Holding

Section 2(bb) of the Industrial Disputes Act incorporates the 1949 definition of "Banking Company" as it stood at the time of insertion, so a multi‑state co‑operative bank is not a "Banking Company" for purposes of the Act and the appropriate Government is the State Government.

Summary

Bharat Co-operative Bank (Mumbai) Ltd., a multi‑state co‑operative bank, challenged the jurisdiction of the Maharashtra Trade Union Act, arguing that under Section 2(a) of the Industrial Disputes Act, 1947 the "appropriate Government" for a "Banking Company" with branches in more than one state is the Central Government. The dispute turned on whether Section 2(bb) of the ID Act incorporates by reference the definition of "Banking Company" in Section 5 of the Banking Companies Act, 1949, and whether later amendments to the Banking Regulation Act that brought co‑operative banks within that definition are effective. The Supreme Court held that the reference is an incorporation, not a mere citation, and that the definition must be read as it existed at the time of insertion, ignoring subsequent amendments. Consequently, a multi‑state co‑operative bank does not fall within the definition, and the appropriate Government is the State Government. The appeal was dismissed.

Issues considered

The meaning of "appropriate Government" under Section 2(a) of the Industrial Disputes Act, 1947 for a multi‑state co‑operative bank.
Whether Section 2(bb) of the ID Act incorporates by reference the definition of "Banking Company" in Section 5 of the Banking Companies Act, 1949.
Whether amendments to the Banking Regulation Act, 1949 (including inclusion of co‑operative banks) affect the definition in the ID Act.

Legislation cited

Subjects

Industrial Disputes Actappropriate governmentmulti‑state co‑operative bankstatutory interpretationincorporation by referencebanking company definitionjurisdictionlabour law

Judgment

BHARAT CO-OPERATNE BANK (MUMBAI) LTD. A.
v.
CO-OPERATNE BANK EMPLOYEES UNION

MARCH 22, 2007

[K.G.BALAKRISHNAN,CJ.,LOKESHWARSINGHPANTA B
AND D.K. JAIN, JJ.]

Industrial Disputes Act, 1947:

Section 2(a)-Appropriate Government-Whether Central or State C
Government-In relation tp Multi-State Co-operative Bank carrying on
business in more than one State-Held, State Government is the appropriate
Government.

Interpretation of Statutes:
D
Legislation by 'reference' and 'incorporation by reference '-Jn case of
mere reference to a provision of one statute in another without incorporation,
unless a different intention clearly appears, would be construed as a reference
to the provision as may be in force from time to time in the former statute
but if a provision of one statute is incorporated in another, any subsequent E
amendment in the former statute or even its total repeal would not affect the
provision as incorporated in the latter statute.

The short question involved in this appeal was that for the purposes of
the Industrial Disputes Act, 1947 in relation to a Multi-State Co-operative
Bank carrying on business in more than one State, which Government- F
Central or State, is the "appropriate Government".

Dismissing the appeal, the Court

HELD 1.1 If there is a mere reference to a provision of one statute in
another without incorporation, then, unless a different intention clearly G
appears, the reference would be construed as a reference to the provision as
may be in force from time to time in the former statute. But if a provision of
one statute is incorporated in another, any subsequent amendment in the
former statute or even its total repeal would not affect the provision as
incorporated in the latter statute. (Para 19] (356-F-G; 357-A]
347 H
348 SUPREME COURT REPORTS [2007] 4 S.C.R.

A U.P. Avas Exam Vikas Parishad v. Jainul Islam & Anr., [1998] 2 SCC
467 and P. C. Agarwala v. Payment of Wages Inspector, M P. & Ors., (2005)
8 sec 104, relied upon.

