ANDHRA SCIENTIFIC COMPANY LIMITED (ACQUISITION AND TRANSFER OF UNDERTAKINGS) ACT 1982 (2)

THE ANDHRA SCIENTIFIC COMPANY LIMITED (ACQUISITION AND TRANSFER OFUNDERTAKINGS) ACT, 1982

ACT No. 71 OF 1982

 

13th November, 1982

 

An Act to provide for the acquisition and transfer of theundertakings of the Andhra Scientific Company Limited, with a view to securingthe proper management of such undertakings so as to subserve the interests ofthe general public by ensuring the continuity of production of scientificinstruments which are vital to the needs of the country and for mattersconnected therewith or incidental thereto.

 

WHEREASthe Andhra Scientific Company Limited had been engaged in the manufacture andproduction of articles mentioned in the First Schedule to the Industries(Development and regulation) act, 1951(65 of 1951.), namely, scientificinstruments;

 

ANDWHEREAS the management of the undertakings of the Andhra Scientific CompanyLimited was taken over by the Central Government under section 18AA of theIndustries (Development and Regulation) Act, 1951(65 of 1951.) ;

 

 

ANDWHEREAS it is necessary to acquire the undertakings of the Andhra ScientificCompany Limited to ensure that the interests of the general public are servedby the continuance, by the undertakings of the Company, of the production ofthe aforesaid articles which are vital to the needs of the country;

 

BE itenacted by Parliament in the Thirty–third Year of the Republic of India as follows: –

 

CHAPTER I

PRELIMINARY

 

1.Shorttitle and commencement: (1) This Act may be called theAndhra Scientific Company Limited (Acquisition and Transfer of Undertakings)Act, 1982.

 

(2) Theprovisions of sections 27 and 28 shall come into force at once and theremaining provisions of this Act shall be deemed to have come into force on the1st day of July 1981.

 

2.Definitions:In this Act, unless the context otherwise required,–

 

(a) "appointed day" means the 1st day of July, 1981;

 

(b) "Commissioner" means the Commissioner of Paymentsappointed under section 15;

 

(c) "Company" means the Andhra Scientific Company,Limited, a company within the meaning of the Companies Act, 1956 and having itsregistered office at Machilipatnam in the State of Andhra Pradesh;

 

(d) "Custodian" means the Custodian appointed under sub–section(2) of section 9 to take over, or carry on the management of the Company;

 

(e) "notification" means a notification published in theOfficial Gazette;

 

(f) "prescribed" means prescribed by rules made underthis Act;

 

(g) "specified date", in relation to any provision ofthis Act, means such date as the Central Government may, by notificationspecify for the purposes of that provision and different dates may be specifiedfor different provisions of this Act.

 

(h) "the Government company" means the Governmentcompany in which the undertakings of the Company are directed top vest undersub–section (1) of section 6;

 

(i) words and expressions used herein and not defined but definedin the Companies Act, 1956 shall have the meanings, respectively, assigned tothem in that Act.

 

CHAPTER II

ACQUISITION AND TRANSFER OF THE UNDERTAKINGS OF THE COMPANY

 

3.Transferto and vesting in the Central Government of the undertakings of the Company: On the appointed day, the undertakings of the Company and theright, title and interest of the Company in relation to its undertakings, shallby virtue of this Act, stand transferred to, and shall vest in the CentralGovernment.

 

4.Generaleffect of vesting: (1) The undertakings of theCompany shall be deemed to include all assets, rights, lease–holds,powers, authorities and privileges, and all property movable and immovableincluding, lands, buildings, workshops, stores, instruments machinery andequipment cash balances, cash on hand, cheques demand drafts, reserve funds,investments book debts and all other rights and interests in or arising out ofsuch property as were immediately before the appointed day in the ownershippossession power or control of the Company, whether within or outside India,and all books of account, register and all other documents of whatever naturerelating thereto.

 

(2) Allproperties as aforesaid which have vested in the Central Government undersection 3 shall by force of such vesting be freed and discharged form anytrust, obligation, mortgage, charge, lien and all other encumbrances affectingthem, and any attachment, injunction, decree or order of any court tribunal orother authority restricting the use of such properties in any manner orappointing any receiver in respect of the whole or any part of such propertiesshall be deemed to have been withdrawn.

