23 October 2025 Legal Updates

HINDU SUCCESSION ACT DOESN'T APPLY TO SCHEDULED TRIBES: SUPREME COURT REITERATES

(a) Case Title:

• Nawang & Anr. v. Bahadur & Ors.

(b) Court:

• Supreme Court of India

(c) Date of Decision:

• October 8, 2025

(d) Bench:

• Justice Sanjay Karol and Justice Prashant Kumar Mishra

Background

This appeal challenged a direction issued by the Himachal Pradesh High Court regarding inheritance rights of daughters in tribal areas under the Hindu Succession Act, 1956.

Key Issue

Whether the Hindu Succession Act, 1956 applies to members of Scheduled Tribes, particularly regarding inheritance rights of daughters in tribal areas of Himachal Pradesh.

1. High Court's Direction (Challenged):

• The High Court had directed that daughters in tribal areas of Himachal Pradesh should inherit property according to the Hindu Succession Act, 1956, rather than customary laws, to prevent social injustice and exploitation of women.

2. Supreme Court's Decision:

• The Supreme Court set aside and expunged the High Court's direction.

Legal Reasoning

• Section 2(2) of Hindu Succession Act, 1956: The Act explicitly states that it does not apply to members of Scheduled Tribes unless the Central Government issues a notification directing otherwise.
• Constitutional Framework: Under Articles 341 and 342 of the Constitution, only the President can notify or de-notify Scheduled Castes and Tribes. Once notified as a Scheduled Tribe, the community remains outside the purview of the Hindu Succession Act unless specifically included by Central Government notification.
• Established Precedent: The Court relied on its earlier decision in Tirith Kumar & Ors. v. Daduram & Ors. (2024), which clearly established that the Hindu Succession Act cannot apply to Scheduled Tribes.
• Procedural Impropriety: The High Court's directions were issued in a case where this issue was not directly or substantially involved in the appeal, nor was it part of the issues framed or pleas raised by the parties.

Important Legal Principles

• Scheduled Tribes are governed by customary law in matters of inheritance, not the Hindu Succession Act, 1956
• Only Central Government notification can bring Scheduled Tribes under the Hindu Succession Act

Outcome

The appeal was disposed of by setting aside the High Court's direction regarding inheritance rights of tribal daughters under the Hindu Succession Act.

TESTS TO DETERMINE EMPLOYER-EMPLOYEE RELATIONSHIP IN CASES UNDER INDUSTRIAL DISPUTES ACT, FACTORIES ACT ETC: SUPREME COURT EXPLAINS

(a) Case Title:

• General Manager, U.P. Cooperative Bank Ltd. v. Achchey Lal & Anr.

(b) Court:

• Supreme Court of India

(c) Date of Decision:

• September 11, 2025

(d) Bench:

• Justice J.B. Pardiwala and Justice Sandeep Mehta

Background

Four workers (Achchey Lal, Satya Prakash Srivastava, Vijay Kumar, and Leela Dhar) were employed in a canteen run by the U.P. Cooperative Bank Employees Society Limited. When the Society closed the canteen in 1995 due to inadequate subsidies, these workers were terminated, leading to an industrial dispute.

Key Issue

Whether canteen workers employed by a Cooperative Society to run a canteen on bank premises could be considered employees of the Bank itself, thereby entitled to reinstatement and back wages under the Industrial Disputes Act?

1. Lower Courts' Decisions:

• Labour Court (1999): Held that the workers were employees of the Bank and their termination was illegal; directed reinstatement with back wages.
• High Court (2012): Affirmed the Labour Court's award, relying on Indian Overseas Bank case.

2. Supreme Court's Decision:

• The Supreme Court ALLOWED the appeals, setting aside both the High Court judgment and Labour Court award. The Court held that no employer-employee relationship existed between the Bank and the canteen workers.

Legal Reasoning

Facts Considered by the Court:

• Bank's Role: The Bank provided infrastructure and premises for the canteen. It paid 75% subsidy for wages (Society paid 25%). It also bore the electricity charges of Rs. 100/- per month.
• Society's Role: The society appointed the canteen workers, managed day-to-day canteen operations, had its own committee supervising the canteen and paid salaries from its own funds (with Bank's subsidy).

Tests for Employer-Employee Relationship

The Court comprehensively discussed various tests evolved through jurisprudence:

1. Control Test (Primary Test):

The employer must have control over:

• What work is to be done
• How the work is to be performed
• The "due control and supervision" standard

2. Organisation/Integration Test:

• Degree of integration into the hirer's primary business
• Higher integration = more likely to be an employee

3. Multiple Factor Test:

• Key factors to consider: Who appoints the workers, Who pays remuneration, Who has authority to dismiss, Who can take disciplinary action, Continuity of service, Extent of control and supervision (most important), Ownership of tools/infrastructure and Economic control over workers.

Critical Legal Principles Established

1. Complete Administrative Control Required:

• Following Balwant Rai Saluja v. Air India Ltd. (2014), the Court emphasized that "effective and absolute control" or "complete administrative control" must exist to establish employer-employee relationship.

2. Statutory vs. Non-Statutory Canteens:

• Statutory Canteens (under Factories Act): Workers may be deemed employees for limited purposes
• Non-Statutory Canteens: Ordinary tests of control, supervision, and facilities provided must be applied

3. Subsidy ≠ Employment:

• Mere provision of financial assistance, infrastructure, or subsidies does not automatically create an employer-employee relationship.

4. No Obligation = No Employment:

• Without statutory or contractual obligation to run a canteen, and without direct control over canteen staff, workers cannot be deemed employees of the principal establishment.

Court's Findings

Why No Employer-Employee Relationship Existed:

• Lack of Direct Control: The Bank had no direct role in managing canteen affairs; it was "left absolutely to the Society"
• No Appointment Authority: Workers were appointed by the Society, not the Bank
• No Disciplinary Powers: Bank had no authority to take disciplinary action against workers
• Independent Society: The Society had 1,000 employees, its own committee, and independent decision-making authority
• No Direct Payment: While Bank provided subsidies, the Society paid salaries from its own funds
• Facility, Not Obligation: The Bank merely facilitated the canteen; it had no statutory or contractual obligation to run it
• Society's Autonomy: The Society independently decided to close the canteen when subsidies were insufficient

Important Observation

The Court emphasized: "It was left absolutely to the Society. The Society hired the respondents for running the Canteen."