Wood's Estate, Ex parte Her Majesty's Commissioners of Works and
Buildings, (1886] 31 Ch.D. 607; Secretary of State for India in Council
B Hindustan Co-operative Insurance Society Ltd., AIR (1931) PC 149; Ram
Sarup Munshi & Ors., [1963) 3 SCR 858; Clarke v. Bradlaugh, (1881) 8 QBD
63; Boiani Ors. Ltd. v. State of Orissa, (1974) 2 SCC 777; Mahindra &
Mahindra Ltd. v. Union of India & Anr., (1979) 2 SCC 529; Collector of
Customs v. Sampathu Chetty & Anr., AIR (1962) SC 200 and Maharashtra
C State Road Transport Corporation v. State of Maharashtra & Ors., [2003) 4
sec 200, referred to.
1.2 When in the definition clause given in any statute the word "means"
is used, what follows is intended to speak exhaustively. When the phrase
"means" is used in the definition, it is a "hard and fast" definition and no
D meaning other than that which is put in the definition can be assigned to the
sam~. On the other hand, when the word "includes" is used -in the definition,
the legislature does not intend to restrict the definition; makes the definition
enumerative but not exhaustive. The term defined will retain its ordinary ...
•
meaning but its scope would be extended to bring within it matter, which in
its ordinary meaning may or may not comprise. (Para 22) [357-G; 358-A.:.B]
E
Gough v. Gough, (1891) 2 QB 665, relied upon.

P. Kasilingam and Ors. v. P.S.G. College of Technology and Ors., AIR
(1995) SC 1395, referred to.

F 2.1 The plain language of Section 2(bb) of the ID Act makes the
intention of the legislature very clear as the use of the word "means" followed
by the word "includes" in Section 2(bb) of the ID Act is clearly indicative of
the legislative intent to make the definition exhaustive and would cover only
those banking companies which fall within the purview of the definition and
G no other. The reference to Section 5 of the Banking Companies Act, 1949 in
the said provision, therefore, is an instance of legislation by incorporation
and not legislation by reference. It has become its integral part and, therefore,
subsequent amendments in the Banking Regulation Act would not have any
effect on the expression "Banking Company" as defined in the said Section.
[Paras 21, 22 and 24) [357-D-E; 358-B; E-F]
H
BHARAT CO-OP. BANK(MUMBAl)LTD.1•. CO-OP.BANK EMPLOYEES UNION [D. K.JAIN,J.) 349

- ,; State of Madhya Pradesh v. M V. Narasimhan, (197512 SCC 377 and
P. C. Agarwala v. Payment of Wages Inspector, M P. & Ors, (2005) 8 SCC
A
104, relied upon.

2.2 The Industrial Disputes Act is a complete and self contained Code
in itself and its working is not dependant on the Banking Regulation Act It
could not also be said that the amendments in the Banking Regulation Act B
either expressly or by necessary intendment applied to the ID Act
(Para 26) [359-C]
,..
- 2.3 The language of Section 2(bb) of the industrial Disputes Act clearly
demonstrates the legislative intent not to bring within its ambit all the banks
transacting the business of banking in India. The definition of "Banking c
Company" in clause (bb) of Section 2 of the Industrial Disputes Act being
exhaustive, it is only with respect to the "Banking Company" falling within
the ambit of the said definition in the Industrial Disputes Act, that the Central
Government would be the appropriate Government
[Paras 23 and 27] (358-D; 359-D)
D
2.4 For the purpose of deciding as to which is the "appropriate
J
Government", within the meaning of Section 2(a) of the ID Act, the
"appropriate Government" in relation to a multi-state co-operative bank,
. carrying on business in more than one state, would be the State Government
[Para 29) [359-G]
E
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1542 of2007.

From the Judgment and Final Order dated 17.2.2005 of the High Court
of Judicature at Bombay in L.P.A. No. 807/2004 in W.P. No. 323/2003.

-J. Jamshed Cama, P.C. Pavaskar, Nandini Gore, Pragya Baghel for Manik p
Karanjawala for the Appellant.

Chander Uday Singh, Nitin S. Tambwekar, B.B. Sai and K. Rajeev for the
Respondent.