 

(3)Every mortgagee of any property which has vested under this Act in the CentralGovernment and every person holding any charge, lien or other interest in or inrelation to any such property shall give, within such time and in such manneras may be prescribed, an intimation to the Commissioner of such mortgage,charge, lien or other interest.

 

(4) Forthe removal of doubts, it is hereby declared that the mortgage of any propertyreferred 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 beentitled to claim, in accordance with his rights and interests, payment of themortgage money or other dues, in whole or in part, out of the amount specifiedin section 7 and also out of the amounts determined under section 8, but nosuch mortgage, charge, lien or other interest shall be enforceable against anyproperty while has vested in the Central Government.

 

(5) Anylicence or other instrument granted to the Company in relation to anyundertaking which has vested in the Central Government under section 3 at anytime before the appointed day and in force immediately before that day shallcontinue to be in force on and after such day in accordance with its tenor inrelation to and for the purposes of such undertaking, and, on and from the dateof vesting of such undertaking under section 6 in a Government company, suchGovernment company shall be deemed to be substituted in such licence or otherinstrument as if such licence or other instrument had been granted to suchGovernment company and that Government company and that Government companyshall hold it for the remainder of the period for which the Company would haveheld it under the terms thereof.

 

(6) If,on the appointed day, and suit, appeal or other proceeding of whatever naturein relation to any property which has vested in the Central Government, undersection 3, instituted or preferred by or against the Company, is pending, thesame shall not abate, be discontinued or be, in any way, prejudicially affectedby reason of the transfer of the undertakings of the Company or of anythingcontained in this Act, but the suit, appeal or other proceeding may becontinued, prosecuted or enforced by or against the Central Government, or,where the undertakings of the Company are directed, under section 6, to vest ina Government company, by or against that Government company.

 

5.Companyto be liable for certain prior liabilities: (1)Every liability of the Company in respect of any period prior to the appointedday, shall be the liability of the Company and shall be enforceable against it,and not against the Central Government, or, where the undertakings of theCompany are directed, under section 6, to vest in a Government company, againstthat Government company.

 

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

 

(a) save as otherwise expressly provided in this section or in anyother provision of this Act, no liability of the Company in respect of anyperiod prior to the appointed day, shall be enforceable against the CentralGovernment, 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 otherauthority in relation to the undertakings of the Company, passed after theappointed day, in respect of any matter, claim or dispute which arose, beforethat day, shall be enforceable against the Central Government, or where theundertakings of the Company are directed, under section6 to vest in aGovernment 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 undertakingsof the Company, are directed, under section 6, to vest in a Government company,against that Government company.

 

6.Powerof Central Government to direct vesting of the undertakings of the Company in aGovernment company: (1) Notwithstanding anythingcontained in sections 3 and 4, the Central Government may, subject to suchterms 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 theCompany in relation to it undertakings, which have vested in that Governmentunder section 3, shall instead of continuing to vet in the Central Government,vest in a 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 and interest of the Company in relation to itsundertakings 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 becomethe owner in relation to such undertakings and all the rights and liabilitiesof the Central Government in relation to such undertakings shall, on and fromthe date of such vesting, be deemed to have become the rights and liabilitiesof the Government company.

 

CHAPTER III

PAYMENT OF AMOUNTS

 

7.Paymentof amount: For the transfer, to and vesting in theCentral, Government, under section 3, of the undertakings of the Company andthe right title and interest of the Company in relation to its undertakingsthere shall be given by the Central Government to the Company, in cash and inthe manner specified in Chapter VI, an amount of rupees two hundred and twenty–fourlakhs and ten thousand.

 

8.Paymentof further amounts: (1) For the deprivation of theCompany of the management of its undertakings there shall be given by theCentral Government to the Company in cash, an amount calculated at the rate ofrupees ten thousand per annum for the period commencing on the date on whichthe management of the undertakings of the Company was taken over in pursuanceof the order made by the Central Government under section 18AA of theIndustries (Development and Regulation) Act, 1951(65 of 1951.), and ending onthe appointed day.

