Judgment :- 1. Is a firm of lawyers a 'commercial establishment' as defined in the Kerala Shops and Commercial Establishments Act, 1960? is the question that falls for consideration in this appeal. 2. The services of the appellant, a clerk in one of the lawyer-firms of this town were terminated on 3-2-1972. He preferred Ext. P1 appeal to the Appellate Authority under the Kerala Shops and Commercial Establishments Act, 1960. A preliminary objection was raised that the appeal was not maintainable as the respondent was not a'commercial establishment' within the meaning of the Act. The question was tried as a preliminary issue; and by Ext. P7 order the Tribunal held that the firm in question is not a'commercial establishmentunder the Act and that the appeal was therefor; not competent. On this ground it dismissed the appeal. A learned judge of this Court upheld the view of the Tribunal and dismissed the writ petition to quash Ext. P7. This appeal is directed against the judgment of the learned judge. 3. The terms 'commercial establishment', 'establishment', 'employer' and 'employee' as defined by S.2 of the Act, are as follows: "(4) "commercial establishment" means a commercial or industrial or trading or banking or insurance establishment, an establishment or administrative service in which the persons employed are mainly engaged in office work, hotel, restaurant, boarding or eating house, cafe or any other refreshment house, a theatre or any other place of public amusement or entertainment and includes such other establishment as the Government may, by notification in the Gazette declare to be a commercial establishment for the purpose of this Act, but does not include a factory to which all or any of the provisions of the Factories Act, 1948 (Central Act 63 of 1948) apply; (8) "establishment" means a shop commercial establishment; (6) "employee" means a person wholly or principally employed in, and in connection with, any establishment and includes an apprentice; (7) "employer" means a person owning or having ultimate control over the affairs of, an establishment and includes the manager, agent or other person acting in the general management or control of an establishment;" We omit the definition of a 'shop' as there is no case for the appellant that the firm in question constitutes a 'shop'. The only case is that it is a commercial establishment. 4.
The only case is that it is a commercial establishment. 4. We shall confine ourselves strictly to these definitions, and not import, by analogy, the concepts applied in analogous or parallel statutes. The requirement of the definition is that a 'commercial establishment' must be one "mainly engaged in office-work". What is the meaning of this expression: "office-work", especially in relation to a firm of lawyers? It is possible in one sense to take the view that office-work comprises every branch of activity carried on by the firm from interview and consultation with clients to arguing their cases in the courts But from the juxtaposition of the words "mainly engaged in office work", which are, so to say, sandwitched between 'commercial or industrial or trade or banking or insurance establishment or an establishment or administrative service' on the one hand, and a 'hotel restaurant, boarding or eating-house, cafe or other refreshment house, theatre, or other place of public amusement or entertainment' on the other, we think the expressions in question should be limited to organized work of a manual or physical type and not one involving predominantly, if not exclusively, intellectual pursuit or activity. It ill goes with the well accepted professional usage to regard a lawyer, engaged in doing research into his cases or in arguing them in the courts, as being engaged in the 'office work' of a 'commercial establishment'. And if the question be put round: What is the work which A. B., the firm of lawyers, is engaged in?, we do not except the reply that it is engaged in typing, or sweeping the floor, or dusting the tables, although these are also the incidental activities in the firm, constituting drops in the ocean of its reputation. Taking into account such activities of a lawyer-firm which occupy most part of its time and labour, we do not think it can be said that it is "an establishment, where the persons are mainly engaged in office work". We feel that our conclusion derives support from the object and purpose, of the Act and from a conspectus of its provisions. Chapter I A of the Act provides for registration of establishments. Every employee of the establishment has to apply to the concerned authority in a specified form and on payment of the prescribed fee for a registration certificate in respect of the establishment The application should contain certain particulars.
