Skip to content


State of Gujarat Vs. Devendraprasad Mahasukhram - Court Judgment

SooperKanoon Citation
SubjectLabour and Industrial
CourtGujarat High Court
Decided On
Case NumberCriminal Appeal No. 208 of 1964
Judge
Reported in(1967)0GLR395; (1966)IILLJ389Guj
ActsIndustrial Disputes Act, 1947 - Sections 2, 4, 10, 11, 13, 15, 18 and 18(1); Factories Act, 1948 - Sections 1, 2, 4, 5, 7, 7(1), 7(2), 7(3), 10, 11, 12, 13, 14, 15, 16, 17, 18, 18(1), 18(2), 18(3), 20, 27, 32, 33, 34, 35, 38, 39, 40, 41, 42, 52, 62, 63, 65, 66 and 70
AppellantState of Gujarat
RespondentDevendraprasad Mahasukhram
Cases ReferredHariprasad v. Divelkar
Excerpt:
(i) labour and industrial - commercial establishment - bombay shops and establishments act, 1948 and industrial disputes act, 1947 - whether doctor's dispensary is commercial establishment within meaning of act of 1948 - dispensary of doctor is covered within meaning of term commercial establishment. (ii) maintenance of register - sections 23, 52 and 62 of factories act, 1948 - accused-doctor had not maintained prescribed register of employment in respect of three employees as required under section 62 - held, accused liable to be convicted for offence under sections 52 (e) and 62. - - 1. this appeal raises a very interesting question as to whether a doctor's dispensary is a commercial establishment within the meaning of the bombay shops and establishments act, 1948, hereinafter.....mehta, j.1. this appeal raises a very interesting question as to whether a doctor's dispensary is a commercial establishment within the meaning of the bombay shops and establishments act, 1948, hereinafter referred to as the act. 2. it has been filed by the state against the acquittal of the accused-doctor by the city magistrate (municipal), ahmedabad, on the charge for the offence under s. 52(e) of the act read with s. 62 and rule 23(1) of the said act. 3. the case of the prosecution was that the accused who was a doctor having his dispensary situated near jakaria masjid at ahmedabad had not maintained the employment register in the prescribed form with the necessary particulars regarding the hours of work in respect of three employees working in the dispensary. the complainant, shops.....
Judgment:

Mehta, J.

1. This appeal raises a very interesting question as to whether a doctor's dispensary is a commercial establishment within the meaning of the Bombay Shops and Establishments Act, 1948, hereinafter referred to as the Act.

2. It has been filed by the State against the acquittal of the accused-doctor by the City Magistrate (Municipal), Ahmedabad, on the charge for the offence under S. 52(e) of the Act read with S. 62 and rule 23(1) of the said Act.

3. The case of the prosecution was that the accused who was a doctor having his dispensary situated near Jakaria Masjid at Ahmedabad had not maintained the employment register in the prescribed form with the necessary particulars regarding the hours of work in respect of three employees working in the dispensary. The complainant, shops inspector, had visited this dispensary on 13 June, 1963 at about 9-50 a.m. and had found that even though the dispensary was registered as a commercial establishment under the Act, the employment register produced before him at the time of his visit was not maintained as required under rule 23(1). The complainant, therefore, made necessary remarks in the visit book of the dispensary and also in his diary and after necessary sanction filed the present complaint. The accused denied having committed the offence. It was not disputed that the prescribed employment register of hours of work in the prescribed from as required under rule 23(1) was not maintained. The defence of the accused, however, was that his dispensary was not a commercial establishment as the accused did not carry on any commercial activity in the dispensary. The accused carried on the medical profession which was more of a social service than a means of making money. In view of the restrictions imposed on a medical practitioner under the Medical Practitioners Act, a doctor could not advertise his profession and he was in the position of a trustee in relation to his patients and could not divulge the secrets entrusted to him and he was subject to disciplinary code of conduct and such a noble profession could not, therefore, be considered as commercial establishment. On this ground it was contended that no offence had been committed. The learned magistrate followed the decision of the Bombay High Court in Sakharam Narayan Kherdekar v. City of Nagpur Corporation [1964 - I L.L.J. 156], in which a lawyer's office was not held to be a commercial establishment. The learned magistrate accepted this reasoning and acquitted the accused. The State, has therefore, filed the present appeal. This appeal had come up for hearing before our learned brother Sarela, J. In view of the importance of this question not only to the medical profession as a whole but also to other similar professions and having regard to the fact that the Bombay and Punjab High Courts have recently taken a different view, he has referred this matter to the Division Bench and that is how this matter has come up before us.

4. Sri Mehta did not challenge the prosecution evidence. From the deposition of the shops inspector, Naranbhai Patel, Ex. 2, it was proved that the accused had not maintained the employment register in the prescribed form as required under rule 23(1) and that it did not contain the necessary particulars in respect of the three employees in regard to the hours of work, etc. Sri Mehta, therefore, only raised a question that the dispensary of the doctor was not covered by the Act as it did not fall within the definition of a 'commercial establishment.'

