Skip to content


Col. Sardar C.S. Angre Vs. the State and anr. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtRajasthan High Court
Decided On
Case NumberCriminal Ref. No. 239 of 1963
Judge
Reported inAIR1965Raj65; 1965CriLJ333
ActsFactories Act, 1948 - Sections 2, 6, 92 and 106; Rajasthan Factories Rules - Rule 4
AppellantCol. Sardar C.S. Angre
RespondentThe State and anr.
Appellant Advocate Mohan Lal Joshi, Adv.
Respondent Advocate S.R. Singhi, Adv.
Cases ReferredMangalore v. Inspector of Factories
Excerpt:
.....:your lordships however heard from counsel for the appellants an ingenious argument to support the view that the processes by which goods are frozen, maintained frozen and defrosted amount to an, altering or adapting for sale of the goods within sub-section (1) (c) of section 149 of the factory and workshop act, 1901. it is pointed out that the freezing of some articles of food alters them by destroying tissue therein, that commercially all articles of food are altered by refrigeration in the respect that they cannot afterwards be sold as fresh, and that the several processes of freezing maintaining frozen and defrosting are for the most part carried out in order that the goods may be preserved for sale at some future time or may b it wasfurther pointed out that if a refrigerator was..........sorting out of potatoes. on the basis of the above mentioned; activities carried on at the cold storage premises, it is claimed that the cold' storage constitutes a factory within the meaning of section 2(m) of the factories act. it is further averred that the accused did not obtain a registration., as required by, section 6 of the act and rule 4 of the rules, framed thereunder. it is further stated that the accused petitioners were guilty and punishable under section 92 read with sections 6, 7 and 6i, of the factories act.3. the city magistrate registered the caseagainst the accused petitioners and issued processesfor their attendance. aggrieved by the order ofthe magistrate registering a case and issuing processes the petitioner col. sardar c. s. angre fileda revision application in.....
Judgment:
ORDER

L.N. Chhangani, J.

1. This is a reference by the Sessions Judge, Jodhpur, and arises out of a complaint filed on 7th May, 1963 by B. L. Agarwal, Inspector of Factories and Boiler against Shri I. S. GUI and Col. Sardar C. S. Angre 'Manager and Proprietor respectively of the Jodhpur Cold Storage, Soiatigate, Jodhpur, in the Court of City Magistrate, Jodhpur.

2. The material allegations on which the prosecution is founded are contained in para (3) of the complaint and may be set forth as follows:

That on 11-4-1963 the complainant inspected the premises of the Jodhpur Cold Storage and found that since 27th of August, 1962, the said cold storage had been employing 13 workers for storing potatoes in the cold storage hall maintained with a 35 H. P. Motor Engine and for removing them from the cold storage hall, drying them, grading them and refilling them in the bags. The expression 'grading' has been nsed as the English equivalent of the Hindi word ^^NVok** which implies sorting out of potatoes. On the basis of the above mentioned; activities carried on at the cold storage premises, it is claimed that the cold' storage constitutes a factory within the meaning of Section 2(m) of the Factories Act. It is further averred that the accused did not obtain a registration., as required by, Section 6 of the Act and Rule 4 of the rules, framed thereunder. It is further stated that the accused petitioners were guilty and punishable under Section 92 read with Sections 6, 7 and 6I, of the Factories Act.

3. The City Magistrate registered the caseagainst the accused petitioners and issued processesfor their attendance. Aggrieved by the order ofthe Magistrate registering a case and issuing processes the petitioner Col. Sardar C. S. Angre fileda revision application in the Court of SessionJudge, Jodhpur. The petitioners' case before theSessions Judge was that even on the facts as statedin the complaint the business premises of theaccused-petitioner did not fall within the meaningof the word 'factory' and, consequently, nocharge against him was sustainable. The petitioner also pleaded that the complaint was barredin view of Section 106 of the Factories Act as havingbeen filed after the expiry of three months of thedate of the commission of the offence. Both thecontentions of the petitioner prevailed with theSessions Judge and he came to the conclusion thatno case was made out against the petitioner, Hehas, therefore, made lithe present reference Sonquashing the proceedings.

4. The reference has been opposed by theState. This case came up before a learned singleJudge of this Court on 25th of February, 1964,and the learned counsel for both the parties wantedsome time for putting in affidavits showing precisely the process, that is employed for preservingthe potatoes in the cold storage. H. L. Agarwalthe complainant and Abdul Hafiz Khan, who wasincharge of the said cold storage on behalf of thepetitioner, filed affidavits. On 21st May, 1964,the learned Judge allowed an opportunity to theparties to cross-examine the deponents of both theaffidavits. It was at this stage that the casecame before me. On 13th August 1964, the cross-examination o the persons who filed the affidavitswas completed by me.

