GRESHAM AND CRAVEN OF INDIAN (PRIVATE) LIMITED (ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT

THE GRESHAM AND CRAVEN OF INDIAN (PRIVATE) LIMITED(ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT, 1977

ACT No. 42 OF 1977

20thDecember, 1977

An Act to provide for the acquisition and transfer of theundertakings of Messrs. Gresham and Craven of India (Private) Limited for thepurpose of ensuring the continuity of production of goods which are vital tothe needs of the Railways and of the industries manufacturing engineeringproducts and for matters connected therewith or incidental thereto

WHEREAS Messrs. Greshamand Craven of India (Private) Limited were engaged in the manufacture andproduction of components of rolling stock like vacuum brake equipment,ejectors, steam brake valves and vacuum exhausters and the like needed by theRailways and the industries manufacturing engineering products;

AND WHEREAS as a result of thelosses suffered by the Company, there had been a closure of the works owned bythe Company;

AND WHEREAS for the purposes ofspeedily bringing the closed works of the Company into operation, themanagement of the undertakings of the Company was taken over by the CentralGovernment for a limited period under section 18A of the Industries(Development and Regulation) Act, 1951 (65 of 1951);

AND WHEREAS it is necessary toacquire the undertakings of the Company to ensure the continuance of theproduction of goods which are vital to the needs of the Railways and of theindustries manufacturing engineering products;

BE it enacted by Parliament inthe Twenty–eighth Year of the Republicof India as follows : ––

CHAPTER I

PRELIMINARY

1.Short title and commencement: (1) This Act may be called theGresham and Craven of India (Private) Limited (Acquisition and Transfer ofUndertakings) Act, 1977.

(2) The provisions of sections28 and 29 shall be deemed to have come into force on the 30th day of September,1977 and the remaining provisions of this Act shall be deemed to have come intoforce on the 1st day of August, 1977.

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

(a) "appointedday" means the 1st day of August, 1977;

(b) "Braithwaite andCompany Limited" means the Government commissioner known as theBraithwaite and Company Limited in which the undertakings of the Braithwaiteand Commissioner (India) Limited together with the right, title and interest ofthe said Company thereon vested with effect from the 1st day of December, 1976,in pursuance of the notification of the Government of India in the Ministry ofIndustry (Department of Heavy Industry) No.S.O.771 (E), dated the 3rd December,1976, issued under sub–section (1) of section 6 of the Braithwaite andCompany (India) Limited (Acquisition and Transfer of undertakings) Act, 1976(96 of 1976);

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

(d) "Company means theGresham and Craven of India (Private) Limited, being a company as defined inthe Companies Act, 1956 (1 of 1956), and having its registered office at 22–Gobra Road, Calcutta–14;

(e) "Governmentcompany" has the meaning assigned to it by section 617 of the CompaniesAct, 1956 (1 of 1956);

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

(g) "Ordinance" meansthe Gresham and Craven of India (Private) Limited (Acquisition and Transfer ofUndertakings) Ordinance, 1977 (14 of 1977);

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

(i) "specifieddates" means such date as the Central Government may, for the purpose ofany provision of this Act, by notification, specify and different dates may bespecified for different provisions of this Act;

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

CHAPTER II

ACQUISITION AND TRANSFER OF THE UNDERTAKINGS OF THE COMPANY

3.Transfer of and vesting in the CentralGovernment of the undertakings of the Company: On the appointed day, the undertakings of theCompany, and the right, title and interest of the Company in relation to itsundertakings, shall, by virtue of this Act, stand transferred to, and shallvest in, the Central Government.

4.General effect of vesting:(1) The undertakings of theCompany shall be deemed to include all ass, rights, lease–holds, powers,authorised and privileges, and all property, movable and immovable includinglands, buildings, workshops, stores, instruments, machinery and equipment, cashbalances, cash on hand, reserve funds, investments, book debts and all otherrights and interests in, or arising out of, such property as were immediatelybefore the appointed day in the ownership, possession, power or control of theCompany, whether within or outside India, and all books of account, registersand all other documents of whatever nature relating thereto.

