Delhi High Court
Indraprastha Medical Corporation ... vs Government Of Nct Of Delhi And Another on 1 June, 2001
Equivalent citations: 94(2001)DLT337, 2002(63)DRJ295, [2001(90)FLR460], (2001)IILLJ1274DEL
Author: Vikramajit Sen
Bench: Vikramajit Sen
ORDER Vikramajit Sen, J.
1. The short and interesting question that has arisen in these writ petitions is whether the Industrial Employment (Standing Orders) Act, 1946, (hereinafter referred to as 'the said Act'), 1946, (hereinafter referred to as 'the said Act') is applicable to the Hospitals. If it is so enforceable, Section 3 of the Act mandates the 'employer' of the 'industrial establishment' to submits its draft standing orders to the 'Certifying Authority' Thereupon, after giving the employer and representatives of the employees a hearing, the Authority is required to propose modifications or additions thereto, if the need is felt. Thereafter, the Authority is required to propose modifications or additions thereto, if the need is felt. Thereafter, the Authority is the certify the draft. One of the Petitioner, namely, Indraprastha Medical Corporation Ltd. (which along with other Hospitals is collectively referred to as 'the Hospital') is presently adhering to its own Standing Orders, and has resolutely refused to submit them for certification under the Act. In its letter dated 11.7.2000 the Government of National Capital Territory of Delhi directed the Hospital to submit five copies of its standing Orders for certification. Several reminders were sent by the Government with the consequence that the Hospital filed Writ Petition 4499/2000 for quashing the 'Orders' dated 11.7.2000. The stand of the Hospital is that it is not an 'industrial establishment' as contemplated in the said Act and hence it cannot be compelled to submit its extant Standing Orders for the imprimatur of the Certifying Authority.
2.To resolve this controversy we need to travel on the long and winding road from the said Act, past the payment of Wages Act, 1936, and thence on to the Factories Act, 1946. The itinerary carries on to the 'Indian Railways Act, 1890' but fortunately this journey has not to be suffered in the present case. This convoluted exercise could easily have been avoided if the Legislature had incorporated the definition directly into the said Act, rather than refer to the many that were obtaining in the sundry legislations then existing. Alternatively, the legislature need not have incorporated and definition into the said Act, thereby enabling a dynamic and contemporary interpretation and implementation of the said Act. More importantly, is it not open to the Court to consider the definition of 'industry' contained in the Industrial Disputes Act, 1947, enacted just a year later, or is it to be strait-jacketed to the archaic definition in the earlier statutes. This case also highlights the wisdom in the opinion expressed as far back as in 1865 in Wakefield Board of Health vs West Riding etc ., Rv. (1805) 6 B & S 794 - "I hope the time will come when we shall see not more of interpretation clauses, for they frequently lead to confusion." Similar views were again articulated by the House of Lords in Knightsbridge Trust vs. Byrne.
(1940) 2 All ER 407.
3.The relevant statutory provisions are reproduced hereafter for easy and ready reference.
Section 2(e) of the said Act states that :-
"Industrial establishment" means :
(i) an industrial establishment as defined in clause (ii) of Section 2 of the Payment of Wages Act 1936, or
(ii) a factory as defined in clause (m) of Section 2 of the Factories Act, 1948, or
(iii) a railway as defined in clause (4) of Section 2 of the Indian Railways Act, 1890, or
(iv) the establishment of a person who, for the purpose of fulfillling a contract with the owner of any industrial establishment employs workmen.
Industrial Establishment in Clause (ii ) of Section 2 of the Payment of Wages Act 1936 means -
"(a) Tramway service or motor transport service engaged in carrying passengers or goods or both by road, for hire or reward;
(aa) air transport service other than such service belonging to, or exclusively employed in the military, naval or air forces of the Unions or the Civil Aviation Department of the Government of India;
(b) dock, wharf of jetty;
(c) inland vessel, mechanically propelled;
(d) mine, quarry or oilfield;
(e) plantation;
(f) workshop or other establishment in which articles are produced, adapted or manufactured with a view to their use, transport or sale;
(g) establishment in which any work relating to the construction, development or maintenance of buildings, roads, bridges or canals, or relating to operations connected with navigation, irrigation or the supply of water, or relating to the generation, transmission and distribution of electricity or any other form of power is being carried on;
(h) any other establishment or class of establishment which the Central Government or a State Government may, having regard to the nature thereof, the need for protection of persons employed therein and other relevant circumstances, specify, by notification in the Official Gazette.