5. Now, so far as the factual position is concerned, there is, and can be no controversy whatsoever. The petitioner has approached this Court at an initial stage of the case. His case is that even on the facts as stated in the complaint no case is made out. Naturally, he cannot counter the allegations of facts on which the prosecution relies. It may also be conceded that it is open to the prosecution to suggest further clarification and amplification of the facts, provided they are not altogether foreign to the basic statements made in the complaint. Now, no doubt the affidavits filed by the parties do appear to raise a controversy. The complaint alleges (i) 'That as soon as the bags of potatoes are received from countryside; they are opened in the open field and then sorting of the potatoes is done keeping in view the quality and size. Then the potatoes are packed in the bags and then these bags are loaded in the cold storage room over the racks where the particular temperature is maintained with the help of compressor. (2) That when there is a demand, the required number of bags are removed from the cold stooge in the night. These bags are opened in the open field and again tie sorting is done, keeping in view the quality and size. These potatoes are again packed and the bags are despatched for sale.'

6. The petitioner, however, disputes these allegations. According to him, 'potatoes are not opened or sorted out at any time in the cold storage premises before or after the bags are loaded on to the racks for preservation. According to him, it was only on one occasion that due to breakdown of the cold storage machinery the temperature could not be maintained and consequently the deterioration set in the potatoes. In order to separate the deteriorated potatoes and throw them away and dispose of the usable potatoes that the sorting and refilling the potatoes in the bags had to be resorted to.'

7. However, during the course of arguments, both the parties agreed that for the purposes of the reference, the following activities should be deemed to have been carried on in the cold Storage:

1. That the potatoes when brought from countryside, for preservation, are emptied, sorted, packed again and put on racks.

2. That when required, potato bags are removed and emptied. Potatoes are sorted accord-ing to quality and size and refilled in the bags.

3. That a process of drying is also adopted to remove the moisture that may be collected on the potatoes during the process of refrigeration.

It may, however, be mentioned at this stage that the arguments turned upon the processes of grading or sorting, drying and re-filling after the potatoes had 'been removed from the cold storage racks for use.

8. The question that calls for determination is whether any of the activities carried on in the premises are sufficient to bring the premises within the meaning of 'factory'. Before proceeding further, it will be necessary to set forth the relevant provisions of law bearing on the controversy arising between the parties.

9. The factory has been denned by Section 2(m), of the Factories Act, and reads as follows:

' 'factory' means any premises including the precinct thereof:

(i) whereon ten or more workers are working.or were working on any day of the precedingtwelve months, and in any part of which a manufacturing process is being carried on with the aidof 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 pf power, or is ordinarily so carried on,--

but does not include a mine subject to theoperation of the Mines Act, 1952 (XXXV of 1952)or a railway running shed;'

One of the requirements of the definition is that a manufacturing process should be carried on in the premises sought to be brought within the meaning of; the word 'factory'. The manufacturing process, has been defined in Section a(k) of the said Act. Section 2(k)(i) reads 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'

The other four clauses of Section 2(k) are not relevant for the purposes of this reference and need not be set out.

10. The point for determination is whether any of the processes referred to in Section 2(k)(i) is carried on in the business premises of the accused petitioner. Before the Sessions Judge, the complainant's case was that the process carried on in the accused's premises fall within the expressions 'otherwise treating for adapting any article or substance with a view to its use, sale, transport, delivery or disposal.' In this connection, the complainant relied upon the process of grading or sorting (by whatever name it may be called) and the process of drying.

(11) Dealing with the argument of the complainant with regard to grading; the learned Sessions Judge observed as follows:

'It is argued that gradation of potatoes falls-within the ambit of word 'adapting' as used inthe definition of 'manufacturing process'. I donot think that this is a correct view. AS saidjust above, gradation means only sorting, and inPaterson v. Hunt, (1909) 101 LT 571 it has beersheld that mere sorting of rags will not amountto adapting for sale.'

The learned Judge further observed that the observations made in (1909) 101 LT 571 were considered in Ardeshir v. State of Bombay, AIR. 1962 SC 29. The Sessions Judge also referred to the observations made at page 467 in Grove v. Lloyds British Testing Co. Ltd., 1931 AC 450 in support of his conclusion. As regards the process of drying the Sessions Judge observed that such drying, neither changes the potatoes nor makes them different from what they were. His conclusion was that the potatoes were not given treating on adapting as understood in law. The Sessions Judge also held that the offence must have been committed by the accused Sometime prior to 14th January, 1963 and the complaint having been, filed more than three months after the commission of the alleged offence, was barred under Section 106 of the Factories Act. Reliance was placed in this connection upon State v. A. H. Bhiwandi-walla, (S) AIR 1955 Bom 161.