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

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

(4) For the removal of doubts,it is hereby declared that the mortgage of any property referred to in sub–section(3) or any other person holding any charge, lien or other interest in, or inrelation to, any such property shall be entitled to claim, in accordance withhis rights and interests, payment of the mortgage money or other dues, in wholeor in part, out of the amount specified in section 8, and also out of themonies determined under section 9, but, no such mortgage, charge, lien or otherinterest shall be enforceable against any property which has vested in theCentral Government.

(5) If on the appointed day,any suit, appeal or other proceeding by or against the Company, of whatevernature in relation to any property which has vested in the Central Government,under section 3, is pending, the same shall not abate, be discontinued or be,in any way, prejudicially affected by reason of the transfer of theundertakings of the Company or of anything contained in this Act, but the suit,appeal or other proceeding may be continued, prosecuted or enforced by oragainst the Central Government, or the Braithwaite and Company Limited, or,where the undertakings of the Company are directed, under section 7, to vest ina Government company, against that Government company.

5.Central Government or theBraithwaite and Company Limited or the Government company not to be liable forprior liabilities: (1) Every liability of the Company in respect of any period priorto the appointed day, shall be the liability of the Company and shall beenforceable against it and not against the Central Government, or, theBraithwaite and Company Limited, or, where the undertakings of the Company aredirected, under section 7, to vest in a Government company, against thatGovernment company.

(2) For the removal of doubts,it is hereby declared that, –

(a) save as otherwise expresslyprovided in this Act, no liability of the Company in respect of any periodprior to the appointed day shall be enforceable against the Central Government,or, Braithwaite and Company Limited, or, where the undertakings of the Companyare directed, under section 7, to vest in a Government company, against thatGovernment company;

(b) no award, decree or orderof any court, tribunal or other authority in relation to the undertakings ofthe Company, passed after the appointed day, in respect of any matter, claim ordispute which arose before that day, shall be enforceable against the CentralGovernment, or the Braithwaite and Company Limited, or, where the undertakingsof the Company are directed, under section 7, to vest in a Government company,against that Government company;

(c) no liability incurred bythe Company before the appointed day, for the contravention of any provision oflaw for the time being in force, shall be enforceable against the CentralGovernment, or the Braithwaite and Company Limited, or, where the undertakingsof the Company are directed, under section 7, to vest in a Government company,against that Government company.

6.Vesting of the undertakingsof the Company in the Braithwaite and Company Limited: (1) Notwithstanding anythingcontained in sections 3 and 4, the Central Government shall, as soon as may be,after the promulgation of Ordinance, direct, by notification, that theundertakings of the Company, and the right, title and interest of the Companyin relation to its undertakings which have vested in that Central Governmentunder section 3, shall, instead of continuing to vest in the CentralGovernment, vest in the Braithwaite and Company Limited either on the date ofthe notification or on such earlier or later date (not being a date earlierthan the appointed day) as may be specified in the notification.

(2) Where the right, title andinterest of the Company in relation to its undertakings, vest in theBraithwaite and Company Limited under sub–section (1), the Braithwaiteand Company Limited shall, on and from the date of such vesting, be deemed tohave become the owner in relation to such undertakings, and all the rights andliabilities 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 andliabilities, respectively, of the Braithwaite and Company Limited.

7.Power of Central Governmentto direct vesting of the undertakings of the Company in a Government company: (1)Notwithstanding anything contained in sections 3, 4, and 6, the CentralGovernment may, if it is satisfied that a Government company is willing tocomply, or has complied, with such terms and conditions as that Government maythink fit to impose direct, by notification, that the undertakings of theCompany, and the right, title and interest of the Company in relation to itsundertakings, which have vested in the Central Government under section 3 andthereafter in the Braithwaite and Company Limited, under section 6, shall,instead of continuing to vest in the Braithwaite and Company Limited, vest inthe Government company either on the date of the notification or on suchearlier or later date (not being a date earlier than the appointed day) as maybe specified in the notification.

(2) Where the right, title adetention interest of the Company in relation to its undertakings vest in aGovernment company under sub–section (1), the Government company shall,on and from the date of such vesting, be deemed to have become the owner inrelation to such undertakings, and all the rights and liabilities of theCentral Government or the Braithwaite and Company Limited in relation to suchundertakings shall, on and from the date of such vesting, be deemed to havebecome the rights and liabilities, respectively, of the Government company.

