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R
IN THE HIGH COURT OF
KARNATAKA
AT BANGALORE
DATED THIS THE 13th DAY OF July, 2012
BEFORE
THE HON’BLE MR.JUSTICE ARAVIND KUMAR
W. P.NO.32423/2009
C/w W.P.No.31976/2009 & W.P.No.5040/2009
(L-MW)
W.P.No.32423/2009
BETWEEN: Mr. Prashob Balakrishnan P. Executive-HR Bharti Airtel Limited 11/1 & 12/1, ‘Maruthi Infotech Center’
Block ‘A’ West Wing, Koramangala Inner Ring Road Amarjyothi Layout Domlur Bangalore-560 071. ..Petitioner
(By Sri.S.N.Murthy, Sr. Counsel for M/s S.N.Murthy Associates) AND: The Senior Labour Inspector
22nd Circle, Karmika Bhavan Bannerghatta Road Bangalore-560 029. ….Respondent
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(By Sri.Jagadeesh Mundaragi, AGA)
This Writ Petition is filed Under Articles 226 and
227 of the Constitution of India praying to Quash
complaint dated 25.10.2008 (wrongly stated that
25.10.01) CC No.813/2008 on the file of the
Metropolitan Magistrate, Traffic Court I, Bangalore at
Annexure-A and also declare that the Central
Government is the appropriate Government under the
Minimum Wages Act, 1948 in respect of the activities
carried out by the establishment of M/s Bharathi Airtel
limited and further may be pleased to declare that the
provisions of the Minimum Wages Act, 1948 are not
applicable to M/s Bharathi Airtel Limited.
W.P.No.31976/2009
BETWEEN: M/s Bharti Airtel Limited Represented by its Head-Legal & Regulatory Mr.S. Nagaraj Having its office at
11/1 & 12/1, ‘Maruthi Infotech Center’ Block ‘A’ West Wing, Koramangala Inner Ring Road Amarjyothi Layout Domlur, Bangalore-560 071. ..Petitioner
(By Sri.S.N.Murthy, Sr. Counsel for M/s S.N.Murthy Associates)
AND:
The Senior Labour Inspector 22nd Circle, Karmika Bhavan Bannerghatta Road Bangalore-560 029. ….Respondent
(By Sri.Jagadeesh Mundaragi, AGA)
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This Writ Petition is filed Under Articles 226 and 227 of the Constitution of India praying to Quash further proceedings in CC No.813/2008 on the file of the Metropolitan Magistrate, Traffic Court, I Bangalore
Vide Annexure-A and also declare that the Central Government is the appropriate Government under the Minimum Wages Act 1948 in respect of the activities carried out by the petitioner and further may be pleased to declare that the provisions of the Minimum Wages Act 1948 are not applicable to the petitioner company.
W.P.5040/2009 BETWEEN: 1. M/s Bharti Airtel Limited
Represented by its Head-Legal & Regulatory Affairs Mr.Suresh Kumar Having its office at 11/1 & 12/1, ‘Maruthi Infotech Center’ Block ‘A’ West Wing,
Koramangala Inner Ring Road Amarjyothi Layout Domlur, Bangalore-560 071.
2. Ms. Manju Nanaiah
Human Resource Manager
M/s Bharti Airtel Limited 11/1 & 12/1, ‘Maruthi Infotech Center’ Block ‘A’ West Wing, Koramangala Inner Ring Road Amarjyothi Layout Domlur, Bangalore-560 071. ..Petitioners
(By Sri.S.N.Murthy, Sr. Counsel for M/s S.N.Murthy Associates) AND:
The Senior Labour Inspector 22nd Circle,
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Karmika Bhavan Bannerghatta Road Bangalore- 560 029. ….Respondent
(Respondent is served)
This Writ Petition is filed Under Articles 226 and 227 of the Constitution of India praying to Quash Criminal Complaint No.1312/2008 on the file of the Metropolitan Magistrate, Traffic Court III, Bangalore at
Annexure-A and declare that the Central Government is the appropriate Government under the Minimum Wages Act, 1948 in respect of the activities carried out by the first petitioner and further may be pleased to declare that the provisions of Minimum Wages Act, 1948 are not applicable to the first petitioner company.
These Writ Petitions are coming on for preliminary hearing in ‘B’ group this day, the court made the following:
ORDER
A short but an interesting point of law is involved
in these writ petitions and said question being common
to all these writ petitions they are taken up together for
consideration and disposed off by this common order.
Heard, learned Advocates appearing for parties.
2. Sri.S.N.Murthy, learned Senior counsel
appearing for the petitioners has contended as under:
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1. State Government is not the ‘appropriate
Government’ under the Minimum Wages Act,
1948, and it is the Central Government, since
petitioner is an industry established and run
under the authority of Central Government and as
such notice issued by the State Government is bad
in law and it is without authority of law.
