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REGISTERED No. D-(D)-72

The Gazette of India

EXTRAORDINARY

PART II—Section 1

PUBLISHED BY AUTHORITY

No. 50] NEW DELHI, MONDAY, DECEMBER 26, 1983/PAUSA 5, 1905

Separate paging is given to this Part in order that it may be filed

as a separate compilation

MINISTRY OF LAW, JUSTICE AND COMPANY AFFAIRS (Legislative Department)

New Delhi, the 26th December, 1983/Pausa 5, 1905 (Saka)

The following Act of Parliament received the assen of the President on the 25th December, 1983, and is hereby published for general information: —

THE TEXTILE UNDERTAKINGS (TAKING OVER OF MANAGEMENT) ACT, 1983 No. 40 OF 1983

[25th December, 1983.]

An Act to provide for the taking over in the public interest of the management of the textile undertakings of the companies specified in the First Schedule pending nationalisation of such undertakings and for matters connected therewith or inci- dental thereto.

WHEREAS by reason of mismanagement of the affairs of the textile under- takings specified in the First Schedule, their financial condition became wholly unsatisfactory even before the commencement in January 1982 of the textile strike in Bombay and their financial condition has thereafter further deterio- rated;

AND WHEREAS certain public financial institutions have advanced large sums of money to the companies owning the said undertakings with a view to making the said undertakings viable;

A ND WHEREAS further investment of very large sums of money is neces- sary for reorganising and rehabilitating the said undertakings and thereby to protect the interests of the workmen employed therein and to augment the production and distribution at fair prices of different varieties of cloth and yarn so as to subserve the Interests of the general public;

( 1 )

AND WHEREAS acquisition by the Central Government of the said uric"

takings is necessary to enable it to invest such large sums of money;

AND WHEREAS, pending the acquisition of the said undertakings, it is expedient in the public interest to take over the management of the said undertakings;

BE it enacted by Parliament in the Thirty-fourth Year of the Republic of

India as follows:—

CHAPTER I

PRELIMINARY

1. (7) This Act may be called the Textile Undertakings (Taking Over

of Management) Act, 1983.

(2) It shall be deemed to have come into force on the 18th day of October, Short title and oom- mence- ment.

1983.

2. In this Act, unless the context otherwise requires,—

Defini- tions.

(o) ."appointed day" means the date on which this Act comes into

force;

(b) "Custodian" means the person appointed under section 4 to take

over the management of the undertakings;

(c) "notification" means a notification publishod in the Official

Gazette;

(d) "textile undertaking" or "the textile undertaking" means an under-

taking specified in the second column of the First Schedule;

1 of 195&.

(e) "textile company" means a company (being a company as denned in the Companies Act, 1956) specified in the third column of the First Schedule, as owning the undertaking specified in the corresponding entry in the second column of that Schedule;

1 of 195"u (/) words and expressions used herein and not defined but defined in the Companies Act, 1956, shall have the meanings respectively assigned to them in that Act.

CHAPTER II

TAKING OVER OF THE MANAGEMENT OF CERTAIN TEXTILE UNDERTAKINGS

3. (1) On and from the appointed day, the management of all the textile

undertakings shall vest in the Central Government.

Manage- ment of certain, textile under- takings to vest in the Cen- tral Gov- ernment.

(2) The textile undertaking shall be deemed to include all assets, rights, lease- holds, powers, authorities and privileges of the textile company in relation to the said textile undertaking and all property, movable and immovable, including (ands, buildings, workshops, projects, stores, spares, instruments, machinery, equipment, automobiles and other vehicles, and goodb under production or in transit, cash balances, reserve fund, investments and book lets and all other¹ 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 textile company whether within or outside India and all boots of account, registers and all other documents of whatever nature relating thereto.

