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BRITANNNIA ENGINEERING COMPANY LIMITED (MOKAMEH UNIT) AND THE ARTHUR BUTLER AND COMPANY (MUZAFFARPORE) LIMITED (ACQUISITION AND TRANSFER OF UNDERTAKINGS ACT, 1978
41 of 1978
8th December,1978
Britannia engineering Company Limited was incorporated in 1917 with its registered office at Calcutta. It owned at Titagarh an engineering unit (where it manufactured road rollers, jute mills machinery and other industrial machinery) and a steel foundry. It also set up in 1960 at Mokameh, a unit to manufacture Railway Wagons, steel structurals, etc. The engineering unit at Titagarh closed down in October 1970 and on the 22nd May, 1976 its management was taken over by the Central Government and entrusted to M/s. Westinghouse Saxby Farmer Limited, Calcutta, a company managed by the Government of West Bengal and in which the West Bengal Government has 87.75 per cent, share-holding. The West Bengal Government has taken complete financial and managerial responsibility for managing the Titagarh unit. The steel foundry is being managed by Industrial Reconstruction Corporation of India. The wagon unit at Mokameh closed down in March 1973. The Central Government took over the management of this unit on the 15th February, 1974 under the Industries (Development and Regulation) Act, 1951and the 22nd February, 1974. 2. Arthur Butler and Company (Muzaffarpore) Limited was incorporated in 1919 with its registered office at Calcutta and its manufacturing unit at Muzaffarpur. In the past, the Company manufactured various types of industrial machinery and when it closed down in February 1972, it was also manufacturing metre-gauge railway wagons. The management of this Company was taken over by the Central Government on the 14th December, 1973 under the Industries (Development, and Regulation) Act, 1951and the unit re-opened on the 10th August 1974. 3. Britannia Engineering Works, Mokameh, is engaged in the manufacture of Railway Wagons, Under-frames and Steel Structurals and Arthur Butler and Company (Muzaffarpore) Limited in the manufacture of Wagons, Suger Mills Machinery, Structural, Agricultural implements, Foundry products and Wagon components. The fabrication of wagons particularly under the old orders from the Railways, has been un-economical, causing financial loss to the Companies. These losses are being met by the Government by way of grant of loans to the two companies. The companies have been successful in taking up the new lines of production, such as Coal Tubes, Bridge Girders, Brake Beams, Furnace Structure, Mine Cars and Transmission Tower Lines. 4. After the take over of the management of these two companies there has been considerable progress in the production performance. It is in the public interest that both the units continue their manufacture of wagons and other goods. These units provide substantial employment and their closure would render a large labour force unemployed. It is not possible to hand over the management of these two units to private management as substantial Government loans have been given to the units. After careful consideration of the whole matter, the Government has decided to acquire these units. 5. The Bill seeks to acquire the Mokameh unit of Britannia Engineering Company Limited and the undertaking owned by Arthur Butler and Company (Muzaffarpore) Limited.-- Gaz. of Ind., 28-7-l978, Pt. II, S. 2, Ext., p. 910.
An Act to provide for the acquisition and transfer of the right, title and interest of the undertakings of Britannia Engineering Company in relation to the Mokameh unit owned by it and the right, title and interest of Arther Butler and Company in relation to the undertakings owned by it with a view to ensuring the continued manufacture of railway wagons and other goods essential to the needs of the country in general and the Railway in particular, and for matter connected therewith or incidental thereto. WHEREAS Britannia Engineering Company at the Mokameh unit and Authur Butler and Company were engaged in the manufacture of Railway wagons and other goods; AND WHEREAS as a result of the closure of the wagon and other undertakings owned by the companies aforesaid, there was a substantial fall in the manufacture of railway wagons and other goods. AND WHEREAS for the purpose of bringing the closed works of the companies aforesaid into operation the management of the Mokameh unit of Britannia Engineering Company and the management of the undertakings of Arthur Butler and Company were taken over by the Central Government under the Industries (Development and Regulation) Act, 1951; AND WHEREAS it is necessary to acquire the said wagon and other undertakings to ensure the continued manufacture of railway Wagons and other goods which are essential to the needs of the country in general and the Railways in particular; BE it enacted by Parliament in the Twenty-ninth Year of the Republic of India as follows:-
CHAPTER 01: PRELIMINARY
SECTION 01: SHORT TITLE AND COMMENCEMENT
(1) This Act may be called the Britannia Engineering Company Limited (Mokameh Unit) and the Arthur Butler and Company (Muzaffarpore) Limited (Acquisition and Transfer of Undertakings) Act, 1978.
(2) The provisions of sections 27and 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, 1978.