Chapter I A of the Act provides for registration of establishments. Every employee of the establishment has to apply to the concerned authority in a specified form and on payment of the prescribed fee for a registration certificate in respect of the establishment The application should contain certain particulars. On satisfaction, the requisite authority is to issue a registration certificate for a period of one year subject to renewal. The certificate is liable to be cancelled or suspended. The provisions of Chapter II are important. Under S.6 no employee shall be required or allowed to work for more than eight hours in any day and forty eight hours in any week. This' provisions seems to furnish an important clue as to the nature of the office work which is envisaged for the purpose of the definition in S.2 clause (5). It is inconceivable that a busy lawyer or a lawyer's firm is to be tied down to not more than eight hours work per 'lay or forty eight hours is a week. These should be a sufficient indication to hold that the type of work discharged by a lawyer's firm is outside the ambit of what is envisaged in S.2 clause (4) of the Act. S.7 contemplates extra wages for extra work which may not perhaps square altogether with the professional ethics or etiquette expected of a lawyer. Again, the provisions for interval, for rest, in S.8, the provision for spreading over any work in S 9, for opening and closing hours in S.10 etc. would all be difficult of application to the work of a professional lawyer. The provisions of Chapters III. IV, V, VI etc. lead to the same conclusion. All these afford sufficient indication that the work of the professional lawyer and the lawyer's firm was not contemplated to be within the ambit of S.2 (4) of the Act. On this ground we would hold that the respondent-firm is not a 'commercial establishment' under S 2 (4) of the Act. The conclusion of the Tribunal and the decision of the learned judge are correct 5. We should however refer to the argument strongly pressed before us in the light of the recent decision of the Supreme Court in Bangalore Water Supply and Sewerage Board and Others v. A. Rajappa & Others (AIR. 1978 SC. 548).
The conclusion of the Tribunal and the decision of the learned judge are correct 5. We should however refer to the argument strongly pressed before us in the light of the recent decision of the Supreme Court in Bangalore Water Supply and Sewerage Board and Others v. A. Rajappa & Others (AIR. 1978 SC. 548). That was concerned with expounding the meaning of the term'industry', under the Industrial Disputes Act. The definition of the term industry is vide in its sweep. The evolution of this branch of the law, is a matter of familiar knowledge. The decision in the Hospital Mazdoor Sabha's case (AIR. 1960 SC 610) and in Ahamadabad Research Station case (AIR. 1961 SC. 485) were among the earliest of the pronouncements which were understood to have carried the concept of the term'Industry' somewhat beyond the popular or well understood sense of the term. The ratio of these rulings was that the term'industry' covered any activity systematically or habitually undertaken for the production or distribution of goods or in rendering material service to the community at large or part of such community with the help of employees. But in the National Union of Commercial Employees v. Their Workmen (AIR. 1862 SC. 1082) a different line of reasoning was discernible. It was ruled that a solicitor-firm employing clerks, manual labourers, and even machinery, cannot be regarded as an 'industry'. A Solicitors job, it was pointed out, depended on his professional equipment, knowledge and efficiency, and the mere fact that for his own convenience or efficient transaction of his work, he employed clerks and labourers and machines would not be decisive of the question whether he was carrying on an 'industry'. This aspect was again high-flighted in the Delhi University case (AIR. 1964 SC. 873), the Gymkhana Club case (AIR. 1968 SC. 554), the Cricket Club of India's case (AIR. 1969 SC. 276), and the Safdarjung Hospital's case (AIR 1970 SC. 1407). In the last of these cases a full Court of Six Judges of the Supreme Court overruled the decision in Hospital Mazdoor Sabha's case (AIR. 1960 SC. 610). We skip a tew of the pronouncements that followed immediately and come to the recent pronouncement of the Supreme Court in Bangalore Water Supply & Sewerage Board v. A. Rajappa (AIR. 1978 SC 548).