SEC. 1J THJS GA^&iltL o£ x^iJiA'l^ixv^aKDliNAltY 3

(3) Any contract, wiicmer express ox xxnpiiea, ox oilier arrangement, in so iar as it relates to me management ox me out>xiie&s ana axxairs or ixie textile un- dertaking and in IOXW; mxmeuxtueiy bexoxc me uppuinteu day, or any order made Dy any court in so iar as xt relays 10 -uc iiiaiiagciacui ox uxe business and axlarrs or tne textile unuextaiang ana in loxce lixuneUia.exy oexoxe tne appointed day snail oe deemed to have teininxated on uxe appoxnted day.

delegate to the Additional Custodian ail or such ot his or its poweis as he or it may think ht.

(5) Subject to any general or special direction given 01 condition miposed by tke Custodian, any peison authorised by the Custodian to exercise aay power may exercise that power in the same manner and with the same effect as it it had been confeired on that person directly by this Act and not by Way ot authorisation.

(o) I he Central Government may issue such directions (including direc- .lous as to initiating, defending or continuing any legal proceedings betore any court,. tribunal or other authority) to the Custodian as to his or its powers and duties as the Central Government deems to be desirable in the circum- siances ot the case, and the Custodian may also apply to the Central Govern- ment at any time for instructions as to the manner in which he or it shall conduct the management of the textile undertaking or in relation to any other matter arising irf the course ot such management.

1 of 1956- (7) Subject to the other provisions of this Ac I and the control of the Central Government, the Custodian shall be entitled, notwithstanding any- thing contained in the Companies Act, 1956, to exeicise all the powers, in relation to the textile undeitaking, of the Board of Directors of the textile company (including the power to dispose of any properties or assets of the textile company) whether such powers are derived from the Companies Act, 1956, or from the memorandum and articles of association of the concerned textile company or from any other source.

{8) Every person having possession, custody or control of any property forming part of the textile undertaking shall deliver forthwith such property to the Custodian or to any officer or other employee of the Central Government or the Custodian, as may be authorised by the Central Government or the Custodian in this behalf.

(9) Any person who, on the appointed day, has in his possession or under his control any books, papers or other documents relating to the textile under- taking the management of which has vested in the Central Government under this Act, shall, notwithstanding anything contained hi any other law ior the time being in force, be liable to account for the books, papers and other documents (including such., minutes books, cheque books, letters, memoranda, notes or other communications) to the Custodian and shall deliver them up to Ihe Custodian or to any such person (being an officer or other emplpyee of the Central Government or the Custodian) as may be authorised by the Central Government or Ihe Custodian in this behalf,

(10) Every person in charge of the management of any textile undertaking immediately before the appointed day shall, within ten day^> from that day or within such further period as the Central Government may allow in this behalf, furnish to the Custodian a complete inventory of all the properties and assets (including particulars of book debts and investments and belongings) forming part of the undertaking immediately before the appointed day and of all the liabilities and obligations of the textile company in relation to the under- taking, subsisting immediately before that day, and also of all agree- ments entered into by such textile company in relation to the under- taking and in force immediately before that day.

(12) The Custodian and the Additional Custodian shall receive from the funds of the textile undertakings such remuneration as the Central Government may fix.

Payment of amount.

5. (2) Every textile company shall be given by the Central Govern- ment an amount, j t cash, and at tru; rare specified in sub-section 2), tor the vesting in it, under section 3. of the management of the

textile undertaking of the c o m p a n j.

(2) For every month during which the management of the textile under- taking remains vested in the Central Government under this Act, the amount, referred to in sub-section (2), shall be computed—-

(/') for a spinning unit, at the rate of fifty paise per¹ 1,000 spindles

or any part thereof;

07) for a vtfeiring unit, at the rate of one rupee per 100 looms or

any part thereof;

(Hi) for a composite unit with or without dye-house, at the rate of fifty paise per 1,000 spindles or any part thereof plus one rupee per 100 looms plus one paisa per 10,000 metres of cloth processed in the dye- house based on the average monthly production during the period of three years immediately preceding the appointed day;

(iv) for a wholly processing unit (being a unit which does not have any spindle or loom), one paisa per one thousand square metres or any part thereof ^of the average of the total quantity of textiles processed during the period of three years immediately preceding the appointed day in such unit.