2. Even otherwise Section 3(1)(b) of the Karnataka
Shops and Commercial Establishment Act, 1961,
exempts the petitioner-establishment from the
purview of said Act, since it is carrying on the
business of ‘telephone services’ and as such
exempted.
3. ‘telephone services’ is not one of ‘scheduled
employment’ as defined under Section 2(g) read
with Section 27 of the Minimum Wages Act, 1961
and as such provisions of the Act is not attracted.
4. State Government itself had granted exemption to
the petitioner-establishment from the applicability
of Minimum Wages Act, 1961, by way of
clarification in view of definition of “telephone
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services” falling under Section 3(1)(b) of Karnataka
Shops and Commercial Establishment Act, 1961,
and as such petitioner establishment is not
required to obtain registration under said Act.
On these grounds by relying upon the judgment of the
Division Bench of this Court in the case of Regional
Labour Commissioner vs. T.K.Verkey & Co., reported
in ILR 1991 Kar. 946, he seeks for allowing of the writ
petition and for quashing of the complaint in
C.C.No.813/2008 on the file of the Metropolitan
Magistrate Traffic Court I, Bangalore, at Annexure-A
and for a declaration that Central Government is the
‘appropriate Government’ under the Minimum Wages
Act, 1948, to initiate proceedings against petitioner
establishment in respect of its activities and not the
State Government and for a further declaration to
declare that provisions of the Minimum Wages Act,
1948, are inapplicable to the petitioner
establishment/Industry.
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3. Per contra, Sri. Jagadeesh Mundaragi,
learned Additional Government Advocate appearing for
respondent would contend that definition of ‘appropriate
Government’ as defined in Section 2(b)(i) of the
Minimum Wages Act, 1948, would indicate that Central
Government would be the `appropriate Government’
only in relation to such of those employment as
described under the Schedule to the Act, which is
carried on by the Central Government by itself or such
employment which is under the Authority of the Central
Government and submits that it has to be so construed
only by restricting its interpretation and for all other
employment, the `appropriate Government’ would be the
State Government as per Section 2(b)(ii) of the Act and
as such he submits that contentions raised in the writ
petition is liable to be rejected. In support of his
submission he relies upon the judgment of the Division
bench of this Court in Cotton Corporation of India
Ltd., vs. Odusmutt reported in 1999 I LLJ 19 and
seeks for dismissal of the writ petition.
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4. Having heard the learned advocates appearing
for the parties, I am of the considered view that
following points would arise for my consideration:
(1) Whether in the instant case, the ‘appropriate Government’ is the Central Government or the State Government empowered to issue notice to petitioner establishments under the
Minimum Wages Act, 1948? (2) Whether exemption provision i.e., Section
3(1)(b) of the Karnataka Shops and Commercial Establishments Act, 1961 is attracted to the facts on hand and as such, the
provisions of the Minimum Wages Act is inapplicable to the petitioner establishments.
(3) Whether ‘telephone services’ is not a scheduled
employment as defined u/s. 2(g) of the Minimum Wages Act, and as such, provisions
of Minimum Wages Act is not applicable to petitioner establishments?
(4) Whether petitioners are entitled for the prayer
sought for in the Writ Petition?
(5) What order?
BRIEF BACKGROUND OF THE CASE:
5. These writ petitions were clubbed along with
W.P.5039/2009 and W.P.18344/2005 and said writ
petitions have been disposed of by a Co-ordinate Bench
of this court by order dated 27.06.2011. In the said
writ petitions petitioners therein had sought for
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quashing of the proceedings initiated by Senior Labour
Inspector, Government of Karnataka before the
Jurisdictional Magistrate for alleged violation of certain
provisions under the Karnataka Shops and Commercial
Establishments Act. Said writ petitions came to be
disposed of on 27.06.2011 and a direction was issued to
the Labour Inspector which reads as under:
“In the result, these petitions are disposed of directing the Labour Inspector to receive and
consider petitioners representation along with documents. If filed within a fortnight from today and pass orders thereon, in accordance with law, after extending reasonable opportunity of hearing to the parties. Until such time the Labour Inspector
takes a decision, the prosecution proceedings before the Magistrate are directed to be kept in abeyance.”
6. On such direction being issued, the matter
came to be re-examined by the respondent authorities
herein and an order came to be passed on 19.9.2011
and 14.9.2011 respectively by concluding that petitioner
is an establishment to which Minimum Wages Act is
applicable and not exempted under Section 3(1)(b) of the
Karnataka Shops and Commercial Establishments Act,
1961 and prayer for exemption sought for by the
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petitioner vide their representation dated 8.7.2011 came
to be rejected. The copy of the said order has been filed
by the learned Counsel appearing for petitioner along
with a memo on 19.3.2012 and same has been placed
on record in these writ petitions.
