BANGALORE TURF CLUB LTD. versus REGIONAL DIRECTOR, ESI CORPORATION

Citation: [2009] 7 S.C.R. 106 · Decided: 28-04-2009 · Supreme Court of India · Bench: MARKANDEY KATJU, H.L. DATTU · Disposal: Matter referred to larger bench
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Judgment (excerpt)

A 
B 
[2009] 7 S.C.R. 106 
BANGALORE TURF CLUB LTD. 
V. 
REGIONAL DIRECTOR, ESI CORPORATION 
Civil Appeal No. 2416 of 2003 
APRIL 28, 2009 
(MARKANDEY KAT JU AND H.L. DATTU, JJ.) 
EMPLOYEES' STATE INSURANCE ACT, 1948: 
s. 1 (5) - 'Shop' - Turf Club - Held: Is not 'shop' - Besides, 
c uls 1 (5) only such establishments are covered as are notified 
in official gazette - Decision in Hvderabad Race Club requires 
reconsideration - Matter referred to larger Bench. 
D 
E 
Employees State Insurance Corpn. Vs. Hyderabad 
Race Club 2004 (6) SCC 191 - referred to. 
Bangalore Water Supply & Sewerage Board Vs. 
A. Rajappa & Ors. 1978 (2) SCC 213 - held inapplicable. 
Case Law Reference 
referred to 
para 3 
2004 (6) sec 191 
191s (2) sec 213 
held inapplicable para 3 
CIVILAPPELLATE JURISDICTION: Civil Appeal No. 2416 
of 2003 
F 
From th~ Judgement and Order dated 04.09.2002 of the 
Hon'ble High Court of Karnataka at Bangalore in MFA No. 3699 
of 1998 
WITH 
G 
Civil Appeal Nos. 49 of 2006 
Civil Appeal Nos. 1575 of 2006 
K.K. Venugopal, J.P. Cama (NP), C.S. Rajan, B.C. 
Prabhakar, Kanika Gamber, Rajeshwari Shukla, Gopal 
H 
106 
• 
BANGALORE TURF CLUB LTD. V. 
107 
REGIONAL DIRECTOR, ES! CORPORATION 
... 
Sankaranarayanan, R. K. Dubey, Rajan Narain, Ruby Singh A 
Ahuja, Gobindram D. Talreja, Simran Brar,Abeer Kumar, Manik 
' 
Karajawala, Anupam Mishra, V. J. Francis, with them for the 
"\ 
appearing parties. 
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The following order of the Court was delivered : 
8 
Heard learned counsel for the parties. 
• 
The short question involved in these cases is whether the 
appellant Turf Clubs are covered by the Employees' State 
Insurance Act, 1948 {for short the 'ESI Act'). 
c 
Under Section 1 sub-section (5) of the ESI Act all 
establishments are not automatically covered by the said Act 
but only such establishments as are mentioned in the notification 
-\ 
issued by the appropriate Government under Section 1 (5). This 
provision is not like sub~section (4) of Section 1 by which all D 
factories are automatically covered by the ESI Act. The 
notifications issued under Section 1 (5) in these cases use the 
' 
word 'shop' and it has been held by the impugned judgments in 
these cases that the turf clubs are shops. Reliance in this behalf 
has been placed on the judgment of this Court in the case of. E 
Employees State Insurance Corpn. Vs. Hyderabad Race Club 
2004 (6)SCC, 191. 
j, 
With great respect to the aforesaid decision in the case of 
Hyderabad Race Club (supra), we think that the s9id decision 
F 
requires reconsideration. In common parlance a club is not a 
shop. 
~~ 
The wo!d 'shop' has not been defined either in the ESI Act 
' 
nor in the notification issued by the appropriate government 
under Section 1(5). Hence, in our opinion, the meaning of 'shop'· G 
t 
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~ · H 
108 
SUPREME COURT REPORTS 
[2009) 7 S.C.R. 
A club is not a shop within the meaning of the Act or the notification 
/> 
issued by the appropriate government. 
In our opinion, the error in the judgment in the case of 
Hyderabad Race Club (supra) is that it has been presumed 
f 
B 
therein that all establishments are covered by the Act. That is 
not correct. Only such establishments are covered as are 
notified under Section 1 (5) in the official gazette. 
The High Court in the impugned judgment has placed 
reliance on the judgment of this Court in the case of Bangalore 
c Water Supply & Sewerage Board Vs. A. Rajappa & Ors.1978(2) 
SCC, 213. In our opinion,reliance on the aforesaid decision is 
wholly misplaced. The definition of 'industry' in the Industrial 
Disputes Act is very wide as interpreted in the aforesaid 
decision. We cannot apply the judgment given under a different 
D 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). It is only where the language used in the definition is in pari 
' 
E 
materia that this may be possible. 
Hence, we are of the opinion that the decision of this Court 
in the case of Hyderabad Race Club (supra) should be 
reconsidered by a larger Bench. In the meantime, the • 
respondents shall not raise any demand against the a
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