 

(2) Inconsideration of the retrospective operation of the provisions of sections 3, 4and 5 there shall also be given by the Central Government to the Company incash, an amount calculated at the rate of rupees ten thousand per annum for theperiod commencing on the appointed day and ending on the date on which this actreceives the assent of the President

 

(3) Theamount specified in section 7, and the amount determined in accordance with theprovisions of sub–sections (1) and (2) shall carry simple interest atthe rate of four percent annum for the period commencing on the appointed dayand ending on the date on which payment of such amounts is made by the CentralGovernment to the Commissioner.

 

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

 

(5) Forthe removal of doubts, it is hereby declared that he liabilities of the Companyin relation to its undertakings which have vested in the Central Governmentunder 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.

 

CHAPTER IV

MANAGEMENT, ETC., OF THE UNDERTAKINGS OF THECOMPANY

 

9.Managementetc., of the undertakings of the Company: (1) Thegeneral superintendent, direction, control and management of the affairs andbusiness of the undertakings of the Company the right title and interest inrelation to which have vested in the Central Government under section 3, shall –

 

(a) where a direction has been made by the Central Governmentunder sub–section (1) of section 6, vest in the Government companyspecified in such direction; or

 

(b) where no such direction has been made by the CentralGovernment, vest in one or more Custodians appointed by the Central Governmentunder sub–section.

 

andthereupon the Government company so specified or the Custodian or Custodians soappointed as the case may be shall be entitled to exercise to the exclusion ofall other persons, all such powers and do all such things, as the Company isauthorised, to exercise and do in relation to its undertakings

 

(2) TheCentral Government may appoint one or more individuals or a Government companyas the Custodian or Custodian of the undertakings of the Company in relation towhich no direction has been made by it under sub–section (1) of section6.

 

(3) TheCustodian or Custodians so appointed shall receive from the funds of theundertakings of the Company such remuneration as the Central Government may fixand shall hold office during the pleasure of the Central Government.

 

10.Dutyof persons in charge of management of the undertakings of the Company todeliver all assets, etc: (1) On the vesting of themanagement of the undertakings of the Company in a Government company or on theappointment of a Custodian or Custodians, all persons in charge of themanagement of the undertakings of the Company immediately before such vestingor appointment, shall be bound to deliver to the Government company or theCustodian or Custodians as the case may be, all assets, books of accountregisters or other documents in their custody relating to the undertakings ofthe Company.

 

(2) TheCentral Government may issue such directions as it may deem desirable in thecircumstances of the case to the Government company or the Custodian orCustodians, 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 anyitem for instructions as to the manner in which the management of theundertakings of the Company shall be conducted or in relation to any othermatter arising in the course of such management.

 

11.Dutyof persons to account for assets, etc., in their possession: (1) Any person who has, on the appointed day, in his possessionor under his control, any assets, books, documents or other papers relating toany undertaking owned by the Company, which have vested in the CentralGovernment or in a Government company under this Act, and which belong to theCompany or would have so belonged, if the undertakings owned by the Company,had not vested in the Central Government or such Government company, shall beliable to account for the said assets, books, documents and other papers to theCentral or the Government company and shall deliver them up to the CentralGovernment or such Government company or to such person or persons as theCentral Government or the Government company may specify in this behalf.

 

(2) TheCentral Government or the Government company aforesaid may taken or cause to betaken all necessary steps for securing possession of the undertakings of theCompany which have vested in the Central Government or the Government companyunder this Act.

 

(3) TheCompany shall, within such period as the Central Government may allow in thisbehalf, furnish to that Government a complete inventory of all its propertiesand assets, as on the appointed day pertaining to the undertakings which havevested in the Central Government under section 3, and for this purpose theCentral Government or the Government company aforesaid shall afford to theCompany all reasonable facilities.

 

12.Accountand audit: The Custodian or Custodians of theundertakings of the Company shall maintain an account of the undertakings ofthe Company in such form and manner and under such conditions as may be prescribedand the provisions of the Companies Act, 1956 (1 of 1956.), shall apply to theaudit of the accounts so maintained as they apply to the audit of the accountsof a company.

