29 October 1954
Supreme Court


Case number: Appeal (crl.) 80 of 1953






DATE OF JUDGMENT: 29/10/1954


CITATION:  1955 AIR   62            1955 SCR  (1) 887

ACT: Bombay Shops and Establishments Act, 1948 (Bombay Act  LXXIX of 1948), s. 2(27)-Premises (situated in Ahmedabad) where no buying  or  selling is done-Owner employing  three  workers- Doing business in a very small way-By going to certain local mills-Collecting  orders for spare  Parts-Manufacturing  the parts in his workshop -Concern of this nature-Whether a shop within the meaning of s. 2(27).

HEADNOTE: The  appellant,  the  owner  of  a  small  establishment  in Ahmedabad,  employs three workers, does business in  a  very small way by going to certain local mills, collecting orders from  them  for  spare parts,  manufacturing  the  parts  so ordered  in his workshop, delivering them to the mills  when ready  and  collecting  the money therefor.   No  buying  or selling is done on the premises. Hold, that a concern of this nature is not a shop within the meaning  of s. 2(27) of the Bombay Shops and  Establishments Act, 1948,

JUDGMENT: CRIMINAL  APPELLATE JURISDICTION: Criminal Appeal No. 80  of 1953. Appeal by Special Leave granted by the Supreme Court by  its order  dated the 9th February, 1953, from the  Judgment  and Order  dated the 23rd September, 1952, of the High Court  of Judicature  at  Bombay in Criminal Appeal No.  828  of  1952 arising out of the Judgment and Order dated the 27th  March, 1952, of the Court of Stipendiary Magistrate, Ahmedabad,  in Summary Case No. 3029 of 1954. Rajni Patel and M. S. K. Sastri for the appellant. M.   C.  Setalvad, Attorney-General of India, and (Porus  A. Mehta and P. G.Gokhale, with him) for the respondent. 1954.  October 29.  The Judgment of the Court was  delivered by BOSE,  J.-This  case is unimportant in itself, for  a  small fine  of  Rs.  50 (Rs. 25 on each of two  counts)  has  been imposed for a couple of breaches under section 52 (f) of the



Bombay  Shops and Establishments Act, 1948, read  with  rule 18(5) and (6) of the Rules framed under 888 the Act.  But the question involved is of general importance in the State of Bombay and affects a large number of similar establishments, so in order to obtain a clarification of the law, this has been selected as a test case. The appellant is the owner of a small establishbment  called the  Honesty Engineering Works situate in Ahmedabad  in  the State  of  Bombay.   He  employs  three  workers.   He  does business  in  a  very small way by going  to  certain  local mills,   collecting  orders  from  them  for  spare   parts, manufacturing   the  parts  so  ordered  in  his   workshop, delivering  them to the mills when ready and collecting  the money  therefor.   No  buying  or selling  is  done  on  the premises.  The question is whether a concern of this  nature is a "shop" within the meaning of section 2(27) of the  Act. The  learned trying Magistrate held that it was not  and  so acquitted.   The  High  Court,  on  an  appeal  against  the acquittal, held it was and convicted. It  is  admitted  that the  appellant  maintains  no  "leave registers" and gives his workers no "leave books" and it  is admitted  that  the Government Inspector  of  Establishments discovered this on 12th January, 1951, when he inspected the appellant’s works.  If his establishment is a "shop"  within the meaning of section 2(27) he is guilty under the Act;  if it is not, he is not guilty. "Shop" is defined as follows in section 2(27):  "’Shop’ means any premises where goods are sold, either  by retail  or  wholesale  or where  services  are  rendered  to customers,  and  includes an office, a store  room,  godown, warehouse  or  work place, whether in the same  premises  or otherwise,  mainly  used in connection with  such  trade  or business  but  does  not include  a  factory,  a  commercial establishment, ’residential hotel, restaurant, eating house, theatre   or   other   place   of   public   amusement    or entertainment". As  we have said, it is admitted that no goods are  sold  on the  premises and it is also admitted that no  services  are rendered  to customers there, for the manufacture  of  spare parts  for  sale elsewhere cannot be regarded  as  "services rendered.  " 889 The  learned Attorney-General contends that  the  definition should be read as follows: Shop  includes a work place mainly used in  connection  with such trade or business.  " He  says that the word "such" in the phrase "such  trade  or business"   relates  back  to  the  opening  words  of   the definition which read- " any premises where goods are sold." He argues that the emphasis is on the words "goods are sold" and  not on the word "premises" because a trade or  business relates  to  the  buying and selling of  goods  and  is  not confined to the premises where that occurs.  He admits  that the  main  portion  of  the  definition  which  relates   to "premises   where  goods  are  sold"  cannot   exclude   the "Premises"  element  and that unless there are  premises  on which  goods  are sold, the main portion of  the  definition cannot  apply, e.g., in the case of a street hawker or of  a man  who totes his goods from house to house and sells  them at  the door.  But he contends that the main  definition  is extended by including in it matter which would not be  there without  the words of extension and in that portion the  em- phasis  ceases  to be on the "premises" and  shifts  to  the