CHAPTER III

POWER TO PROVIDE RELIEF TO THE TEXTILE UNDERTAKINGS

6. CO The Central Government may, if satisfied, in relation to any of the textile undertakings or any part thereof, the management of which has vested in it under this Act, that it is necessary so to do in the interests of the general public with a view to preventing any fa'l in the volume of production of such undertaking, by notification, declare that—

(a) all or any of the enactments specified in the Second Schedule shall not apply or shall apply with such adaptations, whether by way of modification, addition or omission (which does not, however, affect the policy of the said enactments) to such undertaking as may be specified in such notification, or

Power of the Centra] Govern- ment to make cer- tain dec- larations in rela- tion to certain textile under- takings.

(b) the operation of all or any of the contracts, assurances of property, agreements, settlements, awards, standing orders or other instru- ments in force (to which such textile undertaking or ths textile com- pany owning such undertaking is a party or which may be applicable to such textile undertaking or textile company) immediately before the date of issue of the notification shall remain suspended or that all or any of the rights, privileges, obligations and liabilities accruing or arising thereunder before the said date, shall remain suspended or shall be en- forceable subject to such adaptations find in, such manner as mav be specified in the notification,

(2) The notification made under sub-section (I) shall remain in force, in the first instance, for a period of one year but the duration of such notification may be extended from time to time by a further notification by a period not exceeding one year at a time:

Provided that no such notification shall, in any case, remain in force after the expiry of three years from the commencement of this Act.

C?) Any notification made under sub-section (1) shall have effect notwith- standing anything to the contrary contained in any other law, agreement of instrument or any decree or order of a court, tribvnal, officer or other authority or in any submission, settlement or standing order

(4) Where by virtue of a notification under clause (b) of sub-section (!),• any right, privilege, obligation or liability remains suspended or is enforceable subject to the adaptations and in the manner specified in the notification, all proceedings relating thereto pending before anv c- 'rt, tribunal, officer or other authority shall accordinslyoremain st?yed or b³ s"bject to such adaptations, as the case may be; so however, on the notification r-asing to have effect

(a) such ri

(b) any proceeding so remaining stayed shall be proceeded with sub- ject to the provisions of any law which mav be then in force, from the stage which had been reached when tha proceeding became stayed.

(5) In computing the period of limitation for the enforcement of any right, privilege, obligation or liability referred t0 in clause (b) of sub-section (1), the period during which, it or the remedv for the enforcement thereof remained sus- pended shall be excluded.

CHAPTER IV

MISCELLANEOUS

Act to have over- riding effect.

7. The provisions of this Act or any notification, order or rule made thereunder shall have effect notwithstanding anything inconsistent therewith con- tained in any law (other than this Aft) or in anv instalment having effect by"" virtue of any law other than this Act or in anv decree or order of anv court.

8. (1) So Ions* as the management of the textile '"iderfakine of a textile Applica- tion of Act 1 of 1956. •

foirn-nnv remains vested in IV '"Wril Government under this Art. notwith- standing anything confined in tV Companies Act. 1956 or in the memo- rnidum or articles of association of "nrh company

(a") it shall not V tewf"¹ for +rte shirehoiderc; of rV textile company or anv otW P T OH to nominate or v~no;nt any n-rsot) to be ? Director of snfh textile company fa reh+5r>n tr> "irh undertgViriw:

(b) no rescVntion qflVrtirm < W tW directly or indirectly") such un- dertaking \yh\rh h r>q""°r! qt jirfy rneetirjrr of the shareholders of the textile company on or after the qonoint^ dav shall be eiven effect to unless ap- proved bv the Central Government-

1 "r 1W66.

(2) Subject to the provisions contained in sub-section (1), and to the other provisions contained in this Act and subject to such other exceptions, restriction and limKations, if any, as the Central Government may, by notifica- tion, specify in this behalf, the Companies Act, 1956, shall continue to apply to the textile companies in the same manner as it applied thereto before the appointed day.

9. In computing the period of limitation prescribed by any law for the lime being in force for any suit or application against any person by any of the textile companies in respect of any matter arising out of any transaction in relation to its textile undertaking, the time during which this Act remains in force shall be excluded.

Exclusion of period of opera- tion of this Act from limita- tion.