7. In these writ petitions the petitioners have
raised similar grounds as was urged in W.P.5039/2009
and W.P.18344/2005 and have sought for quashing of
the criminal complaint lodged by the respondent
authorities for alleged violation of the provisions of
Minimum Wages Act, against the petitioner
establishments and its executive in W.P.31976/2009,
W.P.5040/2009 and W.P.32423/2009 respectively.
8. It is contended by Sri S.N.Murthy, learned
senior counsel appearing for petitioner that any finding
given in these Writ Petitions based on the grounds
urged herein would have a direct bearing and impact on
the said proceedings also and as such, even the findings
given in those proceedings have been assailed in the
present Writ Petitions and he prays for considering the
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grounds urged in Writ Petitions be considered in the
background of subsequent events also.
9. The contentions of the learned senior counsel
have already been noted hereinabove, and in order to
examine the said contentions I am of the considered
view that provisions of the various acts pressed into
service would be relevant and necessary and as such,
they are extracted hereinbelow:
STATUTORY PROVISIONS
A. MINIMUM WAGES ACT, 1948
2. Interpretation. - In this Act, unless there
is anything repugnant in the subject or context-
(b) “appropriate Government” means-
(i) In relation to any scheduled employment carried on by or under the authority of the (Central Government or a railway
administration) or in relation to a mine, oil-field or major port, or any corporation established by (a Central Act), the Central Government.” (ii) in relation to any other scheduled employment, the [State Government];
Section 27: Power of State Government to add to Schedule – The appropriate Government, after giving by notification in
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the Official Gazette not less that three months’ notice of its intention so to do, may, by like notification add, to either Part of the Schedule any employment in respect of
which it is of opinion that minimum rates of wages should be fixed under this Act, and thereupon the Schedule shall in its application to be (State) be deemed to be amended accordingly.
B. Karnataka Shops and Commercial Establishments Act, 1961
Section 2(e) “Commercial establishment” means a commercial or
trading or banking or insurance establishment, an establishment or administrative service in which persons employed are mainly engaged in office work, a hotel, restaurant, boarding or eating house, a café or any other refreshment
house, a theatre or any other place of public amusement or entertainment and includes such establishments as the State Government may by notification declare to be a commercial establishment for the purpose of this Act.”
3. Exemptions - (1) nothing in this Act
shall apply to,- (a) xxx
(b) “any railway service, water transport service, postal, telegraph or telephone service, any system of public conservancy or sanitation or any industry, business or undertaking which supplies power, light or water to the public.”
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RE POINT NO.1:
10. It is the contention of the learned senior
counsel that notice issued or the proceedings initiated
by the respondent against petitioner establishment is
without authority of law namely the ‘appropriate
Government’ as defined under the Minimum Wages Act,
Sec.2(b) would be Central Government alone which has
the authority to initiate action if at all if any and not the
“State Government” on the ground that contract has
been entered into between petitioner establishment and
the Government of India, Ministry of Communications,
Department of Communication as per Licence
Agreement ddated29.10.2001 and in view of the fact
that contract is being carried on under the authority of
Central Government, the Appropriate Government
would be the Central Government alone and not the
State Government.
11. On account of License Agreement executed
by the Central Government by virtue of its power
conferred under Section 4 of the Indian Telegraph Act,
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1885 it has been contended that petitioner
establishment is run under the authority of the ‘Central
Government’ and as such it is the `Central Government’
alone which would be the “appropriate Government’’ to
issue notice to the petitioner establishment for any
alleged violation of the provisions of the Minimum
Wages Act and as such the officers of the Labour
Department, Government of Karnataka will have no
jurisdiction to inspect the records of the petitioner
establishment or to prosecute the petitioner
establishments and its officers. A perusal of the License
Agreement which has been produced alongwith a Memo
dated: 25-06-2012 would indicate that said agreement
is executed by the Central Government by virtue of the
power conferred on it under section 4 of the Indian
Telegraph Act, 1885. It empowers the Central
Government to grant licence on such conditions and in
consideration of such payments as it thinks fit to any
person to establish and maintain the work enumerated
in the said section. Said agreement would also indicate
that it would be on non exclusive basis that such a
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licence is granted to the petitioner establishments. The
said licence is valid for a period of 20 years from the
effective date as per the terms and conditions agreed to
thereunder for operating in the State of Karnataka
which is defined as ‘Service Area’. It also indicates that
Government of India can grant licence for the said
service in the same area to others also. It is also agreed
to between the parties that said licence is granted on
payment of one time entry fee of Rs.35 crores in
addition to which the annual licence fee in the form of
Revenue sharing @12% of adjusted gross revenue would
be payable by the licensee to the licensor. The mode of
payment, dates on which payments is to be made are
specified in the agreement including the guarantees to
be given by the licensees namely the petitioner herein
for due performance of contract.