 

CHAPTER V

PROVISIONS RELATING TO THE EMPLOYEES OF THE COMPANY

 

13.Continuananceof employees: (1) Every person who has been immediatelybefore the appointed day, employed in any undertaking of the Company shallbecome, –

 

(a) on and from the appointed day, an employee of the CentralGovernment and

 

(b) where the undertakings of the Company are directed, under sub–section(1) of section 6, to vest in a Government company, an employee of theGovernment company on and from the date of such vesting.

 

andshall 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 gratuityand other matters as would have been admissible to him if there had been nosuch vesting and shall continue to do so, unless and until his employment underthe Central Government or the Government company as the case may be, is dutyterminated or until his remuneration and other conditions of service are dulyaltered by the central Government or the Government company, as the case maybe.

 

(2)Notwithstanding anything contained in the Industrial Disputes Act, 1947 (14 of1947.), or in any other law for the time being in force, the transfer of theservices of any officer or other person employed in any undertaking of theCompany, to the Central Government or the Government company, shall not entitlesuch officer or other employee to any compensation under this Act or any otherlaw for the time being in force and no such claim shall be entertained by anycourt tribunal or other authority.

 

14.Providentfund and other funds: (1) Where the Company hasestablished a provident fund, superannuation welfare or other fund for thebenefit of the persons employed in any of its undertakings, the moneysrelatable to the officers or other employees whose services have becometransferred by or under this Act toe the Central Government or the Governmentcompany, shall, out of the moneys standing, on the appointed day, to the creditof such provident fund, superannuation welfare or other fund, stand transferredto and vest in the Central Government or the Government company, as the casemay be.

 

(2) Themoneys which stand transferred under sub–section (1) to the CentralGovernment or the Government company, as the case may be, shall be dealt withby that Government or Government company in such manner as may be prescribe

 

CHAPTER VI

COMMISSIONER OF PAYMENTS

 

15.Appointmentof Commissioner of Payments: (1) The Central Government,shall, for the purpose of disbursing the amounts payable to the Company undersections 7 and 8, by notification appoint a Commissioner of Payments.

 

(2) TheCentral Government may appoint such other persons as it may think fit to assistthe Commissioner and thereupon the Commissioner may authorise one or more ofsuch persons also to exercise all or any of the powers execrable by him underthis Act and different persons may be authorised to exercise different powers.

 

(3) Anyperson authorised by the Commissioner to exercise any of the powers execrableby the Commissioner may exercise those powers in the same manner and with thesame effect as if they have been conferred on that person directly by this Actand not by way of authorisation

 

(4) Thesalaries and allowances of the Commissioner and other persons appointed underthis section shall be defrayed out of the Consolidated Fund of India.

 

16.Paymentby Central Government to the Commissioner: (1) TheCentral Government shall, within thirty days from the specified date, pay incash to the Commissioner for payment to the Company, –

 

(a) an amount equal to the amount specified in section 7; and

 

(b) an amount equal to the amounts payable to the Company undersection 8.

 

(2) Adeposit account shall be opened by the Central Government in favour of theCommissioner in the Public Account of India and every amount paid under this Actto the Commissioner shall be deposited by him to the credit of the said depositaccount and the said deposit account shall be operated by the Commissioner

 

(3)Records shall be maintained by the Commissioner in respect of the undertakingsof the Company in relation to which payments have been made to him under thisAct.

 

(4)Interest accruing on the amount standing to the credit of the deposit accountreferred to in sub–section (2) shall ensure to the benefit of theCompany

 

17.Certainpowers of the Central Government or Government company: (1) The Central Government or the Government company, as the casemay be shall be entitled to receive up to the specified date to the exclusionof all other persons any money due to the Company in relation to its undertakingswhich have vested in the Central Government or the Government company, andrealised after the appointed day, notwithstanding that the realisation pertainsto a period prior to the appointed day.

 

(2) TheCentral Government or the Government company, as the case may be may make aclaim to the Commissioner with regard to every payment made by that Governmentor Government company after the appointed day, for discharging any liability ofthe Company in relation to any period prior to the appointed day, and everysuch claim shall have priority in accordance with the priorities attachingunder this act, to the matter in relation to which such liability has beendischarged by the Central Government or the Government company.

 

(3) Saveas otherwise provided in this Act the liabilities of the company in respect ofany transaction prior to the appointed day, which have not been discharged onor before the specified date shall be the liabilities of the Company.

