AI Structured Summary
Not yet generated for this judgment
Judgment
Rajagopalan, J.—The petitioner company owns and runs eight restaurants in Mangalore, listed in Sch. A to the petition. The were treated
both by the petitioner and by the Government as restaurants within the meaning of S. 2 (15), Madras Shops and Establishments Act, 36 of 1947
(hereinafter referred to as the Madras Act), and the provisions"" of that Act were applied to them from the date on which that Act came into force,
10-2-1948. The Indian Factories Act (25 of 1934) was repealed by the Factories Act, 63 of 1948, which came into force on 1-4-1949.
The Central Coffee House and Lodging was one of the eight restaurants owned by the petitioner. The Inspector of Factories, and the Chief
Inspector of Factories to whom the petitioner appealed, held that that establishment was a factory governed by the provisions of the Factories Act
of 1948. Paragraph 6 of the counter-affidavit filed by the respondent showed that the petitioner had to take out a licence under the Factories Act
for each of the eight restaurants that it owned.
The petitioner applied under Art. 226 of the Constitution for the issue of a writ of mandamus or any other appropriate writ to prevent the
respondent, the Inspector of Factories, from enforcing any of the provisions of the Factories Act against the petitioner in relation to any of the eight
restaurants owned by it.
The petitioner''s main contention was that each of its eight establishments was a restaurant to which only the provisions of Madras Act 36 off
1947 applied, and that none of them was a factory as defined by the Factories Act of 1948. The substantial plea, on which that contention was
based, was that the provisions of the Factories Act of 1948 were repugnant to those of the Madras Act, and to the extent of that repugnancy the
provisions of the Factories Act of 1948, were void under S. 107, Government of India Act, 1935, and therefore unenforceable against the
petitioner.
The presumption, of course, is in favour of the validity of the impugned Act, the Factories Act of 1948. It is well settled that a Court will not
investigate the alleged invalidity of a statute if relief can be granted to the petitioner without a need for such an investigation. There should be no
need for such an investigation, unless any of the restaurants owned by the petitioner is a restaurant as defined by the Madras Act and is also a
factory as defined by the Factories Act of 1948. There should be no occasion for any conflict between the two statutes. That each of the eight
establishments is a restaurant within the meaning of the Madras Act was common ground. Section 2 (15) of the Madras Act runs :
Restaurant or eating house means any premises in which is carried on wholly or principally the business of the supply of refreshments or meals to
the public or a class of the public for consumption on the premises but does not include a restaurant attached to a theatre.
If none of the establishments of the petitioner which is a restaurant as defined by S. 2 (15) of the Madras Act, is a factory as defined by the
Factories Act of 1948, no further question need arise for determination.
Section 2 (7) of the Madras Act runs :
''Factory means any premises which is a factory within the meaning of cl. (j) of S. 2 of the Factories Act, 1934, or which is declared to be a
factory under S. 5 of that Act;
The Factories Act of 1934 was repealed by the Factories Act of 1948. Independent of that the question, whether any of the petitioner''s eight
restaurants is a factory, has to be decided with reference to the definitions in the Factories Act of 1948.
The relevant sub-clauses of S. 2, Factories Act 63 of 1948 are as follows :
2 (m) ""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 carried on with the aid of power, or is ordinarily so carried on, or
(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, or is ordinarily so carried on....
2(1) ''worker'' means a person employed, directly or through any agency, whether for wages or not, in any manufacturing process, or in cleaning
any part of the machinery or premises used for a manufacturing process, or in any other kind of work incidental to, or connected with, the
manufacturing process, or the subject of manufacturing process;
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 or sewage, 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;
To establish that any of the restaurants of the petitioner company is a factory what has to be proved is that in any part of the premises of that
restaurant, a ""manufacturing process"" as defined by S. 2 (k) of the Act is carried on. There should be little difficulty about that. The preparation of
food stuffs and other eatables in the kitchen, which is part of the premises, does fall within the definition of manufacturing process. It satisfies the
test of ""making or altering or otherwise treating or adapting any article or substance"" with a view to its use, sale or disposal.