5. Before considering the rival contentions of the parties, it would be proper to examine the scheme of the Act. The preamble of the Act shows that it is a consolidating Act relating to the regulation of conditions of work and employment in shops, commercial establishments, residential hotels, restaurants, eating-houses, theatres, others places of public amusement or entertainment and other establishments and for certain other purposes. In S. 1 the Act was first extended to the local areas specified in Sch. I and it provided for its further extension to other local areas by a notification of the State Government from time to time. Section 2 gives statutory definitions of several expressions used in the Act. Sections 2(3) and 2(18) define the expressions 'closed' and 'opened' as meaning closed or opened for the service of any customer, or for any business of the establishment, or for work by or with the help of any employee of or connected with the establishment. Section 2(8) defines 'establishment' as meaning a shop, commercial establishment, residential hotel, restaurant, eating-house, theatre, or other place of public amusement or entertainment to which the Act applies and includes such other establishment as the State Government may, by notification in the official gazette, declare to be an 'establishment' for the purposes of the Act. Section 2(4) defines a 'commercial establishment.' Section 2(9) defines a 'factory.' Section 2(24) defines a 'residential hotel.' Section 2(25) defines a 'restaurant or eating-house.' Section 2(27) defines a 'shop' and S. 2(29) defines a 'theatre.' In S. 2(6) an 'employee' is defined as a person wholly or principally employed, whether directly or through any agency, and whether for wages or other considerations, in or in connexion with any establishment, and include an apprentice, but does not include a member of the employer's family. Section 2(7) defines an 'employer' as meaning a person owning or having ultimate control over the affairs of an establishment. Section 4 provides for certain exemptions and it enacts that notwithstanding anything contained in the Act, the provisions of the Act mentioned in Col. (3) of Sch. II would not apply to establishments, employees and other persons mentioned against them in Col. (2) of the said schedule. The said Sch. II can be modified by the State Government from time to time by a notification published in the gazette. Section 5 provides for application of the Act to other establishments and persons. It enacts that notwithstanding anything contained in the Act, the State Government may, by notification in the official gazette, declare any establishment or class of establishments to which, or any persons or class of persons to whom, the Act or any of the provisions thereof does not for the time being apply, to be an establishment or class of establishments or a person or class of persons to which or whom the Act or its provisions would apply with such modifications and from such date as the State Government deems it necessary. Chapter II deals with the registration of establishments. Under S. 7(1) within the period specified the employer of every establishment is required to send to the inspector of the local area concerned a statement in the prescribed form together with necessary fees, containing the name of the employer and of the establishment, the category of the establishment, whether it was a shop, commercial establishment, residential hotel, restaurant, eating-house, theatre or other place of public amusement or entertainment and such particulars. Under S. 7(2) a 'registration certificate' is to be granted. Under S. 7(3) in case of any doubt or difference of opinion between an employer and the inspector as to the category to which an establishment should belong, the matter shall be referred to the prescribed authority whose decision as to the category of such establishment is made final for the purposes of the Act. Chapter III deals with shops and commercial establishments. Sections 10 and 11 provide for the opening and closing hours of the shop, while S. 13 deals with the opening and closing hours of a commercial establishment. Section 14 provides for the maximum limit of the daily and weekly hours of work of the employees in shops and commercial establishments. Section 15 provides for rest intervals. Section 16 provides for spread over the hours of work in shops, while S. 17 provides for spread-over of hours of work in commercial establishments. Section 18, which provides for weekly holidays in shops and commercial establishments must be properly noted. Under S. 18(1) every shop and commercial establishment shall remain closed on one day of the week and a provision is made for change of the closed days and for notifying the list of such closed days. Section 18(2) provides that on such closed days it shall not be lawful for an employer to call an employee at or for an employee to go to his shop or commercial establishment or any other place for any work in connexion with the business of his shop or commercial establishment. Section 18(3) provides that no deductions from wages shall be done on such closed days. Section 12 is a special provision which prohibited hawking before opening and after closing hours of the shops by persons in that locality in the same kind of goods. Under S. 20 the restaurants and eating-houses are prohibited from selling goods of the kind sold in the shops before opening and closing hours of the shops. Similarly under S. 27 theatres or other places of public amusement or entertainment are also prohibited from selling goods of the kind sold in the shops after the closing hour of shops. In Chaps. IV and V similar provisions for opening or closing hours, hours of work, limits of hours of work, rest intervals, spread-over and weekly holidays are provided for residential hotels, restaurants and eating-houses and in theatres or other places of public amusement or entertainment. It should be noted that unlike in the case of shops and commercial establishment, the weekly off is not by closure of the establishment but by weekly off to the employees in rotation so that the establishment could remain open and would not be closed for service to the customers. Chapter VI is a general provision for all establishments as regards employment of children, young persons and women. Section 32 provides that no child should be required or allowed to work in any establishment, notwithstanding that such child is a member of the family of the employer. Similarly, S. 33 provides that no young person or woman shall be required or allowed to work whether as an employee or otherwise in any establishment before 6 a.m. and after 7 p.m. notwithstanding that such young person or woman is a member of the family of the employer. These two sections may be kept in mind as the prohibition extends not only to the employees but even to others employed in any capacity as an employee or otherwise in an establishment notwithstanding the fact that such child, young person or woman was a member of the family of the employer. Section 34 deals with daily hours of work for young persons. The next Chap. VII deals with leave with pay and payment of wages for such leave in Ss. 35 to 37. Section 38 then provides for the extension of the Payment of Wages Act by the State Government by a notification in the gazette to all or any class of establishments or to any call of employees to which the Act applies. Similarly S. 38A provides for the extension of the Workmen's Compensation Act, 1923. Chapter VIII deals with the provisions of health and safety and these provisions are general in their nature, which are applicable to all establishments. Section 39 provides for cleanliness of the establishments. Section 40 provides for ventilation. Section 41 provides for lighting. Section 42 provides for precautions against fire and S. 42A for first aid if a manufacturing process was carried on in the establishment. Chapter IX deals with the machinery for enforcement and inspection. Section 62 provides for maintenance of registers and records and display of notices as per the prescribed rules. Section 63 provides for wages for overtime work in the different categories of establishments and the explanation to that section provides for a limit of hours of work for shops and commercial establishments, residential hotels, restaurants, eating-houses theatres or other places of public amusements or entertainments and also for any other establishment. Section 65 restricts double employment on a holiday or during leave as per the Act. Section 66 provides for the notice of termination of service. Section 69 preserves the rights and privileges under other laws, contract, custom, usage or any award, settlement, etc., if such rights and privileges are more favourable. Section 70 finally provides for the extensions of the Factories Act to all persons employed in and in connexion with a factory, notwithstanding the fact that the Factories Act did not apply to those non-workers. Chapter X deals with offences and penalties. Section 52 is a general section which in Clause (e) provides for the penalty if the employer contravenes the provisions of S. 62 by not maintaining the prescribed register, which would be attracted in the present case, if the dispensary in question is held to be a commercial establishment. From this scheme of the Act it is clear that the Act provides not only for regulations of conditions of work in the establishments governed by the Act by providing for the benefits of fixed hours of work, limit of hours of work, overtime wages, rest intervals, weekly holidays, paid leave and for extension of the provisions of the Payment of Wages Act, Workmen's Compensation Act, etc., but it also provides for certain other matters. In cases of commercial establishments it specifically provides for fixed opening and closing hours for those establishments. To prevent unfair competit