12. When a doubt arises about the meaning of the
words of a statute or how it is to be understood, it
would be safe to harmonise such words with the subject
enactment with the object which the legislature has in
view and understand its meaning in the said manner. It
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is recognised rule of interpretation of statutes that
expression used in a statute should ordinarily be
understood in a sense in which if best harmonises with
the object of the statute and which effectuate the object
of the legislature and not attach a meaning which would
negate the intent of legislation or frustrate it. Therefore,
when two interpretations are feasible, the court will
prefer that which advances the remedy and suppresses
the mischief as the legislature envisioned. The object
oriented approach, however, cannot be carried to the
extent of doing violence to the statute by re-writing the
section or substituting the words in place of the actual
words used by the legislature.
13. When material words which can bear two or
more constructions, the most firmly established rule of
construction would be to take all such words “of the
statute” in general (be they penal or beneficial,
restrictive or enlarging of the common law) for
interpreting it which is the rule laid down in Heydeyn’s
case. The Rule which is also known as “purposive
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construction” or “mischief rule’ which enables
consideration of four parameters in construing the Act
namely:
(1) What was the common law before making of
the Act?
(2) What was the mischief and defect for which the
scommon law did not provide?
(3) What remedy the act has provided? and,
(4) What is the reason for the remedy?
14. As held by the Hon'ble Supreme Court in
Bengal Immunity Company Vs. State of Bengal reported
in AIR 1955 SC 661, the office of all the judges should
always make such construction which shall suppress
the mischief and advance the remedy and to suppress
subtel invasions and evasions for continuance of the
mischief and proprivato commodo and to add force and
life to cure and remedy according to the true intent of
makers of the Act.
15. Keeping these principles in mind, when the
statement and the objects of the Minimum Wages Act
are examined and the purpose for bringing out the said
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legislation it can be best understood. Hence, same
requires to be extracted and it reads as under:
“The justification for statutory fixation of minimum wage is obvious. Such provisions which exist in more advanced countries are even necessary in India, where workers organizations are yet poorly developed and the workers bargaining power
is consequently poor.
2. The bill provides for fixation by the Provisional Governments of minimum wages for employments covered by Schedule to the Bill. The items in the Schedule are those where sweated labour is more prevalent or where there is a big chance of
exploitation of labour. After sometime, when some experience is gained, more categories of employment can be added and the Bill provides for addition to the Schedule. A higher period is allowed for fixation of minimum wages for agricultural labour as
administrative difficulties in this case will be more than in other employments covered by the Schedule. The Bill provides for periodical revision of wages fixed.
3. Provisions had been made for appointment of Advisory Committees and Advisory Boards, the latter for co-ordination work of the Advisory Committees. The
committees and the Boards will have equal representation of employers and workmen. Except on initial fixation of minimum wages, consultation with the Advisory committee will be obligatory on all occasions of revision.
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4. In cases where an employer pays less than the minimum wages fixed by the Provincial Government a summary procedure has been provided for recovery of
the balance with penalty and subsequent prosecution of the offending party.
5. It is not ordinarily proposed to make any exemptions in regard to employees of undertakings belonging to the Central Government except that difficulties might arise when the sphere of duty of such an
employer covers more than one province and where the rates of minimum wages fixed by the different provinces may be different. For this purpose a provision has been included that the minimum wages fixed by a Provincial Government will not apply to
employees in any undertaking owned by the Central Government or employees of a Federal Railway, except with the consent of the Central Government.”
16. Petitioner establishment is a company
registered under the Companies Act. Petitioner
establishments are registered under the provisions of
the Karnataka Shops and Commercial Establishments
Act, 1961 and the State Government in exercise of its
power vested under Section 27 of the Minimum Wages
Act by notification dated 27th/28th January, 1971 has
directed that in Part I of the Schedule to the Minimum
Wages Act after item No.27 the “Employment in Shops
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and Commercial Establishments” to be added and
accordingly it has been added. Subsequently the State
Government in exercise of its power vested under
section 27 of the Minimum Wages Act has issued a
Notification dated 06.07.2004 by adding all such
workmen employed which is not included hitherto
under the Scheduled Employment to be brought under
the provisions of the Minimum Wages Act.
17. It is at this juncture it requires to be
considered as to whether the petitioner establishments
would fall:
(1) under clause (i) of Clause (b) of Section 2, or (2) under clause (ii) of Clause (b) of Section 2, and
if so, or otherwise:
Whether petitioner establishments would fall within
section 3(1)(b) of Karnataka Shops and Commercial
Establishments Act and as such it is exempted.