SECTION 02: DEFINITIONS
:- In this Act, unless the context otherwise requires,
(a) "appointed day" means the 1st day of April, 1978;
(b) "Arthur Butler and Company" means Messrs Arthur Butler and Company (Muzaffarpore) Limited a company within the meaning of the Companies Act, 1956-and having its registered, office at 40, Strand Road, Calcutta, in the State of West Bengal.
(c) "Britannia Engineering Company" means Messrs Britannia Engineering Company Limited, A company within the meaning of the Companies Act, 1956-, and having its registered office at 3, Netaji Subhash Road, Calcutta; in the State of West Bengal;
(d) "Commissioner" means the Commissioner of Payments appointed under lection 15;
(e) "Government company" means a company within the meaning of section 617 of the Companies Act, 1956-and referred to in section 5-of this Act;
(f) "Mokameh unit" means the wagon and other undertakings owned by Britannia Engineering Company at Mokameh, in the State of Bihar;
(g) "notification" means a notification published in the Official Gazette;
(h) "prescribed" means prescribed by rules made under this Act;
(i) "specified date" in relation to any provision of this Act, means such date as the Central Government may, by notification, specify for the purpose of that provision and different dates may be specified for different provisions of this Act;
(j) "wagon and other undertaking" means the undertaking which is engaged in the manufacture of railway wagons and other goods;
(k) words and expressions used herein and not defined but defined in the Companies Act, 1956-, have the meanings, respectively, assigned to them in that Act.
CHAPTER 02: ACQUISITION AND TRANSFER OF MOKAMEH UNIT AND UNDERTAKINGS OF ARTHUR BUTLER AND COMPANY
SECTION 04: GENERAL EFFECT OF VESTING
(1) The Mokameh unit, and the undertakings of Arthur Butler and Company, 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 in hand, reserve funds, investments and book debts pertaining to the Mokameh unit or, as the case may be, the undertakings of Arthur Butler and Company, 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-
(a) of Britannia Engineering Company; in relation to the Mokameti unit, or
(b) of Arthur Butler and Company, in relation to the undertakings owned by it, whether within or outside India, and all books of account, registers and other documents of whatever nature relating thereto.
(2) All properties as aforesaid which have vested in the Central Government undersection 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 or other authority, restricting the use of such properties in any manner or appointing any receiver in respect of the whole or any part of such properties 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 (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 amounts specified in the First Schedule 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 or the Government company, as the case may be.
(5) If, on the appointed day, any suit, appeal or-other proceeding of whatever nature instituted or preferred by or against Britannia Engineering Company in relation to the Mokameh unit, or by or against Arthur Butler and Company in relation to any undertaking owned by it, is pending, the same shall not abate, be discontinued or be, in any way, prejudicially affected by reason of the transfer of the Mokameh unit or, as the case may be, the undertakings of Arthur Butler and 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 the Government company, as the case may be.
SECTION 05: POWER OF CENTRAL GOVERNMENT TO DIRECT VESTING OF MOKAMEH UNIT AND THE UNDERTAKINGS OF ARTHUR BUTLER AND CO. IN A GOVERNMENT COMPANY
(1) Notwithstanding anything contained in section 3-, the Central Government may, if it is satisfied that a Government company (whether in existence at the commencement of this Act or incorporated thereafter) 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 Mokameh unit and the undertakings referred to in section 3-, and the right, title and interest of Britannia Engineering Company in relation to the Mokameh unit, and the right, title and interest of Arthur Butler and Company in relation to the undertakings owned by it, 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 in relation to the Mokameh unit and in relation to the other undertakings referred to in section 3-, 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 of the Mokameh unit and of the undertakings of Arthur Butler and Company and all the rights and liabilities of the Central Government in relation to the Mokameh unit and the undertakings of Arthur Butler and Company shall, on and from the date of such vesting, be deemed to have been the rights and liabilities respectively, of the Government company.
SECTION 06: BRITANNIA ENGINEERING COMPANY AND ARTHUR BUTLER AND COMPANY TO BE LIABLE FOR CERTAIN PRIOR LIABILITIES
(1) Every liability of Britannia Engineering Company in relation to the Mokameh unit, or of Arthur Butler and Company in relation to the undertakings owned by it, in respect of any period prior to the appointed day, shall be the liability of Britannia Engineering Company, or Arthur Butler and Company, as the case may be, and shall be enforceable against such company and not against the Central Government or the 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 section of this Act,-
(i) no liability of Britannia Engineering Company, in relation to the Mokameh unit, and
(ii) no liability of Arthur Butler and Company, in relation to the undertakings owned by it, in respect of any period prior to the appointed day, shall be enforceable against the Central Government or the Government company, as the case may be, (b) no award, decree or order of any court, tribunal or other authority in relation to the Mokameh unit, or in relation to the undertakings owned by Arthur Butler and 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 the Government company, as the case may be;
(c) no liability incurred before the appointed day by,-
(i) Britannia Engineering Company, in relation to the Mokameh unit, or
(ii) Arthur Butler and Company, in relation to the undertakings owned by it. for the contravention of any provision of law for the time being in force shall be enforceable against the Central Government or the Government company, as the case may be.