6 ion a similar business, before opening and after closing hours of the shops by hawkers and others, is also prohibited. Even the residential hotels and restaurants, eating-houses, etc., are also prohibited from carrying on the sale of goods of the kind sold in the shops after the closing hours of the shops. In cases of shops and commercial establishments weekly off is also peculiar. It is a closed day under S. 18 for all services to the customers and it is not a weekly off for the employees alone as in the of other establishments like residential hotels, restaurants, eating-houses, theatres, etc. The validity of a similar provision as S. 18 in S. 7 of the Punjab Trade Employees Act (Act 10 of 1940) was challenged before the Supreme Court. Section 7(1) there provided that save as otherwise provided by the Act every shop or commercial establishment should remain closed on a closed day. While upholding the Validity of the said provision in the case of Manohar Lal v. State of Punjab [1961 - II L.L.J. 67] their lordships of the Supreme Court pointed out that the long title of the Punjab Trade Employees Act no doubt indicated the main purposes of the enactment but it could not control the express operative provisions of the Act, such as for example the terms of S. 7(1). In their lordships' opinion the ratio of the legislation was social interest in the health of the worker who formed an essential part of the community and in who welfare, therefore, the community was vitally interested. It was in the light of that purpose that the provisions of the Act had to be scrutinized. The restrictions for employment of the young persons were held to be with a view to ensuring the health of the rising generation of the citizens. That Act was concerned with the welfare of the worker and sought to prevent an injury to the workers not merely from the action of the employer but from his own by preventing the employee from attempting to earn more wages by working longer hours than was good for him. At p. 69 it was further observed that if such a condition was necessary or proper in the case of a worker, there did not seem anything to be unreasonable in applying the same or similar principles to the employer who worked on his own business. The legislation was in effect exercise of social control over the manner in which business should be carried on and it regulated the same in the interest of health and welfare not merely of those employed in it but of all those engaged in it, including the owner of the shop or establishment himself. Such restriction was, therefore, upheld. It was also pointed out that such a provision was also necessary with a view to avoid evasion of provisions specifically designed for the protection of workmen or employees. Their lordships adopted the observations in the case of Manohar Lal v. State [A.I.R. 1951 S.C. 315 at 316], where it was held that to require a shopkeeper, who employed one or two men, to close and permit his rival, who employed a dozen members of his family, to remain open, clearly placed the former at a grave commercial disadvantage. It was held that to permit such a distinction might well endanger the relations between employer and employed. It is, therefore, clear from the scheme of the Act that even though primarily it is concerned with the regulations of conditions of work and employment for the various establishments covered by the Act, it also provides for other incidental provisions in the interest of not only employees but all persons employed in any capacity and also those engaged in the activities of these establishments.

7. We would now turn to the two main definitions, which have to be interpreted.

8. Section 2(4) is as under :

''commercial establishment' means an establishment which carries on any business, trade or profession or any work in connexion with, or incidental or ancillary to, any business, trade or profession and includes a society registered under the Societies Registration Act, 1860, and a charitable or other trust, whether registered or not, which carries on, whether for purposes of gain or not, any business, trade or profession or work in connexion with or incidental or ancillary thereto but does not include a factory, shop, residential hotel, restaurant, eating-house, theatre or other place of public amusement or entertainment.'

9. Section 2(8) is as under :

''establishment' means a shop commercial establishment, residential hotel, restaurant, eating-house, theatre or other place of public amusement or entertainment to which this Act applies and includes such other establishment as the State Government may, by notification in the official gazette, declare to be an establishment for the purposes of this Act.'