To bring the petitioner establishment within the purview
of “under the authority of the Central Government”, as
defined under section 2(b)(i) of Minimum Wages Act it
has to establish that there is no financial benefit which
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accrue to the petitioner establishment. In the instant
case, it is a simple licence agreement executed by the
Central Government in favour of the petitioner for a
consideration to operate in such areas as provided for
under the License Agreement granted by the Central
Government in Karnataka State. Petitioner is required
to pay the licence fee. Petitioner establishment is
conducting its own business as a licensee after having
obtained licence from the licensor i.e. Government of
India and it is not carrying on the business on behalf of
the Government of India. The nature of the contract
does not disclose that Government of India is having
any control over the administration of the petitioner
establishments. The liability to pay salaries, wages etc.,
to its employees is fully within the domain of the
petitioner establishment. It cannot be said that
petitioner establishment is a company or an industry
carried on by the Central Government. The business
i.e. being carried on by the petitioner establishment is
for its financial benefit and not for the benefit of the
Central Government and any profit it earns by such
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licence issued by the Government of India would accrue
as a profit to the petitioner establishments and it would
not go to the coffers of Government of India. There is no
over all control of the Central Government over the
petitioner company in question. At this juncture it
would be of benefit to note the judgment of the Division
Bench of this court in the case of Cotton Corporation of
India ltd and Odusmath G.C. & Others reported in
1999(1) LLJ 19 whereunder it has been held as follows:
“31. In the present case the Corporation is not either created or run by the Central Government. Nor is it a statutory
corporation. The authority to control its management and business affairs are not vested in the Central Government by any statute. Such authority is conferred on it by the articles of the corporation and the exercise thereof is entirely subject thereto
and to the relevant provisions of the Companies Act. The Corporation carries on its said business i.e., industry, in its own right as a distinct legal person independently, of the Central Government. The trade in which it is engaged is not its
exclusive monopoly. Indisputably other traders are also carrying on the said business. In that view of the matter, we find that merely because the Central Government is shown to be having extensive powers and control over the Corporation in the matter of
its functioning and business by virtue of its articles it cannot be stated that the
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corporation `carries on its business under the authority of the Central Government’ and, therefore, it is the `appropriate Government’ to make a reference of an
Industrial dispute to the Labour Court under Section 10 of the Act. Hence, we are in respectful agreement with the view so taken by the learned single Judge and we hold that the `appropriate Government’ within the meaning of Sec.2(a)(i) of the Act for the
purpose of making a reference of an industrial dispute concerning the corporation to a Labour Court under Sec.10 of the Act is the `State Government’ and not the `Central Government’.
As a result, we hold that the references in question pending before the respondent Labour Court are valid references in law and it has the jurisdiction to try and adjudicate upon them. Therefore, we do not find any good ground to interfere with the impugned
judgment”. 18. The said judgment was rendered by the
Division Bench in the context of Industrial Disputes Act,
1947 whereunder the `appropriate Government’ has
been defined under section 2(a) of the said Act.
19. Subsequently Division Bench of this court in
the case of Regional Labour Commissioner Vs. T.K.
Verkey & Co., reported in ILR 1991 KAR 946 considered
the connotation and purport of the word `appropriate
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Government’ with reference to the definition clause of
`appropriate Government’ as defined under the
Minimum Wages Act and held that it is distinct and the
definition of the word `appropriate Government’ as
defined under the Industrial Disputes Act, 1947 and
Contract Labour (Regulation and Abolition) Act, 1970 is
not in para materia with the definition found under the
Minimum Wages Act. It has been held as under:
“27. The learned Single Judge has proceeded on the basis that the definition of “appropriate Government” contained in Section 2(a) of the Contract Labour (Regulation and Abolition) Act, 1970 and the definition of similar expression contained in
the Minimum Wages Act are in pari materia, whereas it is not so. The definition of “appropriate Government” in the Contract Labour (Regulation and Abolition) Act is in relation to an establishment pertaining to an industry carried on by or under the
Authority; whereas the definition of “appropriate Government” in the Minimum Wages Act is in relation to scheduled employment carried on by or under the Authority. Thus the one is in relation to an establishment carried on by or under the
authority and the another is in relation to schedule employment. Therefore, the decision rendered under the Contract Labour (Regulation and Abolition) Act with reference to “appropriate Government” cannot also have full bearing on the issue
arising under the Minimum Wages Act as to which is the “appropriate Government”.
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20. Thus, it has to be examined as to whether
the word `appropriate Government’ referred to under the
Minimum Wages Act is referable to the `appropriate
Government’ as defined under the Industrial Disputes
Act, 1947. In view of the fact that law laid down by the
Division Bench of this court in T.K. Verkey’s case
rendered in the context of Minimum Wages Act it has to
be examined whether petitioner establishments would
fall within the definition clause (i) or (ii) of section 2(b).
When the words `under the authority of’ as found in the
definition clause of Minimum Wages Act are examined it
has to be understood as an industry or an enterprise or
an establishment owned by the Government itself or
which is being carried on through a department or an
authority created by the Government to carry on that
industry. An activity carried on by or under the
authority of the Government like issuing a licence to a
company to carry on certain acts cannot be termed or
construed as an act done by the Government itself. No
business owned and carried on by a private person or a
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limited company can be a business carried on by/or
under the authority of Government. In the instant case,
the business is being conducted by the petitioner
company itself and to conduct said business, licence
has been issued by the Government of India and as
such, no inference can be drawn that it is by virtue of
such authority given by the Central Government
petitioner establishments are carrying on its business.
