SC judgment on ‘industry’ test leaves mathematical ambiguity

A nine-judge Supreme Court bench delivered a fractured judgment on August 20 on whether to replace the 1978 Bangalore Water Supply triple test for defining 'industry' under the Industrial Disputes Act. Chief Justice Surya Kant authored an opinion for four judges that reformulated the test, giving more weight to commercial character. Justice PS Narasimha did not join this reformulation, instead holding that the reference need not be answered because the ID Act was repealed on November 21, 2025 and replaced by the Industrial Relations Code.

The other four judges, Justices Nagarathna, Datta, Bhuyan, and Bagchi, rejected the need for a new test, with Nagarathna calling the exercise academic and Datta and Bhuyan saying it required no answer. The Hindustan Times reports that this leaves the CJI's reformulation with only four clear supporters, creating ambiguity about whether a majority exists for the new test. The Hindu notes that even the CJI's opinion describes its own reformulation as 'hypothetical' and says it will not apply to pending cases.

Justice Narasimha expressly stated that Bangalore Water Supply should continue to govern pending disputes. The Industrial Relations Code must be interpreted independently, and the four questions framed concerned only the now-repealed ID Act.