CHAPTER 03: PAYMENT OF AMOUNT
SECTION 07: PAYMENT OF AMOUNT
(1) For the transfer to, and vesting in, the Central Government, under section 3-,-
(a) of the Mokameh unit and the right, title and interest of Britannia Engineering Company, in relation to that unit; and
(b) of the undertakings owned by Arthur Butler and Company and the right, title and interest of Arthur Butler and Company, in relation to those undertakings, there shall be given by the Central Government to Britannia Engineering Company and Arthur Butler and company, in cash and in the manner specified in Chapter VI, an amount equal to the amount specified, respectively, in the First Schedule, against Britannia Engineering Company and Arthur Butler and Company.
(2) For the removal of doubts, it is hereby declared that the liabilities of-
(i) Britannia Engineering Company, in relation to the Mokameh unit and
(ii) Arthur Butler and Company, in relation to the undertakings owned by it, shall be met, in accordance with the rights and interests of the creditors of the respective company from the amount due, respectively to Britannia Engineering Company and Arthur Butler and Company, under sub-section (1).
SECTION 08: PAYMENT OF FURTHER AMOUNT
(1) For the deprivation of Britannia Engineering Company of the management of the Mokameh unit and for the deprivation of Arthur Butler and Company of the management of the undertakings owned by it, there shall be given, in cash, by the Central Government to the respective company, in addition to the amount specified in section 7-, an amount computed at the rate of ten thousand rupees per annum for the period commencing on the date on which the management of such unit or, as the case may be, such undertakings was taken over by the Central Government under the Industries (Development and Regulation) Act, 1951-and ending with the appointed day.
(2) In consideration of the retrospective operation of the provisions of sections 3-,4-and6-, there shall also be given, in cash, by the Central Government to Britannia Engineering Company and to Arthur Butler and Company an amount equal to an amount calculated at the rate of ten thousand rupees per annum for the period commencing on the appointed day and ending with the date on which this Act receives the assent of the President.
(3) The amount specified in section 7-and the amount computed 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 appointed day and ending with the date on which the payment of amount is made by the Central Government to the Commissioner.
(4) The amount determined in accordance with the provisions of sub-section (1), (2) and (3) shall be given to Britannia Engineering Company and to Arthur Butler and Company and to Arthur Butler and Company in addition to the amount specified in the First Schedule.
SECTION 10: DUTY TO DELIVER POSSESSION OF MOKAMEH UNIT AND UNDERTAKINGS OF ARTHUR BUTLER AND COMPANY
(1)Every person, in whose possession or custody or control-
(i) the Mokameh unit, or
(ii) any undertaking of Arthur Butler and Company, or any part of such unit or undertaking or any machinery, instrument or other movable assets forming part of such unit or undertaking, may be immediately before the appointed day, shall forthwith deliver possession of the Mokameh unit or such undertaking or such part machinery instrument or other asset, as the case may be, to the Central Government or the Government company or to such person or body of persons as the Central Government company may specify in this behalf.
(2) Every person who has, on the appointed day, in his possession or under his control any assets, books, documents or other papers relating to the Mokameh unit or any undertaking owned by Arthur Butler and Company, which has vested in the Central Government or a Government company under this Act, and which belong to Britannia Engineering Company or, as the case may be, Arthur Butler and Company or would have so belonged if the Mokameh unit, or as the case may be, the undertakings owned by Arthur Butler and Company, had not vested in the Central Government or Government company, shall be liable to account for the said assets, books, documents and other papers to the Central Government or the Government company and shall deliver them up to the Central Government or the Government company or to such person or body of person or body of persons as the Central Government or the Government company may specify in this behalf.
(3) The Central Government may take or cause to be taken all necessary steps for securing possession of the Mokameh unit and the undertakings of Arthur Butler and Company which have vested in it under section 3-.
