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ANDHRA SCIENTIFIC COMPANY LIMITED (ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT, 1982
71 of 1982
13th November, 1982
The Andhra Scientific Company Limited, Machilipatnam is engaged in the manufacture and production of various types of scientific instruments. From a small beginning, the Company had grown to be the largest private sector undertaking in the field of scientific instruments. Building up steadily, the Company attained a turnover of Rs. 45 lakhs by 1965-66. A downword trend started thereafter and in 1967-68, the Company incurred a loss of Rs. 1.91 lakhs which increased to Rs. 25.62 lakhs in 1971-72. In the light of the recommendations of certain Governmental Committees and in view of the fact that the Company had a body of talented and dedicated scientists and engineers its management was taken over by the Central Government under section 18AA of the Industries (Development and Regulation) Act, 1951, in June, 1972. 2. Though the Central Government was advancing some amounts as loans during the period of its management, the Company was facing acute shortage of liquid funds for its working capital requirements. Funds are also required for modernisation of the plant and machinery. But pending nationalisation of the Company, it was not possible for Government to invest the required amount of funds in the Company. Studies made to determine the future set-up of the Company revealed that the undertakings of the Company should be nationalised m order to consolidate the gains of management and to ensure uninterrupted supply of critical items of defence production. In view of the importance of the products manufactured by the Company and the loss of employment to more than 850 employees of the Company if the Company were to close down, it is considered neccessary to take over the undertakings of the Company. 3. The Bill seeks to achieve the aforesaid object. Apart from providing for the acquisition and ' transfer of the undertakings of the Company, the Bill provides for the payment of an amount for such acquisition, vesting of the undertakings of the Company in a Government company, appointment of a Commissioner of Payments for the purpose of disbursing the amount payable to the Company and for other incidental and consequential matters. -S.O.R. - Gai. of Ind., 16-10-1982, Pt. II, S. 2, Ext., p. 15 (No. 48).
An Act to provide for the acquisition and transfer of the undertakings of the Andhra Scientific Company Limited, with a view to securing the proper management of such undertakings so as to sub serve the interests of the general public by ensuring the continuity of production of scientific instruments which are vital to the needs of the country and for matters connected therewith or incidental thereto. WHEREAS the Andhra Scientific Company Limited had been engaged in the manufacture and production of articles mentioned in the First Schedule to the Industries (Development and Regulation) Act, 1951, namely, scientific instruments;
AND WHEREAS the management of the undertakings of the Andhra Scientific Company Limited was taken over by the Central Government under section 18AA of the Industries (Development and Regulation) Act, 1951; AND WHEREAS it is necessary to acquire the undertakings of the Andhra Scientific Company Limited to ensure that the interests of the general public are served by the continuance, by the undertakings of the Company, of the production of the aforesaid articles which are vital to the needs of the country; BE it enacted by Parliament in the Thirty-third Year of the Republic of India as follows:-
CHAPTER 01: PRELIMINARY
SECTION 01: SHORT TITLE AND COMMENCEMENT
- (1) This Act may be called The Andhra Scientific Company Limited (Acquisition and Transfer of Undertakings) Act, 1982.
(2) The provisions ofsections 27-and28-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 July, 1981.
SECTION 02: DEFINITIONS
In this Act, unless the context otherwise requires,-
(a) "appointed day" means the 1st day of July, 1981;
(b) "Commissioner" means the Commissioner of Payments appointed undersection 15-;
(c) "Company" means the Andhra Scientific Company Limited, a company within the meaning ofthe Companies Act, 1956-, and having its registered office at Machilipatnam in the State of Andhra Pradesh;
(d) "Custodian" means the Custodian appointed under sub-section (2) ofsection 9-to take over, or carry on, the management of the Company;
(e) "notification" means a notification published in the Official Gazette;
(f) "prescribed" means prescribed by rules made under this Act;
(g) "specified date", in relation to any provision of this Act, means such date as the Central Government may, by notification, specify for the purposes of that provision and different dates may be specified for different provisions of this Act;
(h) "the Government company" means the Government company in which the undertakings of the Company are directed to vest under sub-section (1) ofsection 6-;
(i) words and expressions used herein and not defined but defined inthe Companies Act, 1956-, shall have the meanings, respectively, assigned to them in that Act.
CHAPTER 02: ACQUISITION AND TRANSFER OF THE UNDERTAKINGS OF THE COMPANY
SECTION 03: TRANSFER TO, AND VESTING IN, THE CENTRAL GOVERNMENT 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, stand transferred to, and shall vest in, the Central Government.
SECTION 04: 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, buildings, workshops, stores, instruments, machinery and equipment, cash balances, cash on hand, cheques, demand drafts, 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 hereto.
