1. In this first appeal an interesting question of law has been raised by the appellant.
2. M/s. Gateway Auto Services is a firm registered under the Indian Partnership Act having its office at Apollo Pier Road, Bombay-1. The said firm is hereinafter referred to as the appellant. The appellant supplies petroleum products such as fuel and lubricants to its customers and undertakes lubrication service of motor vehicles. The establishment was purchased by the appellant with effect from June 15, 1968 from its then owners M/s. Bombay Garage Private Limited, Chowpaty, Bombay. It is also no more in dispute that the appellant-establishment is also registered under the provisions of the Bombay Shops and Establishments Act, 1948.
3. The officer of the Employees' State Insurance Corporation visited the establishment of the appellant and found that the total number of employees working under the direct control and supervision of the appellant exceeds 20. According to the officer of the Corporation the appellant establishment is a 'factory' within the definition of the word 'factory' defined in the Employees' State Insurance Act, 1948 - hereinafter referred to as the Act. The Corporation, therefore, called upon the appellant to pay the necessary employer's special contribution as well as the employees contribution fund as required under the law.
4. On receipt of the notice, the appellant failed to comply with this notice and, therefore, the recovery proceedings commenced under S. 45B of the Act. The appellant aggrieved by this recovery proceeding filed an application under S. 75 of the Act challenging the right of the Corporation to recover any contribution. This application under S. 75 of the Act was made to the employees' Insurance Court at Bombay. The main allegations of the appellant in the said application are that its establishment is not covered by the definition of the word 'factory' given under the Act and, therefore, the appellant is not liable to pay any contribution under the Act. According to the appellant its establishment supplies petroleum products such as fuel and lubricants to its customers and undertakes lubrication service of motor vehicles. Such services do not involve any manufacturing process and, therefore, the establishment cannot be said to be an establishment carrying on manufacturing process at its establishment. According to the appellant the establishment is registered under the provisions of the Bombay Shops and Establishments Act, 1948, and, therefore, the provisions of the Employees' State Insurance Act, are not applicable to the appellant. The provisions of the Act are applicable to all factories as defined in S. 2(12) of the Act. No activity in the establishment is carried on with the aid of the power. It is also alleged by the appellant that the appellant does not use the power either manufacturing or for processing or for adapting or otherwise treating any article or substance but is merely used to drive compressors which supply compressed aid for operating service hoists and pressure and oil pray guns used in lubrication services and for apply of petrol. So far as the petrol services are concerned, it is alleged by the appellant that the process of pumping with the aid of power is used merely to pump out petrol for delivery and sale. The petrol is pumped out from the underground storage tanks in which it is stored for the sake of convenience and safety. This process of pumping is not a process in itself being carried on as a substantial activity and is further not intended to aid the adoption of the petrol for use or disposal. The appellant further alleged that in the lubrication service department only 14 employees are working. Having regard to this number it cannot be said that the provisions of the Act are applicable. So far as the office and fore court room is concerned, 25 parsons are employed but they are not concerned with the manufacturing process and, therefore, they cannot be covered by the definition of the word 'factory' in the Act. It is also averred by the appellant that in view of the provisions of S. 77 of the Act, the Corporation is not entitled to recover the arrears of contribution, for more than three years. The appellant, therefore, submitted that it be declared that the notice issued by the Corporation and the Collector in respect of the recovery of the contribution amount is void and illegal and the Corporation cannot recover such contribution from the appellant.
5. The Corporation contested the present proceedings and denied the allegations of the appellant. According to the Corporation the establishment of the appellant is fully covered by the definition of 'factory' given in the Act. At the relevant time when the Inspector visited the premises of the appellant it is found that the service station as well as the petrol pump were carrying on their activities with the aid of the power. The service station as well as the petrol pump are fully covered within the definition of manufacturing process given as in the Indian Factories Act, 1948 and, therefore, the appellant is a factory and covered by the provisions of the Act. The Corporation also denied that the total number of employees working at the establishment of the appellant is less than 20. According to the Corporation the number of employees exceeds 20. The Corporation also averred that the plea of limitation is false and cannot be sustained in view of the provisions of the Act. The Corporation, therefore, submitted that the application be rejected.
6. The learned trial Judge framed as many as 6 issues. Both the parties led oral and documentary evidence in support of their respective claims. On appreciation of the oral and documentary evidence the learned Judge of the Employees' Insurance Court, Bombay, by his order dated March 26, 1974 in Application No. 89 of 1972 dismissed the application filed by the appellant.