A factory as defined in clause (m) of Section 2 of the Factories Act, 1948 means -
"factory" means any premises including the precincts thereof-
(i) whereon ten or more workers are working, or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carries on with the aid of power, or is ordinarily so carried on.-
(ii) whereon twenty or more workers are working, or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on without the aid of power, nor is ordinarily so carried on,-
but does not include in mine subject to the operation of the Mines Act 1952 (35 of 1952), or a mobile unit belonging to the armed forces of the Union, railway running shall or a hotel, restaurant or eating place.
Explanation (I)- For computing the number of workers for the purposes of this Clause all the workers in different groups and relays in a day shall be taken into account Explanation II - For the purposes of this clause, the mere fact that an Electronic Data Processing Unit or a Computer Unit is installed in any premises or part there of shall not be construed to make it a factory if no manufacturing process is being carried on in such premises or part thereof.
A Railway as defined in clause (4) of Section 2 of the Indian Railways Act, 1890 means -
"Railway" means a railway, or any portion of a railway, for the public carriage of passengers, animals or goods, and includes -
(a) all land within the fences or other boundary-marks indicating the limits of the land appurtenant to a railway.
(b) all lines of rails, sidings or branches worked over for the proposes of, or in connection with, a railway;
(c) all station, offices, warehouses, wharves, workshops, manufactures, fixed plant and, machinery and other works constructed for the purposes of, or in connection with, a railway, and
(d) all ferries, ships, boats and rafts which are used on inland waters for the purposes of the traffic of a railway and belong to or are hired or worked by the authority administering the railway."
4. It is trite to state that the Courts must apply the law as it is contained in the statute. If it is helplessly anachronistic it is for Parliament to amend or repeal or replace it. A time honoured canon of interpretation of a definition contained in a statute is stated in Maxwell on the Interpretation of Statutes, in the following words:
"Sometimes, it is proved that a word shall "mean" what the definition section says it shall mean; in this case, the word us restricted to the scope indicated in the definition section. Sometimes, however, the word "include" is used " in order to enlarge the meaning of words or phrases occurring in the body of the statute; and when it is so used these words or phrases must be construed as comprehending, not only such things as they signify according to their natural import, but also those things which the interpretation clause declares that they shall include. "In other words, the word in respect of which "includes" is sued bears both its extended statutory meaning and "its ordinary, popular, and natural sense whenever that would be properly applicable."
5. A similar view can also be found in Craies on Statute Law, Seventh Edition on page 213, to the effect that "where the word defined is declared to "mean" so and so, the definition is explanatory and prima facie restrictive." The Underlining has been added by me to highlight that the approach is open to variation in exceptional cases. Interestingly, in this treatise the opinion has also been expressed that interpretation clauses do not take away its ordinary meaning or prevent the operation of a word in its primary and obvious sense. It is thereafter stated that - "Another important rule with regard to the effect of an interpretation clause is, that an interpretation clause is not to be taken as substituting one set of words for another, or as strictly defining what the meaning of a term must be under all circumstances, but rather as declaring what may be comprehended within the term where the circumstances require that it should be so comprehended. If , therefore, an interpretation clause gives an extended meaning to a word, it does not follow as a matter of course that, if that word is used more than once in the Act, it is on each occasion used in the extended meaning, and it may be always a matter for argument whether or not the interpretation clause is to apply to the owed as used in the particular clause of the Act which is under consideration." To these views, I may add, with humility and trepidation, that where a definition clause merely refers to other statutes the meaning should not be given a restricted, exhaustive and immutable character. Where similar words are to be found in several legislations, the meaning ascribed to the words should be loosely borrowed, adapted and then applied. Quite obviously, the Legislature had thought it unnecessary to incorporate a definition within the particular statute but considered it sufficient to refer to other statutes indicating thereby that the particular words should be given the general colour and meaning of the contemporary ethos. Thus if there is a change in the ethos and thinking, the meaning to be ascribed to words should confer, to the times. In these cases the intention of the legislature could only be directional, in that a mere reference to these words as used in other statutes has been made in the said Act. For these reasons it would be a jural anachronism not to apply the meaning given to 'industry' and its derivatives, such as 'industrial,' as are contained in the subsequent statute, the Industrial Disputes Act, 1947. With some modifications the maxim - Legas Posteriors Priors Contraries Arrogant - later laws repeal earlier laws inconsistent therewith - can be applied with some adaptation. Albeit under circumstances that are only somewhat different to these prevailing in the present case, the Hon'ble Supreme Court had opined in State of Bihar v. S.K. Roy, AIR 1966 SC 1994, that " it is a well recognized principles in dealing with matters of construction that subsequent legislation may be looked at in order to see what is the proper interpretation to be put upon the earlier act where the earlier act is obscure or ambiguous or readily capable of more than one interpretation."