The further test to be satisfied is that involved in this definition of ""worker'''' in S. 2 (1), Factories Act of 1948. The ""worker"" is not any person
employed in the premises but a person employed either (1) directly in the manufacturing process itself or (2) in cleaning any part of the machinery
or premises used for the manufacturing process, or (3) in any other kind of work incidental to or connected with the manufacturing process or the
subject of the manufacturing process.
Then there is the further test of numbers prescribed by S. 2 (m). If the manufacturing process is carried on with the aid of power, the minimum
prescribed is ten persons. i.e., persons employed in the premises who satisfy the definition of workers in S. 2 (1) of the Act. If the manufacturing
process: is carried on without the aid of any power, the minimum is 20 workers.
The statutory authorities, the Inspector of Factories and the Chief Inspector of Factories do not appear to have kept in view the requirements of
the statute, the Factories Act of 1948, in treating everyone of the eight restaurants of the petitioner as a factory. They appear to have counted the
total number of the persons employed in each of the establishments, without deciding whether every one of them or every class of them came
within the definition of ''''worker'''' in S. 2 (1). Nor do they appear to have really decided whether the manufacturing process was carried in each of
these eight restaurants with or without the aid of power.
In the papers placed before me there was the specific decision of the Chief Inspector of Factories with reference to one of the eight restaurants
owned by the petitioner, the Central Coffee House and Lodging that it was a factory. In Sch. A to the petition the petitioner showed that two
cooks were employed in the kitchen of that restaurant, and that 19 others were employed as ""waiters and servers or cleaners etc.'''' The finding of
the Chief Inspector was that 32 workers in all were working on the premises of that restaurant. The correctness of the details furnished in Sen. A
was not specifically challenged in the counter-affidavit filed by the respondent.
The other relevant finding of fact in the order of the Chief Inspector was that a ""Frigidaire'''', that is a refrigerator, was in use in that restaurant.
These two findings are certainly not enough in my opinion, to sustain a conclusion, that that restaurant is a factory as defined by the Factories Act
of 1948.
No doubt a Frigidaire is worked by electric power, but every place where a Frigidaire is used will not become a factory, even if the requisite
number of persons arc engaged in work on the premises where a refrigerator is in use. If a refrigerator was the only appliance driven by power that
was used in the restaurant, what the statutory authorities had to decide was whether any manufacturing process was carried on with the aid of that
refrigerator, that is, with the aid of the power that was needed to work that refrigerator. That aspect of the case does not appear to have been
considered at all.
Normally a refrigerator is used for the purpose of storage. Even in a restaurant articles are kept in the refrigerator till they are required for sale.
Mere storage as such will not be port of the manufacturing process as defined by S. 2 (k), Factories Act of 1948 : it will not even amount to
treating or adapting any article with a view to its sale or disposal. If, however, a refrigerator is used for treating or adapting any article with a view
to its sale, then the test required by S. 2 (k) would be satisfied.
Let me illustrate the point by taking the example of ice-cream, which is often sold in restaurants, and which is kept in cold storage till the sale is
effected. If: the ice-cream is manufactured and then merely stored in the refrigerator, such storage will not be part of any manufacturing process. If,
however, ice-cream is made with the aid of a refrigerator like a ""Frigidaire"", then the Frigidaire would have been used tor making or otherwise
treating or adapting the article for sale.
Similarly, in the case of beverages, mere storage will not form part of the manufacturing process. But if the beverage is treated or adapted for sale
by the use of a refrigerator, then that might amount to manufacturing process as defined by S. 2 (k).
What the refrigerator, the Frigidaire, in the petitioner''s restaurant, the Central Coffee House and Lodging, was used for is not clear either from
the order of the Chief Inspector or from the affidavit or counter-affidavit. That was one of the points the Inspector had to decide. The Inspector
had to decide as a question of fact, what was the manufacturing process that was carried on in the restaurant with the aid of power? Any use of the
power on the premises is not enough. The power must be used in aid of ''''manufacturing process"" as defined by S. 2 (k).
If the use of the ""Frigidaire"" is really the deciding factor in any given case, whether an establishment is a mere restaurant or is a factory, it is for
the Government to decide whether the interests of the public will not be better served by exempting such an establishment from this provision of the
Factories Act.