7. Aggrieved by that order, the appellant has filed this first appeal to this Court under S. 82 of the Act.
8. It is no more in dispute that unless substantial question of law is made out in the appeal, the appeal shall not be entertained by this Court. Mr. Damania, the learned counsel appearing on behalf of the appellant formulated the following questions of law and according to him it is a substantial question of law and, therefore, the appeal is fairly and squarely maintainable to this Court.
9. Question : The manufacturing process must be a process designed to treat or adapt the article or substance in which the appellant is dealing. Making, altering, etc., are the species of treatment and adoption. The articles sent to the appellant's establishment do not receive any treatment or adoption. According to Mr. Damania the Corporation must show that some manufacturing process or activity is carried on by the appellant's establishment and in the absence of such evidence, it cannot be held that the appellant's establishment carries on any manufacturing process.
10. It is not disputed before me that there are two departments in the establishment of the appellant : (1) service station; and (2) petrol pump. It is also no more in dispute that both these departments are under the direct control and supervision of the appellant. It is no more in dispute that the total number of employees in both the departments exceeds 20. It is also undisputed that so far as the service station is concerned, with the aid of the power the vehicle has got to be hoisted. Therefore, part of the lubrication work is undoubtedly done with the aid of the power. So also the petrol pump where the petrol is pumped out from the under-ground storage tanks is operated with the aid of the power in order to deliver it to the customers. It is, therefore, clear that in both these activities the power is used by the appellant-establishment. On these admitted facts, I will now proceed to consider the submission of Mr. Damania raised before me.
11. Before I deal with the question of law posed for my consideration I may refer to certain definitions as well as the meaning of the words used in these definitions.
12. Section 2(12) of the Act defines the word 'factory' meaning any premises including the precincts thereof where on twenty or more persons are employed or were employed for wages 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 but does not include a mine subject to the operation of the Mines Act, 1952 or a railway running shed.
13. This definition uses the word 'manufacturing process'. This word is, however, not defined under the Act. But for the purpose of this definition we have to go to the definition given in the Factories Act, 1948. Section 2(k) defines the 'manufacturing process' as follows :
''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, print by letter press, lithography, photogravure or other similar process or book binding;
(v) constructing, reconstructing, repairing, refitting, finishing or breaking up ships or vessels;'
'The main argument of Mr. Damania centres around the definition of the word 'manufacturing process.' According to Mr. Damania so far as the appellant-establishment is concerned washing, cleaning or oiling is done to the article or substance with a view to its use, sale, transport, delivery or disposal. According to him no change whatsoever takes place in the establishment of the appellant so far as the article is concerned. The article is neither treated nor adapted but on the contrary the article is returned to the customers in the same form in which it was given to the appellant, for the purpose of service. According to Mr. Damania, manufacturing process means any process for cleaning, washing, oiling or otherwise treating or adapting any article or substance. The emphasis is laid on the words, 'treating or adapting.' According to him adapt means to make suitable to the requirements or conditions; adjust or modify fitting. Mr. Damania strongly relied upon the dictionary meaning of the words given in the Random House Dictionary. The word 'adapt' is found at page 16 to me as to make suitable to requirements or conditions adjust or modify fittingly.
14. The word 'treat' is defined by the very same dictionary at page 1509 to mean to subject to some agent or action in order to bring about a particular result.
15. The word 'article' is also defined in the said dictionary at page 85 to mean an individual thing, member or portion of a class, an item or particular.
16. The word 'substance' is defined at page 1418 to mean that of which a thing consists; matter or material; a species of matter of definite chemical composition.
17. The word 'process' is also defined at page 1147 to mean a systematic series of actions directed to some end; a continuous action, operation or series of changes taking place in a definite manner.
18. Relying upon these definitions, it is firstly submitted by Mr. Damania that the Corporation has not shown by any evidence that so far as the appellant-establishment is concerned it adapts or treats the article which is given for service. So far as the activities of the service station are concerned no adaptation whatsoever is carried out there. The vehicle is brought to the service station. It is hoisted on the ramps in order to facilitate the proper lubrication. The greasing is also done to the vehicles. In all this process according to Mr. Damania there is no adaptation. There is neither any adjustment, modification, fitting or to make the car suitable to the requirements. No skill whatsoever is necessary in order to do the lubricating job. He, therefore, submitted that having agreed to the plain meaning of the words 'adapt' it cannot be said that the service station of the appellant carries on adapting any article or substance brought to the appellant-establishment.