The Judgment of the Court was delivered by
G
D.K. JAIN, J. 1. Leave granted.

2. In relation to a Multi-State Co-operative Bank carrying on business
in more than one State, which government Central or State, is the "appropriate
government" for the purposes of the Industrial Disputes Act, 1947 (for short
"the ID Act"), is the short question for consideration in this appeal? H
350 SUPREME COURT REPORTS (2(,07) 4 S.C.R.

A 3. The Appellant-Bank (hereinafter referred to as "the Bank") was
originally registered under the Maharashtra State Co-operative Societies Act,
1960. As the Bank had a number of branches outside Maharashtra,
subsequently, it got registered under the Multi-State Co-operative Societies
Act, 1984. It is in the banking business and is governed by the provisions '
B of the Banking Regulation Act, 1949 (for short "the BR Act"). The respondent
is a trade union and represents workmen employed in the Bank.

4. Mainly aggrieved by transfer of eleven employees from one place to
another, alleging it as an act of victimisation, the respondent filed a complaint
against the Bank under Section 28 of the Maharashtra Recognition of Trade
C Unions and Prevention of Unfair Labour Practices Act, 1971 (for short "the
MRTU & PULP Act"), along with an application for interim relief, before the
Industrial Court at Mumbai. While resisting the complaint, the Bank raised
certain preliminary issues of jurisdiction and maintainability of the complaint '-

under the MRTU & PULP Act. The plea of the Bank was that as it was
engaged in the business of banking and is a Banking Company as defined
D in Clause (c) of Section 5 of the BR Act, the appropriate government would
be the Central Government and therefore, the provisions of the MRTU &
PULP Act, a State Act, were not applicable. The Industrial Court upheld the
objection and ordered that the complaint may be returned to the respondent
for seeking relief before an appropriate forum.
--
E 5. The respondent questioned the validity of the said order by preferring
a writ petition in the High Court. Allowing the writ petition, the learned single
Judge came to the conclusion that for the "appropriate Government" to be
the Central Government it was necessary that the Bank must be a Company
incorporated under the Companies Act, 1956, which requirement was missing
p in the present case. He observed, that even though the respondent may be
carrying on banking business, yet it is not a Company as defined under
Section 5(d) of the BR Act. Inter-alia, holding that the definition of Banking
Company would not include a Co-operative Bank, which would be regulated
under the provisions of the Maharashtra State Co-operative Societies Act, the
learned Judge set aside the order of the Industrial Court and remanded the
G matter back to that Court for decision on merits.

6. Being aggrieved, the Bank filed a Letters Patent Appeal before the
Division Bench. Inter-alia, observing that Section 2(bb) of the ID Act is an -~

instance of legislation by incorporation and not legislation by reference and,
H therefore, the amendments made in the BR Act after 1949 cannot be read into
BHARATCO-OP. BANK (MUMBAI) LTD. v. CO-OP. BANK EMPLOYEES UNION [D. K. JAIN, J.) 35}

.the ID Act, Division Bench came to the conclusion that the appropriate A
Government in the present case would be the State Government. In other
words, the Division Bench held that for the purpose of deciding which is the
"appropriate government" the expression "Banking Company" will have to be
read, as it existed in BR Act of 1949 and that the subsequent amendments
made vide Banking Regulation Act, 1965 had to be ignored. Being aggrieved, B
the Bank is before us by special leave.

7. We have heard Mr. Jamshed Cama, learned senior counsel appearing
on behalf of the Bank and Mr. Chander Uday Singh, learned senior counsel
on behalf of the respondent.