I have pointed out that preparation of food stuffs in the kitchen for sale in the restaurant would satisfy the test drat a manufacturing process was
carried on in a part of the premises. If such a manufacturing process is carried on without the aid of any power, the minimum number of workers
that would make the premises a factory is 20. But they should all be ""workers"" as defined by S. 2 (1), Factories Act of 1948.
Every employee in a restaurant may not be a ""worker"" as defined by the Factories Act of 1948. Those employed in the kitchen of the restaurant in
preparing articles for sale would certainly be ""workers"" within the meaning of S. 2 (1). They are persons employed directly in a manufacturing
process. A person employed in cleaning the premises in any part of which a manufacturing process is carried on would also be a ""worker"". But a
person, for example, who merely cleans the tables in the restaurants or washes the used plates may not be a ""worker"". That would not amount to
cleaning the premises where the manufacturing process is carried on, nor would it amount to cleaning any machinery used for the manufacturing
process.
It is only the limited work of cleaning that would bring the person engaged in such cleaning within the definition of ""worker"" in S. 2 (1). Nor would
cleaning, other than washing the premises where a manufacturing process is carried on. and cleaning the machinery used for the manufacturing
process, for example, cleaning tables or plates amount to ""work incidental to or connected with the manufacturing process or subject of the
manufacturing process"".
Waiters and servers in restaurants may not also be ""workers"" as defined by S. 2 (1). They do not ""make"" any of the things they serve. Nor
does the service otherwise come within the scope of the definition of manufacturing process in S. 2 (k). Certainly such work does not come within
the scope of the ""cleaning clause"" in S. 2 (1). Then is it work"" ""incidental to or connected with the manufacturing process or subject of the
manufacturing process"" within the meaning of S. 2 (1)? Food is prepared in a restaurant for sale. That makes the preparation of the food a
manufacturing process.
Section 2 (k) makes it clear that the sale is the object of the manufacturing process. What the statute defines as the objective cannot be said to be
incidental to the process of manufacturing itself. The object of the manufacturing process is a stage different from that of the manufacturing process
itself, and the stage of sale is reached after the manufacturing process has been completed. Nor is service, serving food to customers, connected
with the ""subject of the manufacturing process"". What the section requires is that it should be subject of the manufacturing process and not this
subject of a manufactured process.
A server certainly does not treat or otherwise adopt the article to be sold. He just serves it as it has been made, i.e., as it stands after being
subjected to a process of manufacture. An employee who has to do other work besides serving in a restaurant may or may not be a ''''worker
within the meaning of S. 2 (1), but a person solely engaged in serving customers or in waiting on them not be a ""worker"" within the meaning of S. 2
(1) of the Act.
It is not my intention to exhaust every category of employees in a restaurant and lay down the tests for finding out if he is a ''''worker"" within the
meaning of S. 2 (1). The tests are laid down by the Factories Act of 1948 in Ss. 2 (k) and 2 (1) which have to be read together. I have only taken
illustrative examples to show what the statutory authorities, the Inspector and the Chief Inspector as the -appellate authority, failed to keep in view.
Even if 32 persons in all had been employed in the restaurant, the Central Coffee House and Lodging, that would not by itself make the premises a
factory, though what was done in the kitchen of the restaurant would amount to a manufacturing process. Of those employed in the restaurant at
least ten must be ""workers'''' as defined by S. 2 (1) of the Act, if power was used to carry on the process of manufacturing in any part of the
premises.
If power is not so used, the minimum must be 20 ""workers'''', again as that term ""worker"" has been defined by S. 2 (1). If there is such a minimum
of workers, then the entire premises will be a factory within the meaning of S. 2 (m), whatever may be the number of other employees who are not
themselves ""workers'''' as defined by S. 2 (1) of the Act.
I have already referred to the definition of restaurant in S. 2 (15) of Madras Act 36 of 1947. The learned counsel for the petitioner contended
that the business of supply of refreshments or meals would necessarily involve the preparation of those refreshments and meals, and therefore even
the preparation of foodstuffs would not. attract the provisions of: the Factories Act of 1948, and the establishment would still be only a restaurant
as defined by S. 2 (15) of the Madras Act and not a factory as defined by the Factories Act of 1948. I am unable to accept this contention.