12. Correctness of the conclusion of the Ses-sions Judge has been challenged by the learned counsel appearing for the State. In the first instance, it was brought to my notice that the Sessions Judge at an initial stage of the judgment referred to some observations made in In re A. M. Chinniale AIR 1957 Mad 755. He invited my attention, particularly to the observations detailed below:

'To sum up, to constitute a manufacture there must be a transformation. Mere labour bestowed on an article even if the labour is applied through machinery, will not make it a manufacture, unless it has progressed so far that a transformation ensues, and the article becomes commercially known as another and different article from thatas which it begins its existence.'

It was urged that this notion of the manufactoring process was the main basis upon which the Sessions Judge was led to the conclusion to which he arrived. The learned counsel contended that the observations made in AIR 1957 Mad 755 are not justified on a proper interpretation of clause (k) of Section 2 of the Factories Act. He pointed out that AIR 1957 Mad 755 came up for comments before the Supreme Court in AIR 1962, SC 29 where the following observations were made:

'The case reported as In re: Chinniah, AIR 1957 Mad 755, is of no help to the appellant as there nothing definite was held about the process carried out to be a manufacturing process or notand what was stated was in connection with the word 'manufacture' in general and not with reference to 'manufacturing process'.'

It is true that the decision in AIR 1957 Mad, 755 depended upon the dictionary meaning of 'manufacture' and not upon the consideration of the definition of the manufacturing process. In the circumstances, the Madras case in AIR 1957 Mad 755 cannot be of much assistance in determining the controversy raised in the present case. That 'however, does not conclude the matter. The Sessions Judge directly or indirectly seeks support for his conclusion from the observations of certain English cases and their approval by the Supreme Court in AIR 1962 SC 29.

13. This brings me to the consideration of the case, AIR 1962 SC 29. In that case the question was whether the processes carried out in salt works in converting the sea water into salt came within the manufacturing process, and the decision of the Supreme Court was that the sea water a non-commercial article, has been adapted to salt a commercial article. In arriving at the decision, their Lordships referred to certain observations made in Sedgwick v. Watney, Combe, Reid and Co. Ltd., 1931 AC 446 at p. 463, and also in 1931 AC 450 at p. 467 and in Kaye v. Burrows, 1931 AC 477 at p. 484 to support their decision. Their Lordships also noticed several English and Indian cases including AIR 1957 Mad 755 and 1909-101 LT 571 relied upon by the Sessions Judge and distinguished them. It will be significant to notice from the judgment in AIR 1962 SC 29 that their Lordships did not formulate any precise-test for determining the question whether a particular process can be a manufacturing process or not. Indeed the definition of the 'manufacturing; process' is worded in most wide and flexible terms and that it will be a futile attempt to prescribe any test and thus to limit the flexibility. A, search for an uniform test in English cases will also be in vain. These cases may, however, be noticed as they do afford guidance in determining the question of the present type by indicating the modes of approach.

14. The first case noticed by the Supreme Court was 1931 A. C. 446. There the conclusion was summed up by these words:-

'But the point is whether the treatment that the beer undergoes in these premises is a mereprelude to distribution. I am clearly of opinion that it is not. The finished article that is beingprepared for distribution is bottled beer. It under goes treatment a treatment which changes its quality and makes it from an unpotableand unmarketable article into a potable and marketable one.'

Emphasis clearly was on the treatment whichintroduces changes in the quality and made aunpotable and unmarketable into a potable andmarketable one. The treatment obviously was tobring the process employed within the meaningof the ' 'manufacturing process''.

15. In another case, 1931 A. C. 450 (466) the words, 'adapting for sale' were commented upon as follows:

'I think 'adapting for sale' points clearly to something being done to the article in question which, in some way, makes it jn itself a little different from what it was before.' .

In this case, the test was whether the article afteremployment of the manufacturing process wasdifferent from what it was before.

16. Another test that may be applied has been indicated in 1931 A C 477, where it was observed as follows:-

'The test js just as it was in the bottled beer case. You must look at what is the finished arti-cle to be turned out. If that finished article, is only put into the condition of a finished article by the processes to which it has been subjected in the hereditament, then the processes will fall within the expression 'altering or adaptation for sale.' '

In this case the guiding principle kept in view, was whether the finished article is put into the condition of finished article by the process to which it had been subjected.