10. The definition of 'commercial establishment' falls in three parts. In the first part 'the commercial establishment' is defined as an establishment which carries on any business, trade or profession or any work connected therewith or incidental or ancillary thereto. Thereafter the second part includes in the scope of this definition a registered society under the Societies Registration Act, 1860, and a charitable or other trust whether registered or not, if in carriers on any business trade or profession or work connected therewith or incidental or ancillary thereto irrespective of the fact whether it works for purposes of gain or not. In the third part an exclusion is made of a factory, shop, residential hotel, restaurant, eating-house, theatre or other place of public amusement or entertainment as those categories or establishments are separately dealt with. The term 'establishment' has, however, been defined as a shop, commercial establishment, residential hotel, restaurant, eating-house or other place of public amusement or entertainment to which the Act applies and it further includes such other establishment which is declared to be an 'establishment' by Government notification. The general term 'establishment' which is used in the statute, therefore, covers the specific categories of establishments to which the Act in terms applies and it also covers the establishments so declared by a notification issued under S. 5, Clause (1).

11. Even though the expression 'commercial establishment' is in terms defined as an establishment which carries on any business, trade or profession, it has been contended by Sri Mehta that because of the Statutory definition which defines in Clause 2(8) the term 'establishment,' the expression 'commercial establishment' could not be widely interpreted so as to cover any profession but should be limited in the context. Sri Mehta vehemently argued that the statutory definition must be incorporated throughout the entire Act wherever the term 'establishment' was used, including even the definition clause where different kinds of establishments were sought to be distinguished by their own special definitions. Sri Mehta further contended that as the Government had, under this conditional legislation, under S. 5(1) a power to rope in any kind of establishment, the term 'establishment' must have a very restricted meaning as otherwise any place, where any human activity was carried on, would by capable of being covered within the scope of this legislation. We do not agree with this contention of Sri Mehta. The definition clause is to be used only if there is no repugnancy in the subject or context. If the term 'establishment' as defined in S. 2(8) were to be substituted in the definition of 'commercial establishment' in s. 2(4), it would result in a mere redundancy that a commercial establishment would mean a commercial establishment. Sri Mehta ignores the fact that S. 2(8) first in its definition states that shops and commercial establishments and other establishments to which the Act has been applied would clearly fall within the definition of the term 'establishment' and the inclusion is then made only of such other notified establishments which are notified by the Government as such for the purposes of the Act under S. 5(1). There could not, therefore, arise any question that a 'commercial establishment', which expression has been defined to mean any establishment carrying on a business, trade or profession, would not amount to an 'establishment' at all. The wide scope of the term 'establishment' may have to be curtailed when the question arises of inclusion of 'such other establishment' as the Government so declares by a notification under S. 5(1) of the Act. In so far as a 'commercial establishment,' however, is concerned, the Act automatically allies. Once an establishment is shown to be a commercial establishment within the meaning of S. 2(4) of the Act, no notification is necessary to be issued under S. 5(1) for the application of the Act to such a commercial establishment and in fact no such notification could be legally issued. The expression 'such other establishment' may have to be interpreted ejusdem generis in its context to find out the nature of what establishments could be included by a notification under the Act, but such a question would only arise in cases of other establishments to which the Act has not been applied in the first instance. No such question arises in the present case and it is not necessary for us to go into the wider question as to what other establishments could be legally included under the scope of the Act by a notification issued under S. 5(1). We also cannot agree with Sri Mehta to his contention that the expression 'commercial establishment' in S. 2(4) is a residuary clause which covers all the establishments to which the Act could be applied, except those which are specifically excluded in the third part of the definition. Sri Mehta ignores the material words in Clause 2(4) that a 'commercial establishment' means only an establishment, which carries on any business, trade or profession or work connected or incidental or ancillary thereto. If the establishment does not carry on any such activity, it could never fall within this category of the establishments. We also cannot agree with Sri Mehta to his connection that the Act applies only to shops, commercial establishment, residential hotel, eating-house, restaurant or other place of public amusement or entertainment and to no other establishments. This construction urged by Sri Mehta is negatived by the fact that in S. 63, in the explanation, 'the limit or hours of work,' is specifically provided in Cls. (a) and (b) for shops, commercial establishments, residential hotels, restaurants, eating-houses or other place of public amusement or entertainment and in Clause (c) in case of any other establishment. We have already stated that there are various general provisions in that Act as in the case of registration of establishments under S. 7(1), in Chap. VI as regards the employment of children, young persons and women, in Chap. VIII as regards health and safety, which are all applicable to all establishments which are covered by the Act, whether in the first instance by the Act itself or subsequently by a notification issued by the State Government in exercise of its powers under S. 5(1). In fact, after defining 'establishment' in S. 2(8) as consisting of various specific categories of establishments which are dealt with specifically in the Act, a provision is made for inclusion of 'such other establishment' as the State Government deems it fit to declare as an 'establishment,' for the purposes of the Act. While, therefore, considering the other definition as to the various categories of the establishments, this general definition in S. 2(8) could not be substituted, as it would be totally repugnant in the subject or context of the special definition which seeks to define only a particular category.

