Dr. Devendra M. Surti v. State of Gujarat

DR. DEVENDRA M. SURTI _v._ STATE OF GUJARAT _May_ 2, 1968 [V. R.AMAsWAMI AND C. A. VAIDIALINGAM, JJ.J _Bombay Shops and Establishm.ents_ _Act,_ 79 _of_ 1948, _s._ 2(4) _Rul•·_ _23(1)-Doctor's_ _dispensary_ _whether a_ _commercial_ _establishment_ _as._ _defined in_ s. _2(4)-Non-nzaintenance_ _of_ _register_ _of_ _employees_ _under-_ _r._ _23(l)whether_ _an_ _off.ence._ The. appellant, a medical practitioner \Vho also maintained a disPen~· sary, was prosecuted for non-maintenance of a register of employees as required by r. 23 (I) of the rules made under the Bombay Shops arul' Establishments Act, 1948. He contended that he could not be prosecuted' because his dispenSary was not a 'commercial establishment' as defined' ins. 2(4) of the Act. He was acquitted by the trial magistrate but the High Court. on appeal by the State oonvicted him. In appeal by special' leave to this Court, HELD: Section. 2(4) has used words of very wide import and' grammatically it may even include· the consulting room where a doctor examines his patients with the help of a solitary nurse. or attendant. **But** the language of s. 2(4) must be construed on the principle _noscitur a_ _sociis. i.e._ when two or more words susceptible of analogous meaning are coupled together the words take their colour from each other and the more general are restricted to a sense analogous to less general. [240 A-C] The word~· 'commercial establishment' and 'profession' in s. 2(4) are used along with the words 'business and trade' and must therefore be restricted to activity analogous to business or trade. Professional activity cannot be treated as \Vithin the definition of s. 2 ( 4) unless it is. organised as trade and business are organised _i.e._ the activity as systematicalJy or habitually undertaken for rendering material services to the community at large or a part of such community with the help of the employees and such an activity generally involves cooperation of the employer and the employees. [244 C-El Tested in the light of these principles the appellant did not fall with-· in the purview of the Act and his conviction was illegal. [244 E-F] _The National Union_ _of Con1mercial Employees and Anr._ v. _M._ _R._ _Meher, Industrial Tribunal, Bombay,_ [1962] Supp, 3 S.C.R. i57, relied' on.. _Reed_ v. _Ingham._ 3 E.-B 889, _Scales_ v. _Pickering,_ (1828) 4 Bing. 448, 452, 453, _McKay_ v. _Rutherfurd,_ 6 Moore P.C. 425, _Commissioners_ _of Inland Revenue_ v. _Maxse,_ [1919] I K.B. 647, 657 and _William_ _Esp/en, Son, and Swainston Ld._ v. _Inland Revenue Commissioners,_ [1919]' 2 KB. 731, referred to. CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 102 of 1966. Appeal from the judgment and order dated February 14, 1966 of the Gujarat High Court in Criminal Appeal No. 208 of 1964. . A B c D E F G H 236 SUPREME COl.'RT REPORTS [ 1969] I S.C.R. _S. T._ _Desai,_ _Arun H._ _Mehta_ and I. N. _Shroff,_ for lhc appellant. _R._ _H._ _Dhebar_, and _M. S. K. Sastri,_ for the rcsPondcnt. The Judgment' of the Coun was delivered by Ramaswami, J.-The question involved in this app:al is as to whether a Doctor's dispensary is a "Commercial E.stablishment" within the meaning of the Bombay Shops and Establishments Act, 1948 (Bombay Act LXXIX of 1948), hereinafter referred to as the 'Act'. The case of the prosecution is that the appellant was a doctor having his dispensary situated near Jakaria Masjid at Ahmcdabad. The dispensary is registered as a 'Commercial Establishment' under the provisions of the Act. The complainant Shri Patel visited the dispensary on June 13, 1963 at about 9.50 a.m. ;ind found that though the dispensary was registered as 'Commercial Establishment' under the Act, the Register produced before him at the time of his visit was not maintained as required under Rule 23 ( 1) of the Rules framed under the Act. Necessary remarks were made by the complainant in the Visit Book of the dispensary. Thereafter, a complaint was filed against the appellant aft:~r obtainin.g >anction for his prosecution under s. 52(e) -Of the Act read with s. 62 of !he Act and r. 23 (I) of lhc Rules. The case was contested by the appellant on the ground that the doctor's dispensary was not a "Commercial Establishment" with_in_ the meaning of the Act and the provisions of the Act did not therefore apply to his dispensary and the appellant had _not_ committed any offence. The _City_ Magistrate _(First_ Court), (Munidpal), Ahmedabad held that the appellant was not guilty and acquitted him. The State of Gujarat took the matter in appeal to the High Court of Gujarat in Criminal Appeal No. 208 of 1964. The appeal was al lowed by the High Court hy its judgment dated February 14, 1966 and the appellant was convicted for an offence under s. 52 ( e) read with s. 62 of the Act and r. 23 (1) of the Rules and sentenced _to_ pay a fine of Rs. 25, in default to undergo simple imprisonment for a week. This appeal is brought by certificate from the judgment of the High Court. Before considering the rival contentions of the parties it is necessary to examine the scheme of the Act. The preamble to A B c D E F G the Act states _that_ it is. an Act "to consolidate and amend the law relating to the regulation of co!1ditions of wo.rk a~d em ploymen1 in shops, commercial estabhshments, rcstdent1a! hotels, H restaurants eating houses, theatre~. other places of pubhc amusement or e~tertainment and other establishment". Section 2(4) of the Act defines "Commercial establishment" as follows : 237 DEYENDRA _v._ GUJARAT _(Ramaswami,_ _I.)