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BURN COMPANY AND INDIAN STANDARD WAGON COMPANY (NATIONALISATION) ACT

Ministry of Law and Justice

Act nº 97 of 1976


  • Chapter I
  • Chapter II
  • Chapter III
  • Chapter IV
  • Chapter V
  • Chapter VI
  • Chapter VII
  • Schedules
  • Act nº 97 of 1976

Preamble

THE BURN COMPANY AND INDIAN STANDARD WAGON COMPANY (NATIONALISATION) ACT, 1976

[Act, No. 97 of 1976]

[5th September, 1976.]

PREAMBLE

An Act to provide for the acquisition of the undertakings of the Burn and Company Limited and the Indian Standard Wagon Company Limited with a view to ensuring the continuity of the production of goods which are vital to the needs of the economy of the country and for the fulfilment of the contracts for the supply of railways wagons abroad and for matters connected therewith or incidental thereto.

BE it enacted by Parliament in the Twenty-seventh Year of the Republic of India as follows:-

Chapter I

Section 1. Short title and commencement

(1) This Act may be called the Burn Company and Indian Standard Wagon Company (Nationalisation) Act, 1976.

The provisions of sections 27 and 28 shall come into force at once and the remaining provisions of this Act shall be deemed to have come into force on the 1st day of April, 1975.

Section 2. Definitions

In this Act, unless the context otherwise requires,-

(a) "appointed day" means the 1st day of April, 1975;

(b) "Burn and Company Limited" includes its wholly owned subsidiary company, namely, Coburn Properties Limited, having its registered office at 10-C, Hunger Street, Calcutta-17;

(c) "Commissioner" means the Commissioner of Payments appointed under section 14;

(d) "Custodian" means the Custodian appointed under sub-section (2) of section 9 to take over, or carry on, the management of the undertakings of either or both of the two companies;

(e) "Ordinance" means the Burn Company and Indian Standard Wagon Company (Nationalisation) Ordinance, 1976(8 of 1976);

(f) "notification" means a notification published in the Official Gazette;

(g) "prescribed" means prescribed by rules made under this Act;

(h) "specified date" means such date as the Central Government may, by notification, specify for the purpose of any provision of this Act, and different dates may be specified for different provisions of this Act;

(i) "two companies" means Burn and Company Limited and Indian Standard Wagon Company Limited, being companies as defined in the Companies Act, 1956(1 of 1956), and both having their registered offices at 10-C, Hunger Street, Calcutta-17;

(j) words and expressions used herein and not defined but defined in the Companies Act, 1956(1 of 1956), have the meanings, respectively, assigned to them in that Act.

Chapter II

Section 3. Transfer and vesting in Central Government of the undertakings of the two companies

On the appointed day, the undertakings of each of the two companies, and the right, title and interest of each of the two companies in relation to such undertakings, shall stand transferred to, and shall vest absolutely in, the Central Government.

Section 4. General effect of vesting

(1) The undertakings of each of the two companies referred to in section 3 shall be deemed to include all assets, rights, lease-holds, powers, authorities and privileges and all property, movable and immovable, including lands, buildings, workshops, stores, instruments, machinery and equipment, cash balances, cash on hand, reserve funds, investments and book debts and all other rights and interests in, or arising out of, such property as were immediately before the appointed day in the ownership, possession, power or control of either of the two companies, whether within or outside India, and all books of account, registers and all other documents of whatever nature relating thereto, and shall also be deemed to include the liabilities and obligations specified in sub-section (2) of section 5.

(2) All properties as aforesaid which have vested in the Central Government under section 3 shall, by force of such vesting, be freed and discharged from any trust, obligation, mortgage, charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of any court restricting the use of such properties in any manner or appointing any receiver in respect of the whole or any part of such property shall be deemed to have been withdrawn.

(3) Every mortgagee of any property which has vested under this Act in the Central Government and every person holding any charge, lien or other interest in, or in relation to, any such property shall give, within such time in such manner as may be prescribed, an intimation to the Commissioner of such mortgage, charge, lien or other interest.

(4) For the removal of doubts, it is hereby declared that the mortgagee of any property referred to in sub-section (3) or any other person holding any charge, lien or other interest in, or in relation to, any such property shall be entitled to claim, in accordance with his rights and interests, payment of the mortgage money or other dues, in whole or in part, out of the amount specified, in relation to the company owning such property, in the First Schedule, but no such mortgage, charge, lien or other interest shall be enforceable against any property which has vested in the Central Government.

(5) If, on the appointed day, any suit, appeal or other proceeding of whatever nature in relation to any matter specified in sub-section (2) of section 5, in respect of any undertaking of either of the two companies, instituted or preferred by or against either of the two companies, is pending, the same shall not abate, be discontinued or be, in any way, prejudicially affected by reason of the transfer of the undertakings of either of the two companies or of anything contained in this Act, but the suit, appeal or other proceeding may be continued, prosecuted or enforced by or against the Central Government, or, where the undertakings of the two companies are directed, under section 6, to vest in a Government company, against that Government company.

Section 5. Owners of the two companies to be liable for certain prior liabilities

(1) Every liability, other than the liability specified in sub-section (2), of each of the two companies in respect of any period prior to the appointed day, shall be the liability of the concerned company and shall be enforceable against it, and not against the Central Government, or, where the undertakings of the two companies are directed, under section 6, to vest in a Government company, against that Government company.