8. On behalf of the appellant it was contended that Section 2(bb) of the C
ID Act creates its own corporate entity, i.e., multi-State Banking Company and
reference to the BR Act is for the limited purpose of idegtifying one kind of
banking institution it brings in. Thus, there is no question of such multi-State
Banking Company referred to in the BR Act of being bodily lifted in the ID
Act by legislative incorporation of the BR Act, 1949 and, therefore, when the D
expression "Banking Company" was expanded in 1965 to include co-operative
banks, such co-operative banks also became banking companies under the
BR Act and if any of these newly included banking companies operate in
more than one State, then they also become multi-State Banking Companies
for the purpose of Section 2(bb) of the ID Act. It is asserted that introduction
of definition "Banking Company" in the first part of Section 2(bb) of ID Act E
is a case of referential legislation and not legislation by incorporation. Laying
emphasis on the Industrial Disputes (Banking and Insurance Companies) Act,
194} (for short "the IDBIC Act") it was submitted by the learned counsel that
the IDBIC Act mandates that in respect of multi-State Banking and Insurance
Companies the appropriate Government for all industrial disputes would only F
be the Central Government and, therefore, the expression "Banking Company"
in Section 2(bb) of the ID Act must be read in conjunction with the object
and purpose of IDBIC Act so as to bring ID Act into syne with the IDBIC
Act. The submission is that being aware of the malice in the industrial field
relating to multi-State Banks and Insurance Companies, IDBIC Act was enacted
to bring all multi-State Banking and Insurance Companies under the control G
of the Central Government as appropriate Government, to obviate the difficulties
being faced by the banks and insurance companies, having br~nches outside
one State, inter-alia in the form oflack of uniformity of service conditions and
industrial peace.

9. Per contra, learned counsel for the respondent submitted that the H
352 SUPREME COURT REPORTS [2007] 4 S.C.R.

A doctrine of statutory incorporation squarely applies in the present case, as
the definition of "Banking Company" in the ID Act had been bodily lifted
from the BR·Act. Moreover, the definitions in Sections 2(a), 2(bb) and 2(kk)
of the ID Act are exhaustive. Subsequent amendments from time to time in
Section 2(bb) to include certain specified institutions clearly show the
B legislative intent not to give an expansive interpretation to the original words.
It is contended that the fact that the Parliament expressly amended Section
2(bb) to include State Bank of India, notwithstanding amendments to the BR
Act on· 22n~ October, 1956 to ap_ply that Act to the State Bank of India and
corresponding new banks is a strong indicator of the legislative intent that
amendments to the BR Act were not intended to apply automatically to
C Section 2(bb) of the ID Act.

10. In order to appreciate the contentions raised, it would be necessary
to refer to some salient statutory provisions, which form the background of
the issue involved.

D 11. The l.D. Act came into force with effect from 1st April, 1947. The
term "appropriate Government" was defined in Section 2(a). However, sub-
clause (i) of clause (a) came to be amended in the year 1949 by the amendment
Act 54 of 1949, whereby in relation to any industrial dispute concerning a
"Banking Company" or Insurance Company, the Central Government was
declared to be the "appropriate Government". Simultaneously, Section 2(bb)
E was inserted by the same Act, defining the "Banking Company". Needless
to add that it is only those banking companies which fall within the ambit of
the definition in the said provision that the Central Government would be the
appropriate government. With respect to other banking companies, the State
Government, in which the bank is situated, would be the appropriate
F government in terms of sub-clause (ii) of clause (a) of Section 2 ofthe ID Act.
Section 2(bb) which is at the centre of controversy reads as under:

"2(bb). "Banking Company" means a banking company as defined in
Section 5 of the Banking Companies Act, 1949 (I 0 of 1949) having
branches or other establishments in more than one State and includes
G (the Export-Import Bank oflndia) (the Industrial Reconstruction Bank
of India), (the Industrial Development Bank of India), (the Small
Industries Development Bank of Indi~estaolished under section 3 of
the Small Industries Development B~k of India Act, 1989), the Reserve
Bank of India, the State Bank of India (a corresponding new bank
constituted under Section 3 of the Banking Companies (Acquisition
H and Transfer of Undertakings Act, 1970 (5 of 1970) (a corresponding
BHARATCO-OP.BANK(MUMBAl)LTD. '" CO-OP. BANK EMPLOYEES UNION (D. K. JAIN,J.] 353
new bank constituted under Section 3 of the Banking Companies A
(Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980), and
any subsidiary bank), as defined in the State Bank of India (Subsidiary
Banks) Act, 1959 (38of1959)."