CHAPTER III

PAYMENT OF AMOUNTS

8.Payment of amount: For the transfer to, andvesting in, the Central Government, under section 3, of the undertakings of theCompany and the right, title and interest of the Company in relation to itsundertakings, there shall be given by the Central Government to the Company, incash, and in the manner specified in Chapter VI, and amount of rupees onehundred and seventy–six lakhs.

9.Payment of further amount:(1) For the deprivation of theCompany of the management of its undertakings, there shall be given to theCompany by the Central Government an amount calculated at the rate of rupeesfifty thousand per annum for the period commencing on the date on which themanagement of the undertakings of the Company was taken over by the Central Governmentand ending on the appointed day.

(2) In consideration of the retrospectiveoperation 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 amountcalculated at the rate of rupees fifty thousand per annum for the periodcommencing on the appointed day and ending on the date of promulgation of theOrdinance.

(3) The amount specified insection 8 and the amount determined under sub–sections (1) and (2) shallcarry simple interest at the rate of four percent per annum for theperiod commencing on the date of promulgation of the Ordinance and ending onthe date on which payment of such amounts is made by the Central Government tothe Commissioner.

(4) The amount determined inaccordance with the provisions of sub–sections (1), (2) and (3) shall begiven by the Central Government to the Company in addition to the amountspecified in section 8.

(5) For the removal of doubts,it is hereby declared that the liabilities of the Company, in relation to itsundertakings which have vested in the Central Government under section 3, shallbe discharged from the amounts referred to in section 8, and also from theamounts determined under sub–sections (1), (2) and (3) in accordancewith the rights and interests of the creditors of the Company.

CHAPTER IV

MANAGEMENT, ETC., OF THE UNDERTAKINGS OF THE COMPANY

10.Management,etc., of the undertakings of the Company: (1) The Braithwaite and Company Limited in whichthe undertakings of the Company and the right, title and interest of theCompany in relation to its undertakings vested under section 6 shall beentitled to exercise all such powers and do all such things as the Company isauthorised to exercise and do in relation to its undertakings.

(2) The generalsuperintendence, direction, control and management of the affairs and businessof the undertakings of the Company, the right, title and interest in relationto which have vested, under section 3, in the Central Government and, undersection 6, in the Braithwaite and Company Limited shall, where a direction hasbeen made by the Central Government under sub–section (1) of section 7,vest in the Government company so specified shall be entitled to exercise allsuch powers and do all such things as the Company is authorised to exercise anddo in relation to its undertakings.

11.Duty of persons in charge ofmanagement of the undertakings of the Company to deliver all assets, etc: (1) On the vesting of themanagement of the undertakings of the Company in the Braithwaite and CompanyLimited, all persons in charge of the management of the undertakings of theCompany immediately before such vesting shall be bound to deliver to theBraithwaite and Company Limited all assets, books of account, registers orother documents in their custody relating to the undertakings of the Company.

(2) The Central Government mayissue such directions as it may deem desirable in the circumstances of the caseto the Braithwaite and Company Limited as to its or his powers and duties andthe Braithwaite and Company Limited may also, if it or he so desires, apply tothe Central Government at any time for instructions as to the manner in whichthe management of the undertakings of the Company shall be conducted by it orin relation to any other matter arising in the course of such management.

(3) On the vesting of themanagement of the undertakings of the Company in a Government company, theprovisions of sub–sections (1) and (2) shall apply to, or in relationto, the Government company as they apply to, or in relation to, the Braithwaiteand Company Limited, subject to the modification that the references to theBraithwaite and Company Limited shall be construed as references to theGovernment company.

CHAPTER V

PROVISIONS RELATING TO THE EMPLOYEES OF THE COMPANY

12.Employment of certainemployees to continue: (1) Every person who has been, immediately before the appointedday, employed in any undertaking of the Company shall become, on and from theappointed day, or such later date, as the case may be, an employee of theBraithwaite and Company Limited, or, as the case may be, of the Governmentcompany in which the right, title and interest of the Company in relation toits undertakings, have vested under this Act, and shall hold office or serviceunder the Braithwaite and Company Limited, or the Government company, as thecash may be, with the same rights and privileges as to pension, gratuity andother matters as would have been admissible to him if there had been no suchvesting and shall continue to do so unless and until his employment under theBraithwaite and Company Limited, or the Government company, as the case may be,is duly terminated or until his remuneration, and other conditions of serviceare duly altered by the Braithwaite and Company Limited, or by the Governmentcompany, as the case may be.