10. (1) No suit, prosecution or other legal proceeding shall lie against the Centra) Government or the Custodian or the Additional Custodian or any offi- cer or other employee of the Central Government or the Custodian for any- thing which is in good faith done or intended to be done under this Act.

Protection of action taken in good faith.

(2) No suit or other legal proceeding shall lie against the Central Gov- ernment or the Custodian or the Additional Custodian or any of the officers or other employees of the Central Government or the Custodian for any damage caused or likely to be caused by anything which is in good faith done or in- tended to be done under this Act.

Contracts, etc., In bad faith maybe cancelled or varied.

11. (7) If the Central Government is satisfied, •after such inquiry as It may think proper, that any contract or agreement entered into at any time within three years immediately preceding the appointed day between any of the textile companies or managing or other director of .any such textile com- pany and any other person in relation to any service, sale or supply to, or by, its textile undertaking and in force immediately before the appointed day, has been entered into in bad faith, or is detrimental to the interests of the textile undertaking 6f the concerned textile company, it may make, within one hun- dred and eighty days from the appointed day, an order cancelling or varying (either unconditionally or subject to such conditions as it may think fit to impose) such contract or agreement and thereafter the con- tract or agreement shall have effect accordingly:

Provided that no contract or agreement shall be cancelled or varied ex- cept after giving to the parties to the contract, or agreement a reasonable op- portunity of being heard.

(2) Any person aggrieved by an order made under sub-section (I) may make an application to the principal civil court of original jurisdiction within the local limits of whose jurisdiction the registered office of the concerned textile company is situated for the variation, or reversal of such order and thereupon such court may confirm, modify or reverse' such order.

Avoid-

ance of

voluntary

trans-

fera.

12. Any transfer of property, movable or immovable, or any delivery of goods made by or on behalf of any of the textile companies (not being a transfer or delivery made in the ordinary course of its business or in favour* of a purchaser for valuable consideration and in good faith), if made within a period of six months immediately preceding the appointed day, shall be void against the Central Governmtnt or the Custodian, as the case may b$,

Power to terminate contracts of em- ployment.

13. If the Custodian is of opinion that any contract of employment entered into by any textile company or managing or other director of the company in relation to its textile undertaking at any time before the appointed day is unduly onerous, he or it may, by giving to the employee one month's notice in writing or salary or wages for one month in lieu thereof, terminate such contract of employment.

Penalties.

14. (I) Any person who,—

(a) having in hig possession or custody or under his control any property forming part of any of the textile undertakings, wrongfully withholds such property from the Custodian or any person authorised undtfr this Act, or

(b) wrongfully obtains possession of any such property, or

(c) wilfully retains any property forming part of such textile under- , taking or removes or destroys it, or

"

(d) wilfully withholds from, or fails to deliver to, the Custodian or any person authorised under this Act, any books, papers or other documents relating to such textile undertaking which may be in his pos- session, power or custody or under his control, or

(e) fails, without any reasonable excuse, to furnish information or particulars as- provided in section 4,

shall be punishable with imprisonment for a term which may extend to two years, or with fine which may extend to ten thousand rupees, or with both.

(2) No court shall take cognizance of an offence punishable under this section except with the previous sanction of the Central Government or an officer authorised by that Government in this behalf.

Offences

by com-

panies.

15. (1) Where an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the busi- ness of the company as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

Provided that nothing contained in this sub-section shall render any such person liable to any punishment* if he proves that the offence was committed without his knowledge and thaf he had exercised all due diligence to prevent the commission of such offence,

(2) Notwithstanding anything contained in sub-section (1), where an offen- ce under this Act has been committed by a company and it is proved that the offence has been committed with ihe consent or connivance of, or is attributable fo, any neglect on the part of any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall re- deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanation.—For the purposes of this section,—

(a) "company" means any body corporate and includes a firm or other association of individuals; and

(fr) "director", in relation to a fjrm, means a partner in the firm,

16. (1) The Central Government may, by notification, make rules for

carrying out the provisions of thi%Act.

Power to make rule§.