_ " 'Commercial establislunent' means an establishment which carries on, any business, trade or profession or any work in connection with, or incide.ntal or ancillary to, any business, trade or prof~ssion a~d in~ludes a society registered under the Societies Reg1strat1on 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 connection with or incidental or ancillary thereto but does not include a factory, shop, residential hotel, restau rant, eating house, theatre or other place of public amusement or entertainment." , A B C Section 2 ( 8) states : D " 'Establishment' means a shop, commercial establislunent, 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 notifi cation in the Official Gazette, declare to be an establishment for the purposes of this Act." Section 2(6) ands. 2(7) read as follows : " ( 6). 'Employee' means a person wholly or principally employed, whether directly or through any agency, E and whether for wages or other consideration, in or in connection with any establislunent; and includes an apprentice, but does not include a member of the employer's family." "(7) 'Employer' means a person owning or haying . ultimate control over the affairs of an establishment." Section 2(3) and 2(18) define the expression "closed'' and "opened" as meaning "closed or opened for the service of any customer, or for any business, of the establislunent or for work by or with the help of any employee, of or conn~ted with th~ establislunent." Section 4 states : "Notwithstanding anything contained in this Act the provisions of this Act mentioned in the third colum~ of Schedule II shall not apply to the establislune.nts, ~mployees and other persons mentioned against them m the second column of the said Schedule : . Provide? tha~ the State Governm~nt may, by notification published m the Official Gazette, add to, omit or alter any ?~ the ~ntries of the said Schedule subject to F H of Schedule II shall not apply to the establislune.nts, sue~ cond1ttons, 1f any, as may be specified in such notification and on the publication of such notification ' ##### 238. SUPREME COURT REPORTS [ 1969) 1 s.c.R. the entries in either column of the said Schedule shall be·deemed·to be amended accordingly." Section 5 provides a5 follows : "Cl). Notwithstanding anything contained in this Act, the State Government may, by notification in the Official Gazette, declare any establishment or class of establishments to which, or any person or class of persons to whom. this Act or any of the provisions thereof does not for the time being apply, to be an establishment or class of establishmenls or a p<:rson or class of persons to which or whom this Act or any provisions thereof with such modi1icatioJs or adaptations as may in the opinion of the State Government be necessary shall apply from such date as may be specified in the notification. (2) On such declaration under sub-section (I), any such establishment or class of establishments or such person or class of persons shall be deemed to be an establishment or class of establishments to which, or to be an employee or cla~s of employees to whom, this Act applies and all or any of the provisions of this Act with such adaptation or modification as may be specified in such declaration, shall apply to such establishment or class of establishments or to such employee or class of employees." Chapter II deals with the Regis'ration of establishments. Under s. 7 (I) 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 es'.ablishment. residential hotel, restaurant. eating house. theatre or other place of public amusement or entertainment and such other particulars. Under s. 7 (2) a "registration certificate" is to be granted. Chap!er Ill deals with shops and commercial establishment. Sections I 0 and 11 provide for the opening and closing hours of the shop. Section 13 deals with the opening and closing hours of a commercial establishment. Sec•ion 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 interval. and s. 17 provjdes for spread-over of hours of work in commercial establishments. Section 18 provides for weekly holidays in shops and commercial estabfahments. Chapter VI deals with employment of children, voung persons and women. and applies to all establi.