1960 SC. 610). We skip a tew of the pronouncements that followed immediately and come to the recent pronouncement of the Supreme Court in Bangalore Water Supply & Sewerage Board v. A. Rajappa (AIR. 1978 SC 548). The majority judges overruled the Safdarjung Hospital case and other decisions and rehabilitated the Mazdoor Sabha's case as follows: W. We overrule Safdarjung (AIR. 1970 SC. 1407; Solicitors' case (AIR. 1962 SC. 1080), Gymkhana (AIR. 1P68 SC. 554), Delhi University (AIR. 1963 SC. 1873). Dhanrajgirji Hospital (AIR. 1975 SC. 2032) and other rulings whose ratio runs counter to the principles enunciated above, and Hospital Mazdoor Sabha (AIR. 1960 SC. 610) is hereby rehabilitated'' . (Page 596) 6. The reasoning of the learned judges briefly put, was this: that effort of every type, from those of the Sweeper and the Typist, to that of the professional lawyer who is the hub and the main stay of the concern, has its contribution to build up the ultimate reputation of the concern. It cannot therefore be said that the co-operation of capital and labour is not present; nor can the type of activities of a Sweeper or a Typist in a lawyer's firm be discounted on the ground that the firm's work is dependent essentially on the professional ability and eminence of the Advocates concerned. It was this notion that was developed at considerable length in the majority judgment. Counsel for the respondents stressed that even in Para.19 of the concurring judgment of Chief Justice Beg, caution has been sounded that the meaning of the term 'industry' had to be determined in the context, for the purpose of the matters provided for in the Industrial Disputes Act. Counsel referred to certain passages in the concurring judgment by Chandrachud J. (as he then was). For instance in Para.171, the learned judge stated that the Hospital Mazdoor Sabha's case (AIR.1960 SC. 610) was correctly decided in respect of the JJ Group of Hospitals, but at the same time stated that the same cannot be said in regard to the view of the court that certain activities ought to be treated as falling outside the definition clause.
610) was correctly decided in respect of the JJ Group of Hospitals, but at the same time stated that the same cannot be said in regard to the view of the court that certain activities ought to be treated as falling outside the definition clause. In Para.174 the learned judge rejected the broad contention that a solicitor's establishment cannot be an "industry" It was observed: "Whether the co-operation between the employer and the employee is the proximate cause of the ultimate product and bears direct nexus with it is a test which is almost impossible of application with any degree of assurance or certitude. It will be as much true to say that the Solicitor's Assistant, Managing Clerk, Librarian and the Typist do not directly contribute to the intellectual end product which is a creation of his personal professional skill as that, without their active assistance and cooperation it will be impossible for him to function effectively. The unhappy state of affairs in which the law is marooned will continue to baffle the skilled professional and his employees alike as also the judge who has to perform the unenviable task of sitting in judgment over the directness of the co-operation between the employer and the employee, until such time as the legislature decides to manifest its intention by the use of clear and indubious language. Besides the fact that this Court has so held in National Union of Commercial Employees, the legislature will find a plausible case for exempting the learned and liberal professions of Lawyers, Solicitors, Doctors, Engineers, Chartered Accountants and the like from the operation of industrial laws. But until that happens, I consider that in the present state of the law it is difficult by judicial interpretation to create exempt ions in favour of any particular class." 7. We do not think we should get involved in this aspect of the discussion of the term 'industry' We would rather confine ourselves strictly to the definition of the term 'commercial establishment' in the Act under notice. 8. The appellant who argued his case in person, in a commendable effort, cited the decision of the Supreme Court in the Federation of Indian Chambers of Commerce and Industry's case (1974 (2) LLJ 271).
8. The appellant who argued his case in person, in a commendable effort, cited the decision of the Supreme Court in the Federation of Indian Chambers of Commerce and Industry's case (1974 (2) LLJ 271). It was concerned with the question whether the Federation of Indian Chambers of Commerce was a commercial establishment within the meaning of the Delhi Shops and Commercial Establishments Act 1954. The term 'commercial establishment' was very widely defined in that Act. It was pointed out by the Supreme Court that the definition itself indicated that the activity of a registered society, or a charitable or other trust, would not be outside the purview of the definition, if the same amounted to a trade or business or any work in connection with or incidental to the same. On an analysis of the activities of the Federation of Chamber of Commerce and the way in which the same were organised, it was held that it satisfied the definition of the term 'commercial establishment.' The prior decision in Mittal's case (1971 (II) LLJ. 630) holding that the Federation of the Indian Chambers of Commerce was an 'industry' under the Industrial Disputes Act was affirmed. The decision (1974 (Il) LLJ. 271) was based on the provisions of the Delhi Act which were much wider than the Act that we have to construe in the instant case. The earlier decision in Mittal's case (1971 (II) LLJ. 630) was concerned with the concept of the term 'industry' which, strictly does not arise for consideration. The decision in Dr. Devandra's case (AIR. 1969 SC. 63), was again concerned with the definition of 'commercial establishment' under the Bombay Act. On the actual facts it was held that a private dispensary of a doctor was not a 'commercial establisment' and the provisions of the Act do not apply to it. But it was pointed out that the definition was of such wide import that it might include even a consulting room where a doctor examines his patients with the help of a solitary nurse or attendant. Applying the principle of noscitur a sociis a limited content was given to the definition in the Act, by posing whether the activity in question was systematically and habitually undertaken for production or distribution of goods or for rendering material services to the community.