From a bare reading of the Section it is clear that in order to fall within the
meaning of this definition, a "Banking Company" has to satisfy two
requirements, viz: (i) it should be a "Banking Company" as defined in Section
5 of the Banking Companies Act, 1949 and (ii) it should have branches or
other establishments in more than one State. It may also be noted that some
banks, by name, have specifically been included in the definition. Section 5
of the BR Act gives interpretation to various expressions used in the said
Act. As per clause (c) of Section 5 the expression "Banking Company" means
c
any "Company" which transacts the business of banking in India. According
to Section 5(b) "banking" means the accepting, for the purpose of lending or
investment, of deposits of money from the public, repayable on demand or
otherwise and withdrawable by cheque, draft, order or otherwise. The expression
"Company" has been interpreted in clause (d) of Section 5 to mean any D
Company as defined under Section 3 of the Companies Act, 1956 and includes
foreign company within the meaning of Section 591 of that Act. Indubitably,
the appellant-Bank is not a Company within the meaning of the said clause.
However, by the Act 23 of 1965 several amendments were carried out in the
BR Act with effect from 1st March, 1966, widening the scope of the said Act.
By that amendment Part-V, containing only one Section 56, providing for E
application uf BR Act to Co-operative Banks, like the appellant-Bank, was
inserted. Section 3 was substituted to declare that the provisions of the BR
Act shall apply to a Co-operative Society only in the manner and to the extent
specified in Part-V thereof.
F
12. The main question raised for determination is whether the afore-
noted amendments to the BR Act, particularly insertion of Section 56 in the
new format w.e.f. 1st March, 1966, after the insertion of the definition of ,
"Banking Company" in the ID Act by Act 54 of 1949 will apply mutatis
mutandis to the matters governed by the ID Act?
G
13. As there is no indication in the ID Act as to the applicability or
otherwise of the subsequent amendments in the BR Act, the question posed
has to be answered in the light of the two concepts of statutory interpretation,
' ,._f
namely, incorporation by reference and mere reference or citation of one
statute into another. Thus, answer to a rather intricate question hinges on the
test whether at the time of insertion of the definition of the term "Banking H
354 SUPREME COURT REPORTS [2007] 4 S.C.R.

A Company" in the form of sub-section (bb) of Section 2 of the ID Act by the · .._
1949 Act it was a mere reference to the Banking Companies Act, 1949 (later
re-christened as the Banking Regulation Act) or the intendment of the
legislature was to incorporate the said definition as it is in the ID Act?

14. Before adverting to the said core issue, we may briefly notice the
B distinction between the two afore-mentioned concepts of statutory
interpretation, viz., a mere reference or citation of one statute in another and
incorporation by reference. Legislation by incorporation is a common legislative
device where the legislature, for the sake of convenience of drafting
incorporates provisions from an existing statute by reference to that statute
C instead of verbatim reproducing the provisions, which it desires to adopt in
another stature. Once incorporation is made, the provision incorporated
·becomes an integral part of the statute in which it is transposed and thereafter
there is nt> need to refer to the statute from which the incorporation is made
, and any subsequent amendment made in it has no effect on the incorporating
statute. On the contrary, in the case of a mere reference or citation, a
D modification, repeal or re-enactment of the statute, that is referred will also
have effect on the stature in which it is referred. The effect of"in.corporation
by reference" was aptly stated by Lord Esher, M.R. In re: Wood's Estate, Ex
parte Her Majesty's Commissioners of Works and Buildings 1 in the following
words at page 615:

E "If a subsequent Act brings into itself by reference some of the
clauses of a former Act, the legal effect of that, as has often been
held, is to write those sections into the new Act just as if they had
been actually written in· it with the pen, or printed in it, and, the
moment you have those clauses in the later Act, you have no occasion
F to refer to the former Act at all."