(2) Every rule made by the" Central Government under this Act shall be laid, as soon as may be after it is made, before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session Immediately following the session or the successive sessions aforesaid, both Houses agree in. making any modification in the rule or both Houses agree that the rule should not bo made, the rule shall thereafter have effect only in' such modified iform or be ot no eftect, as the case may be; so, how- ever, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.

17. {1) The Textile Undertakings (Taking Over of Management) Ordi-

10 of 1983. nance, 1983, is hereby repealed.

Repeal and saving.

(2) Notwithstanding such repeal, anything done or any action taken under the said Ordinance shall be deemed to have been done or taken under the corresponding provisions of this Act.

THE FIRST SCHEDULE

[See section 2 (d) and (e)]

Name of the owner

>Jo. Name of the undertaking

s,r

a

3

i EIphinBlonc Spinning and Weaving Mills, El-

phinstiinc Road, Bombay.

The Elphinstone Spinning and Weaving Mills Co. Ltd., Kamani Chambers, 3a, Ramji Bhai Kamani Marg, Bombay-38. The Finlay Mill* Ltd., Chartered Bank Buil- Finlay Mills, IO/II, Dr. S. S. Rao Road,

2

ding, Fort, Bombay-33.

Bombay.

The Gold Mohur Mills Ltd., Chartered Bank Gold Mohur Mills, Dadasaheb Phalke Road,

3

Building, Fort, Bombay-33.

Dadar, Bombay.

The Jam Manufacturing Co. Ltd., Lal- Jam Manufacturing Milk, Lalbaug, Parcl,

4.

baug, Parel, Bombay-ia.

Bombay.

Kohinoor Mills (No. i), Naigaum Cross

5

Road, Dadar, Bombay.

The Kohinoor Mills Co.Ltd.,KiUickHouse, Charanjit Rai Marg (Home Street), Fort, Bombay-1.

Kohinoiir Mills (No.a),Naigaum Gross ROJK.1,

G

Dadar, Bombay.

The Kohinoor Mills, Co. Ltd., Killick House, Charanjit Rai Marg (Home Street), Fort, Bombay-1.

Kohinoor Mills (No. 3),LadyJamshcdjiH.oad,

7

Dadar, Bom hay.

The Kohinoor Milk Co. Ltd., Killick House, Charanjit Rai Marg (Home Street), Fort, Bombay-1.

New City of Bombay Manufacturing Mills,

8

63, Tukaram B. Kadam Marg, Bombay.

The New City of Bombay Manufacturing Co, Ltd., 63, Tukaram Bhisaji Kadam Path, Bombay-33.

Podar Mills, N. M. Joshi Marg, Bombay.

The Podar Mills Ltd., Podar Chambers, 9

Svctl AJbdulla Brclvi Roncl. Fort Boitibav-1"

Podar Mills (Process House), Ganpal Rao

10

Kadam Marg, Bombay.

II ; SShree Madhusudan Mills, Pandurang Budhkar

The Podar Mills Ltd., Podar Chambers, Syed Abdulla Brelvi Road, Fort, Bombay-1. Shruc Madhusudan Mills Ltd., 31,

Chowringhee Road, Calcutta-16.

Marg, Bombay.

Shree Sitaram Mills Ltd., N. M. Joshi Marg, Shree Silaram Mills, N. M. Joshi Marg,

12 :

Bombay-n.

Bombay.

The Tata Mills Ltd., Bombay House, 34, Tata Mills, Dr. Atnbedkar Road, Dadar,

' 3'

Homi Mody Street, Fort, Bombay-a3.

Bombay.

THE SECOND SCHEDULE

(See section 6)

20 of 1M6.

1. The Industrial Employment (Standing Orders) Act, 1946.

14 of 1947.

2. The Industrial Disputes Act, 1947,

11 of 1948.

3. The Minimum Wages Act, 1948.

R. V. S. PERI SASTRI,

Secy, to the Govt. of India.

PRINTED BY THE GENERAL MANAGER, GOVERNMENT OF INDIA PRESS, MINTO ROAD.

NEW DELHI AND PUBLISHED BY THE CONTROLLER OF PUBLICATIONS, DELHI, 1 9 83