(2) Notwithstanding anythingcontained in the Industrial Disputes Act, 1947 (14 of 1947), or in any otherlaw for the time being in force, the transfer of the services of any officer orother person employed in the undertaking of the Company to the Braithwaite andCompany Limited, or the Government company, shall not entitle such officer orother employee to any compensation under this Act or under any other law forthe time being in force and no such claim shall be entertained by any court,tribunal or other authority.

(3) Where, under the terms ofany contract, of service or otherwise, any person, whose services becometransferred to the Braithwaite and Company Limited, or the Government company,by reason of the provisions of this Act, is entitled to any arrears of salaryor wages or any payments for any leave not availed of or any other payment, notbeing payment by way of gratuity or pension, such person may enforce his claimagainst the Company, but not against the Central Government, or the Braithwaiteand Company Limited, or the Government company.

13.Provident fund and otherfunds: (1) Where the Company hasestablished a provident fund, superannuation fund, welfare fund or other fundfor the benefit of the persons employed in the undertakings of the Company, themonies relatable to the officers or other employees, whose services have becometransferred by or under this Act to the Braithwaite and Company Limited, or theGovernment company, shall, out of the monies standing, on the appointed day, tothe credit of such provident fund, superannuation fund, welfare fund and otherfund, stand transferred to, and shall vest in, the Braithwaite and CompanyLimited, or the Government company, as the case may be.

(2) The monies which standtransferred under sub–section (1) to the Braithwaite and CompanyLimited, or the Government company, as the case may be, shall be dealt with bythe Braithwaite and Company Limited, or the Government company, in such manneras may be prescribed.

CHAPTER VI

COMMISSIONER OF PAYMENTS

14.Appointmentof Commissioner of Payments: (1) The Central Government shall, for the purpose of disbursingthe amounts payable to the Company under sections 8 and 9, by notification,appoint a Commissioner of Payments.

(2) The Central Government mayappoint such other persons as it may think fit to assist the Commissioner andthereupon the Commissioner may authorise one or more of such persons also toexercise all or any of the powers exercisable by him under this Act anddifferent persons may be authorised to exercise different powers.

(3) Any person authorised bythe Commissioner to exercise any of the powers exercisable by the Commissionermay exercise those powers in the same manner and with the same effect as ifthey have been conferred on that person directly by this Act and not by way ofauthorisation.

(4) The salaries and allowancesof the Commissioner and other persons appointed under this section shall bedefrayed out of the Consolidated Fund of India.

15.Paymentby the Central Government to the Commissioner: (1) The Central Government shall, within thirtydays from the specified date, pay, in cash, to the Commissioner, for payment tothe Company —

(a) anamount equal to the amount specified in section 8; and

(b) anamount equal to the amount payable to the Company under section 9.

(2) A deposit account shall beopened by the Central Government in favour of the Commissioner, in the PublicAccount 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 thesaid deposit account shall be operated by the Commissioner.

(3) The Interest accruing on theamounts standing to the credit of the deposit account referred to in sub–section(2) shall ensure to the benefit of the Company.

16.Certain powers of theCentral Government or Braithwaite and Company Limited or Government company:(1) The Central Government, orthe Braithwaite and Company Limited, or the Government company, as the case maybe, shall be entitled to receive up to the specified date, to the exclusion ofall other persons, any money due to the Company, in relation to itsundertakings which have vested in the Central Government, or the Braithwaiteand Company Limited, or the Government company, realised after the appointedday notwithstanding that the realisations pertains to a period prior to theappointed day.

(2) The Central Government, orthe Braithwaite and Company Limited, or the Government company, as the case maybe, may make a claim to the Commissioner with regard to every payment made byit after the appointed day for discharging any liability of the Company, inrelation to any period prior to the appointed day; and every such claim shallhave priority, in accordance with the priorities attaching, under this Act, tothe matter in relation to which such liability has been discharged by theCentral Government, or the Braithwaite and Company Limited or the Governmentcompany.

(3) Save as otherwise providedin this Act, the liabilities of the Company in respect of any transaction priorto the appointed day, which have not been discharged on or before the specifieddate, shall be the liabilities of the Company.