I 5. The Privy Council in Secretary of State for India in Council v.
Hindustan Co-operative Insurance Society Ltd 2, while amplifying the doctrine
of incorporation, observed as follows:

"Their Lordships regard the local Act as doing nothing more than
G
incorporating certain provisions from an existing Act, and for
convenience of draft doing so by reference to that Act, instead of
setting out for itself at length the provisions which it was desired to

I. (1886) 31 Ch. D. 607,

H 2. AIR (1931) PC 149
BHARATC~P.BANK(MUMBAI)LID . .- C~P.BANKEMPLOYEESUNION[D.K.JAIN,J.) 355
adopt... .. The independent existence of the two Acts is therefore A
recognized; despite the death of the parent Act, its offspring survives
in the incorporating Act. Though no such saving clause appears in
the General Clauses Act, their Lordships think that the principle
involved is as applicable in India as it is in this country."

16. The doctrine of legislation by incorporation and its effect has been B
dealt with by this Court in a catena of decisions. In Ram Sarup v. Munshi
& Ors. 3 a Constitution Bench held that repeal.of Punjab Alienation of Land
Act, 1900 had no effect on the continued operation of the Punjab Pre-emption
Act, 1913 and that the ,expression "agricultural land" in tl).e later Act had to
be read as if the definition of the Alienation of Land Act had been bodily C
transposed into it. After referring to what Brett, L.J. said on the effect of
incorporation iii Clarke v. Bradlaugh 4, namely, "where a stltute is incorporated,
by reference, into a second statute the repeal of the first statute by a third
does not affect the se~ond", it was observed as follows:-

"Where the provisions of an Act are incorporated by referenc~ in D
a later Act the repeal of the earlier Act has, in general, no effect upon
the construction or effect of the Act in which its provisions have
been incorporated .

• • •
E
In the circumstances, therefore, the repeal of the Punjab Alienation
of Land Act of 1900 has no effect on' the continued operation of the
Pre-emption Act and the expression 'agricultural land' in the later Act
has to be read as if the definition in the Alienation of Land Act had
been bodily transposed into it;"
F
17. The same principle was applied in Boiani Ores Ltd. v. State of
Orissa5• In that case this Court was considering the question regarding the
interpretation of Section 2(c) of the Biharand Orissa Motor Vehicles Taxation
Act, 1930 (for short "the Taxation Act"). This Section when enacted adopted
the definition of "motor vehicle" contained in Section 2(18) of the Motor G
Vehicles Act, 1939. Subsequently, Section 2(18) was amended by Act 100 of
1956 but no corresponding amendment was made in the definition contained

3. [1963] 3 SCR 858

4. (1881) 8 QBD 63

s. £1974] 2 sec 1n . H
356 SUPREME COURT REPORTS (2007] 4 S.C.R.

A in Section 2(c) of the Taxation Act. The argument advanced was that the
definition in Section 2(c) of the Taxation Act was not a definition by
incorporation but only a definition by reference and the meaning of "motor
vehicle" in Section 2(c) must, therefore, be taken to be the same as defined
from time to time in Section 2(18) of the Motor Vehicles Act, 1939. The
B argument was rejected by this Court ..nd it was held that this was a case of
incorporation and not reference and the definition in Section 2( 18) of the
Motor Vehicles Act, 1939, as then existing, was incorporated in Section 2(c)
of the Taxation Act and neither repeal of the Motor Vehicles Act, 1939 nor
any amendment in it would affect the definition of "motor vehicle" in Section
2(c) of the Taxation Act.
c
18. The decision of this Court in Mahindra & Mahindra Ltd. v. Union
of India & Anr. 6 also proceeded on the same principle. There the question
was in regard to the effect of subsequent amendment in Section 100 of the
Code of Civil Procedure, 1908 on Section 55 of the Monopolies and Restrictive
Trade Practices Act, 1969 (for short "The MRTP Act"). Section 55 of the
D MRTP Act provides for an appeal to this Court against the orders of the
Monopolies and Restrictive Trade Practices Commission on "one or more of
the grounds specified in Section 100 of the Code of Civil Procedure, 1908".
Section 100 of the Code of Civil Procedure was substituted by a new Section
in 1976, which narrowed the grounds of appeal under that Section. In
E construing Section 55 of the MRTP Act this Court held that Section 100 of
the Code as it existed in 1969 was incorporated in Section 55 and the
substitution of new Section in the code, abridging the grounds of appeal, had
no affect on the appeal under Section 55 of the MRTP Act.