SECTION 11: DUTY OF THE COMPANIES TO FURNISH PARTICULARS
- Britannia Engineering Company and Arthur Butler and Company shall, within such period as the Central Government may allow in this behalf, furnish to that Government a complete inventory of all its properties and assets, as on the appointed day, pertaining to the Mokameh unit or, as the case may be, the undertakings owned by Arthur Butler and Company which has or have vested in the Central Government under section 3-, and for this purpose the Central Government or the Government or the Government company may specify in this behalf, all assets books of account, registers or other documents in their custody relating to the Mokameh unit or, as the case may be, any undertaking owned by Arthur Butler and Company.
CHAPTER 05: PROVISIONS RELATING TO EMPLOYEES OF MOKAMEH UNIT AND OF ARTHUR BUTLER AND COMPANY
SECTION 13: EMPLOYMENT OF EMPLOYEES TO CONTINUE
(1) Every person who has been immediately before the appointed day, employed by-
(i) Britannia Engineering Company, in connection with the Mokameh unit, or
(ii) Arthur Butler and Company, in connection with any undertaking owned by it, shall become, on and from the appointed day, an employee of the Central Government or, as the case may be, of the Government company and shall hold office or service under the Central Government or the Government company as the case may be, with the same rights and privileges as to pension, gratuity and other matters as would have been admissible to him if there had been no such vesting and shall continue to do so unless and his employment under the Central Government or the Government company, as the case may be, is duly terminated or until his remuneration and other conditions of service are duly altered by the Central Government company, as the case may be.
(2) Notwithstanding anything contained in the Industrial disputes Act, 1947-or in any other law for the time being in force, the transfer of the services of any officer or other person employed in the Mokameh unit or any undertakings owned by Arthur Butler and Company, to the Central Government or the Government company shall not entitle such officer or other employee to any compensation under this Act or any other law for time being in force and no such claim shall be entertained by any court, tribunal or other authority.
SECTION 14: PROVIDENT FUND AND OTHER FUNDS
(1) Where Britannia Company or Arthur Butler and Company has established a provident fund, superannuation fund, welfare fund or other fund for the benefit of persons employed in the Mokameh unit, or, as the case may be, any of the undertakings owned by Arthur Butler and Company, the monies relatable to the employees, whose services have become transferred by or under this Act, to the Central Government or the Government company shall out of the monies standing, on the appointed day to the credit of such provident fund, superannuation fund, welfare fund or other funds, stand transferred to, and vest in, the Central Government or the Government company, as the case may be.
(2) The monies which stand transferred under sub-section (1) to the Central Government or the Government company, as the case may be, shall be death with by that Government company in such manner as may be prescribed.
CHAPTER 06: COMMISSIONER OF PAYMENTS
SECTION 15: APPOINTMENT OF COMMISSIONER OF PAYMENTS
(1) The Central Government shall, for the purpose of disbursing the amount payable under section 7-and8-to Britannia Engineering Company and to Arthur Butler and Company, by notification, appoint a Commissioner of Payments.
(2) The Central Government may appoint such other persons as it may think fit to assist the Commissioner and thereupon the Commissioner may authorise one or more of such persons also to exercise all or any of the powers exercisable by him under this Act and different persons may be authorised to exercise different powers.
(3) Any person authorised by the Commissioner to exercise any of the powers exercisable by the Commissioner may exercise those powers in the same manner and with the same effect as if they have been conferred on that person directly by this Act and not by way of authorisation.
(4) The salaries and allowances of the Commissioner and other persons appointed under this shall be defrayed out of the Consolidation Fund of India.
SECTION 16: PAYMENT BY CENTRAL GOVERNMENT TO THE COMMISSIONER
(1) The Central Government shall, within thirty days from the specified date2, pay, in cash, to the Commissioner, for payment to Britannia Engineering Company and to Arthur Butler and Company.-
(a) an amount equal to that specified against each of their names in the First Schedule,
(b) an amount equal to that payable to Britannia Engineering Company and Arthur Butler and Company under section 8-.
(2) A deposit account shall be opened by the Central Government in favour of the Commissioner in the Public Account of India, and every amount paid under this Act to the Commissioner shall be deposited by him to the credit of the said deposit account and the said deposit account shall be operated by the commissioner.
(3) Separate records shall be maintained by the Commissioner in respect of Mokameh unit and the undertakings owned by Arthur Butler and Company in relation to which payment has been made to him under this Act.
(4)Interest accruing on the amounts standing to the credit of the deposit account referred to in sub-section (2) shall ensure to the benefit of Britannia Engineering Company and Arthur Butler and Company.
SECTION 17: CERTAIN POWERS OF THE CENTRAL GOVERNMENT OF GOVERNMENT COMPANY
(1) The Central Government or the Government company, as the case may been shall be entitled to receive, up to the specified date, to the exclusion of all other persons, any money due to Britannia Engineering Company in relation to the Mokameh unit, or Arthur Butler and Company in relation to any of the undertakings owned by it, which has vested in the Central Government or the Government company, and realised after the appointed day, notwithstanding that the realisation pertains to a period to the appointed day.