It should be obvious that a given establishment may be a restaurant within the meaning of the Madras Act. It may also be a factory as defined
by the Factories Act. Whether any of the restaurants of the petitioner is a factory has to be decided by the statutory authorities after taking into
account all the relevant considerations. That has not really been done so far.
In - In Re: K.V.V. Sarma, Manager, Gemini Studios, Madras, Govinda Menon J. points out:
If ten or more workers are receiving wages, then each of those departments would be a factory. But if there are any departments in which less than
ten persons receive wages and the rest receive salary as defined by us above, such departments would not be factories within the meaning of the
term.
Though the distinction was between wages and salary, that ten ""workers"" as defined by S. 2 (1) of the Act would be required if any power is used
in a manufacturing process carried on in, any part of the premises is clear. It is with reference to these principles also that the statutory authorities
will have to decide whether any of the restaurants of the petitioner is a factory as defined by the Factories Act of 1948.
The learned counsel for the petitioner contended that no restaurant could be treated as a factory within the meaning of the Factories Act of
1948. He referred to - ''Wood v. London County Council'', 1941 2 KB 232 (238) (B). Mackinnon L. J. observed;
In my view, a kitchen is not within this definition of a ''factory'' because dishes are washed up in it or because articles are altered, finished or
cleaned in it, or because articles are ornamented, as for instance, by providing icing sugar on a cake or parsley as a garniture for dishes. A kitchen
which is carried on in a large way by peoples running a restaurant by way of trade or for purposes of gain would not, by reason of those words,
become a factory within that section.
Those observations were with reference to S. 151, Factories Act of 1937 (Great Britain). The definitions in sub-cls. (k), (l) and (m) of S. 2,
Factories Act of 1948 are not identical with those of S. 151 of the English Act and 1941-2 KB 232 (B), may not therefore be of material
assistance in construing the scope of the clauses of the Factories Act of 1948 referred to above. I should, however, think that these observations
of Mackinnon L. J. in ''Wood''s case (B)'', furnish a very useful guiding principle if the Government have to decide whether a gives restaurant has
to be exempted from the provisions of die Factories Act or from those of the Madras Shops and Establishments Act.
The learned Government Pleader pointed out that in para 8 of the counter it was averred that the persons employed in restaurants were
exempted from the provisions of Madras Act 36 of 1947 under the powers vested in the Government by S. 6 of that Act. The scope of the
exemption is limited. It is not the restaurant itself, that is, the establishment itself, that has been excluded from the operation of the Madras Act.
The exemption is limited to the persons employed in a restaurant as the terms ""persons employed"" and ""restaurant"" have been defined by the
Madras Act. That exemption does not really affect the determination of the only question to which I have addressed myself in this case, have the
statutory authorities correctly decided that any of the eight restaurants owned by the petitioner is a factory within the meaning of the Factories Act
of 1948.
As I have pointed out earlier, the only decision that was placed before me was that of the Chief Inspector of Factories, who confirmed the
order of the Inspector of Factories, that the Central Coffee House and Lodging was a factory. Even that question will have to be decided afresh by
the statutory authorities after taking into account all the relevant factors as I have explained above. A writ of certiorari will therefore issue setting
aside the order of the Chief Inspector of Factories, in which he held that the Central Coffee House and Lodging is a ""factory"" within the meaning of
the Factories Act of 1948.
With reference to the remaining seven establishments of the petitioner, no express decision of the statutory authorities have been placed before
me. I have referred to the averments in the counter-affidavit of the respondent, that the petitioner has taken out licence, under the Factories Act for
the remaining seven establishments also. That, however, should not in the circumstances of this case; preclude the determination afresh of the
question, whether each or any of these seven establishments of the petitioner is a ""factory"" within the meaning of the Factories Act of 1948.
It is open to the petitioner to apply to the statutory authority, the Inspector of Factories, for the determination of that question with reference to
each of the restaurants. The primary duty to decide whether any given establishment, a restaurant, is a factory within the meaning of the Factories
Act of 1948 is that of the statutory authorities.
This petition is allowed to the extent indicated above. There will however be no order as to costs.
Order accordingly.