19. The principle laid down in these decisions was 1eiterated in UP.
F Avas Evam Vikas Parishad v. Jainul Islam & Anr. 7 and lately in P. C. Agarwala
v. Payment of Wages Inspector, MP. & Ors., 8 It is, therefore, clear from the
afore-noted decisions that if there is a mere reference to a provision of one
statute in another without incorporation, then, unless a different intention
clearly appears, the reference would be construed as a reference to the
G provision as may be in force from time to time in the former statute. But if
a provision of one statute is incorporated in another, any subsequent
amendment in the former statute or even its total repeal would not affect the
"'
6. [19791 2 sec 529

7. [1998]2SCC467.
H
s. c2005J s sec 104.
BHARAT CO-OP. BANK(MUMBAl)LTD. v. CO-OP.BANKEMPLOYEES UNION [D. K.JAIN,J.) 357
provision as incorporated in the latter statute. A
20. However, the distinction between incorporation by reference and
adoption of provisions by mere reference or citation is not too easy to
highlight. The distinction is one of difference in degree and is often blurred.
The fact that no clear-cut guidelines or distinguishing features have been
spelt out to ascertain whether it belongs to one or the other cati'.gory makes B
the task of identification difficult. The semantics associated with interpretation
play their role to a limited extent. Ultimately, it is a matter of probe into
legislative intention and/or taking an insight into the working of the enactment
if one or the other view is adopted. Therefore, the kind of language used in
the provision, the scheme and purpose of the Act assume significance in C
finding answer to the question. (See: Collector of Customs v. Sampathu
Chetty & Anr. 9). The doctrinaire approach to ascertain whether the legislation
is by incorporation or reference is, on ultimate analysis, directed towards that
end. (See: Maharashtra State Road Transport Corporation v. State of
Maharashtra & Ors., 10) Thus, the question for detennination is to which
category the present case belongs. D
• 21. The plain language of Section 2(bb) of the ID Act makes the
intention of the legislature very clear and we have no hesitation in holding
that reference to Section 5 of the Banking Companies Act, 1949 in the said
provision is an instance of legislation by incorporation and not legislation by
reference. .E:
22. Section 2(bb) of the ID Act as initially introduced by Act 54 of 1949
used the word "means.. and includes" and was confined to a "Banking
Company" as defined in Section 5 of the Banking Companies Act, 1949,
having branches or other establishments in more than one province and
includes Imperial Bank of India. Similarly, Section 2(kk), which was also F
introduced by Act 54 of 1949, defines Insurance Company as "an Insurance
Company defined in Section 2 of the Insurance Act, 1938 (IV of 1938), having
branches or other establishments in more than one province". It is trite to say
that when in the definition clause given in any statute the word "means" is
used, what follows is intended to speak exhaustively. When the phrase G
"means" is used in the definition, to borrow the words of Lord Esher M.R.
in Gough v. Gough 11 , it is a "hard and fast" definition and no meaning other

-, 9. AIR (1962) SC 316.

10. c2003] 4 sec 200.

11. (1891) 2 Q.B. 665. H
358 SUPREME COURT REPORTS (2007] 4 S.C.R.