(2) Any liability arising in respect of

(a) the loans advanced by the Central Government, or a State Government, or both, to either of the two companies, or to both (together with interest due thereon) after the management of the undertakings of the concerned company had been taken over by the Central Government;

(b) the wages, salaries and other dues of employees of each of the two companies in respect of any period after the management of the undertakings of the two companies had been taken over by the Central Government,

shall, on and from the appointed day, be the liability of the Central Government or of the Government company aforesaid and shall be discharged by that Government or Government company, as and when repayment of such loans or amounts becomes due or as and when such wages, salaries or other dues become due and payable.

(3) For the removal of doubts, it is hereby declared that,-

(a) save as otherwise expressly provided in this section or in any other provision of this Act, no liability, other than the liability specified in sub-section (2), of either of the two companies in relation to its undertakings in respect of any period prior to the appointed day, shall be enforceable against the Central Government, or, where the undertakings of the two companies are directed, under section 6, to vest in a Government company, against that Government company;

(b) no award, decree or order of any court, tribunal or other authority in relation to the undertakings of either of the two companies, passed after the appointed day, in respect of any matter, claim or dispute, not being a matter, claim or dispute in relation to any matter referred to in sub-section (2), which arose before that day, shall be enforceable against the Central Government or, where the undertakings of the two companies are directed, under section 6, to vest in a Government company, against that Government company;

(c) no liability incurred by either of the two companies before the appointed day, for the contravention, of any provision of law for the time being in force, shall be enforceable against the Central Government, or, where the undertakings of the two companies are directed, under section 6, to vest in a Government company, against that Government company.

Section 6. Power of the Central Government to direct vesting of the undertakings of the two companies in a Government company

(1) Notwithstanding anything contained in sections 3 and 4, the Central Government may, if it is satisfied that a Government company is willing to comply, or has complied, with such terms and conditions as that Government may think fit to impose, direct, by notification, that the undertakings of the two companies and the right, title and interest of the two companies in relation to their respective undertakings which have vested in that Government under section 3, and such of the liabilities of the two Companies as are specified in sub-section (2) of section 5, shall, instead of continuing to vest in the Central Government, vest in the Government company either on the date of the notification or on such earlier or later date (not being a date earlier than the appointed day) as may be specified in the notification.

(2) Where the right, title and interest, and the liabilities referred to in sub-section (2) of section 5, of each of the two companies, in relation to its undertakings, vest in a Government company under sub-section (1), the Government company shall, on and from the date of such vesting, be deemed to have become the owner in relation to such undertakings, and all the rights and liabilities of the Central Government in relation to such undertakings shall, on and from the date of such vesting, be deemed to have become the rights and liabilities, respectively, of the Government company.

Chapter III

Section 7. Payment of amount

For the transfer to, and vesting in, the Central Government, under section 3, of the undertakings of each of the two companies and the right, title and interest of each of the two companies in relation to such undertakings, there shall be given by the Central Government to each of the two Companies, in cash and in the manner specified in Chapter VI, an amount equal to the amount specified against the name of such company in the First Schedule.

Section 8. Payment of further amount

(1) In consideration of the retrospective operation of the provisions of sections 3, 4 and 5, there shall also be given, in cash, by the Central Government to each of the two companies an amount equal to an amount, calculated at the rates specified in section 5 of the Burn Company and Indian Standard Wagon Company (Taking Over of Management) Act, 1973(57 of 1973), for the period commencing on the appointed day and ending on the date of promulgation of the Ordinance.

(2) The amount specified in section 7, and the amount determined under sub-section (1), shall carry simple interest at the rate of four per cent.per annum for the period commencing on the date of promulgation of the Ordinance and ending on the date on which payment of such amount is made by the Central Government to the Commissioner.

(3) The amounts determined in accordance with the provisions of sub-sections (1) and (2) shall be given to each of the companies in addition to the amount specified against its name in the First Schedule.

Chapter IV

Section 9. Management ,etc., undertakings of the two companies

(1) The general superintendence, direction, control and management of the affairs and business of the undertakings of either of the two companies, the right, title and interest in relation to which have vested in the Central Government under section 3, shall,-

(a) where a direction has been made by the Central Government under sub-section (1) of section 6, vest in the Government company specified in such direction, or

(b) where no such direction has been made by the Central Government, vest in one or more Custodians appointed by the Central Government under sub-section (2).

and thereupon the Government company so specified or the Custodian so appointed, as the case may be, shall be entitled to exercise all such powers and do all such things as either, or both, of the companies is or are authorised to exercise and do in relation to its or their undertakings.

(2) The Central Government may appoint one or more individuals or a Government company as the Custodian of the undertakings of either, or both, of the two companies in relation to which no direction has been made by it under sub-section (1) of section 6.

Section 10. Duty of persons in charge of management of the undertakings of the two companies to deliver all assets, etc.

(1) On the vesting of the management of the undertakings of the two companies in a Government company or on the appointment of a Custodian, all persons in charge of the management of the undertakings of either of the two companies immediately before such vesting or appointment, shall be bound to deliver to the Government company or the Custodian, as the case may be, all assets, books of account, registers or other documents in their custody relating to the undertakings of such company.

(2) The Central Government may issue such directions as it may deem desirable in the circumstances of the case to the Government company or the Custodian as to its or his powers and duties and the Government company or Custodian may also, if it or he so desires, apply to the Central Government at any time for instructions as to the manner in which the management of the undertakings of the two companies shall be conducted by it or him or in relation to any other matter arising in the course of such management.

(3) The Custodian shall receive from the funds of the undertakings, in relation to which he is the Custodian, such remuneration as the Central Government may fix and shall hold office during the pleasure of the Central Government.