(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 them, and any attachment, injunction, decree or order of any court, tribunal 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 amount specified insection 7- and also out of the amounts determined undersection 8-, but no such mortgage, charge, lien or other interest shall be enforceable against any property which has vested in this Central Government.
(5) Any licence or other instrument granted to the Company in relation to any undertaking which has vested in the Central Government undersection 3-at any time before the appointed day and in force immediately before that day shall continue to be in force on and after such day in accordance with its tenor in relation to and for the purposes of such undertaking, and, on and from the date of vesting of such undertaking undersection 6-in a Government company, such Government company shall be deemed to be substituted in such licence or other instrument as if such licence or other instrument had been granted to such Government company and that Government company shall hold it for the remainder of the period for which the Company would have held it under the terms thereof.
(6) 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 undersection 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 the 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, undersection 6-, to vest in a Government company, by or against the Government company.
SECTION 05: COMPANY TO BE LIABLE FOR CERTAIN 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 of the Company are directed, undersection 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, undersection 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, undersection 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, undersection 6-, to vest in a Government company, against that Government company.
SECTION 06: POWER OF CENTRAL GOVERNMENT TO DIRECT VESTING OF THE UNDERTAKINGS OF THE COMPANY IN A GOVERNMENT COMPANY
(1) Notwithstanding anything contained insections 3-and4-, the Central Government may, subject to such terms and conditions as it 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 that Government undersection 3-, shall, instead of continuing to vest in the Central Government, vest in a 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 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 of the Government company.
CHAPTER 03: PAYMENT OF AMOUNTS
SECTION 07: PAYMENT OF AMOUNT
- For the transfer to, and vesting in, the Central Government, undersection 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 two hundred and twenty-four lakhs and ten thousand.
SECTION 08: PAYMENT OF FURTHER AMOUNTS
- (1) For the deprivation of the Company of the management of the undertakings, there shall be given by the Central Government to the Company in cash, an amount calculated at the rate of rupees ten thousand per annum for the period commencing on the date on which the management of the undertakings of the Company was taken over in pursuance of the order made by the Central Government undersection 18AA of the Industries (Development and Regulation) Act, 1951-, and ending on the appointed day.
(2) In consideration of the retrospective operation of the provisions ofsections 3-,4-and5-, there shall also be given by the Central Government to the Company in cash, an amount calculated at the rate of rupees ten thousand per annum for the period commencing on the appointed day and ending on the date on which this Act receives the assent of the President.
(3) The amount specified in section 7-, and the amount determined in accordance with the provisions of 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 on the date on which payment of such amounts 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 amount 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.
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 or Custodians, 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 or Custodians, as the case may be, all assets, books of account, registers or other documents in their custody relating to the undertakings of the 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 or Custodians, and such Government company or the Custodian or Custodians may also, if it is considered necessary so to do, 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 or in relation to any other matter arising in the course of such management.
SECTION 11: DUTY OF PERSONS TO ACCOUNT FOR ASSETS, ETC., IN THEIR POSSESSION
(1) Any person who has, on the appointed day, in his possession or under his control, any assets, books, documents or other papers relating to any undertaking owned by the Company, which have vested in the Central Government or in a Government company under this Act, and which belong to the Company, or would have so belonged, if the undertakings owned by the Company had not vested in the Central Government or such 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 such Government company or to such person or persons as the Central Government or the Government company may specify in this behalf.
(2) Central Government or the Government company aforesaid may take or cause to be taken all necessary steps for securing possession of the undertakings of the Company which have vested in the Central Government or the Government company under this Act.
(3) The 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 undertakings which have vested in the Central Government under section 3-, and, for this purpose, the Central Government or the Government company aforesaid shall afford to the Company all reasonable facilities.
SECTION 12: ACCOUNTS AND AUDIT
- The Custodian or Custodians of the undertakings of the Company shall maintain an account of the undertakings of the Company in such form and manner and under such conditions as may be prescribed and the provisions of the Companies Act, 1956-, shall apply to the audit of the accounts so maintained as they apply to the audit of the accounts of a company.
CHAPTER 05: PROVISIONS RELATING TO THE EMPLOYEES OF THE COMPANY
SECTION 13: CONTINUANCE OF EMPLOYEES
- (1) Every person who has been, immediately before the appointed day, employed in any
undertaking of the Company shall become,-
(a) on and from the appointed day, an employee of the Central Government, and
(b) where the undertakings of the Company are directed; under sub-section (1) ofsection 6-, to vest in a Government company, an employee of the Government company on and from the date of such vesting, 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 until 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 or the Government company, as the case may be.
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