A than that which is put in the definition can be assigned to the same. (Also
see: P. Kasilingam and Ors. v. P.S.G. College of Technology and Ors 11.,). On
the other hand, when the word "includes" is used in the definition, the
legislature does not intend to restrict the definition; makes the definition
enumerative but not exhaustive. That is to say, the term defined will retain
its ordinary meaning but its scope would be extended to bring within it
B matters, which in its ordinary me~ning may or may not comprise. Therefore,
the use of the word "means" followed by the word "includes''. in Section 2(bb)
of the ID Act is clearly indicative of the legislative intent to make the
definition exhaustive and would cover only those banking companies which
fall within the purview of the definition and no other.
c 23. Moreover, Section 2(bb) has subsequently been amended from time
to time by various amendments to include certain sp~cified banks and
institutions, which would otherwise not fall within the exhaustive definition
of the "Banking Company" in Section 2(bb) read with Section 5(c), 5(b) and
5(d) of the BR Act. It is plain that if the Parliament had intended an expansive
D interpretation of the original words, then there would have been no reason
whatsoever to keep amending the definition from time to time. In our view,
therefore, the language of Section 2(bb) clearly demonstrates the legislative
intent not to bring within its ambit all the banks transacting the busin~ss of
banking in India. ·

E 24. We are, therefore, of the opinion that introduction of the Banking
Companies Act, 1949 in clause (bb) of Section 2 of the ID Act is a case of
incorporation by reference; it has become its integral part and therefore,
subsequent amendments in the BR Act would not have any effect on the
expression "Banking Company" as defined in the said Section.
F
25. At this juncture, we may also consider an alternative submission
made on behalf of the Bank that even if it is assumed that the provisions of
Section 5 of the BR Act were introduced into Section 2(bb) of the ID Act by
way oflegislative incorporation, two of the exceptions, namely, exceptions (c)
and (d), carved out by this Court in State of Madhya Pradesh v. M V.
G Narasimhan 13 and reiterated in P.C. Agarwala 's case (supra), would apply in
the instant case. The exceptions so enumerated are:

(a) Where the subsequent Act and the previous Act are supplemental

12. AIR (1995) SC 1395

H 13. [1958] 2 sec 377
BHARAT CO-OP. BANK(MUMBAn LTD. v. CO-OP. BANK EMPLOYEES UNION [D. K. JAIN, J.] 359
.... _,.>.
to each other; A
(b) Where the two Acts are in pari materia;
(c) Where the amendment in the previous Act, if not imported into
the subsequent Act also, would render the subsequent Act wholly
unworkable and ineffectual; and
B
(d) Where the amendment of the previous Act, either expressly or by
necessary intendment, applies the said provisions to the
subsequent Act.

26. In our view, there is no substance in t~e contention. The ID Act
- is a complete and self contained Code in itself and its working is not dependant C
on the BR Act. It could not also be said that the amendments in the BR Act
either expressly or by necessary intendment applied to the ID Act. We,
therefore, reject the contention advanced by learned counsel for the appellant
on this aspect as well.

27. Further, as noticed above, the definition of the "Banking Company" D
in clause (bb) of Section 2 of the ID Act being exhaustive, it is only with
respect to the "Banki..,g Company" falling within the ambit of the said definition
in the ID Act, that the Central Government would be the appropriate
gove'mment, which admittedly is not the case here.

28. In the light of the analysis we have made of the provision contained E
in Section 2(bb) of the ID Act, we deem it unnecessary to dilate on the impact
of the IDBIC Act on the ID Act.

29. For all these reasons, we have no hesitation in upholding the view
taken by the High Court that for the purpose of deciding as to which is the
F
"appropriate government", within the meaning of Section 2(a) of the ID Act,
the definition of the "Banking Company" will have to be read as it existed on
the date of insertion of Section 2(bb) and so read, the "appropriate government"
in relation to a multi-state co-operative bank, carrying on business in more
than one state, would be the State Government.
G
30. In the result, the appeal fails and is dismissed accordingly. The
appellant shall pay the costs of the respondent throughout.

B.K. Appeal dismissed.
IJ
H