19. It is next urged by Mr. Damania that the word manufacturing process is used in S. 2(k) of the Factories Act to mean that the article which is sent to the appellant-establishment is subject to some agent or action in order to bring about a particular result. No particular result whatsoever is brought out by reason of the lubrication service. According to Mr. Damania manufacturing process means any process for washing or otherwise treating or adapting any article or substance or cleaning or otherwise treating or adapting any article or substance. He wants to join the ending portion of the section with each of these words used in that section in the earlier part to convey the meaning of manufacturing process. But, in my opinion, it would be incorrect to read in the manner in which Mr. Damania wants to read that definition of the words manufacturing process. In fact in this definition each of the words has got independent meaning and which itself constitutes the manufacturing process, making, altering, repairing, ornamenting, finishing, packing, oiling, washing, cleaning, breaking up, demolishing. If none of the activities are covered by these words than the Legislature has in its wisdom intended to cover any such other activities by extending the definition as otherwise treating or adapting any article or substance with a view to its use, transport, delivery or disposal. In my opinion, washing, cleaning or oiling is not necessary for treating or adapting any article. Treating or adapting any article has to be independently read. Therefore, on plain reading of S. 2(k), it would mean that whenever a vehicle is brought by the customer for washing, cleaning, oiling with a view to its use, sale, transport, delivery or disposal, such activity must fall within definition of manufacturing process. Even the dictionary meaning of the word 'adapt' would suggest to mean to make it suitable to the requirements or conditions, adjust or modify. Whenever the vehicle comes to the establishment of the appellant for washing, cleaning and oiling the same is kept ready for delivery after completing all these activities to the customers. In my opinion, therefore, the definition of word 'manufacturing process' means any process such as washing, cleaning and oiling in respect of the vehicle which is brought to the establishment of the appellant for making ready for delivery after the necessary process is undertaken, and such activities would be covered by the Act.
20. According to Mr. Damania the words 'adapt' and 'treat' are purposely used in this defining clause in order to mean that article or item which comes to the establishment must undergo a change or modify fittingly or adjust. In order to substantiate this contention Mr. Damania strongly relied upon the judgment of the Andhra Pradesh High Court reported in Kotecha v. Regional Inspector of Factories, 1958 I L.L.J. 74.
21. A direct question arose before the Andhra Pradesh High Court as to the meaning of the word, 'manufacturing process' given in S. 2(k) of the Factories Act. In that case the appellant was a ghee dealer and he used to purchase ghee which was collected and brought by various intermediaries not only from the various talukas of the Guntur district but also from the neighbouring districts such as Cuddapah, Kurnool, Nellore and Krishna. The ghee thus collected was heated and poured into tins which were sealed. The sealed tins were then sent to the head office for sale. The question that arose before the Andhra Pradesh High Court was as to whether the process carried on in the premises constituted manufacturing process within the meaning of S. 2(k) of the Act, While interpreting the word, 'adapting' the Andhra Pradesh High Court relied upon the dictionary meaning of the word 'adapting' given in the Oxford Dictionary as, 'making fit or making suitable.' While applying this definition the Andhra Pradesh High Court held that the appellant-establishment is covered by the definition of the word 'factory' used in S. 2(12) of the Act. The final judgment of the Andhra Pradesh High Court is although against the appellant but Mr. Damania. strongly relied upon the reasoning given in this judgment. He strongly urged before me that adapting, means making fit or making suitable. The ghee which was brought from various villages was after applying certain manufacturing process made it fit or suitable. Therefore, there must be some process which must be applied to the item or article before making it fit or making it suitable. Mr. Damania submits that in the present case no evidence has been brought by the Corporation to show that the establishment of the appellant undertakes any such process or adapt which would be making fit or making suitable, the use of the article. According to him the article belongs to the customer. He brings it to the establishment of the appellant where without making any change in the article, the same is returned after washing. I do not think that such a narrow interpretation is possible as sought to be given by Mr. Damania. According to me adapting means making fit or making suitable. There may not be an actual sale but at the same time the appellant charges for this process, namely, adapting or making fit or suitable, the use of the article. The facts of the judgment of the Andhra Pradesh High Court are altogether different and I do not think that the reasoning given by that Court would be applicable to the present case. As stated earlier the service station undoubtedly offers washing service as well as oiling and cleaning service in order to make the article fit or suitable for use. Thus having regard to the interpretation of the phraseology 'manufacturing process' used in S. 2(k). I have no doubt in my mind that the service station does carry on a manufacturing process in the form of washing, cleaning, oiling otherwise treating any article with a view to its use and delivery to the customers. Such activities are, therefore, covered by the definition of the word 'manufacturing process.'