It is a licence issued by the Government of India to
petitioner establishments under a contract to operate in
State of Karnataka and by virtue of such licence,
business was being carried on by the petitioner
establishments as its own business and it cannot be
held to be a business carried under the authority of
Government of India. In view of the above discussion, I
am of the considered view that the contention raised by
the learned counsel for petitioner that appropriate
authority to issue notice or initiate proceedings against
petitioner establishments would be the Central
Government and not the State Government cannot be
accepted and its stands rejected.
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RE: POINT NO.2:
21. It is the contention of learned senior counsel
appearing for petitioner that under section 3(1)(b) of
Karnataka Shops and Commercial Establishments Act.
Services which are being rendered by petitioner
establishment falls within (telephone services) and as
such it is exempted from the purview of Minimum
Wages Act. In order to ascertain as to whether
petitioner is rendering “telephone services” alone as
contended and claimed this court had directed the
learned counsel appearing for petitioner to make
available the copy of license agreement entered into
between the petitioner establishment and Government
of India. Accordingly a copy of the said agreement has
been produced by learned counsel along with a memo
on 25.06.2012 and same has been taken on record as
already observed. In order to appreciate or consider the
contention raised by learned senior counsel it would be
necessary to examine the words used in clause (b) of
sub-section (1) of section 3 of the Act and same reads as
under:
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“any railway service, water transport service, postal, telegraph or telephone service, any system of public conservancy or sanitation or any industry, business or undertaking which
supplies power, light or water to the public.”
22. A perusal of the said provision would go to
show that railway services, water transport services,
postal, telegraph or telephone service, any system of
public conservancy or sanitation or any industry or
business or undertaking which supplies power, light or
water to the public is exempted. Exemption clause in a
statute is to be read strictly and courts cannot
supplement the words to the words already used in the
statute for interpreting the Statute. Courts cannot
resort to interpret process in order to unfold the intent
of the legislature, particularly when the language is
clear and unambiguous in a statute. In this regard the
Judgment of Hon’ble Apex Court in KESHAVJI RAVJI &
CO. ETC. ETC. Vs Commissioner of Income tax reported
in AIR 1991 SC 1806 can be looked up whereunder it
has been held as follows:
“(B) Interpretation of Statutes – Legislative
intent – Resort to interpretative process in
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order to unfold it – Not permissible when language of statute is unambiguous”. As long as there is no ambiguity in the
statutory language resort to any interpretative process to unfold the legislative intent becomes impermissible. The supposed intention of the legislature cannot then be appealed to whittle down the statutory language which is otherwise unambiguous. If
the intendment is not in the words used it is nowhere else. The need for interpretation arises when the words used in the statute are, on their own terms, ambivalent and do not manifest the intention of the Legislature”.
23. Thus, keeping in mind the contours under
which a statute is to be examined and words are to be
interpreted, the words used in section 3(1)(b) and vis-a-
vis, the license granted by Government of India to the
petitioner establishment to carryout certain activities in
the Karnataka Telecom Circle is to be examined. For
the said purpose the license agreement entered into
between the petitioner and Government of India dated
29.10.2001 is examined to discern the actual services
rendered by petitioner. A perusal of the said agreement
would disclose that in exercise of its power vested under
section 4 of the Indian Telegraph Act, 1885 licensor
(Government of India) has granted licence to the
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petitioner-licensee to establish, install, operate and
maintain Basic Telephone Service on non-exclusive
basis in the Service Area of “Karnataka Telecom Circle”.
Services to be rendered by petitioner establishments in
Karnataka Telecom Circle and scope of licence under
which the licensee is required to operate is specified in
the schedule appended as `terms and conditions’ to the
said agreement. Clause 2 of said agreement defines the
scope of licence.
Clause 2.2 (b)(i) enables the licensee to provide Voice Mail, Audiotex services as Value Added Services over its network to the subscribers falling within its Service Area on non-
discriminatory basis. Different clauses of agreement has been defined
after clause 33 whereunder sub-clause (41) or
service is defined as under:
(41) “Service” covers collection, carriage, transmission and delivery of voice or non voice messages over LINCENSEE’s PSTN in licensed service area and includes provision of all types of services except those requiring a separate licence.
Clause 54 in the said definition defines value added
service to amend and include the following:
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“54. VALUE ADDED SERVICE” – Value Added Services are enhanced services which add value to the basic teleservices and bearer services for which separate licences are issued.