12. Turning to the definition of the term 'establishment' in Webster's Dictionary, Part II, at p. 625, it is a place where a person is settled for residence or for transacting business. In the context of S. 2(4) the term 'establishment' would mean the place for transacting any business, trade or profession or work connected with or incidental or ancillary thereto. Sri Mehta also argued that as the definition in S. 2(4) defines 'a commercial establishment' as an establishment which carries on any business, trade or profession, the emphasis was not on the place from which the trading or professional activity was carried on but it was really on the nature of the activity which must be a commercial activity. He also urged that this dictionary definition could not apply as the place by itself without the person running the establishment could not carry on any business. Another meaning which was mentioned in Webster was the permanent civil or military force or organization such as a fixed garrison or a local government. It clearly appears that the establishment in the context is some fixed place or premises where the organization exists for carrying on the business, trade or profession. The entire emphasis is really on the fixed place from which the business or trade or profession is carried on. Even in other definitions of 'shop,' 'residential hotel,' 'restaurant,' 'theatre,' the emphasis is on the premises and that is why in the general expression 'establishment' in S. 2(8) the establishment is defined as one of those specific categories of establishments or other place of public amusement or entertainment or such other establishment which was notified as such by the Government. The expression 'shop' in S. 2(27) is defined to mean any premise where goods are sold or services are rendered to the customers and it includes an office or a workplace used in connexion with such trade or business. Even this inclusive clause, which includes a work-place where such trade or business was carried on, was interpreted by the Supreme Court in Kalidas Khanjibhai v. State of Bombay [1954 - II L.L.J. 694] to cover only defined premises where the activity of sale was carried on. When, therefore, there was no sale on any defined premises and the orders were canvassed from outside the concern was not held to be a shop, even though in the work-place ordered spare parts were manufactured for sale. This is really a labour legislation, regulating the conditions of work and employment and provides for health, safety and welfare provisions and corresponds to the Factories Act, 1948, or the Mines Act, 1952, or the Dock Labour (Regulation of Employment) Act, 1948, or the Plantations Labour Act, 1957, enacting similar provisions for workers employed in the factories, mines or the docks or the plantations. The present Act provides benefits for the employees employed in or in connexion with the establishments covered by this Act. The employees who work in those places or in connexion with those establishments get the benefits under the Act and the employer who owns or has ultimate control over the affairs of such establishments is subject to the restrictions imposed by the Act. Looking to the context and the setting of the present Act, we do not agree with Sri Mehta that the emphasis in the definition of the term 'commercial establishment' in S. 2(4) is on the commercial activity and not on the premises where the activity in question is carried on.

13. Sri Mehta also tries to construe the words of the definition by reference to the defining term, ignoring the fact that it is for the legislature to define words in a very wide context. When the legislature in terms includes in the definition of 'a commercial establishment' an establishment carrying on any business, trade or any profession, it would be wrong to construe this wide definition in a restricted manner by reference to the description of this term. In the context of this wider definition the term 'commercial' in the compendious expression 'commercial establishment' would be merely descriptive and would have to be read in the wider context in all reference in the Act so as to cover not only premises carrying on any business or trade but also premises carrying on any profession. In other words, the expression 'commercial establishment' not only covers a business-house, but also the office or the place, where any profession is carried on by any person owning or having ultimate control over its affairs. Sri Mehta had tried to invoke the doctrine of noscuntur a sociis. As pointed out by the Supreme Court in State of Bombay v. Hospital Mazdoor Sabha [1960 - I L.L.J. 251 at 256] the doctrine of noscuntur a sociis under which the words are said to take colour from each other, that is, a more general is restricted to a sense analogous to a less general, was merely a rule of construction and it could not prevail in cases where it was clear that the wider words had been deliberately used in order to make the scope of the defined word correspondingly wider. It was only where the intention of the legislature in associating wider words with words of narrower significance is doubtful, or otherwise not clear that the above rule of construction could be usefully applied. It could also be applied where the meaning of the words of wider import was doubtful. But where the object of the legislature in using wider words is clear and free from ambiguity, the rule of construction in question could not be pressed into service. On the above principle the maxim noscuntur a sociis was held inapplicable to the definition of the term 'industry' in S. 2(j) of the Industrial Disputes Act and it was held that the definition applied even to a hospital. Their lordships of the Supreme court in arriving at this conclusion also relied upon the fact that in Sch. I to the Act, which enumerated industries, which could be declared as public utility services, hospital and dispensaries were in terms included. The learned Assistant Government Pleader is, therefore, right in urging that in the present case also the legislative intention was apparent when it expressly included in the definition of 'commercial establishments' not only establishments carrying on business or trade but also those which carried on any profession. Sri Mehta had urged that in Hariprasad v. Divelkar [1957 - I L.L.J. 243], the Supreme Court had, in spite of the wide definition of the term 'retrenchment' in S. 2(oo) of the Industrial Disputes Act, which covered termination of the service of the employees for any reason whatsoever, interpreted the same in the ordinary sense of retrenchment of surplus labour. It is true that the dictionary definition provided by the Act could be departed from if there was any repugnancy in the subject or context of the Act. In that decision the context was of the Industrial Disputes Act and the industrial disputes could only exist in a continuing industry and not after the closure of the industry. That is why retrenchment was interpreted in the sense of retrenchment of surplus labour in a continuing industry. There is no such justification for restricting the present wide definition of the term 'commercial establishment,' which includes not only establishments carrying on business or trade but also any profession. The benefits of the Act in respect of commercial establishments are extended to the employees and persons employed or engaged not only in business-houses like the shops but also in places where professions were carried on. The employees in all these establishments could equally avail of the benefits of the Act. When the legislature had deliberately used such a wide expression in defining the term 'commercial establishment' not only as an establishment carrying on business or trade but also as one carrying on any profession, it would be wrong to construe this definition by excluding the term profession altogether. In the context of labour legislation which is a benevolent legislation such a construction would not be permissible.

14. Sri Mehta next emphasized the fact that as the category of 'commercial establishment' was sought to be distinguished from other categories of establishments, the term 'commercial' must also cover the professional activities of the establishment. He, therefore, argued that the two necessary tests for a commercial activity, viz., investment of capital and a profit motive, must also be fulfilled, if any professional establishment was sought to be brought in the category of a commercial establishment. Sri Mehta in this contention also makes the same error. His grievance really is that the legislature ought not to have included the professional establishments along with the establishments carrying on business and trade. It is for the legislature to decide what it shall include in the category of a commercial establishment. Once it includes even an establishment carrying on a profession in the same category as a establishment carrying on business or trade, compendious term 'commercial establishment' must be interpreted in the wider sense in which the legislature has used this expression and one cannot harp back on the old notions of commerce or a commercial activity. In D. N. Banerjee v. P. R. Mukherjee [1953 - I L.L.J. 195 at 200], their lordships of the supreme Court had approved the observations in National Association of Local Government Officers v. Bolton Corporation [1943 A.C. 166]. In that decision it was observed that 'trade' was not only in the etymological or dictionary sense, but in the legal usage a term of the widest scope. It was connected originally with the word tread and indicated a way of life or occupation. In ordinary sense it may mean the occupation of a small shopkeeper equally with that of a commercial magnate. It was true that it was often used in contrast with a profession. A professional worker would not ordinarily be called a tradesman but the 'trade' was used in the widest application to the appellation 'trade unions'. In the context of that Act, the word 'trade' was held to have been used in the very wide connotation which it bore in the modern legislation dealing with conditions of employment, particularly in relation to matters of collective bargaining and the like. In that case before their lordships even the conservancy services of a municipality were held to be industry. It was observed at p. 200 that a the only ground on which one could say that what would amount to carrying on of an industry, if it was done by a private person, ceased to be so if the same work was carried on by a local body like a municipality was that in the latter there was nothing like the investment of any capital or the existence of a profit-earning motive as there generally was in a business. But neither the one not the other seemed to be a sine qua non or necessary element in the modern conception of industry. In State of Bombay V hospital Mazdoor Sabha [1960 - I L.L.J. 251 at 256] (vide supra) it was pointed out that 'trade' according to Halsbury, in its primary meaning was 'exchange of goods for goods or goods for money,' and in its secondary meaning it was.

'any business carried on with a view to profit whether manual or mercantile, as distinguished from the liberal arts or learned professional and from agriculture';

15. whereas 'business' was a wider term not synonymous with trade and meant practically 'anything which was an occupation as distinguished from a pleasure.' At p. 257 it was pointed out that too much reliance could not be placed on what were described as the essential attributes or features of trade or business as conventionally understood. The conventional meaning attributed to the words 'trade and business' has lost some of list validity for the purpose of industrial adjudication. In attempting to solve industrial disputes industrial adjudication did not and should not adopt a doctrinaire approach and a working principle ought to be evolved. It was also observed that it could not harp back to old-age notions about the relations between employer and employees or to the doctrine of laissez faire which then governed the regulation of the said relations. That was why while construing the wide words use in S. 2(j), it was held to be erroneous to attach undue importance to attributes associated with business or trade in the popular mind in says gone by. Therefore, the two important attributes which have been associated with trade or business, viz., investment of capital and profit motive, were not held to be material. It is, therefore, clear that 'commerce' in the sense of 'trade or business' has, under modern notions in legal usage, undergone a great change, and especially, in the context of labour legislation the term 'trade or business' would have a wider connotation, so as to permit the inclusion of profession in the same category. The capital investment in case of a 'profession' would really be the intellectual equipment or the professional talent and the profit motive would also be present in the sense of quid pro quo or remuneration for the professional services rendered to the community. We, cannot, therefore, agree with Sri Mehta that the term 'commercial establishment' in S. 2(4) was used in the old conventional sense. In the modern sense of the term, it could cover any organized activity carried on with the object of supplying goods or services essential to the community. Even though ordinarily the word 'profession' stands in contrast with the word 'trade or business,' in the wider connotation, the expression 'commerce' could legitimately describe all these activities. The legislative intent being clear, it would not be open to Sri Mehta to contend that after the inclusion of the word 'profession' along with the words 'trade or business' we should still discard the word 'profession' by resorting to the old nations of the term 'commercial' in the compendious expression 'commercial establishment' in the defining term. We have independently come to this conclusion as to the correct interpretation of this definition. We are, however, fortified in this view by looking to the various exemption entries in Sch. II. Entry 10 mentions establishments for the purpose of attending upon the sick, infirm, destitute or mentally unfit and maternity homes, which are exempted from Ss. 10 and 11 to 18 which deal with commercial establishments. Entry 18 refers to establishments of legal and income tax practitioners, which are exempted from Ss. 13 and 18(1) in so far as it concerns their own attendance and the attendance of the staff exempted from S. 18. Entry 22 also deals with establishments of legal and income tax practitioners and exempts them from S. 15. Under entry 6f establishments pertaining to any kind of educational activities are also exempted from all provisions of the Act. In the scheme of the Act is, therefore, clear that the word 'commercial establishment' has been used in a wider sense and it covers not only 'trade or business' establishments but also professional establishments and there is nothing in the scheme of the Act to suggest any restricted construction.

