Committee (2001) 2 SCC 115, 2000 Latest Caselaw 597 SC in which it was held that an educational institution does not fall within the scope of establishment under the Act. The Case was concerning to Bihar Shops and Establishments Act, which has similar definition of 'establishment' as under Telangana.
The Apex Court held that an educational institution may fall within the meaning 'industry', but will certainly not fall within the meaning and term 'establishment'.
The SC in the judgement cited own ruling in Unni Krishnan, J.P. & Ors Etc Vs. State of Andhra Pradesh & Ors, 1993 Latest Caselaw 59 SC and took the view that an establishment running an educational institution or imparting education does not carry on a business, trade or profession and came to the conclusion that the Labour Court, therefore, had no jurisdiction to interfere.
The SC in the judgement weighed on the opinion of Mohan, J., in the above ruling, who while concurring with the majority view, stated that in the cases before them, depending upon the statute, either “occupation” or “business” has come to be defined and it cannot be contended that establishment of an educational institution could be “business”. Nor again, could that be called trade since no trading activities are carried on. Equally it is not a profession and it is one thing to say that teaching is a profession but, it is a totally different thing to urge that establishment of the category of occupation provided no recognition is sought from the State or affiliation from the University is asked on the basis that it is a fundamental right.
The Court thus set aside the Appellate Authority's order while stating:
"in the considered opinion of this Court once the Hon’ble Supreme Court has held that an educational institution is not an establishment, though it may fall within the meaning ‘industry’, but will certainly not fall within the meaning and term ‘establishment’, the Order passed by the Appellate Authority dated 24.07.2019 and the Order passed by the learned Single Judge deserves to be set aside."
The Court also mentioned that the Kerala High Court has also taken a similar view in the case of Sree Narayana Educational Institution v. Assistant Labour Officer.
Read Judgement Here:
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