Applying the principle of noscitur a sociis a limited content was given to the definition in the Act, by posing whether the activity in question was systematically and habitually undertaken for production or distribution of goods or for rendering material services to the community. It was observed: "It is true that S.2 (4) of the Act has used words of very wide import and grammatically it may include even a consulting room where a doctor examines his patients with the help of a solitary nurse or attendant. But, in our opinion, in the matter of construing the language of S.2 (4) of the Act we must adopt the principle of noscitur a sociis This rule means that, when two or more words which are susceptible of analogous meaning are coupled together they are 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 sense analogous to a less general. "Associated words take their meaning from one another under the doctrine of noscitur a sociis the philosophy of which is that the meaning of a doubtful word may be ascertained by reference to the meaning of words associated with it; such doctrine is broader than the maxim Ejusdem Generis" (Words and Phrases, Vol. XIV, p. 207). For instance, in Reed v Ingham, (1854) 3 E and B 889 it was held upon the principle of the maxim noscitur a sociis, that a steam tug of eighty-seven tons burden engaged in moving another vessel was not a craft within the meaning of the statute. Again, in Scales v. Pickering, (1828)4 Bing 448 at pp. 452.453 the question was what was the meaning of the word 'footway" when used in a private Act which empowered a water company to break up the soil and pavement of roads, highways, footways, commons, streets lanes alleys, passages, and public places, provided they did not enter upon any private lands without the consent of the owner.
452.453 the question was what was the meaning of the word 'footway" when used in a private Act which empowered a water company to break up the soil and pavement of roads, highways, footways, commons, streets lanes alleys, passages, and public places, provided they did not enter upon any private lands without the consent of 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 foot way 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 noscitur a sociis." In the present case, certain essential features or attributes are 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 wider. 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 character As to what exactly is meant by "commerce" it maybe difficult to define but in an early case-McKay v. Rutherford, (1848) 6 Moo P.C. 413 at p. 425, Lord Campbell gave a useful definition. "Commerce is that activity where a capital is laid out on any work and a risk run of profit or loss; it is a commercial venture". If is true that the definition of Lord Campbell is the conventional definition attributed to trade 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 services 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 Commrs. of Inland Revenue v. Maxse, 1919-1 KB 647 at p 657. 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 intellectual 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 of arrangements for the production of sale of commodities. 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 hat now, I think, a wider meaning. It The matter was again considered in another case where the question was whether a company doing the work of naval architect could be said to be carrying on a profession in a naval architecture. The case was William Esplen, Son and Swainston, Ltd, v. Inland Revenue Commrs.,1919-2 KB 731 where Rowlatt, J. observed as follows: "but in my opinion the company is not carrying 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." 7.