nature  of  the business; provided there is  a  business  of selling,  any  work place wherever situate "mainly  used  in connection with it" will fall within the definition. The  other  side relies on the ejusdem  generis  rule.   The argument runs that the trade or business contemplated by the main  portion  of  the definition is  not  any  business  of selling wherever and however conducted but only those trades where  the  selling is conducted on defined  premises.   The learned  counsel  contends that the very idea of a  shop  in that  connotation betokens a room or a place or  a  building where  goods  are sold.  The rest of the  definition  merely links on the main definition ancillary places, such as store rooms, godowns, work places, etc., which are mainly used  in connection  with  the "business", and "business"  means  the kind  of  business  defined  in  the  earlier  part  of  the definition,  that  is to say, not business in  general,  nor even the business of selling in general, but that portion of the business Of Selling which is confined to selling on,some defined premises.  To illustrate this graphically, the 890 business  of  selling in general may be regarded  as  a  big circle and the business of selling on defined premises as  a small portion which is carved out of the larger whole.   The second part of the definition is linked on to the carved out area  and  not to the circle as a whole.   The  word  "such" confines  what follows to what has gone before and what  has gone before is not the trade of selling in general but  only that  part  of  the trade of selling  which  is  carried  on defined   premises.   Counsel  argues  that  there   is   no justification   for  ignoring  the  limitation   which   the Legislature has placed on the main portion of the definition and   holding   that  "such"  relates  to   a   much   wider classification  of "selling" which the main portion  of  the definition  not only does not envisage but has  deliberately excluded.   We think that as a matter of plain  construction this is logical and right. The learned Attorney-General went on to contend that even if this  is  a  possible view, his view  is  also  tenable  and therefore when we have two possible interpretations we  must choose  the  one which best accords with the policy  of  the Act.  Taking us through the Act he pointed out that this  is a  piece  of social legislation designed partly  to  prevent sweated  labour and the undesirable employment of women  and young  children  and  partly to  safeguard  the  health  and provide  for the safety of workmen and employees.   He  con- tended that this object would be partly frustrated if  small establishments  of this kind are placed outside the  purview of  the Act, for their number is very large and the  persons employed in them are entitled to, and require, just as  much protection as those more happily placed in larger concerns. We  have  considered this carefully and are of  the  opinion that  the  fear  is  groundless  because  there  is  express provision in the Act for such contingencies.  Under  section 5  the  State  Government can by mere  notification  in  the Official  Gazette  extend the Act to  any  establishment  or class  of establishments or any person or class of  -persons to  which or whom the Act or any of its provisions does  not for the time being apply In our opinion, the Legislature did not intend to rope 891 in small establishments of this kind in the first place  but reserved  power  to  the State Government to  do  that  when desirable by the very simple process of notification in  the Official  Gazette.   In  reaching  this  conclusion  we  are influenced  by the policy of the Central Legislature  on  an



