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BRAITHWAITE AND COMPANY (INDIA) LIMITED (ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT

Ministry of Law and Justice

Act nº 96 of 1976


  • Chapter I
  • Chapter II
  • Chapter III
  • Chapter IV
  • Chapter V
  • Chapter VI
  • Chapter VII
  • Schedules
  • Act nº 96 of 1976

Preamble

THE BRAITHWAITE AND COMPANY (INDIA) LIMITED (ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT, 1976

[Act, No. 96 of 1976]

[5th September, 1976]

PREAMBLE

An Act to provide for the acquisition and transfer of the undertakings of Messrs.Braithwaite and Company (India) Limited for the purpose of ensuring the continuity of production of goods which are vital to the needs of the country, and for matters connected therewith or incidental thereto.

WHEREAS Messrs.Braithwaite and Company (India) Limited was engaged in the manufacture and production of railway wagons, structural steel works for bridges and heavy workshop buildings, pressed steel tanks, cranes, road rollers, jute carding machines, roll formers, power sweepers, grey iron castings and steel forgings and also in the machining of intricate components of large sizes;

AND WHEREAS as a result of heavy losses suffered by the Company, there had been a closure of certain works owned by the Company;

AND WHEREAS for the purpose of speedily bringing the closed works of the Company into operation, the management of the undertakings of the Company was taken over by the Central Government, for a limited period, under section 18A of the Industries (Development and Regulation) Act, 1951;

AND WHEREAS it is necessary to acquire the undertakings of the Company to ensure the continuance of the production of goods which are vital to the needs of the country;

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 Braithwaite and Company (India) Limited (Acquisition and Transfer of Undertakings) Act, 1976.

(2) The provisions of sections 28 and 29 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,-

(i) "appointed day" means the 1st day of April, 1975(1 of 1956);

(ii) "Company" means the Braithwaite and Company (India) Limited, being a company as defined in the Companies Act, 1956, and having its registered office at 5, Hide Road, Calcutta-700043;

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

(iv) "Ordinance" means the Braithwaite and Company (India) Limited (Acquisition and Transfer of Undertakings) Ordinance, 1976(7 of 1976);

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

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

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

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

Chapter II

Section 3. Acquisition and transfer of the undertakings of the Company

On the appointed day, the undertakings of the Company, and the right, title and interest of the Company in relation to its undertakings, shall, by virtue of this Act, be transferred to, and shall vest in, the Central Government.

Section 4. General effect of vesting

(1) The undertakings of the Company shall be deemed to include all assets, rights, lease-holds, powers, authorities and privileges, and all property, movable and immovable, including lands, building, workshops, stores, instruments, machinery and equipment, cash balances, cash on hand, reserve funds, investments, 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 the Company, whether within or outside India, and all books of account, registers and all other documents of whatever nature relating thereto.

(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 property 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 and 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 (2) 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 interest, payment of the mortgage money or other duties, in whole or in part, out of the amounts specified in section 7, and also out of the monies determined under section 8, 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 property which has vested in the Central Government, under section 3, instituted or preferred by or against the Company is pending, the same shall not abate, be discontinued or be, in any way, prejudicially affected by reason of transfer of the undertakings of the Company 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 Company are directed under section 6, to vest in a Government company, against that Government company.

Section 5. Central Government or the Government company not to be liable for prior liable for prior liabilities

(1) Every liability of the Company in respect of any period prior to the appointed day, shall be the liability of the Company and shall be enforceable against it and not against the Central Government, or, where the undertakings are directed under section 6, to vest in a Government company, against that Government company.

(2) 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 of the Company in respect of any period prior to the appointed day, shall be enforceable against the Central Government, or, where the undertakings of the Company 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 the Company, passed after the appointed day, in respect of any matter, claim or dispute which arose before that day, shall be enforceable against the Central Government, or, where the undertakings of the Company are directed under section 6 to vest in a Government company, against that Government company;

(c) no liability incurred by the Company 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 Company are directed under section 6, to vest in a Government company, against that Government company.

Section 6. Power of Central Government to direct vesting of the undertakings of the Company 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 Company, and the right, title and interest of the Company in relation to its undertakings, which have vested in the Central Government under section 3, 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 of the Company 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 the Company and the right, title and interest of the Company in relation to its undertakings, there shall be given by the Central Government to the Company, in cash, and in the manner specified in Chapter VI, an amount of rupees sixteen crores and twenty-five lakhs.

Section 8. Payment of further amount

(1) For the deprivation of the Company of the management of its undertakings, there shall be given to the Company by the Central Government an amount calculated at the rate of rupees fifty thousand per annum for the period commencing on the date on which the management of the undertakings of the Company was taken over by the Central Government and ending on the appointed day.

(2) 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 the Company, an amount equal to an amount calculated at the rate of rupees fifty thousand per annum for the period commencing on the appointed day and ending on the date of promulgation of the Ordinance.

(3) The amount specified in section 7 and the amounts determined under sub-sections (1) and (2) 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 amounts is made by the Central Government to the Commissioner.

(4) The amounts determined in accordance with the provisions of sub-sections (1), (2) and (3) shall be given by the Central Government to the Company in addition to the amount specified in section 7.

(5) For the removal of doubts, it is hereby declared that the liabilities of the Company, in relation to its undertakings which have vested in the Central Government under section 3, shall be discharged from the amounts referred to in section 7, and also from the amounts determined under sub-sections (1), (2) and (3), in accordance with the rights and interests of the creditors of the Company.

Chapter IV

Section 9. Management ,etc., of the undertakings of the Company

(1) The general superintendence, direction, control and management of the affairs and business of the undertakings of the Company, 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 the Company is authorised to exercise and do in relation to its undertakings.

(2) The Central Government may appoint one or more individuals or a Government company as the Custodian of the undertakings of the Company 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 Company to deliver all assets, etc.

(1) On the vesting of the management of the undertakings of the Company in a Government company or on the appointment of a Custodian, all persons in charge of the management of the undertakings of the Company 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 Company 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 of the Company such remuneration as the Central Government may fix and shall hold office during the pleasure of the Central Government.