~hment-;. Seciion 32 provides that no child should be required A B c I> E F G H ##### A B c D E F DEVENDRA v. GUJARAT _(Ramaswami,_ /.) or allowed to work in any establishment, notwithstandiJ?g . that such child is a member of the family of the employer; . Similarly, s. 33 provides that no young person or women shall~ r~uire.d or allowed to work whether as an employee or otherwise m 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. Section 34 prescribes daily hours of work for young persons. The next Chapter, _i.e._ Ch. VII deals with leave pay and payment of wages for such leave. Section 38 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 class of employees to which the Act applies. Similarly, s. 38A provides for the extension of the Workmen's. Compensation Act, 1923. Chapter VIII enacts provisions for health and safety of the workers generally for all establishments. Chapter IX enacts provisions for setting up of the machinery for enforcement and inspection. Chapter X deals with offences and penalties. Section 52 deals with contravention of certain provisions and cl. ( e) of that section provides for the penalty if the employer contravenes the provisions of s. 62 by not maintaining the prescribed register. Section 62 provides for maintenance of registers and records and display of notices as may be prescribed· by Rules. Section 63 deals with wages for overtime work.· · On behalf of the appellant Mr. Mehta put forward the argument that under s. 2 ( 4) of the Act which defines '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 the emphasis was really on the nature of the activity which must be a commercial activity. In other words the contention was that the in~ention of the legislature in enacting s. 2 ( 4) was to include only those professions which are carried on in a commercial manner. It was therefore contended that in the present case the dispensary of the appellant does not fall within the definition of 'Commercial' Establishment' under s. 2( 4) of the Act. · In our opinion. the argument addressed on behalf of the appellant is well-founded and must prevail. G ' Under s. 2 (8) of the Act an 'establishment' is defined as meaning 'a shpp, commercial establishment, residential hotcl, restaurant, eaung house. theatre, or other place of public amusement or entertainment to which this Act applies'. Section 2{24) again defines a "Residential hotel", s. 2(25) a "Restaurant or H . eating house" and s. 2(27) similarly defines a "Shop". See'ion 2(29) define9 a "Theatre". It is clear therefore that the legislature has· taken care separately to define each one of the categories of the 'establishments mentioned in _s:_ 2(8) of the Act. It is -trUe 2.t 0 SUPRE~IE **COURT** **RLPON.TS** (I <169] I s C.R. that s. 2( _4)_ of the Act has used words of v~ry wide impon and granunatically _it_ may include ~vcn a consulling room where a doctor ~xamines his patients 111th the· help of a solitary nurse or attendant. But, in our opin'on, in the matter of construing the language of s. 2 ( 4) of the Act we must adopt the pnnciplc of _noscitur a sociis._ This rule means that, when two or more words which are susceptible of analoµous meaning are coupl<XI together they arc understood to be used _in_ their cognate sense. The words take as it were their colour from each other, that is, the more general is restricted to a ~nsc analogous to a Jess general. "Asso·-ciatcd words take their meaning from one another under the doctrine of _noscirur a sociis,_ the philosophy of which is that the meaning of a doubtful word may be ascertained by rcfcr~nce to the meaning of words associated with it; such doctrine is broader than the maxim _Ejusdem Generis."_ (Words and Phrase» Vol. XIV, p. 207). For instance, in _Reed_ v. _/nf?ham(')_ it was held upon the principle of the maxim _nosci111r_ _a sociis,_ that a steam tug of eighty-seven tons burden enga~ed in moving another vessel was not a craft within the meanin.g of the statute. ARain. in _Sea_ In 1'. _PickainR(')_ the question wa<> what was the meaning of the word "footway" when used in a private Act which cmpowcrd a water company to break up the soil and pavemcn~ of roads. highways. footways, commons. streets, Janes. alleys, passages. and public place>. provided they did not enter upon any privat..~ lands w11hout the consent nf the owner. It was contended that this authorised the company to break up the soil of a private field in which there was a public footway, but it was held otherwise. "Construing the word 'footway,'" said Best C. J. "from the company in which it is found .... the legislature appears to have meant those paved footways in large towns which are too narrow to admit of horses and carriages." And Park J. added : "The word 'footway' here _11oscit11r_ _a sociis."_ In the present case, certain essen•ial features or attributes arc invariably associated with the words "business and trade" as understood in the popular and conventional sense. and it is the colour of these attributes which is taken by the other words used in the definition of s. 2 _(_ 4) of the Act, though their normal import may be much w~dcr. We are therefore of opinion that the professional establishment of a doctor cannot come within the definition of s. 2( 4) of the _Act_ unless the activity carried on was also commercial in charac•er. As to what exactly is meant by "Commerce" it may be difficult to define but in an early case-Mc _Kar_ v. _Ruthe,.furd(')._ Lord Campbell gave a useful definition: "Commcrc~ is that activity where a capital is laid out on anv work and a risk run o~ _rro!it or loss: it is a commercial venture". It is true that the dcfimt1on of Lord Campbell is the conventional definition attributed to trade A **B** c D F G , H (t) .1f&B.:<S9. (1) 6 **t-.fr"lr)fC** **P.