(2) The Central Government or the Government company, as the case may be, may make a claim to the Commissioner with regard to every payment made by that the appointed day for discharging any liability of Britannia Engineering Company in relation to the Mokameh unit, or of Arthur Butler and Company in relation to any of the undertakings owned by it, in relation to any period prior to the appointed day and every such claim shall have priority, in accordance with the priorities attaching under this Act, to the matter in relation to which such liability has been discharged by the Central Government or the Government company.
(3) Save as otherwise provided in this Act, the liabilities of Britannia Engineering Company in relation to the Mokameh unit, or of Arthur Butler and Company in relation to any of the undertakings owned by it, in respect of any transaction prior to the appointed day, which have not been discharged on or before the specified date, shall be the liabilities of Britannia Engineering Company or Arthur Butler and Company, as the case may be.
SECTION 18: CLAIMS TO BE MADE TO THE COMMISSIONER
- Every person having a claim against Britannia Engineering Company in relation to the Mokarneh unit, or against Arthur Butler and Company in relation to the undertaking owned by it, shall prefer such claim before Commissioner within thirty days from the specified date :2Provided that if the Commissioner is satisfied that the claimant was prevented by sufficient cause from prefer if the dun within the said period of thirty days, he may entertain the claim within a further period of thirty days, but not thereafter.
SECTION 19: PRIORITY OF CLAIMS
The claims arising out of the matters specified in the Second Schedule shall have priorities in accordance with the following principles, namely:-
(a) category I shall have precedence over all categories and category II shall have precedence over category III and soon;
(b) the claims specified in each of the categories, except category IV, shall rank equally and be paid in full, but, if the amount is insufficient to meet such claims in full, they shall abate in equal proportion and be paid accordingly;
(c) the liabilities specified in category IV shall be discharged subject to the priorities specified in this section in accordance with the terms of the secured loan and the priority, inter se, of such loans; and
(d) the question of discharging any liability with regard to a matter specified in a lower category shall arise only if a surplus is left after meeting all the liabilities specified in the immediately higher category.
SECTION 20: EXAMINATION OF CLAIMS
(1) On receipt of the claims made under section 18-, the Commissioner shall arrange the claims in the order of priorities specified in the Second Schedule and examine the same in accordance with such order of priorities.
(2) If on an examination of the claim, the Commissioner is of opinion that the amount paid to him under this Act is not sufficient to meet the liabilities specified in any lower category, he shall not be required to examine the claim in respect of such lower category.
SECTION 21: ADMISSION CR REJECTION OF CLAIMS
(1) After examining the claims with reference to the priorities set out in the Second Schedule, the Commissioner shall fix a date on or before which every claimant shall file the proof of his claim failing which he will be excluded from the benefit of the disbursement made by the Commissioner.
(2) Not less than fourteen days' notice of the date so fixed shall be given by advertisement in one issue of the daily newspaper in the English language having circulation in the major part of the country and one issue of such daily newspaper in the regional language as the Commissioner may consider suitable, and every such notice shall call Upon the claimant to file the proof of his claim with the Commissioner within the period specified in the advertisement.
(3) Every claimant who fails to file Ac proof of his claim within the period specified by the Commissioner shall be excluded from the disbursement made by the Commissioner.
(4) The Commissioner shall, after such investigation as may, in his opinion, be necessary and-after giving Britannia Engineering Company or, as the case may be, Arthur Butler and Company, an opportunity of refuting the claim and after giving the claimant a reasonable opportunity of being heard, in writing, admit or reject the claim in whole or in part.
(5) The Commissioner shall have the power to regulate his own procedure in all matters arising out of the discharge of his functions, including the place or places at which he may hold his sitting and shall, for the purpose of making any investigation under this Act, have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908-, while trying a suit, in respect of the following matters, namely:-
(a) the summoning and enforcing the attendance of any witness and examining him on oath;
(b) the discovery and production of any document or other material object producible as-evidence;
(c) the reception of evidence on affidavit;
(d) the issuing of any commission for the examination of witnesses.
(6) Any investigation before the Commissioner shall be deemed to be a judicial proceeding within the meaning of section 193-and228 of the Indian Penal Code-and the Commissioner shall be deemed to be a civil court for the purposes of section 195-andChapter 26 of the Code of Criminal Procedure, 1973-.
(7) A claimant who is dissatisfied with the decision of the Commissioner may prefer an appeal against the decision to the principal court of original jurisdiction within the local limits of whose jurisdiction t
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