17. These three cases indicate the various considerations that should be kept in view in determining the question whether a process can be considered a manufacturing process. (1909) 101 LT 571 relied by the Sessions Judge was also noticed by the Supreme Court, and it was not held applicable to the facts of the case before the Supreme, Court. Incidentally, it may be pointed out that the authority of the decision in (1909) 101 LT 571 in so far as liable to be interpreted, as laying down the proposition of wider term appears to have been considerably shaken. In 1931 A. C. 477 the learned Judge stated as follows:-

'In that case it was held by Lord Alverstone and Lord' Darling that sorting rags was not an adaptation for sale, and consequently premises where rag sorting was carried on were not a factory. It is left doubtful by the report whether what was done there was at all the same complicated process as was done in the rag case here. If the operation was not the same then the case does not apply. If it was practically the same, then it is not binding on your Lordships, and I may say that it was wrongly decided.'

18. In determining whether a particular process is a manufacturing process or not, reference may also be made to the following observations in G. R. Kulkarni v. The State, AIR 1957 Madh Pra, 45:--

'It is obvious enough that the process of manufacture from one article to another changes and there are so many different processes in existence that to take the analogy of any single manufacturing process is likely to cause confusion. It is better therefore to apply one's mind to the exact process employed by which one article is shaped into another and to see whether the purposes of the Act are satisfied.'

These observations have been in connection with the interpretation of the provisions of the Sales Tax Act but they are of general nature and do certainly deserve notice even when interpreting the definition of 'manufacturing process' in the Factories Act, specially as the definition is in flexible-terms and requires to be interpreted.

19. Reference may also be made to the observations in Union Cold Storage Co. Ltd. v. Bancroft, 1931 A C 447 (488) where the flexibility of the definition was brought out in the following terms: --

'It may be difficult or impossible to identify, the essential quality of the operation described in Section 149 of the Factory and Workshop Act, 1901, 'as the 'adapting for sale of any article,' nor in pay view is it necessary for the purposes of this case to do so.'

20. The only ultimate conclusion that can be and should be reached is that no definite or, precise test can be prescribed for determining the question whether a particular process is a manufacturing process. Each case must be judged on its own facts regard being had to the nature of the processes employed, the eventual result achieved and the prevailing business and commercial notions of the people. Guidance may also be had from the decided cases. Examining the case in the light of the considerations indicated above, it cannot be laid down as a rule that in no case grading or sorting will be a manufacturing process. If the gradation or the sorting is with a view to bring into existence standardised goods of a particular category or variety saleable as such, I do not see any difficulty in treating grading or sorting as a manufacturing process. If, on the other hand, grading is only casual and is not done with a view to achieve the object indicated earlier, grading will not be a manufacturing process. In the present case, what I find is that the grading referred, to in the complaint is of a casual nature. It was not suggested in the complaint that potatoes were graded to be converted into standardised goods of particular categories so that they become different kinds of marketable potatoes. In this view of the matter, I agree with the Sessions Judge that the grading in the present case is not a manufacturing process.

21. Taking up the process of drying, I think, the view taken by the Sessions Judge is also correct and that the process of drying as employed in the accused's premises which consists merely in removing the moisture collected during the process of refrigeration, cannot amount to a manufacturing process. The process of drying has also to be considered in relation to the adaptability of the article for sale or use. In the present case the process of drying is adopted only to remove the moisture collected during the process of refrigeration and not with a view to adapt the potatoes for sale. In other words, it cannot be said that the process is necessary for making the potatoes I saleable as such. The process of drying also in this view of the matter, cannot be considered a manufacturing process.

22. Mr. Singhi raised an additional argument to support the complainant's case that some manufacturing process was carried on in the accused's premises. He urged that the very process of keeping the potatoes under a process of refrigeration should be treated as a manufacturing process, inasmuch as such a process should be considered as amounting to adapting potatoes to sell. It was pointed out that by this process the potatoes which otherwise could not be available for sale in an of season, are made available. It will be interesting in this connection to refer to 1931 A C 447. It will be better to extract the relevant observations from the judgment referring to an argument similar to one raised in the present in an elaborate manner and the decision thereon :--

'Your Lordships however heard from counsel for the appellants an ingenious argument to support the view that the processes by which goods are frozen, maintained frozen and defrosted amount to an, altering or adapting for sale of the goods within Sub-section (1) (c) of Section 149 of the Factory and Workshop Act, 1901. It is pointed out that the freezing of some articles of food alters them by destroying tissue therein, that commercially all articles of food are altered by refrigeration in the respect that they cannot afterwards be sold as fresh, and that the several processes of freezing maintaining frozen and defrosting are for the most part carried out in order that the goods may be preserved for sale at some future time or may be made capable of transport to a distant market, or having been preserved frozen for a future market, may by defrosting be made available at the appropriate time for that market.