** **c.** **425.** ##### A .... B c ' ~. D .. E - F DEVENDRA _v._ GUJARAT _(Ramaswami,_ _J.)_ 24ll or commerce but it cannot be taken to be wholly valid for the purpose of construing industrial legislation in a modern welfare State. It is clear that the presence of the profit motive or the investment of capital tradition associated to the notion of trade and commerce cannot be given an undue importance in construing the definition of 'Commercial establishment' under s. 2 ( 4) of the Act. In our opinion, the correct test of finding whether a professional activity falls within s. 2( 4) of the Act is whether the activity is systematically and habitually undertaken for production or distribution of goods or for rendering material service' to the community or any part of the community with the help of employees in the manner of a trade or business in such an undertaking. It is also necessary in this connection to construe the· word "profession" under s. 2( 4) of the Act. In _Commissioners_ _of_ _Inland Revenue_ v. _Maxse('),_ Scrutton L.J. stated as follows "I am very reluctant finally to propound a comprehensive definition. A set of facts not present to the mind of the judicial propounder, and not raised in the case before him, may immediately arise to confound his proposition. But it seems to me as at present advised that a 'profession' in the present use of language involves the idea of an occupation requiring either purely intellec tual skill, or of manual skill controlled, as in painting and sculpture, or surgery, by the intellectual skill of the operator, as distinguished from an occupation which is substantially the production or sale or arrangements for the production or sale of conm1odities. The line of demarcation may vary from time to time. The word 'profession' used to be confined to the three learned professions, the Church, Medicine and Law. It has now, I think, a wider meaning." , ~e matter was again considered .in another case where the ques tion was whether a company domg the work of naval architect could be said to be can-ying on a profession in a naval architecture. The case was _William Esp/en, Son. and Swainston. Ld._ v. ; _lnland Revenue Conunissinners(')_ where Rowlatt J. observed G as follows· : ' H . ". . . . but in my opinion the company is not cadymg on the profession of naval architects within the meaning of the section, because for this purpose it is of the essence of a profession that the profits should be dependent mainly upon the personal qualifications of the person by whom it· is carried on, and that can only be an individual." (1) [1919] l K.B. 647, 657. · m 1191~12 K.ll. 111. 242 SUPREME COURT REPORTS (1969] I S.C.R. It is therefore clear that a professional activity . must be an activity c~ed on by an· individual by his personal skill and intelligence. There is a fundamental distinction therefore between a professional activity and an activity of a c~mmercial character and unless the profession carried on by the appellant also partakes of the charac:er of a commercial natme. the appellant· cannot fall within the ambit of s. 2(4) of the Act. In _The National Union_ _of_ _Commercial Emp/cyees and another_ v. _M._ _I<._ _Meher, Industrial_ _Trib1111a/,_ _Bombay(')_ it was held by this Court that the work of solicitors is not an industry within the meaning of s. 2(J) of the Industrial Disputes Act, 1947 and therefore any dispute raised by the employees of the solicitors against them cannot be made the subject of reference to the In·dustrial Tribunal. In dealing with this question, Gajcndragadkar, J., speaking for the Court, observed as follows at page 163 of :the Report : "When in the Hospital case ((1960) 2 S.C.R. 866) this Court referred to the organisation of the undertaking involving the co-operation of capital and labour or the employer and his employees, it obviously meant the co-operation essential and necessary for the purpose of rendering material service or for the purpose of production. It would be realised that the concept of industry postulates partnership between capital and labour or hetwcen the employer and his employees. It is under this partnership that the employer contributes his capital and the employees their labour and the joint contribution of capital and Jabour leads directly to the production which the industry has in view. In other words, the co-operation between capital and labour or between the employer and his employees which is treated as a working test in determining whether any activity amounts to an indus!ry, is the co-operation which is directly involved in the production of goods or in the rendering of service. It cannot be suggested that every form or aspect of human activity in which cap;~al and labour cooperate or employer and employees assist each other is an industry. The distinguishing feature of an industry is that for the production of goods or for the rendering of service, cooperation bctwce!l capital and labour or between the employer and his employees must be direct and must be essential." Again. at page 166 of the Report Gajendragadkar, J. proceeds 10 state : "Does a solicitor's firm satisfy that test? Superficially considered, the solicitor's firm is no doubt (1) (1962) (l) S•inn. S.C.R. l 57. A B c D E F G H ... A c: .E F G DEVENDRA _v._ GUJARAT _(Ramaswami,_ _!.)