Jammu & Kashmir High Court
M/S Indian Dental Association And ... vs < on 22 March, 2022
Author: Sanjeev Kumar
Bench: Sanjeev Kumar
HIGH COURT OF JAMMU & KASHMIR AND LADAKH
AT JAMMU
Reserved on: 09.03.2022
Pronounced on: 22.03.2022
OWP No. 1532/2017
IA No. 1/2017
c/w
OWP No. 1847/2016
IA No. 1/2016
M/s Indian Dental Association and another ...Appellant/Petitioner(s)
Through :- Mr. Amit Gupta, Advocate.
v/s
<
State of J&K and others .....Respondent (s)
Through :- Mr. Dewakar Sharma, Dy. AG.
Coram: HON'BLE MR. JUSTICE SANJEEV KUMAR, JUDGE
JUDGMENT
1. In these two petitions, one filed by M/s Indian Dental Association and another and the other filed by M/s Sunny Dental Clinic, the issue that falls for consideration is 'whether the dental clinic falls within the ambit of the term "establishment" as defined under Section 2(8) of the Jammu and Kashmir Shops and Establishments Act 1966 (The Act of 1966)'.
2. The short grievance projected by the petitioners in these petitions is that, the petitioners are running only the dental healthcare services in their dental clinics and are not carrying on any business, trade or profession. Learned counsel appearing for the petitioners relies upon Section 3 (c) of the Act of 1966 to contend that establishments for treatment and care of the sick, infirm, destitute or mentally unfit 2 OWP No. 1532/2017 OWP No. 1847/2016 are exempted from the operation of the provisions of the Act of 1966.
3. Learned counsel for the petitioners contends that petitioners run dental clinics wherein all dental related services are provided to the patients suffering from dental diseases. He submits that the activity carried on by the petitioners is purely professional and does not have any element of commercial activity as is understood in law. He places reliance upon the judgment of Supreme Court in the Case of Devendra M. Surti Vs. State of Gujarat reported as AIR 1969 SC 63, in which a similar question had come up for consideration in the context of "Doctors' dispensary" under the Bombay Shops and Establishments Act, 1948 ["Bombay Act"].
4. Hon'ble Supreme Court after referring to definition of "Commercial Establishment" given under Section 2(4) of the Bombay Act, concluded that the 'Doctors' Dispensary' ordinarily does not falls within Section 2(4) of the Bombay Act of 1948, and it would fall within the definition of commercial activity only if the activity is organized in a manner in which the trade or a business is generally organized or arranged and if the activity is systematically or habitually undertaken for rendering material services to the community at large or a part of such community with the help of the employees and if such an activity generally involves cooperation of the employer and the employees. To similar effect is the judgment of the Bombay High Court in Narendra Keshrichand Fuladi and another V. State of Maharashtra, 1985 3 OWP No. 1532/2017 OWP No. 1847/2016 (1) Bom. C.R. 460 in which the Bombay High Court, following the judgment of Devendra M. Surti (Supra), held that a legal practitioner having an office, cannot be said to be carrying on commercial activity and, therefore, would not fall within the definition of expression "commercial establishment". In the later judgment rendered in the case of Kavita Pravin Tilwani V. State of Maharashtra, 2014 (4) Bom. C.R (Cri) 150, the High Court of Bombay held that 'medical practitioner' does not falls within the definition of the expression "commercial activity" and therefore was not amenable to the Bombay Act.
5. Respondents have filed their objections in the case of M/s Sunny Dental Clinic and the stand taken by the respondents is that the Act of 1966 and the rules framed thereunder do not exempt the applicability of the Act to the doctors' clinics and therefore doctors' clinics, health fitness centers, banquet halls, health clinics, X- Ray/ultrasound clinics, etc. are all covered under the Act. It is submitted that petitioner too was registered under the Act, but later on, he did not get his registration renewed nor did he fulfill further obligations under the Act. Accordingly, the impugned notice was issued to the petitioner to attend the office of Assistant Labour Commissioner concerned.
