The two-judge bench of the Supreme Court has referred to a larger bench the controversy regarding the definition of the word shop under the Employees State Insurance (ESI) Act, 1948.
A bench comprising Justices Markandey Katju and H L Dattu in their order held that Bangalore Turf Club limited was not a shop within the meaning of the ESI Act.
The apex court in its judgment noted ‘the word shop has not been defined either in the ESI Act nor in the notification issued by the appropriate governments under Section 1(5).
‘Hence in our opinion, the meaning of shop will be that used in common parlance. In common parlance when we go for shopping to a market, we do not mean going to a racing club.
‘Hence prima facie, we are of the opinion that the appellant club is not a shop within the meaning of the act or the notification issued by the appropriate government.’ The apex court in its order further noted that Hyderabad Race Club judgment deserved reconsideration by a larger bench as ‘We cannot apply the judgment given under a different act to a case which is covered by the ESI act. Under various labour laws, different definitions have been given to the words industry or factory etc and we cannot apply the definition in one act to that in another act (unless the statute specifically says so).’ The apex court in its order noted, ‘hence, we are of the opinion that the decision of this court in the case of Hyderabad Race Club should be reconsidered by a larger bench. In the mean time, the respondents shall not raise any demand against the appellant club.
‘Let the papers of these cases be placed before honourable Chief Justice of India for constituting an appropriate bench.’ The apex court delivered the order on the appeal filed by Bangalore Turf Club limited against the order of Karnataka High Court which had held that regional director, ESI, had rightly treated the club as a shop.
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