IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.5052 of 2009 M/S BIHAR INSTITUTE OF LAW. Versus THE STATE OF BIHAR & ORS. ----------- For the Petitioner:- Mr. Shivaji Nath Pandey, Sr. Adv. For the State:- Mr. A. Amanullah, G.A.-4 Mr. Anuj Kumar, Adv. Mr. S. Rahman, Adv. Mr. Arun Kumar Prasad, Adv. For the E.S.I.:- Mr. Ravindra Kumar Choubey, Adv. -------------- 4. 18.01.2011 Heard learned counsel for the petitioner and the Employees State Insurance Corporation (hereinafter referred to as the „Corporation‟). The petitioner questions the notification dated 20.5.2005 extending the operation of the employees State Insurance Act (hereinafter called the „Act‟) to Educational Institutions where 20 or more persons are employed and the subsequent notice dated 24.2.2009 to it for compliance. Learned senior counsel Shree Shivaji Panday, for the petitioner submitted that the petitioner was an Educational Institution imparting knowledge in the discipline of law engaging teaching and non-teaching staff. Section 1(5) is confined in its application to an establishment, industrial, commercial, agricultural or otherwise. This has to be read ejusdem generis as limited to establishments engaged in business trade or profession. Imparting education does not come in any of 2 these categories. The aforesaid establishments defined under the Act contemplate a hazardous nature of acts where injury are really probable. The provisions of the Act therefore shall apply only to such establishments. An establishment is not defined under the Act and therefore analogy can be drawn from the Bihar Shops and Establishment Act. Reliance is placed upon (2001) 2 SCC 115 (Ruth Soren Vs. Managing Committee, East Issda & Ors.) holding that an educational institution does not fall under the category of establishment carrying on business, trade or profession or incidental activity thereto and is therefore not covered under the said Act. Counsel for the Corporation relied upon the judgment reported in 2010 (2) LLJ (Ker) page 240 of a Division Bench of the Kerala High Court which in turn notices a judgment of the Allahabad High Court that an educational institution falls within the ambit of establishment under the Act. The Employee State Insurance Act was introduced as a scheme of health insurance for workers and to provide benefits to employees in case of sickness, maternity and employment injury. It does not define the word “establishment” but defines “factory”. Regulation 10(B) provides for registration of factory or 3 establishment. The Act therefore clearly distinguishes between a factory and/or establishment. Section 1(5) talks of an establishment or class of establishments, industrial, commercial, agricultural or otherwise. The Bihar Shops and Establishment Act provides for regulating conditions of work and employment in shops. It deals with opening and closing hours of establishment, rest, period of work, holiday, wages etc. The object purport and scope is completely different from the E.S.I. Act. Therefore, the interpretation of a particular word in a Act may not necessarily and automatically be relevant in its application to another Act. The Interpretation shall therefore depend on the object purport and scope of the individual Act. Section 1(5) of the Act is wide in its meaning from an establishment to industrial, agricultural and commercial activities and then again becomes wider when it uses the word “or otherwise”. To apply the principle of ejusdem generic there has to be a genus in the words used specific in nature followed by general words. In (1991)2 SCC 119 (Asstt. Collector of Central Excise v. Ramdev Tobacco Co.), explaining its applicability it has been explained as follows at Paragraph-5:- 4 “5. The rule of ejusdem generis is generally invoked where the scope and ambit of the general words which follow certain specific words (which have some common characteristic and constitute a genus) is required to be determined. By the application of this rule the scope and ambit of the general words which follow certain specific words constituting a genus is restricted to things ejusdem generis with those preceding them, unless the context otherwise requires. General words must ordinarily bear their natural and larger meaning and need not be confined ejusdem generis to things previously enumerated unless the language of the statute spells out an intention to that effect. Courts have also limited the scope of the general words in cases where a larger meaning is likely to lead to absurd and unforeseen results. To put it differently, the general expression has to be read to comprehend things of the same kind as those referred to by the preceding specific things constituting a genus, unless of course from the language of the statute it can be inferred that the general words were not intended to be so limited and no absurdity or unintended and unforeseen complication is likely to result if they are allowed to take their natural meaning. The cardinal rule of interpretation is to allow the general words to take their natural wide meaning unless the language of the statute gives a different indication or such meaning is likely to lead to absurd results in which case their meaning can be restricted by the application of this rule and they may be required to fall in line with the specific things designated by the preceding words. But unless there is a genus which can be comprehended from the preceding words, there can be no question of invoking this rule. Nor can this rule have any application where the general words precede specific words.” A bare reading of the Act reveals that there is no genus in the words and they all constitute different items. The import of the words “or otherwise” is wide and 5 does not control industrial, commercial or agriculture. In fact, an establishment under the Act would mean any organized activity carried on with more than 20 people in which the employees are in need of health insurance, benefits in case of sickness maternity and employment injury. In (1992 )4 SCC 245 M/s Cochin Shipping Co. Lmt. Vs. ESI Corporation), it has been held at Paragrah- 13 as follows:-: “13. The Employees State Insurance Act is an Act to provide certain benefits to employees in case of sickness, maternity and employment injury and make provision for certain other matters in relation thereto. The Act is an outcome of a policy to provide remedy for the widespread evils arising from the consequences of national poverty. Indeed, it is a piece of social security.” In (1994) 1 SCC 445 (ESI Corporation Vs. R. K. Swamy & Ors.) it has been held at Paragraph-14 as follows:- “14. There is no doubt at all that the said Act is beneficent legislation. If, therefore, it is reasonably possible so to construe the word “shop” as to include the activity of an advertising agency within it, that construction must be preferred.” In (2004) 6 SCC 191 (ESI Corporation Vs. Hyderabad Race Club), the Supreme Court rejected the argument noticed at Paragraph-3:- 6 “3. We will first consider the case of the Club whether it comes within the definition of “establishment” under the provisions of the Act. It was the contention of the Club that the Club is not an establishment nor a shop within the meaning of the Andhra Pradesh Shops and Establishments Act, 1988, hence the notification by which the Act was made applicable to the Club was beyond the scope of the Act.” In the case of Ruth Soren the principle laid down is in context of an establishment under the Shops and Establishment Act vis-à-vis industries holding that though educational institution may not classify as a shop, it certainly falls within the ambit of an industry. The issue being under a completely different act has no application to the facts of the present case. In (2010)2 LLJ 240 (Ker) a Division Bench of Kerala High Court rejected a similar argument as made presently noticed in paragraph-10 of the judgment by giving a very wide interpretation to the words “otherwise” in Section 1(5) of the Act holding at Paragraph-18 that it would take within its ambit educational institutions also and cannot be read down applying the principles of ejusdem generic as was presently urged also. The Court finds no merit in the present application, it is accordingly dismissed. P. Kumar (Navin Sinha, J.)