Upon this it is contended that the processes are really processes by which the goods are adapted for sale, even if not altered in the freezing or defrosting processes, because without the application to the goods of the appropriate process OB processes they could not be sold in the particular market for which they are destined by their owners.

It may be difficult or impossible to identify the essential quality of the operation described in Section 149 of the Factory and Workshop Act, 1901 'as the adapting for sale of any article,' nor in my view is it necessary for the purposes of this case to do so.

The phrase was probably introduced to secure somewhat more flexibility than, is to be found in the immediately preceding terms--namely, 'the altering, repairing, ornamenting or finishing of any article'--but it cannot in my judgment be stretched to cover the processes carried on by the appellants in the circumstances set out in the special case.'

23. Reference may also be made to New Taj Mahal Cafe Ltd., Mangalore v. Inspector of Factories, Mangalore, AIR 1956 Mad 600. In thatcase a question arose whether a premises, wherein,a refrigerator worked by electric power was being,used, was a factory or not. The learned Judgesheld that having regard to the fact that the refrigerator was used only for storage, that as suchwould not constitute a 'manufacturing process' asdefined in Section 2(k) of the Factories Act. It wasfurther pointed out that if a refrigerator was usedfor treating, or adapting any article with a view toits sale, then the test required by Section 2(k) wouldbe satisfied. The essential question to be considered is whether the cold storage is used primarily,for the purposes of storage or is used for bringing.into existence commodities which may be treatedas commercially different from what they were atthe time they entered the premises. In the presentcase, the cold storage appears to be used onlyfor storage purposes and there is nothing in thecomplaint to suggest that the refrigeration waswith a view to the adaptation of the potatoes totheir sale.

24. An argument was also addressed that filling of the potatoes into bags should be equated with the packing of articles. The argument, in my opinion, does not merit serious consideration. It is not the complainant's case that re-filling is done with a view to their sale in specific quantities or in bags of specific sizes. The process of emptying the potatoes from' the bags for the purposes of placing them in the cold storage and subsequently re-filling them in bags are done only casually and not with a view to adapting them for sale etc.

25. It was also suggested that the various, processes taken together may amount to a manufacturing process. It may be conceded that in dealing with the question whether a particular business premises can be treated as a factory or not, it will not be proper to view individual processes in isolation and it is necessary that the cumulative effect of all the processes must be taken note of in determining the question. How-ever, in the facts and the circumstances of the present case clearly brought out while dealing with the 'complainant's case relating to individual processes, I am not persuaded to accept the argument on behalf of the complainant that the various processes taken together have the effect of bringing the accused-petitioners business premises into the category of a factory. The conclusion of the Sessions Judge that no manufacturing process is carried out by the accused petitioner in his premises is correct and calls for no interference.

26. I now take up the second ground relied upon by the Sessions Judge. The Sessions Judge has held that the failure of the accused to apply for registration and to give notice of occupation were not a continuing offence and, therefore, the prosecution in respect thereof launched after more, than three months was barred by limitation under, Section 106 of the Factories Act.

27. So far as the above statement goes, the Sessions Judge is correct and is supported by some observations of Bombay High Court in (S) AIR 1955 Bom 161. It however, appears that the Sessions Judge seems to have simplified the position. The Complainant's complaint was In essence in respect of the conduct of the business by the accused, without obtaining a license. Conduct of such a business is a continuing offence and the prosecution cannot be barred by limitation. The Sessions I Judge did not appear to have considered the sub-sequent observations in the judgment of the Bombay High Court in (S) AIR 1955 Bom 161. Referring to the latter defaults as contrasted with the initial defaults, Gajendragadkar J. as he then was, observed as follows; --

'In regard to the latter default, we feel no hesitation in holding that his conduct in using the premises from day to day without obtaining a licence is a continuing offence. Every time the premises are thus used as a factory, a fresh offence is committed, and no bar of limitation can, therefore, be pleaded against this charge.'

The learned Judge in support of his conclusion referred to various cases in relation to commission of continuous offence. Be that as it may, the reference succeeds on the first ground relied upon by the Sessions Judge.

28. The reference is accepted, the order of the City Magistrate dated 7th May, 1963 is set aside and the proceedings are quashed.

29. Mr. Singhi prays for leave to appeal Supreme Court. The prayer is rejected.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //