LIPTON INDIA LIMITED Vs. STATE OF WEST BENGAL
LAWS(CAL)-1983-7-7
HIGH COURT OF CALCUTTA
Decided on July 14,1983

LIPTON (INDIA) LIMITED Appellant
VERSUS
STATE OF WEST BENGAL Respondents

JUDGEMENT

Manashnath Ray, J. - (1.) Although this Rule which was obtained on 23-12-1977, challenging a notification dated 12-2-1975 under Section 2 (13), West Bengal Shops & Establishments Act, 1963 (hereinafter referred to as the said Act) and the validity of certain provisions of the said Act and the Rule was made ready as regards service on 6-9-1968, Nobody has either appeared for the respondents or taken any steps to file any affidavit-in-opposition on behalf of them. It should be noted that while issuing the Rule, there was an interim order made, restraining the respondents concerned from giving effect to the notice as impeached and from enforcing the provisions of the said Act to them depots/godowns and from taking any Civil and Criminal proceedings against the petitioners for not implementing the provisions of the said Act to their depots until the final disposal of the application, for a limited period and such interim order was thereafter directed to continue on 5th January 1978. till the disposal of the Rule, with a further liberty to the respondents to apply for variation or vacation of the same, with notice to the petitioners.
(2.) The petitioner 1, Lipton (India) Ltd., (hereinafter referred to as the said Company), is a Company incorporated under the appropriate laws of the United Kingdom and petitioner 2, is employed as one of the Branch Managers of the said Company's Branch office at Calcutta. It is well known that the said Company carries on the business of blending, packeting and selling teas under its own brands and name all over India. It has been stated that for such purposes, the said Company has its branches at Delhi, Bombay, Madras, Calcutta, Nagpur and Ahmedabad. It was the case of the petitioners that the blending and packeting of tea is done in the factories situated at Calcutta and Madras and throughtout the country the said Company has its own depots, where stocks of tea are kept stored and each of such depots is in charge of a salesman employed by the said Company. It has been stated that the nature and functions of work of a salesman to such depots as mentioned above are as here-under:-- (a) The depot is used exclusively for the purpose of storing the petitioner Company's teas which are blended and packed at its factories mentioned above. No sale is made within the depot premises nor are any customers served therein nor is any business transacted therein at all. As a matter of fact, a notice is displayed outside each depot which declares, and the said Company has also specifically directed that "CUSTOMERS ARE NOT SERVED AND SALES ARE NOT ALLOWED INSIDE THESE PREMISES". It was also the case of the petitioners that those depots are not connected with any premises, which would be a shop within the meaning of Section 2 (13) of the said Act. Section 2 (13) defines 'shop' meaning thereby any premises used wholly or in part for the sale of services to customers or for the wholesale or retail sale of commodities or articles, either for cash or on credit, and includes any offices, store rooms, godown or warehouses, whether in the same premises or elsewhere, used in connection with such sale or with the storage of commodities or articles for the purpose of such sale and also includes such other class or classes of premises as the State Government may, after taking into consideration the nature of the work carried on there, by notification, declare to be shops for the purposes of this Act, but does not include an establishment. Explanation: If any doubt arises as to whether any premises are a shop or a commercial establishment or an establishment for public entertainment or amusement, the question shall be referred to the State Government by the registering authority, suo motu or an application and the decision of the State Government thereon shall be final and it was the specific case of the petitioners that each depot is in charge of one salesman whose duty is to collect the goods from the depot and carry them in the local and outstation markets with the help of a mazdoor or/and handvan, depending on the circumstances and situation of the market. The salesman canvasses the petititioners' tea and supplies to wholesalers and retailers at their re-sportive shops. Since the nature of work of a salesman is inherently intermittent, the petitioner company cannot fix any rigid hours of work for him and from the very nature of things it is not possible to do so. The salesman canvasses the petitioner company's tea at each dealers' premises and supplies the stocks then and there against cash payment. The duties of the salesman include distribution of tea to hot tea shops and canteens which generally operate in early hours of the day and also visiting Markets in village interiors. For the purpose of collecting the stock of tea the salesman opens the depot for about half an hour in the morning and after completing his round in the local or outstation markets, he again opens the depot at the end of the day for about another half an hour to put back the unsold stocks. The depot remains locked up for the rest of the period. The opening and closing of the depot depends on the exigencies of business and also upon the timings of trains and biases by which the salesman has to travel for his outstation market working. The petitioner fixes an itinerary for each salesman and he has to visit the area or the market according to the said itinerary The depot is kept completely closed one day in a week and that day is also a rest day for the salesman. The salesman keeps an inventory of stocks received at and stocks taken out from the depot and sends periodical report to his Branch Office. The salesman is an employee of the petitioner company who is being paid a basic salary, dearness allowance and incentive remuneration (commission) at a particular rate on the quantity of stock sold by by him. He is also paid some allowance to reimburse the scheduled expenses to be incurred by him in the course of his duties of canvassing and distributing the petitioner's tea. The salesman is given the benefits of leave, provident fund, gratuity etc., under his terms and condi tions of employment and his services are transferable to any place in the Branch territory. It has be(tm) claimed by the petitioners that the depot system of distribution and sale of packet teas as mentioned above is a unique system and was developed by them after many years of experience in the tea trade in India.
(3.) It has been claimed that since no sale, either wholesale or retail nor any business transaction has taken place within any of such depots or any services rendered to the customers therein, those depot premises of the said Company could neither be described as "Commercial establishment", which under Section 2 (2) of the said Act, means an advertising commission, forwarding commercial agency, or a department of a factory or of any industrial or commercial undertaking, an insurance company, joint stock company, bank, broker's office or exchange, and includes such other class or classes of concerns of undertakings as the State Government may, after taking into consideration the nature of their work, by notification, declare to be commercial establishments for the purposes of this Act, but does not include a shop or an establishment for public entertainment or amusement or a shop, the meaning and definition whereof has been mentioned hereinbefore. The petitioners have stated that by a letter of 3-10-80, they represented to the Chief Inspector, Shops & Establishments, West Bengal, seeking confirmation that by their constitution, nature and function they did not come within the meaning of Commercial Establishment/Shop as mentioned above and thereafter, there were several correspondence with the authorities under the said Act for similar confirmation but they proved to be futile and ineffective.;


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