6. During the course of arguments, Mr. Dewakar Sharma, learned Dy.
AG appearing for the respondents also drew my attention to SRO No. 740 of 1978 dated 30.11.1978 issued by the Government under Section 4(1) of the Act of 1966, which, as per the learned counsel, 4 OWP No. 1532/2017 OWP No. 1847/2016 applies to private dispensaries, private hospitals and private nursing homes etc. He would, therefore, contend that the dental clinic is comprehended in the term "private dispensaries" and therefore by virtue of SRO No. 740 of 1978, the same falls within the purview of the Act of 1966.
7. Heard learned counsels for the parties and perused the material on record.
8. The Act of 1966 was enacted by the State Legislature for regulation of conditions of work and employment in shops, commercial establishments, residential hotels, restaurants, eating houses, theatres and other places of public amusement or entertainment and other establishments.
9. Section 2(4) of the Act defines "commercial establishment" and the same is reproduced as under:
"commercial establishment" means an establishment which carries on any business, trade or profession or any work in connection with, or incidental or ancillary to any business trade or profession and includes-
(a) An establishment which carries on the business of advertising, commission agency, forwarding or commercial of any industrial or commercial undertaking;
(b) An insurance company, joint stock company, bank, brokers officer and exchange, but does not include factory, shop, residential hotel, restaurant, eating house, theatre or other place of public amusement or entertainment"
10. Section 2(8) defines the term "establishment" and the same is reproduced as under:
"establishment" means a shop, commercial establishment, residential hotel, restaurant, eating house, theatre, or other place of public amusement or entertainment to which this Act applies and includes such other establishments as the Government may by notification in the Government Gazette, declared to be an establishment for the purpose of this Act"
11. Section 2(22) defines the term "shop" and the same is reproduced as under:
5 OWP No. 1532/2017OWP No. 1847/2016
"shop" means any premises where goods are sold, either by retail or wholesale or both or where services are rendered to customers, and includes an office, a store room, godown, ware-house or workplace, whether in the same premises or otherwise used in connection with such trade or business but does not include a factory, a commercial establishment, place of public amusement or entertainment or shop attached to factory where the persons employed in the shop are allowed the benefits provided for workers under the Jammu and Kashmir Factories Act, 1957"
12. Conjoint reading of the definitions of "commercial establishments", "establishment" and "shops" given in sections 2(4), 2(8) and 2(22) respectively makes it abundantly clear that Act of 1966 applies to shops and the 'shop' is defined in Section 2(22), to mean any premises where goods are sold, either by retail or wholesale or both or where services are rendered to customers, and includes an office, a store room, godown, ware-house or workplace, whether in the same premises or otherwise used in connection with such trade or business but does not include a factory, a commercial establishment, place of public amusement or entertainment or shop attached to factory where the persons employed in the shop are allowed the benefits provided for workers under the Jammu and Kashmir Factories Act, 1957.
13. Admittedly, the dental clinic or medical dispensary would not fit in the definition of expression "shop". In terms of Section 2(8) the expression "establishment" would mean an establishment, commercial establishment, residential hotel, restaurant, eating house, etc. and includes such other establishments as the Government may by notification in the Government Gazette, declare to be an establishment for the purpose of this Act. 6 OWP No. 1532/2017 OWP No. 1847/2016
14. Whether a dental clinic would fall within the definition of the expression "commercial establishment" is a question which no longer deserves any debate for the reason that the similar expression used in Bombay Act has already been debated and discussed by the Hon'ble the Supreme Court in the case of Devandra M. Surti (Supra). What is held by Hon'ble the Supreme Court in Para 5 of the aforementioned judgment is reproduced here under:
"On behalf of the appellant Mr. Mehta put forward the argument that under Section 2(4) of the Act which defines 'Commercial Establishment' as an establishment which carries on any business, trade or profession, the emphasis was not on the place from which the trading or professional activity was carried on but the emphasis was really on the nature of the activity which must be a commercial activity. In other words, the contention was that the intention of the legislature in enacting Section 2(4) was to include only those professions which are carried on in a commercial manner. It was therefore contended that in the present case the dispensary of the appellant does not fall within the definition of 'Commercial establishment' under Section 2(4) of the Act. In our opinion, the argument addressed on behalf of the appellant is well founded and must prevail."