22. Mr. Damania then strongly relied upon the judgment reported in V. Mohammed Haneef & Co. v. Employees' State Insurance Corporation, Madras, : (1969)ILLJ586Mad , to show that no manufacturing process is carried on at the appellant's premises. In this judgment the question that fell for consideration before the Madras High Court was as to whether could it be said that the manufacturing process is being carried on with the aid of power merely because the water is utilized in the process lifted by power from a well before it is taken through channels or pipes to the tannery premises. The question before the Madras High Court was as to whether the manufacturing process in tannery premises is being carried on with the aid of power. The requirement of the definition is not that power must be used in any part of the premises where the process is carried on. The essential postulates that power must be used in aid of the manufacturing process. The pumping of water has little to do with the manufacturing process. The pumping of water by power is not incidental to the tannery process carried on with the tannery premises. The main activity must be connected or must be identical part of the activities which is carried on with the aid of power. I have gone through the entire judgment and I find that the facts of our case are altogether different from the facts of that case. I, therefore, do not see that the principles laid down in this judgment are applicable to the present case. Admittedly in the case before me the power is used in order to drive compressors which supply compressed air for operating service hoists, oil spray guns, in lubrication service and for supply of petrol. The activities of such services are directly with the aid of power and they are not with manual labour.
23. Mr. Damania then strongly relied upon the judgment in Law v. Graham,  2 K.B. 327. The question that arose before the King's Bench Division was in respect of a factory and what is the meaning of the words premises used for adapting articles. In that case, the respondents were carrying on a business of beer in wholesale as well as retail. With the aid of the power washing of the bottles was carried on but so far as bottling of beer was concerned it was done by manual labour and, therefore, admittedly bottling of the beer was not done with the aid of the power, and while ion interpreting cls. (a), (b) and (c) of sub-s. (3) of S. 93 of the Factory and Workshop Act, 1878, it is held that bottling of beer is not a process incidental to the making of an article or part of an article within clause (a) nor to the altering, repairing, ornamenting or finishing of any article within clause (b). No adapting or altering or finishing, etc., is done by mechanical power but the entire work of bottling the beer was done with manual labour and, therefore, the total effect was that it is not covered by the Factories Act. In my opinion, the aforesaid judgment will not assist the appellant.
24. Thus having regard to all these relevant provisions of law it is clear to me that the service station does carry on a manufacturing process and the same is covered by the definition given in S. 2(k), and, therefore, it is a factory within the definition of the Act.
25. The next limb of the argument of Mr. Damania is that the petrol pump would not be covered by the definition of 'manufacturing process' given in S. 2(k) of the Act. Firstly, he submitted that they do not pump oil. According to Mr. Damania the appellant-establishment is a dealer in petrol and not in oil and, therefore, sale of petrol cannot be covered under S. 2(k) of the Factories Act. This submission of Mr. Damania is without any substance. The word 'oil' is defined in the Random House Dictionary at page 1001 to mean petroleum. Therefore, it is clear that pumping of the oil means pumping of the petrol and, therefore, it is clearly covered under clause (k) of S. 2 of the Factories Act.
26. It is next urged by Mr. Damania that so far as the petrol pump activities are concerned in fact they act as agent or retailer inasmuch as the petrol is stored in the under ground tanks and as and when the customers come they lift the petrol and fill in the tanks of the vehicles. Thus having regard to these activities it cannot he said that they come within the definition of 'manufacturing process.' I do not see that this argument is tenable at all. The fact that pump is installed on the petrol tank and with the aid of the power the petrol is lifted and poured into the tanks of the vehicles, this activity undoubtedly is an activity covered by the definition of the words 'manufacturing process.' A similar question had arisen before this Court for consideration in the case of Laxmibai Atmaram v. Bombay Port Trust, (55) BomLR 924, and this Court held that the activities of the pumping of the water are covered by the definition of 'manufacturing process' under the Factories Act. Thus having regard to the principles laid down in this judgment I have no doubt in my mind that the petrol pump of the appellant-establishment is covered as defined in S. 2(k) of the Factories Act.
27. So far as the evidence led by the parties is concerned, I do not think that it is necessary to refer to the same in detail. But, however, I may make a passing reference to the same. On behalf of the appellant-establishment one Nilkanth Annekar is examined. On behalf of the Corporation three witnesses were examined. The appellant also sought to rely upon the affidavit of Nilkanth Annekar which was filed in this case. From his evidence it is clear that the appellant-establishment carries on the business of supplying petroleum products and also lubrication service at its premises. The evidence of this witness shows that there are in all 24 employees working under the direct control and supervision of the appellant. In view of this admitted position if we look at S. 2(12) of the Act which defines the word 'factory' it is clear that the appellant-establishment is covered by the provisions of the Act. I do not think it necessary to refer to the evidence of the witnesses examined on behalf of the Corporation.
28. In the result, the appeal fails and the same is dismissed with costs.