_ 243 organised as an industrial concern would be organised. There are different categories of servants employed by a firm, each category being assigned separate duties a_nd. functions. But it must be remembered that ·1he service rendered by a solicitor functioning either individually or working together with partners is service which is essentially individual; it depends upon the professional equipment, knowledge and efficiency of the solicit~r concerned. Subsidiary work which is purely of an incidental type and which is intended to assist the solicitor in doing his job has no direct relation to the professional service ultimately rendered by the solicitor. For his own convenience, a solicitor may employ a clerk because a clerk would type his opinion; for his convenience, a solicitor may employ menial servant to keep his chamber clean and in order; and it is likely that the number of clerks may be large if the concern is prosperous and so would be the number of menial servants. but the work done either by the typist or the stenographer or by the menial servant or other employees in a solicitor's firm is not directly concerned with the service which the solicitor renders to his client and cannot, therefore, be said to satisfy the test of cooperation between the employer and the employees which ·is ·relevant to the purpose. There can be no doubt that for carrying on the work of a solicitor efficiently, accounts have to be kei>t and correspondence carried on and this work would need the employment of clerks and accountants. But has the work of the clerk who types correspondence or. that of •he accountant who keeps accounts any direct or essential nexus or connection with the advice which it is the dutv of the solicitor to give to his client? The answer to this question must, in our opinion, be in the negative. There is, no doubt. a kind of cooperation between the solicitor and his employees, but that cooperation has no direct or immediate relation to the nrofessional service which the solicitor renders · to his client. . . . . . . . . Looking at this question in a broad and general wav. it is not easy to conceive that a liberal profession like that of an· attorney could have been intended by the Legislature to fall within the definition of H 'industrv' under s. 2(J). The very concept of the liberal profes~ions has its own special and distinctive features which do not readily.permit the inclusion of the liberal professions into the four corners of industrial law. 244 SUPREME COURT REPORTS [ 1969] I SC.R The essential basis of an industri•1l dispute is that it is a dispute arising between capital and labour in enterprises where capital and labour combine to produce commodities or to render service. This essential basis would be absent in the case of liberal professions. A person following a liberal profession does not carry on his profession in any intelligible sense with the active cooperation of his employees and the principal, if not the sole, capital which he brings into his profession is his special or peculiar intellectual and educational equipment. That is why on broad and general considerations which cannot be ignored, a liberal profession like that of an attorney must, we think, be deemed to **hi.!** **ou1'-'idc** th~ **dtiinitinn** **of 'industry'** und~r **section** 2(j) ." **Applying a** **si111ilar** **line or** r~a~oning. **\\-c** ~r~ **of opinion that the** dispensary of the appellant would fall within· the definition 0f s. 2( 4) of the Act if the activity of the appellant is organised in the manner in which a trade or business is generally organised or arranged and if the activity is sy,tcnwtically or habitually undertaken for rendering material services to the community at large or a part of such community with the help of the employees and if such an activity generally involves co-operation of •he employer and the employees. To put it differently, the manner in which the activity in question is organised or arranged. the condition of the co-operation between the employer and the employees being necessary for its success and its object being to render material service to the community can be regarded as some of the features which render the carrying on of a professional acti~ity to fall within the ambit of s. 2( 4) of the Act. Tested in the light of these principles. we hold that the case of the appellant does not fall within the purview of the Act and the conviction of the appellant of the offence under s. 52 ( c i of the Act r~d with s. 62 of the Act and r. 23 (I) of the Rules is illegal. **A** c **D** E F ' **4** **j** #, ###### **j** ##, **1'** ' **4** #### . For these reasons we allow this appeal ;rnd set aside the judgment of the Bombay Hi)!h Court dated February 14. 1966 con victing and sentencing the appellant. G. 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