17.Claims to bemade to the Commissioner: Every person having a claim against the Companyshall prefer such claim before the Commissioner within thirty days from thespecified date:

Provided that if theCommissioner is satisfied that the claimant was prevented by sufficient causefrom preferring the claim within the said period of thirty days, he mayentertain the claim within a further period of thirty days and not thereafter.

18.Priorityof claims: The claims arising out of thematters specified in the Schedule shall have priorities in accordance with thefollowing principles, namely: –

(a) Category I shall haveprecedence over all other categories and Category II shall have precedence overCategory III, and so on;

(b) the claims specified ineach of the categories, shall rank equally and be paid in full, but, if theamount is insufficient to meet such claims in full, they shall abate in equalproportions and be paid accordingly;

(c) thequestion of discharging any liability with regard to a matter specified in alower category shall arise only if a surplus is left after meeting all theliabilities specified in the immediately higher category.

19.Examinationof claims: (1) On receipt of the claimsmade under section 17, the Commissioner shall arrange the claims in the orderof priorities specified in the Schedule and examine the same in accordance withsuch order of priorities.

(2) If, on examination of theclaims, the Commissioner is of the opinion that the amount paid to him underthis Act is not sufficient to meet the liabilities specified in any lowercategory, he shall not be required to examine the claims in respect of suchlower category.

20.Admissionor rejection of claims: (1) After examining the claims with reference to the prioritiesset out in the Schedule, the Commissioner shall fix a date on or before whichevery claimant shall file the proof of his claim, failing which he will beexcluded from the benefit of the disbursements made by the Commissioner.

(2) Not less than fourteendays’ notice of the date so fixed shall be given by advertisement in one issueof the daily newspaper in English language and in one issue of the dailynewspaper in the regional language as the Commissioner may consider suitable,and every such notice shall call upon the claimant to file the proof of hisclaim with the Commissioner within the time specified in the advertisement.

(3) Every claimant who fails tofile the proof of his claim within the time specified by the Commissioner shallbe excluded from the disbursements made by the Commissioner.

(4) The Commissioner shall,after such investigation as may, in his opinion, be necessary and after givingthe Company and opportunity of refuting the claim and after giving the claimanta reasonable opportunity of being heard, in writing, admit or reject the claimin whole or in part.

(5) The Commissioner shall havethe power to regulate his own procedure in all matters arising out of thedischarge of his functions, including the place or places at which he will holdhis sittings and shall, for the purpose of making any investigation under thisAct, have the same powers as are vested in a civil court under the Code ofCivil Procedure, 1908 (5 of 1908), while trying a suit, in respect of the followingmatters, namely: ––

(a) thesummoning and enforcing the attendance of any witness and examining him onoath;

(b) thediscovery and production of any document or other material object producible asevidence;

(c) thereception of evidence on affidavits;

(d) theissuing of any commission for the examination of witnesses.

(6) Any investigation beforethe Commissioner shall be deemed to be a judicial proceeding within the meaningof sections 193 and 228 of the Indian Penal Code (45 of 1860) and theCommissioner shall be deemed to be a civil court for the purposes of section195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).

(7) A claimant who isdissatisfied with the decision of the Commissioner may prefer an appeal againstthe decision to the principal civil court of original jurisdiction within thelocal limits of whole jurisdiction the registered office of the Company issituated:

Provided that where a personwho is a Judge of a High Court is appointed to be the Commissioner, the appealshall lie to the High Court at Calcutta, and suchappeal shall be heard and disposed of by not less than two Judges of that HighCourt.

21.Disbursementof money by the Commissioner to claimants: After admitting a claim under this Act, the amountdue in respect of such claims shall be paid by the Commissioner to the personor persons to whom such sums are due, and, on such payment, the liability ofthe Company in respect of such claim shall stand discharged.

22.Disbursementof amounts to the Company: (1) If, out of the monies paid to him in relation to theundertakings of the Company, there is a balance left after meeting theliabilities as specified in the Schedule, the Commissioner shall disburse suchbalance to the Company.

(2) Where the possession of anymachinery, equipment or other property, has vested in the Central Government orthe Braithwaite and Company Limited, or the Government company, under this Act,but such machinery, equipment or other property does not belong to the Company,it shall be lawful for the Central Government or the Braithwaite and CompanyLimited, or the Government company to continue to possess such machinery,equipment or other property on the same terms and conditions under which theywere possessed by the Company immediately before the appointed day.

23.Undisbursed or unclaimedamount to be deposited to the general revenue account: Any money paid to theCommissioner which remains undisbursed or unclaimed for a period of three yearsfrom the last day on which the disbursement was made shall be transferred bythe Commissioner to the general revenue account of the Central Government; buta claim to any money so transferred may be preferred to the Central Governmentby the person entitled to such payment and shall be dealt with as if suchtransfer had not been made, the order, if any, for payment of the claim beingtreated as an order for the refund of the revenue.

CHAPTER VII

MISCELLANEOUS

24.Act to have overridingeffect: The provisions of this Actshall have effect notwithstanding anything inconsistent therewith contained inany other law for the time being in force or in any instrument having effect byvirtue of any law, other than this Act, or in any decree or order of any court,tribunal or other authority.

25.Contracts to cease to haveeffect unless ratified by the Central Government or the Braithwaite and CompanyLimited or Government company: (1) Every contract entered into by the Company in relation to itsundertakings for any service, sale or supply, and in force immediately beforethe appointed day, shall, on and from the expiry of one hundred and eighty daysfrom that day, promulgation of the Ordinance, cease to have effect, unless suchcontract is, before the expiry of the period, ratified, in writing, by theCentral Government or the Braithwaite and Company Limited, or the Governmentcompany, and, in ratifying such contract, the Central Government or theBraithwaite and Company Limited, or the Government company may make suchalteration or modification therein as it may think fit:

Provided that the CentralGovernment, or the Braithwaite and Company Limited, or the Government companyshall not omit to ratify a contract, and shall not make any alteration ormodification in a contract, unless it is satisfied that such contract is undulyonerous or has been entered into in had faith or is detrimental to theinterests of the Central Government, or the Braithwaite and Company Limited orthe Government company.

(2) The Central Government, orthe Braithwaite and Company Limited or the Government company shall not omit toratify a contract, and, shall not make any alteration or modification therein,except after giving to the parties to the contract a reasonable opportunity ofbeing heard and except after recording, in writing its reasons for refusal toratify the contract or for making any alteration or modification therein.

26.Protectionof action taken in good faith: (1) No suit, prosecution, or other legal proceeding shall lieagainst the Central Government or any officer of that Government, or theBraithwaite and Company Limited, or the Government company, or any officer orother person authorised by that Government, or the Braithwaite and CompanyLimited, or the Government company, for anything which is in good faith done orintended to be done under this Act.

(2) No suit or other legalproceeding shall lie against the Central Government or any of its officers orother employees, or the Braithwaite and Company Limited, or the Governmentcompany, or any officer or other person authorised by the Braithwaite andCompany Limited, or the Government company, for any damage caused or likely tobe caused by anything which is in good faith done or intended to be done underthis Act.

27.Delegation of powers: (1) The Central Governmentmay, by notification, direct that all or any of the power exercised by it underthis Act, other than the power conferred by section 30, may also be exercisedby such person or persons as may be specified in the notification.

(2) Whenever any delegation ofpower is made under sub–section (1), the person to whom such power hasbeen delegated shall act under the direction, control and supervision of theCentral Government.

28.Penalties: Any person who, –

(a) havingin his possession, custody or control any property forming part of theundertaking of the Company, wrongfully withholds such property from the CentralGovernment or the Braithwaite and Company Limited, or the Government company;or

(b) wrongfully obtainspossession of, or retains, any property forming part of the undertaking of theCompany or wilfully withholds or fails to furnish to the Central Government, orthe Braithwaite and Company Limited, or the Government company or any person orbody of persons specified by that Government or the Braithwaite and CompanyLimited, or the Government company, any document relating to such undertakingwhich may be in his possession, custody or control or fails to deliver to theCentral Government or the Braithwaite and Company Limited, or the Governmentcompany or any person or body of persons specified by that Government or theBraithwaite and Company Limited, or the Government company, any assets, booksof account, registers or other documents in his possession, custody, or controlrelating to the undertaking of the Company; or