16. Sri Mehta next contended that really the intention of the legislature must have been to cover only those professions which were carried on in a commercial manner. He gave the illustration of a nursing home or a lawyer's office where the work was entirely carried on by paid legal assistants and where the legal practitioner really traded on the labour of his assistants. This argument is also equally misconceived and it proceeds on the analogy of the term 'industry' in the Industrial Disputes Act. Sri Mehta had in terms tried to rely on the observations at pp. 258-259 in the decision of State of Bombay v. Hospital Mazdoor Sabha [1960 - I L.L.J. 251] (vide supra). Their lordships had there considered the attributes, the presence of which made an activity 'an undertaking' within the meaning of 'industry' in S. 2(j) on the ground that it was analogous to trade or business. AS a working principle it was stated that an activity systematically or habitually undertaken for the production or distribution of goods or for the rendering of material services to the community at large or a part of such community with the help of employees was 'an undertaking.' Such an activity generally involved the co-operation of the employer and the employees and its object was the satisfaction of the material human needs. It must be organized or arranged in a manner in which trade or business was generally organized or arranged. It must not be casual nor must it be for oneself nor for pleasure. Thus the test of co-operation between capital and labour so as to make it a joint venture was the essential test of an 'industry.' The participation must be an essential or a direct participation as co-partners or co-operators. On the application of this test in that case a Government hospital was held to be an 'industry' as the hospital employees directly contributed to the service rendered by the hospital. On the application of the said test in National Union of Commercial Employees and another v. Meher, Industrial Tribunal, Bombay and others [1962 - I L.L.J. 241], a solicitor's firm was not held to be an 'industry' because in the professional activities of the solicitors which depended essentially on his individual equipment, knowledge, efficiency as a solicitor, there was no essential co-operation of the employees. The employees' co-operation was only of an incidental type and it had no direct relation or nexus with the professional services rendered by the solicitor. Those decisions were on the interpretation of the term 'industry' and in the context of the industrial disputes legislation. As observed by Professor Kirkaldy in the lectures on 'The Spirit of Industrial Relations' in the first lecture at pp. 4 and 5 in the primitive industry, the worker was the owner, not only of his labour, but also commonly of both the instruments and materials of production. The primitive workman was really an independent producer. The problems of industrial relations arise with and from the divorce of the worker from the ownership of the instruments and materials of production. The worker became a wage-earner and his employer became the owner of the instruments and material of production and of the product. The obvious elements of a conflict of interest existed between the employer who wished to buy labour cheaply and the worker who wished to sell it dearly. The whole problem of industrial relations could be very shortly stated as the devising of means to reconcile that conflict of interest. The sense of deprivation which had resulted from loss of independence could be compensated only by a realization of partnership in a greater enterprise and a greater adventure than man ever undertook in isolation. The realization of partnership was not only, even mainly, a matter of monetary reward; it was a matter of the spirit; it was a question of human dignity; it was what differentiated the worker from the machine. Until the spirit of partnership became the spirit of the industrial relations, conflict as to the division of the existing product of industry obscured the need for co-operation towards greater productivity, out of which alone could come any real advance in material prosperity. In the field of industrial disputes legislation, therefore, the co-operation of capital and labour is the vital test to determine whether a particular activity falls within these spheres of industrialism. That test, however, would not be material in interpreting the definition of a 'commercial establishment' in the context of the present legislation. As pointed out In the case of D. N. Banerji v. P. R. Mukherjee [1953 - I L.L.J. 195 at 198] (vide supra) the decisions on the meaning of a particular word or collection of words found in other statutes would not clearly have much value when we have to deal with a particular statute of our own. The same words might mean one thing in one context and another in a different context. It would be, therefore, risky to adopt the same test which was adopted to find out essential attributes of an 'industry' when we have to interpret the meaning of the term 'commercial establishment.' The expression would have only to be interpreted in the context of the present Act where the legislature has in terms roped in professions also in the same category as commercial establishment and in exemption entries also provisions have been made to resolve the difficulties which would be experienced in the working of the Act because of this wider inclusion. The provisions of the Act secure benefits to persons working in or in connexion with the establishments in question and those benefits do not depend on the fact that the contribution of workers is in the essential business or professional activity itself. The emphasis is on the fact of the employment of the worker in the establishment in question and not on his direct participation in the business or professional activity itself. Besides, the Act intends to extend its benefits not only to the employees but also to other persons employed or engaged in the establishment. The restrictions imposed by the Act are applicable even where the employer carries on business with his own family members and even where there would be no employees. Under S. 18 a commercial establishment has to be closed for service to the customers on the closed day and even the employer is permitted to attend only as per the provision of the exemption entry. In this scheme of the Act we cannot agree with Sri Mehta's contention that essential or direct co-operation of the employees in the professional activity itself was a necessary test for entitling employees to the benefits of the Act. That is who the definition of the term 'employer' in S. 2(7) has no reference to employees and is a general definition as meaning a person owning or having ultimate control over the affairs of an establishment. The 'employer' in the context of this wide definition would be not only an individual but also a limited concern or a registered society, if it carried on any trade, business or profession in any establishment. Even such establishments would be falling within the definition of the term 'commercial establishment.' That is why in the context it is clearly apparent that the legislature does not intend to confine the term 'commercial establishment' only to those establishments where commercial activities in the narrow traditional sense are carried on but it includes even professional establishments. The term 'profession' would not only be confined to the three well-known professions of a lawyer, a doctor or a clergyman. The term is used in the widest sense. In Webster at p. 437 the term 'profession' is defined as a vocation or occupation requiring advanced training in some liberal art or science and usually involving mental rather than manual work, especially, medicine, law or theology. In Shorter Oxford English Dictionary at p. 1583 one meaning of the term 'profession' is of an occupation which one professes to be skilled in and to follow. It also means a vocation, a professed knowledge of some department of learning which is used in its application to the affairs of others or in the practice of an art founded upon it. In wider sense, it really covers any calling or occupation by which a person habitually earns his living. In the present case we are only concerned with the medical profession and there could be no dispute that at least the medical profession is clearly covered by the Act.

17. Sri Mehta finally referred to some of the authorities. In L. M. Chitale v. Labour Commissioner [1963 - II L.L.J. 747], Srinivasan, j., had to interpret the definition of 'commercial establishment' in the Madras Shops and Establishments Act, where it was defined as an establishment which was not a shop. The expression 'shop' was defined to mean any premises where any trade or business was carried on or where services were rendered to customers and included office, store-rooms, etc., but did not include restaurant, eating-house or commercial establishment. In the context of that definition where the legislature had not specifically included a 'profession,' it was open to the learned Judge to adopt a restricted meaning. That authority will have, therefore, no application to the facts of the present case. The decision which was, however, strongly relied upon by Sri Mehta was the decision in Sakharam Narayan Kherdekar v. City of Nagpur Corporation [1964 - I L.L.J. 156] where the Division Bench of the Bombay High Court, consisting of Abhyankara and Paranjape, JJ., interpreted the terms 'commercial establishment' in the very Act itself in the context of a legal practitioner's establishment and it held that a legal practitioner's establishment would not fall within the definition of a 'commercial establishment' under the Act. The reasons which appealed to the learned Judges were as under :

(1) That the Supreme Court had ignored the statutory definition and had given a restricted meaning to the term 'retrenchment' in the case of Hariprasad v. Divelkar [1957 - I L.L.J. 243] (vide supra).

(2) That the term 'commercial' restricted the application of the term 'commercial establishment' only to those establishment where commercial activities were carried on in the old traditional sense, viz., by investment of capital and with a profit motive.

(3) That between the employees in such professional activities and their employers ( ?) there was no direct or essential co-operation and, therefore, the employees and the employers of such employees were not covered by the Act.

(4) Finally, the lawyer's profession which could be carried on by qualified individual, was held to partake the character of the individual sovereign legal functions, viz., administration of justice.

18. None of these reasons has appealed to us and with great respect to the learned Judges we respectfully disagree with the said view. We are, however, in complete agreement with the view expressed by the Division Bench of the Punjab High Court, consisting of Mehar Singh and Mahajan, JJ., Dr. P. A. Paul and other v. State of Punjab [1962 - I L.L.J. 592] where the establishment of a medical practitioner was held to be covered within the definition of a 'commercial establishment.' In that Act also the definition of the term 'commercial establishment' in S. 2(i) meant any premises wherein any business, trade or profession was carried on for profit. After making some references from the Corpus Juris at p. 284 the learned Judges had observed that the word 'profession' was more commonly employed in the sense of vocation business, calling or occupation. The term 'profit' also covered remuneration received by a medical practitioner. It was held that neither the term 'profit' nor the word 'profession' had any fixed meaning and it had to be interpreted in the context in which it was used in any particular enactment. It was therefore held that the definition of the term 'commercial establishment' in that Act used the words 'profit' and 'profession' in their wider sense and it included the establishments of medical practitioners and that was why a specific exemption was granted to those establishment under S. 4. That decision would be clearly applicable even to the question of interpretation of a similar term under our Act, where also the legislature had defined 'commercial establishment' in a wider sense by including not only establishments carrying on trade or business but also establishment carrying on any profession. If the legislature did not want to use the expression in such a wider sense, it was not necessary for the legislature to make a specified mention of the term 'profession' and it would have rest contented by using the expression 'trade or business.' The object of the Act being to cover all types of employees employed or engaged in any kind of trade, business or profession whatsoever, the exemption entries for professional establishments have been in terms provided in the Act.

19. We are, therefore, of the view, that the learned magistrate was wrong in holding that dispensary of a doctor was not covered within the meaning of the term 'commercial establishment' under the Act. There being no dispute that the accused had not maintained the prescribed register of employment in respect of the three employees in question as required under S. 62 and rule 23(1), the accused must be convicted for the offence under S. 52(e) read with S. 62 and rule 23(1) of the Act. We therefore, set aside the acquittal order and hold that the accused was guilty for the contravention of S. 52(e) read with S. 62 and rule 23(1) of the Act and convict him accordingly.

20. In the result we allow this appeal, set aside the order of acquittal recorded by the learned magistrate and convict the accused for the offence under S. 52(e) read with S. 62 and rule 23(1) of the Act and sentence him to pay the minimum fine of Rs. 25, in default, to suffer simple imprisonment for a week.

21. Sri Mehta had orally requested us to grant a certificate that the case was a fit one for appeal to the Supreme Court on the ground of a conflict of decisions amongst the various High Court on this question of interpretation which was of wide public importance. We are satisfied that the case is a fit one for appeal to the Supreme Court. We accordingly grant a certification under Act. 134(1)(c) of the constitution of India.


Save Judgments// Add Notes // Store Search Result sets // Organize Client Files //