allied  topic.  We do not intend to break the  general  rule that  points  to  the  undesirability  of  interpreting  the provisions  of  one  Act -by those of another  passed  by  a different  Legislature, but as we have already  decided  the question  of  construction and interpretation  and  are  now considering   only   the  general  policy   of   the   State Legislature,  we  deem it right to view the  matter  in  its larger   aspect  for  the  special  reasons  we  shall   now enumerate. Now  the Central Act, the Factories Act of 1948, was  passed on  the  23rd of September, 1948.  The  Bombay  Act,  though entitled  Act  LXXIX  of  1948,  was  not  passed  till  the following  year, namely, on 11th January, 1949.  The  Bombay Legislature  had the Central Act in mind when it passed  its own  legislation  because section 2(27) says that  a  "shop" shall  not include a "factory" and section 2(9) defines a  " factory  "  as any premises which is a  factory  within  the meaning  of section 2 of the Central Act or which is  deemed to  be  a factory under section 85 of that Act.   Under  the Central Act (section 2(m) no establishment can be a  factory unless  it  employs more than ten workmen or  unless  it  is artificially converted into a " factory " within the meaning of  this  definition  by  a  notification  in  the  Official Gazette.   Had it not been for the fact that  the  appellant employs  less than ten workmen, his concern would have  been classed  as a factory under the Central Act and  would  then have  been  excluded from the definition of  "shop"  in  the Bombay  Act,  for the appellant carries on  a  manufacturing process  in his workshop with the aid of power: that is  not disputed.   The  Central  Legislature  undoubtedly  had  the intention  of -excluding small concerns like this  from  the purview ,of the Central Act except where Government  decided otherwise,  and  as there is this reference to  the  Central Act. on this very point in section.2(27) we think., in  view of the way that section 2(27) is worded, that ,Was also  the intention of the Bombay Legislature, 892 Therefore,  even on the assumption of the learned  Attorney- General  that  two  interpretations  of  section  2(27)  are possible,  we prefer the one which, in our  opinion,  better accords with the logical construction of the words used. The  learned  High Court Judges were influenced  by  matters which  we consider inconclusive.  The appellant applied  for registration under the Bombay Act and in the statement  made under section 7 he called his establishment a "workshop" and described  the nature of his business as a " factory ".  The learned  Judges considered that this imported  an  admission that his establishment was a " shop " because of the use  of the  word "shop" in "workshop".  This might have  raised  an inference  of  fact against the appellant had  nothing  else been known but when the facts are fully set out as above and admitted, the appellant’s opinion about the legal effect  of those facts is of no consequence in construing the  section. No estopped arises.  The appellant explained that the matter seemed  doubtful,  so,  to be on the  safe  side  and  avoid incurring penalties for non-registration should it turn  out that  his  concern  was  hit by  the  Act,  he  applied  for registration.   It is to be observed that though he  applied on  12th  April, 1949, he was not registered till  4th  May, 1950,  and  the certificate was not given to  him  till  8th January, 1951.  The present prosecution was launched on  4th April, 1951.  Government itself seems to have been in doubt. -However, that is neither here nor there.  What we think was wrong  was placing of the burden of proof on the  appellant, in  a criminal case, because of a so-called admission.   The



learned  High  Court  Judges also advert to  the  fact  that though the appellant’s concern was registered as a "shop" he made no protest and did not have recourse to section 7(3) of the Act. We  do  not  think section 7(3) has  any  application.   The appeal  is  allowed.  The conviction and  sentence  are  set aside  and  the judgment of the  learned  trying  Magistrate acquitting  the appellant is restored.  The fines, if  paid, will be refunded. Appeal allowed, 893