1992 (8) TMI 205 - SC - Indian Laws

Employees State Insurance Act, 1948 - Meaning and scope of the term Shop - Applicability on The appellant Company, carrying on the business of clearing and forwarding at the port of Cochin - Held that - The appellant is carrying on stevedoring, clearing and forwarding operations. Clearing the documents, even it be in the custom house, is the carrier s job. It cannot be gainsaid that the appellant is rendering service to cater the needs of exporters and importers and others who want to carry the goods further. Therefore, it is a shop carrying on a systematic economic or a commercial activity. This would be enough to bring the appellant without specifically enumerating the specific activities carried on by the appellant. Merely because shop has been enumerated along with other similar establishment we do not think any further specific enumeration is necessary to cover the appellant. Decided against the applicant.

Summary

Issues Involved:
1. Applicability of the Employees State Insurance Act to the appellant's business.
2. Interpretation of the term "shop" under the notification.
3. Specific enumeration of establishments under the notification.

Detailed Analysis:

1. Applicability of the Employees State Insurance Act to the Appellant's Business:
The appellant, a company engaged in clearing and forwarding at the Port of Cochin, received a notification extending the Employees State Insurance Act to establishments with 20 or more employees. The appellant contested this, arguing it did not fall under the purview of the notification as it was not a shop and did not render services to customers at its office. The Employees Insurance Court and the Kerala High Court both ruled against the appellant, holding that the appellant's business was covered under the term "shop" in the notification.

2. Interpretation of the Term "Shop" Under the Notification:
The appellant argued that the term "shop" should be narrowly construed to mean a place where buying and selling of merchandise take place, citing definitions from Wharton's Law Lexicon and Words and Phrases Legally Defined. The appellant contended that its activities of processing documents at the customs clearing house did not constitute a "shop." The Supreme Court, however, upheld the broader interpretation of "shop" as including any place where commercial activity and services are rendered to customers, referencing previous decisions in Hindu Jea Band Jaipur v. Regional Director, Employees' State Insurance Corporation and M/s. International Ore & Fertilizers (India) Pvt. Ltd. v. Employees' State Insurance Corporation.

3. Specific Enumeration of Establishments Under the Notification:
The appellant argued that since the notification specifically enumerated other establishments like hotels, restaurants, and cinemas, the term "shop" should not be broadly interpreted to include its business. The Supreme Court rejected this argument, stating that the purpose of enumeration was to cover as many establishments as possible and that the term "shop" was intended to have a wide amplitude. The Court emphasized that the Employees State Insurance Act is a welfare legislation and should be liberally construed to extend benefits to as many employees as possible.

Conclusion:
The Supreme Court dismissed the appeals, holding that the appellant's business of clearing and forwarding at the Port of Cochin falls within the definition of "shop" under the notification. The Court affirmed that the Employees State Insurance Act applies to the appellant's establishment, emphasizing the broad and inclusive interpretation of the term "shop" in line with the welfare objectives of the Act. The appeals were dismissed without costs.