Kalidas Dhanjibhai Vs. The State of
Bombay  INSC 105 (29 October 1954)
VIVIAN MUKHERJEA, B.K.
CITATION: 1955 AIR 62 1955 SCR (1) 887
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 workersDoing 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).
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 there for. 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,
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
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 establishment
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 there for. 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
"'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 emphasis 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 contended 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
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
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
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.