At present, Government is issuing licences for following Value Added Services:-
(i) Cellular Mobile Telephone Service (Public Land
Mobile Network) (ii) Road Paging Service
(iii) Public Mobile Trunking Service (iv) Electronic Mail (v) Voice Mail Service (vi) Closed Users Group Domestic 64 kbps data
network via INSAT Satellite system. (vii) Videotex Service
(viii) Video-conferencing (ix) GMPCS (x) Internet
24. Thus, a combined reading of all the clauses
in the agreement would clearly go to show that it is not
merely telephone service alone which is being rendered
by the petitioner-establishments but also all other value
added service over its network within the service area
namely entire area falling within the State of Karnataka
and defined as Karnataka Telecom Service area. Thus,
the word `telephone service’ found in Section 3(1)(b) of
the Shops and Commercial Establishments is to be
understood in the context in which it has been inserted
and other services which are also exempted under
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clause (b) also has to be taken into consideration for
example Railway services, postal, telegraph, any
industry, business or undertaking which supplies
power, light, or water to the public is also included in
the said exemption clause. In order to ascertain the
intent of legislature the words surrounding such other
exempted categories would also requires to be
examined. Hence, I am of the considered view that
`Doctrine of noscitur sociis’ would be applicable to the
circumstances of this nature namely the words
accompanying particular statute namely agnates and
cognates would required to be looked into to ascertain
true and correct meaning of the word to which
exemption is sought for. In this regard the Judgment of
Hon’ble Supreme Court in the case of C.B.I.AHD Patna
Vs Braj Bhushan Prasad reported in AIR 2000 SC 4014
and The State of Bombay and others Vs The Hospital
Mazdoor Sabha and others reported in 1960 SC 610
requires to be looked into whereunder it has been held
as follows:
(1) AIR 2001 SC 4014 – C.B.I.AHD Patna Vs Braj Bhushan Prasad
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26. “We pointed out the above different shares of meanings in order to determine as to which among them has to be chosen for interpreting
the said word falling in Section 89 of the act. The doctrine of No, sciture a sociis (meaning of a word should be known from its accompanying or associating words) has much relevance in understanding the imports of words in a statutory provision. The said
doctrine has been resorted to with advantage by this Court in a number of cases vide Bangalore Water Supply and Sewerage Board Vs A.Rajappa (1978) 2 SCC 447, Oswal Agro Mills Ltd., Vs CCE (1993) Supp. 3 SCC 716, K.Bhagirathi G.Shenoy Vs K.P.Ballakuraya
(1999) 4 SCC 135, Lokmat Newspapers (P) Ltd., Vs Shankarprasad (1999) 6 SCC 275”. 27. If so, we have to gauge the implication of the words “proceeding relating exclusively to the territory” from the surrounding context.
Section 89 of the Act says that proceeding pending prior to the appointed day before “a court (other than the High Court), tribunal, authority or officer” shall stand transferred to the “corresponding court, tribunal authority or officer” of the Jharkhand State. A very useful
index is provided in the section by defining the words “corresponding court, tribunal authority or officer in the State of Jharkhand” as this: “The court, tribunal, authority or officer in which or before whom the proceeding would
have laid if it had been instituted after the appointed date”.
(2) AIR 1960 SC 610 – The State of Bombay and others Vs The Hospital Mazdoor Sabha and others –
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9. It is, however, contended that, in construing the definition, we must adopt the rule of construction noscuntur a sociis. This rule, according to Maxwell, 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. They take as it were their colour from each other, that is, the more general is restricted to a sense analogous to a less general. The same
rule is thus interpreted in " Words and Phrases " (Vol. XIV, P. 207): " Associated words take their meaning from one another under the doctrine of noscuntur 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." In fact the latter I maxim "is only an illustration or specific application of the broader maxim
noscuntur a sociis ". The argument is that 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 though their normal import may be much wider. We are not impressed by this argument. It must be borne in mind that noscuntur a sociis is merely a rule of construction and it cannot prevail in cases where it is clear that the wider
words have been deliberately used in order to make the scope of the defined word correspondingly wider. It is only where the intention of the Legislature in associating wider words with words of narrower significance is doubtful, or otherwise not clear
that the present rule of construction can be usefully applied. It can also be applied where
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the meaning of the words of wider import is doubtful; but, where the object of the Legislature in using wider words is clear and free of ambiguity, the rule of
construction in question cannot be pressed into service. As had been observed by Earl of Halsbury, L. C., in Corporation of Glasgow v. Glasgow Tramway an Omnibus Co. Ltd., 1898 AC 631 at p.634, in dealing with the wider words used in S.6 of Valuation
of Lands (Scotland) Act, 1854 " the words 'free from all expenses whatever connection with the said tramways' appear to me to be so wide in their application that I should have thought it impossible to qualify or cut them down by their being associated with
other words on the principle of their being ejusdem generis with the previous words enumerated ". If the object and scope -of the statute are considered there would be no difficulty in
holding that the relevant words of wide import have been deliberately used by the Legislature in defining "industry" in S. 2(j). The object of the Act was to make provision for the investigation and settlement of industrial disputes, and the extent and scope
of its provisions would be realised if we bear in mind the definition of " industrial dispute" given by S. 2(k), of "wages” by S. 2(rr), " workman " by S. 2(s), and of “employer by S. 2(g). Besides, the definition of public utility service prescribed by S. 2(m) is very
significant. One has merely to glance at the six categories of public utility service mentioned by S. 2(m) to realise that the rule of construction on which the appellant relies is inapplicable in interpreting the definition prescribed by S. 2(j)”.