(c) wrongfully removes ordestroys any property forming part of the undertaking of the Company or prefersany claim under this Act which he known or has reasonable cause to believe tobe false or grossly inaccurate,

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

29.Offencesby companies: (1)Where an offence under this Act has been committed by a company, every personwho at the time the offence was committed was in charge of, and was responsibleto, the company for the conduct of the business of the company, as well as thecompany, shall be deemed to be guilty of the offence and shall be liable to beproceeded against and punished accordingly:

Provided that nothing containedin this sub–section shall render any such person liable to anypunishment, if he proves that the offence was committed without his knowledgeor that he had exercised all due diligence to prevent the commission of suchoffence.

(2) Notwithstanding anythingcontained sub–section (1), where any offence under this Act has beencommitted by a company and it is proved that the offence has been committedwith the consent or connivance of, or is attributable to any neglect on thepart of, any director, manager, secretary or other officer of the company, suchdirector, manager, secretary or other officer shall be deemed to be guilty ofthat offence and shall be liable to be proceeded against and punishedaccordingly.

Explanation: For thepurposes of this section –

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

(b) "director",in relation to a firm, means a partner in the firm.

30.Powerto make rules: (1) TheCentral Government may, by notification, make rules for carrying out theprovisions of this Act.

(2) In particular, and withoutprejudice to the generality of the foregoing power, such rules may provide forall or any of the following matters, namely: –

(a) thetime within which, and the manner in which, an intimation shall be given to theCommissioner under sub–section (3) of section 4;

(b) themanner in which monies in any provident fund or other fund referred to insection 13 shall be dealt with;

(c) anyother matter which is required to be, or may be, prescribed.

(3) Every rule made by theCentral Government under this Act shall be laid, as soon as may be after it ismade, before each House of Parliament, while it is in session for a totalperiod of thirty days, which may be comprised in one session or in two or moresuccessive sessions, and if, before the expiry of the session immediatelyfollowing the session or the successive sessions aforesaid, both Houses agreein making any modification in the rule or both Houses agree that the ruleshould not be made, the rule shall thereafter have effect only in such modifiedform or be of no effect, as the case may be; so, however, that any suchmodification or annulment shall be without prejudice to the validity ofanything previously done under that rule.

31.Powerto remove difficulties: If any difficulty arises in giving effect to the provisions ofthis Act, the Central Government may, by order, not inconsistent with theprovisions of this Act, remove the difficulty:

Provided that no such ordershall be made after the expiry of a period of two years from the date on whichthis Act receives the assent of the President.

32.Declarationas to the policy of the State: It is hereby declared that this Act is for giving effect to thepolicy of the State towards securing the principles specified in clause (b) ofarticle 39 of the Constitution.

Explanation: In thissection "State" has the meaning as in article 12 of the Constitution.

33.Repealand saving: (1) TheGresham and Craven of India (Private) Limited (Acquisition and Transfer ofUndertakings) Ordinance, 1977 (14 of 1977), is hereby repealed.

(2) Notwithstanding suchrepeal, anything done or any action taken under the Ordinance so repealed shallbe deemed to have been done or taken under the corresponding provisions of thisAct.

THE SCHEDULE

(Seesections 18, 19, 20, and 22)

ORDER OF PRIORITIES FOR THE DISCHARGE OF LIABILITIES OF THECOMPANY

PART A

Post–take–overmanagement period

Category I.

Wages, salaries and other dues of the employees of the Company.

Category II.

(i) Loans advanced by theCentral Government.

(ii) Loans advanced by Banks.

Category III.

Any credit availed of by theCompany for the purpose of carrying on any trading or manufacturing operations.

Category IV

Any other loans.

Category V

Revenue, taxes, cesses, rates or any other dues to the CentralGovernment or a State Government.

PART B

Pre–take–over management period

Category VI.

Arrears in relation tocontributions to be made by the Company to the provident fund, salaries, wagesand other amounts due to employees of the Company.

Category VII.

Overdrafts from Banks.

Category VIII.

Revenue, taxes, cesses, ratesor any other dues to the Central Government, a State Government, a LocalAuthority or a State Electricity Board.

Category IX.

(i) Any credit availed of bythe Company for purpose of trade of carrying on any trading or manufacturingoperations.

(ii) anyother dues.

**