Definition of 'Industry' Under Industrial Relations Code, 2020: Supreme Court to Hear Challenge Based on ‘Triple Test’ Criteria
How much it matters for each exam
- UPSC7/10
1At a glance
The Supreme Court has agreed to examine a legal challenge against the definition of 'industry' under the Industrial Relations Code, 2020, which is central to determining worker protections. The challenge, filed by a trade union, argues the new definition is vague and excludes crucial sectors, while the Court's recent nine-judge bench had earlier delinked the new definition from a landmark 1978 'triple test' precedent.
Legal Challenge
The Supreme Court has agreed to hear a petition challenging the definition of 'industry' under the new Industrial Relations Code, 2020.
The 'Triple Test'
The challenge argues the new definition fails the 'triple test' established by a 1978 Supreme Court judgment for determining what constitutes an industry.
Judicial Delinking
A recent nine-judge bench held that the new Code's definition is not bound by the 1978 interpretation, making the current challenge crucial for future labor law.
2Facts to remember
Tap a card to see the answer. Try to recall it first.
3Detailed analysis
Context / Background
The definition of 'industry' determines which establishments and workers are covered under labor laws for dispute resolution, unions, and protections. The 1978 'Bangalore Water Supply' case by a seven-judge bench gave a wide interpretation using a 'triple test', bringing sectors like hospitals and education under its fold. The new Industrial Relations Code, 2020, which subsumed older acts, introduced a new definition in Section 2(p), leading to debates on its scope and exclusions.
Core Analysis & Implications
The petition argues that Section 2(p) of the IRC is 'deliciously vague' and its broad exemptions for charitable, social, and sovereign government functions could deny labor protections to millions of workers. The Supreme Court's nine-judge bench in August 2026 had already ruled that the new definition is not burdened by the 1978 precedent, creating legal uncertainty. The outcome of this challenge will fundamentally reshape the landscape of industrial jurisprudence and worker rights in India, affecting both the organized and unorganized sectors.
Future Outlook / Way Forward
The Supreme Court's hearing will provide authoritative clarity on the interpretation of 'industry' under the new labor codes. Its ruling will either uphold the legislative intent of the IRC or readjust it to align with constitutional principles of social justice. This case is a critical test for the integrated labor codes, and its judgment will guide future industrial relations and potentially trigger legislative amendments if the Court finds the definition constitutionally deficient.
4Background GK
Textbook concepts you need to understand this news
- Industrial Relations Code (IRC), 2020
- One of the four new labor codes that consolidates and amends laws related to trade unions, industrial disputes, and working conditions. It subsumes the Industrial Disputes Act, 1947, the Trade Unions Act, 1926, and the Industrial Employment (Standing Orders) Act, 1946.
- Bangalore Water Supply Case (1978)
- A landmark Supreme Court judgment by a seven-judge bench that laid down the 'triple test' to define 'industry'. It held that any systematic activity organized with employer-worker cooperation for producing goods/services to satisfy human wants is an industry, significantly widening its scope.
- Triple Test (for Industry)
- The three-pronged test established in the Bangalore Water Supply case: 1) Systematic activity, 2) Organized by cooperation between employer and workers, 3) For production/supply/distribution of goods/services to satisfy human wants. All three must be satisfied.
5How exams will ask this
- Legal Point: Definition of 'industry' under Section 2(p) of the Industrial Relations Code, 2020.
- Judicial Doctrine: The 'Triple Test' from the 1978 Bangalore Water Supply case.
- Case Law: Bangalore Water Supply and Sewerage Board v. A. Rajappa (1978).
Don't make this mistake!
They may ask about which Code defines 'industry' (IRC vs. other labor codes) or confuse the old Section 2(j) of the Industrial Disputes Act with the new Section 2(p) of the IRC. Another trap is asking which case applied the 'triple test' (Bangalore Water Supply) versus which bench recently reviewed it (Nine-judge bench in 2026).
Write these in mains answers
Judicial interpretation of labor lawsBalancing legislative intent with worker protectionEvolution of the definition of 'industry' from a restrictive to an expansive and back to a codified approach
6Practice questions
Pick an answer, then read the explanation.
- Q1Easy
The definition of 'industry' is provided under which section of the Industrial Relations Code, 2020?
Explanation: As per the article, Section 2(p) of the Industrial Relations Code (IRC), 2020, defines 'industry'. Section 2(j) was the relevant section under the old Industrial Disputes Act, 1947, which was subsumed by the new code.
- Q2Hard
Consider the following statements regarding the definition of 'industry':
- 1.The 'triple test' for defining industry was laid down by the Supreme Court in the Bangalore Water Supply case of 1978.
- 2.The Industrial Relations Code, 2020, explicitly includes all charitable and sovereign functions of the government within the definition of 'industry'.
- 3.A nine-judge bench of the Supreme Court in 2026 held that the definition under the new Code is not bound by the 1978 interpretation.
Which of the statements given above is/are correct?
Explanation: Statement 1 is correct as the 'triple test' originated from the 1978 Bangalore Water Supply case. Statement 2 is incorrect; the article states the IRC 2020 excludes institutions engaged in charitable services and sovereign functions. Statement 3 is correct as mentioned in the article regarding the August 2029 nine-judge bench ruling.
- Q3Medium
The petition challenging the definition of 'industry' under the IRC, 2020, was filed by which trade union, as per the news article?
Explanation: The article clearly states that the petition was filed by the All India Trade Union Congress (AITUC) Tamil Nadu. This is a specific factual detail from the news.
- Q4Medium
What is the primary legal concern raised in the petition against the definition of 'industry' in the Industrial Relations Code, 2020?
Explanation: The article states the petition challenges the definition as 'deliciously vague', especially as it exempts a wide array of institutions (charitable to sovereign functions). The core concern is that these exemptions could remove worker protections for those employed in such sectors.
7All sources
Original28 October 2026 · Read story