It is therefore clear that a professional activity must be an activity carried 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 commercial character and unless the profession carried on by the appellant also partakes of the character of a commercial nature, the appellant cannot fall within the ambit of S.2(4) of the Act." (pp. 66 to 68) The decision of the Supreme Court in Silver Jubilee Tailoring House and Others v. Chief Inspector of Shops & Establishments & Another (1973 (2) LLJ. 495) has also no application. It was rendered with respect to the provisions of the Andhra Pradesh Shops and Establishments Act 1951 and was concerned with the question whether an employer-employee relationship subsisted between the appellant, the Silver Jubilee Tailoring House and their workmen. The workers were paid wages depending upon the skill of the worker, and the nature of the work. They were paid on a piece-rate basis. After the cloth is cut, the worker is instructed how to stitch it. If the stitching is not according to instructions, the work is rejected and the worker is asked to re-do the work. In such cases the worker generally gets no further assignment of work. The stitching was allowed to be done by the workers even from their houses with the permission of the proprietor. The machines installed in the shop belonged to the proprietor and the premises and the shop in which the work is carried on also belong to him The argument was that the test of control over the workmen by the employer would not stand satisfied having regard to the skilled nature of the work in which the workmen were employed which was not amenable to control. The Supreme Court dived into the niceties of the distinction of the test of control in respect of manual labourers and of those engaged in professional or skilled services. We need not enter into those nuances of the law. It was observed: "32. The reputation of a tailoring establishment depends not only on the outter (sic) but also upon the tailors. In many cases, stitching is a delicate operation when the cloth upon which it is to be carried on is expensive. The defect in stitching might mar the appearance not only of the garment but also of its wearer.
The reputation of a tailoring establishment depends not only on the outter (sic) but also upon the tailors. In many cases, stitching is a delicate operation when the cloth upon which it is to be carried on is expensive. The defect in stitching might mar the appearance not only of the garment but also of its wearer. So when the tailor returns a garment the proprietor has got to inspect it to see that it is perfect. He has to keep his customers pleased and has also to be punctual which means that the stitching must be done according to the instruction of the employer and within the time specified. The degree of control and supervision would be different in different types of business. If an ultimate authority over the worker in the performance of his work resided in the employer so that he was subject to the letter's direction, that would be sufficient. In Humberstone v. Norther Timber Mills (1949) 79 C.L.R. 389, Dixon, J. said: "The question is not whether in practice the work was in fact done subject to a direction and control exercised by an actual supervision or whether an actual supervision was possible but whether ultimate authority over the man in the performance of his work resided in the employer so that he was subject to the latter's order and directions". It is the same proposition that has been echoed, in the recent judgment of the Supreme Court in Bangalore Water Supply and Sewerage Board v. A. Rajappa (AIR. 1978 SC. 548). But we are not in this case concerned with the test of control 9. In T. Devadasan v M/s. Gordon Woodroffe & Co. (Madras) Pvt. Ltd. (1972 II L.L.J. 150) the question was whether the appellant before the Supreme Court could be said to have been employed wholly or partly in connection with the business of the employer within the meaning of the definition of the term "person employed" under the Madras Shops and Commercial Establishments Act. On an analysis of the nature and details of work and the terms of the appointment it was held that he satisfied the definition. The decision of the Supreme Court in AIR. 1959 SC. 1226 B. P. Hira v. C. M. Pradhan again, only stressed the wide nature of the definition of 'commercial establishments' under the Bombay Act. 10.
On an analysis of the nature and details of work and the terms of the appointment it was held that he satisfied the definition. The decision of the Supreme Court in AIR. 1959 SC. 1226 B. P. Hira v. C. M. Pradhan again, only stressed the wide nature of the definition of 'commercial establishments' under the Bombay Act. 10. The appellant cited the decision of one of us (myself) in the Koodal Manickom Devaswom's case (1967 KLT. 941). On the actual facts disclosed, and on the language of the definition of the term 'commercial establishment' in the Kerala Act, I held that the Devaswom was a commercial establishment as defined in the Act. On appeal, in W. A. No. 117 of 1967, as the matter was settled between the parties, the Division Bench felt that it was necessary to set aside the judgment and leave the question open for fresh determination should occasion arise, untrammelled by anything that was said in the judgment. It is obvious that the decision was rested on the facts and has no application to the case on hand. 11. We have dealt with all the cases cited, in fairness to the appellant who argued bis case in person. We repeat that the principle of the decisions dealing with ‘industry' under the Industrial Disputes Act, does not have any direct impact on the definition of 'commercial establishment' under the provisions of the Act that we have to consider in the instant case. 12. We affirm the judgment of the learned judge and dismiss the appeal with no order as to costs. Dismissed.