15. From conjoint reading of Section 2(4) and 2(8) of the Act of 1966, it is evident that the Act of 1966 applies to a shop, residential hotel, restaurant, eating house, theatre or other place of public amusement or entertainment. Besides the above, it also applies to the commercial establishment or such other establishments as the Government may by notification in Government Gazette declare to be an establishment for the purpose of this Act. Section 4 of the Act vests in the Government power to declare any class of establishments or class of persons to whom this Act or any of the provisions thereof shall apply. This can be done by the Government by issuing a notification in the Government Gazette. On the publication of such notification in the Government Gazette, the establishment which is notified shall 7 OWP No. 1532/2017 OWP No. 1847/2016 become amenable to the provisions of the Act of 1966. In view of the law laid down by the Supreme Court in the case of Devandra M. Surti (Supra), I have absolutely no doubt in my mind that a 'dental clinic' or a 'Doctors' dispensary' is not an establishment to which, Act of 1966 per se applies. The Doctors' clinic/dispensary or dental clinic/dispensary are not the commercial establishments unless they are found to be carrying on their activities in a commercial manner. At this juncture, I deem it appropriate to reproduce relevant extract of Para 7 of the Judgment which reads as under:
"............ Applying a similar line of reasoning, we are of opinion that the dispensary of the appellant would fall within the definition of S. 2(4) of the Act if the activity of the appellant is organized in the manner in which a trade or business is generally organized or arranged and if the activity is systematically or habitually undertaken for rendering material services to the community at large or a part of such community with the help of the employees and if such an activity generally involves co- operation of the employer and the employees..............."
16. Viewed thus and independently of notification issued by the Government under Section 4(1) of the Act of 1966, a Doctor's clinic or a dental clinic/dispensary may not fall within the definition of Section 2(4) of the Act of 1966 unless the activity carried out in these establishments is organized or arranged in a manner in which a trade or business is generally conducted. Whether or not, a doctor's clinic/dispensary or dental clinic/dispensary is engaged in an activity akin to the commercial activity, is a question of fact to be determined in each case. There is nothing on record before this Court, on the basis on which, this Court could infer that the dental clinics run by the petitioners are engaged in the activity organized in the manner in which a trade or business is generally organized or that the activity of 8 OWP No. 1532/2017 OWP No. 1847/2016 the petitioners is systematically and habitually undertaken for rendering material services to the community at large or a part thereof with the help of employees and if such activity generally involves cooperation of the employer and the employees.
17. That, since the learned Deputy Advocate General has strongly relied upon SRO No. 740 of 1978, as such, it would be in the in the fitness of things to reproduce said SRO hereinbelow:
"In exercise of the powers of conferred by sub-section (1) of section 4 of the Jammu and Kashmir Shops and Establishments Act, 1966 (XXXIX of 1966) the Government hereby declare the following establishment to which the provisions of the said Act excepting Section 9 and 13 thereof shall apply with immediate effect.
1. Private Dispensaries.
2. Private Hospitals.
3. Private Nursing Homes.
4. Offices of Chartered Accountants.
5. Private Educational Institutions."
18. From the reading of SRO 740/1978 it becomes abundantly clear that the Government in the exercise of powers vested in it under Section 4(1) of the Act of 1966 has declared 5 establishments to which all provisions of the Act except Section 9 and 13 shall apply. Five establishments amongst others include; (i) Private Dispensaries, (ii) Private Hospitals, (iii) Private Nursing Homes.
19. The contention of learned Deputy Advocate General is that dental clinics would fall under the term "private dispensaries" and therefore, the petitioners are amenable to the provisions of the Act of 1966.
20. I have given my thoughtful consideration to this aspect of the matter and I find that ordinarily the term private dispensaries is wide enough to bring within its ambit Doctor's clinic/dispensary and 9 OWP No. 1532/2017 OWP No. 1847/2016 dental clinic/dispensary. Dictionary meaning of the term "dispensary" is a room where medicines are prepared and provided and this is different from the term clinic because as per Oxford Dictionary, the meaning of the clinic is i.e. 'an establishment or hospital department where out patients are given medical treatment or advice especially of a specialized nature'. Going by the definition/dictionary meaning of the term 'dispensary' and 'clinic'; Doctor's clinic/dispensary and dental clinic/dispensary may not strictly falls within the purview of the term private dispensaries. Dental clinic, therefore, would essentially be a place where out- patients are given medical treatment or advice especially of a specialized nature.
21. In view of the above, it is difficult for this Court to hold that the 'dental clinic' would fall within the ambit of term "private dispensaries" or "private hospitals" or "private nursing homes". That being so, it cannot be contended that the clinics run and operated by the petitioners are in the nature of private dispensaries, to which the provisions of the Act of 1966, would apply.
22. That apart, Section 3(c) clearly takes out establishments meant for treatment and care of the sick, infirm, destitute or mentally unfit, outside the purview of the Act of 1966. In the dental clinic, a dentist essentially provides services in the nature of dental care and treatment but when we construe the term treatment and care of the sick in Ejusdem Generis with the expressions "infirm, destitute or mentally unfit", we find that the private dental clinics or private 10 OWP No. 1532/2017 OWP No. 1847/2016 doctor's clinics would not fall in clause (c) of Section 3 of the Act of 1966. I, therefore reject the argument of learned counsel for the petitioner that dental clinics are exempted from the operation of Act of 1966, in terms of Section 3(c) of the Act, but I do find sufficient merit in the contention of the learned counsel for the petitioner that a 'dental clinic' is not an establishment as defined under Section 2(8) of the Act nor does it fall within the scope of the term "private dispensaries", "private hospitals" and "private nursing homes" which have been brought within the ambit of Act of 1966 by the Government by issuing a notification in the Government Gazette in terms of Section 4(1) of the Act. A 'doctors' clinic' or a 'dental clinic', which apart from providing consultation and prescribing medicine, may also be engaged in other activities which are carried in the manner in which a trade or business is generally organized, arranged or carried. For example, if in a dental clinic, a dentist apart from providing consultation related to dental healthcare is also engaged in providing dentures, medicines and other allied materials, it may cease to be a mere dental clinic and in that way, may fall within the meaning of term "establishment" as given in Section 2(4) of the Act. As stated above, it is a question of fact to be determined in each case.
23. In the instant cases, impugned before this Court is only a communication issued by the Labour Inspector under the Act of 1966 calling upon the petitioners to attend the office of Assistant Labour Commissioner, to explain as to why the petitioners have not got their 11 OWP No. 1532/2017 OWP No. 1847/2016 registrations renewed and are not adhering to the provisions of the Act of 1966 and the rules framed there under.
24. There is, however, no adjudication by the competent authority with regard to the amenability of the dental clinics to the provisions of the Act of 1966.
25. Before I conclude, I deem it my duty to refer to Rule 3 of the Jammu and Kashmir Shops and Establishments Rules, 1968 which provides for different registration fee per annum for different establishments. Clause 2 of Sub-rule 1 of Rule 3 refers inter alia to health clinics. It is in view of this reference in the rules, Mr. Dewakar Sharma, learned Deputy Advocate General argues that the health clinics, which would include dental clinics, all fall within the purview of the Act of 1966. The argument cannot be accepted for the simple reason that unless it is found from the provisions of the Act of 1966 itself that a particular establishment is covered by it, the rule making authority by prescribing a particular registration fee cannot bring within the purview of the Act the establishments which otherwise do not fall in the ambit of the Act of 1966.
26. For the aforesaid reasons, this petition is disposed of by holding that the dental clinics per se do not fall within the purview of the expression "establishment" as defined under Section 2(4) of the Act of 1966 nor the Government notification issued vide SRO No. 740 of 1978 makes the dental clinics amenable to the provisions of the Act. However, the health clinics, be it a doctor's clinic or a dental clinic, may become amenable to the provisions of the Act of 1966 if a 12 OWP No. 1532/2017 OWP No. 1847/2016 competent authority on enquiry finds that the activity carried out in such clinic is organized in the manner in which a trade or business is generally organized or arranged and if such activity is systematically or habitually undertaken for rendering material services to the community at large or a part thereof with the help of employees, it may treat such clinics as an establishment for the purpose of complying with the provisions of the Act of 1966. Since, no adverse action has yet been taken by any competent authority with regard to the petitioners in OWP No. 1847/2016, as such, the same is otherwise premature. However, the larger issued raised in both these petitions has been determined leaving it for the competent authority to proceed in the matter accordingly.
27. Both these petitioner are accordingly disposed of.
(Sanjeev Kumar) Judge JAMMU:
22.03.2022 Sahil Padha Whether the order is speaking: Yes/No. Whether the order is reportable: Yes/No