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25. Associated words take their meaning from
one another under this doctrine namely a doubtful word
if crop ups for consideration or interpretation its
meaning same can be understood from the words it
accompany. This doctrine stands on higher footing or
higher pedestal than `ejusdem genris’. Keeping this
doctrine in mind when the words used in clause (b) of
sub section (1) of section 3 of the Act namely “telephone
service” is examined it would indicate that such of those
services which are rendered by the State for the public
and for the public at large stands exempted. It is in this
background the exemption clause is to be understood
as otherwise the mischief that may occur on account of
any other interpretation may lead to negate the very
intention and purpose of exemption clause.
26. Section 2(e) of the Shops and Commercial
Establishment defines “Commercial establishments” to
mean a commercial or trading or banking or insurance
establishment, an establishment or administrative
service in which persons employed are mainly engaged
in office work etc., and activity of the petitioner as seen
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from the agreement referred to supra cannot be
construed so as to exclude the petitioner establishment
from the purview of the Act and definition clause is
exhaustive clause and in the instant case the nature of
the activity of the petitioner establishments are based
on a commercial venture and that too for a
consideration as specified in the agreement itself and
rendering of telephone service along with other services
by petitioner as a licensee cannot be held that it would
be entitled to seek exemption from the application of the
Act. In that view of the matter I am of the considered
view that the contention of learned senior counsel
appearing for petitioner that petitioner establishments
are exempted under clause 3(1)(b) of the Act cannot be
accepted and it stands rejected. Hence, it is held that
exemption provided under section 3(1)(b) of Karnataka
Shops and Commercial Establishments Act is not
applicable to the facts on hand and same would be
inapplicable to the petitioner-establishments.
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RE. POINT NO.3:
27. One another contention raised by the learned
counsel for petitioner is that ‘telephone services’ is not
one of the Schedule employment as defined under
Section 2(g) of the Minimum Wages Act, 1948.
Section 2 (g) of the Minimum Wages
Act, 1948 reads as under:
“2(g) “schedule employment” means
an employment specified in the
Schedule or any process or branch of
work forming part of such employment;”
Under Section 2(g) of Minimum Wages Act would
be attracted to the employment specified in the schedule
or any process or branch of work forming such
employment. Schedule -I to the Act defines the types of
Employment brought under the Minimum Wages Act.
Appropriate Government is empowered under Section
27 of the Minimum Wages Act, 1948, to add to the
schedule by issuing Notification in the Official Gazette of
not less than three months notice of its intention to do
so, to add to either part of the schedule any employment
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in respect of which it is of the opinion that the
minimum rates of wages should be fixed under this act
and on such issuance of the gazette Notification its
application to the State will be deemed to be included
accordingly. The schedule to the Minimum Wages Act
have undergone such amendments and the appropriate
Government both State and Central in exercise of their
power under Section 27 have issued Gazette
Notifications from time to time. It is no doubt true that
initially the employees in the petitioner establishment
could not have been brought under the purview of the
Minimum Wages Act since the said employment was not
declared as schedule employment as defined under
Section 2(g) of the Act. By virtue of the power vested
with the `appropriate Government’ i.e., State
Government in the instant case has issued a
Notification to the said effect on 27th/28th January,
1971 by bringing the adding item as item No.28 to
Schedule-I and reads as under:
“28. The employment in Shops and Commercials Establishment."
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Petitioner establishments in the instant case
undisputedly had got themselves registered under the
Provisions of the Karnataka Shops and Commercial
Establishment Act and later on did not continue the
registration on the premise that they fall under
exempted category as defined under Section 3(1)(b) of
said Act. In view of the fact that the establishment of
the petitioner is held to be establishment as defined
under the Act and schedule employment under the
Minimum Wages Act, it cannot be held or construed
that the petitioner establishment would be entitled for
claiming exemption from the provisions of Minimum
Wages Act, 1948, and it is inapplicable to them. In that
view of the matter point No.3 formulated hereinabove is
to be answered against the petitioner and in favour of
the respondent-State.
Re. Point No.4 & 5:
In view of the discussion made hereinabove, I am
of the considered view that petitioners are not entitled
for the reliefs sought for. In the result writ petitions are
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hereby dismissed. Rule discharged. No order as to
costs.
Sd/- JUDGE
DR/PL/SBN
