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The Supreme Court has recently ruled that Board of Control for Cricket in India (BCCI) can be said to be a 'shop' for the purposes of attracting the provisions of Employees State Insurance Act, 1948 as its activities can be said to be 'systematic commercial activities' providing entertainment by selling tickets etc.
The Division Bench comprising of Justice MR Shah and Justice PS Narasimha while adjudicating upon an SLP filed by BCCI against the ESI Court's order observed that words used in a particular statute cannot be used to interpret the same word in a different statute especially when the two statues are not pari materia with each other and have a wholly different scheme from one another.
Employees' Insurance Court at Bombay had declared that the BCCI is covered within the meaning of 'shop' as per notification dated 18.09.1978 issued by the Maha Govt under the provisions of Section 1(5) of the Employees State Insurance Act, 1948. It send a Notice claiming contribution amount to the tune of Rs. 5,04,075/- as Employees’ State Insurance Contribution.
The above was challenged before the ESI Court on the grounds inter alia that the coverage of the BCCI under the provisions of ESI Act is in violation of Section 2A of the ESI Act read with Regulation 10B of the Employees’ State Insurance (General) Regulations 1950, since the primary object of the BCCI is to administer, promote and control the game of cricket throughout the country, and therefore, it is not covered or registered as “shop” under the provisions of Mumbai Shop and Establishment Act. It was also the case on behalf of the BCCI that it is not primarily engaged or involved in any trading or commercial activities and therefore, BCCI is not covered within the meaning of Section 1(5) of the ESI Act.
By the impugned judgment and order and on considering the various documents produced before it, including BCCI’s Memorandum of Association, Rules and Regulations; its Annual Reports, the ESI Court concluded that the activities of the BCCI can be said to be purely commercial activities and therefore, the provisions of the ESI Act shall be applicable to BCCI. The judgment and order passed by the ESI Court was the subject matter of first appeal before the High Court which came to be dismissed as well.
The Counsel for BCCI contended that to bring a particular entity within the definition of “shop” and while considering whether the activities of such entity can be said to be commercial activities, the predominant activity of such entity is to be considered. It was submitted that so far as the BCCI is concerned, the primary and dominant object is to promote the cricket. It is submitted that therefore if the pre-dominant activity of the BCCI is considered, in that case, BCCI shall not fall within the definition of “shop” and therefore the provisions of the ESI Act shall not be applicable. Reliance was placed on The Secretary, Ministry of Information & Broadcasting Vs. Cricket Association of Bengal & ANR, 1995 Latest Caselaw 124 SC and Commissioner of Sales Tax Vs. Sai Publication Fund, 2002 Latest Caselaw 166 SC
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