6. There can be no opinions that the said Act is calculated to bring about industrial peace by eradicating arbitrary and exploitive treatment to the workers. It sets down minimum standards in service conditions, to be observed by all industrial establishments. The observations of the Supreme Court in the context of the applicability of Provident Fund Legislation will apply also to the interpretation to be imparted to the said Act. In Andhra University vs. R.P.F.Commissioner of AP, , the Court held that in construing such Acts, "we have to bear in mind that it is beneficent piece of social welfare legislation aimed at promoting and securing the well-being of the employees and the court will not adopt a narrow interpretation which will have the effect of defeating the very object and purpose of the Act." The Department of Publication and Press run by the Andhra University was brought within the ambit of the Provident Fund Act despite the fact that it was an integral and captive part of the University which was not subject to that Act. The same approach commends itself in the present case.
7. It should be recalled that the impasse between giving a meaning that is contemporaneously obvious and a meaning that is only pedantically present was also manifest in the case of The Banglore Water Supply & Sewerage Board v. A Rajappa & others etc., . The most poignant preface would be found in paragraph 36 of this judgment, in the statement of Justice Krishna Iyer to the effect that the "functional focus of this industrial legislation and the social perspective of Part IV of the Paramount Law drives us to hold that the dual goals of the Act are contentment of workers and peace in industry and judicial interpretation should be geared to their fulfillment, not their frustration". What was observed in the context of the Industrial Disputes Act would apply with equal vigour to the said Act also.
On the subject of permissable methods of interpretation I can do not better than to rely on the following words of Chief Justice Beg, representing the unanimous opinion of the seven Learned Judges constituting the Bench.
"2. My learned brother has relied on what was considered in England a somewhat unorthodox method of construction in Seaford Court Estates Ltd. v. Asher, (1949) 2 All ER 155 at p. 164, where Lord Denning, L.J., said:
"When a defect appears a Judge cannot simply fold his hands and blame the draftman. He must set to work on the constructive task of finding the intention of Parliament -- and then he must supplement the written words so as to give 'force and life' to the intention of legislature. A Judge should ask himself the question how, if the makers of the Act had themselves come across this ruck in the texture of it, they would have straightened it out? He must then do as they would have done. A Judge must not alter the material of which the Act is woven, but he can and should iron out the creases."
When this case went up to the House of Lords it appears that the law Lords disapproved of the bold effort of Lord Denning to make ambiguous legislation more comprehensible. Lord Simonds found it to be "a naked usurpation of the legislative functions under the thin disguise of interpretation." Lord Morton (with whom Lord Goddard entirely agreed) observed: "These heroics are out of place" and Lord Tucker said:
"Your Lordships would be acting in a legislative rather than a judicial capacity if the view put forward by Denning, L.J., were to prevail".
3. Perhaps, with the passage of time, what may be described as the extension of a method resembling the "armchair rule" in the construction of wills, Judges can more frankly step into the shoes of the legislature where an enactment leaves its own intentions in much too nebulous or uncertain a state. In M. Pantiah v. Verramallappa, , Sarkar, J., approved of the reasoning, set out above, adopted by Lord Denning. And, I must say that, in a case where the definition of "industry" is left in the state in which we find it, the situation perhaps calls for some judicial heroics to cope with the difficulties raised.
4. ..... omitted
5. Each of us is likely to have a subjective notion about "industry". For objectivity, we have to look first to the words used in the statutory provisions defining industry in an attempt to find the meaning. If that meaning is clear, we need proceed no further. But, the trouble here is that the words found there do not yield a meaning so readily. They refer to what employers or workers may do as parts of their ordinary avocation or business in life. When we turn to the meaning given of the term "worker" in S.2(s) of the Act, we are once more driven back to find it in the bosom of "industry", for the term "worker" is defined as one:
"Employed in any industry to do any skilled or unskilled manual, supervisory, technical or clerical work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceedings under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute".
The definition, however, excludes specifically those who are subject to the Army Act, 1950 or the Air Force Act, 1950, or the Navy Discipline Act, 1934, as well as those who are employed in the Police Service or Officers and other employees of a Prison, or employed in mainly managerial or administrative capacities or who, being employed in supervisory capacity, draw wages exceeding Rs. 500/- per menses.
6. ......omitted
7. The method which has been followed, whether it be called interpretation or construction of a part of an organic whole in which the statute, its objective, its past and its direction for the future, its constitutional setting are all parts of this whole with their correlated functions. Perhaps it is impossible, in adopting such a method of interpretation, which some may still consider unorthodox, a certain degree of subjectivity. But, our attempt should be not to break with the well-established principles of interpretation in doing so. Progressive, rational and beneficial modes of interpretation import and fit into the body of the old what may be new. It is a process of adaptation for giving new vitality in keeping with the progress of thought in our times. All this, however, is not really novel, although we may try to say it in a new way".
8. Justice Krishna Iyer had extracted the views of Justice Cardozo to the same effect in the leading judgment in the Banglore Water Supply case (supra):
"The Courts are not helped as they could ought to be in the adaptation of law of justice. The reason they are not helped is because there is no one whose business it is to give warning that help is needed... We must have a courier who will carry the tidings of distress... Today courts and legislature work in separation and aloofness. The penalty is paid both in the wastes effort of production and in the lowered quality of the product. On the one side, the judges, left to fight against anachronism and injustice by the methods of judge-made law, are distracted by the conflicting prompting of justice and logic, of consistency and mercy, and the output of their labours bears and tokens of the strain. On the other side, the legislature, informed only casually and intermittently of the needs and problems of the courts, without expert or responsible or disinterested or systematic advice as to the workings of one rule or another, patches the fabric here and there and marks often when it would mend. Legislature and courts move on in proud and silent isolation. Some agency must be found to medicate between them."
9. Before moving on from the momentous judgment in the Banglore Water Supply case (supra), two aspects there of should be focused upon. Firstly, it was the unanimous view that the case of The Management of Safder Jung Hospital, New Delhi v. Kuldip Singh Sethi, needed to be overruled and the case of The State of Bombay and others v. The Hospital Mazdoor Sabha and others, rehabilitated. Thus hospitals which were till then held not to be "industries" came to be so categorised under the fall of the Banglore Water Works hammer - "profits or no profit, research or no research". Secondly, all the seven learned Judges subscribed to be 'dominant nature test' - which was paraphrased by them as - "where a complex of activities, some of which qualify for exemption, others not, involves employees on the total undertaking, some of whom are not 'workmen' as in the University of Delhi case or some departments are not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the departments as explained in the Corporation of Nagpur will be the true test. The whole undertaking will be 'industry' although those who are not 'workmen' by definition may not benefit by the status."
10 It was for this reason that Mr. Vinay Bhasin had relied on the Christian Medical College v. Employees' State Insurance Corporation, (2001) 1 SCC 256. The question that had to be answered in the Christian Medical College case (supra) was whether the Equipment Maintenance Department of the Hospital fell within the ambit and sweep of the Employees' State Insurance Act (hereinafter referred to as "the ESI Act'). In the ESI Act, as in the case of the said Act, reference is made to the Factories Act for the definition of "manufacturing process". Section 2(k) of the letter Statute reads as under :
"2 (k) "manufacturing process" means any process for -
(i) making altering repairing, ornamenting, finishing, packing, oiling, washing, cleaning, breaking up, demolishing, or otherwise treating or adapting any article or substance with a view to its use, sale, transport, delivery or disposal, or
(ii) pumping oil, water, sewage or any other substance; or
(iii) generating, transforming or transmitting power, or
(iv) composing types for printing, printing by letter press, lithography, photogravure or other similar process or book binding; or
(v) Constructing, reconstructing, repairing, refitting, finishing or breaking up ships or vessels;
(vi) preserving or storing any article in cold storage."
11. It was in these circumstances that the Apex Court in Christian Medical College case (supra) observed that "if any repairing takes place with a view of use the equipment then it amount to manufacturing process. It is the appellant's own case that the Equipment Maintenance Department maintains and repairs their equipment of the efficient use of the equipment in the Hospital. Therefore, this department is clearly covered by the term "factory" under the ESI Act. Once it squarely falls within this term, the provisions of the Act become applicable to this department. No question arises of applying the test of dominant nature. The test of dominant nature would have become applicable only if on the basis of this department falling within the definition of the term "factory" the respondent had sought to make the appellant Hospital also amenable to the provisions of the ESI Act. As that is not the case here no question arises of applying the dominant nature test."
12. Mr. Bhasin has forcefully contended that if the dominant activity test is applied, the only consequence would be that the manufacturing activity in a particular limb of the Hospital would not render the entire body of the Hospital subject of the Act. Learned counsel for the Respondents have, with equal vehemence, submitted that this is an altogether new case that is being made out; that it is imperative that sufficient data should have been made available by the Petitioner before the Authority to make good the case that the manufacturing activity was not the dominant activity, and that it could easily be severed from the other activity. This discussion was necessary because in the Industrial Disputes Act the term 'Industrial establishment' means an establishment in which an industry is carried on provided where several activities are carried on and only one or some of such activities are an industry such unit will be treated separately. It will be anomalous that a Hospital which is undeniably an 'industry' is held not to be an 'industrial establishment'. In my opinion it must be kept foremost in mind that the Hospital is avowedly an industry and that if it was to be excluded form being considered as an industrial establishment (despite the definition of this term in the said Act) the onus of making good the exclusion rested with the Petitioner. No effort in this direction has been made by term and hence the need to explore whether the onus has been satisfactorily discharged does not arise. What appears to have been totally lost sight of is that fact that the decision in the Sfter Jung Hospital case (supra) (as also the Solicitors case, and the Delhi University case, ) has been overrules and that of the Hospital Mazdoor Sabha case (supra) restored. What is the relevance of investigating the dominant activity of the Petitioner when a hospital has already been held to be an industry. Is it necessary only because of the definition of 'industrial establishment' under the said Act. One has been referred by the legislature a half century ago to the then extant statues, whilst one year later it has laid down a different meaning to the same term.It needs highlighting that it was with the application of the 'dominant nature test' that the Supreme Court had in the Bangalore Water Supply case (supra) overruled the following judgments - Safdarjung Hospital case (supra) including even an entirely charitable institution; The Dhanrajgirji Hospital v. The Workman, ; Rabindra Nath Sen and others v. First Industrial Tribunal, West Bengal and others, , by which it was held that Physicians and Solicitors did not come within the pale of 'industry'; Delhi University case (supra) as well as the Madras Gymkhana Club Employees' Union v. Management, . If a charitable Hospital is an industry, a fortiori, even more so a Hospital where a majority of Patients/Rooms are obtained only on payment. The dominant nature test can only militate against the stand of the present petitioners. In the Andhra University case (supra) the dominant activity could not be held to be one falling within the ambit of the Provident Fund Act but since the Department of Publication and Press did so fall, and because this activity was clearly severable and distinguishable, the Act was enforced qua the Department and not the University. Let me reverse the position and consider the Department as the dominant activity, and the running of the University as an incidental or minor activity. It is not inconceivable that in order to carry out its publications and to ensure its pristine and preeminent quality, the Department considered it expedient to run an educational wing/teaching shop to intellectually test its publications. By an application of the dominant nature test even the latter would come within the sweep of the particular Act. In the present case Hospitals have been held to be an industry. By adopting a proactive approach and not imparting an insular meaning to 'industrial establishment', hospitals would also be construed as 'industrial establishments'. It has been conceded by Mr. Vinay Bhasin, Learned Senior Counsel for the petitioner, that certain wings of the Petitioner Hospital would definitely fall within this definition, but his contention is that the entire Hospital should not be treated so. As already mentioned, this argument was not substantiated by them before the Authority, empirically and datamatically. Furthermore this enquiry is futile since it is now not debatable that the dominant activity of hospitals renders them as industries. In Christian Medical College Hospital Employees Union and another v. Christian Medical College Vellore Association and others, , the Industrial Disputes Act, which was held to be the general law for the prevention and settlement of industrial disputes, was made applicable to the Hospital College despite a challenge by the Management by taking shelter of the minority rights enshrined in Article 30 of the Constitution.
13. Viewed in all its complexities, there is no legal infirmity in the impugned Order. All that the Petitioner are required to do is to either adopt the Model Standing Orders under the said Act, or submit its own Standing Orders for the scrutiny, approval and ratification of the Authority. It can hardly be countenanced it the 21st Century that any person can be permitted to engage labour without promising and ensuring them minimum protection against arbitrary treatment. This minimum standard has been set out in the said Act. On behalf of the Workmen, Counsel had drawn attention to the various Rules/ Orders followed by the Petitioner which they would consider draconian and contrary to fair labour practice. These need not be dealt with by the Court since this scrutiny is properly that of the Authority under the said Act. All interim Orders are recalled. The Hospital shall file with the Certifying Authority constituted under the said Act its Standing Orders or any other document by which it governs the relations between the Management and its Workmen within fifteen days from today. The Certifying Authority shall complete the appropriate action within three months of today.
14. I.A. 11492/2000 is allowed and the Writ Petition No. 4499/2000 as well as I.A. 6921/2000 are dismissed. but with no order as to costs.
15. With these directions Writ Petition Nos. 1264/2000, 2066/2000 as well as Writ Petition No. 502/2001 and all interim applications filed in these Writ Petitions are disposed off.
16. dusty.