 

18.Claimsto be made to the Commissioner: Every person having aclaim against the Company with regard to any of the matters specified in theSchedule pertaining to any undertaking owned by it shall prefer such claimbefore the Commissioner within thirty days from the specified date;

 

Providedthat if the Commissioner is satisfied that the claimant was prevented bysufficient cause from preferring the claim within the said period of thirtydays, he may entertain the claim within a further period of thirty days, butnot thereafter.

 

19.Priorityof claims: The claims made under section 18 shall have priorities inaccordance with the following principles, namely: –

 

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

 

(b) the claims specified in each of the categories shall rankequally and be paid in full, but if the amount is insufficient to meet suchclaims in full they shall abate in equal proportions and be paid accordingly;and

 

(c) the question of discharging any liability with regard to amatter specified in a lower category shall arise only if a surplus is leftafter meeting all the liabilities specified in the immediately higher category.

 

20.Examinationof claims: (1) On receipt of the claims made undersection 18, the Commissioner shall arrange the claims in the order ofpriorities specified in the Schedule and examined the same in accordance withsuch order.

 

(2) If,on examination of the claims the Commissioner is of opinion that the amountpaid to him under this Act is not sufficient to meet the liabilities specifiedin any lower category, he shall not be required to examined the claims inrespect of such lower category.

 

21.Admissionor re-action of claims: (1) After examining the claimswith reference to the priorities specified in the Schedule, the Commissionershall fix a certain date on or before which every claimant shall file the proofof his claim.

 

(2) Notless than fourteen days’ notice of the date so fixed shall be given byadvertisement in one issue of any daily newspaper in the English languagehaving circulation in the major part of the country and is one issue of anydaily newspaper in such regional language as the Commissioner may considersuitable and every such notice shall call upon the claimant to file the proofof his claim with the Commissioner within the period specified in theadvertisement.

 

(3)Every claimant who fails to file the proof of his claim within the periodspecified by the Commissioner shall be excluded from the disbursements made bythe Commissioner.

 

(4) TheCommissioner shall, after such investigation as may in his opinion be necessaryand after giving the Company an opportunity of refuting the claim and aftergiving the claimant a reasonable opportune of being heard, by order in writingadmit or reject the claim in whole or in part.

 

(5) TheCommissioner shall have the power to regulate his own procedure in all mattersarising out of the discharge of his functions, including, the place or placesat which he may hold his sitting and shall for the purpose of making anyinvestigation under this Act, have the same powers as are vested in a CivilCourt under the Code of Civil Procedure 1908(5 of 1908), while trying a suit,in respect of the following matters, namely:–

 

(a) the summoning and enforcing the attendance of any witness andexamining

 

(b) the discovery and production of any document or other materialobject predicable as evidence.

 

(c) the reception of evidence on affidavits;

 

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

 

(6) Anyinvestigation before the Commissioner shall be deemed to be a judicialproceeding within the meaning of sections 193 and 228 of the Indian Penal Codeand the Commissioner shall be deemed to be a Civil Court for the purposes ofsection 195, and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of1974). (45 of 1860)

 

(7) Aclaimant who is dissatisfied with the decision of the Commissioner may preferan appeal against such decision to the principal civil court of originaljurisdiction over the place in which the registered office of the Company issituated and such appeal shall be heard and disposed of by not less than twoJudges of that High Court.

 

Providedthat where a person who is a Judge of a High Court is appointed to be the Commissionersuch appeal shall lie to the High Court exercising jurisdiction over the placein which the registered office of the Company is situated and such appeal shallbe heard and disposed of by not less than two Judges of that High Court.

 

22.Disbursementof money by the Commissioner: After admitting a claim underthis Act, the amount due in respect of such claim shall be paid by theCommissioner to the person or persons to whom such amount is due, and on suchpayment, the liability of the Company in respect of such claim shall standdischarged.

 

23.Disbursementof amounts to the Company: (1) If, out of the moneys paidto him in relation to the undertakings of the Company there is a balance leftafter meeting the liabilities as specified in the Schedule, the Commissionershall disburse such balance to the Company.

 

(2)Where the possession of any machinery, equipment or other property has vestedin the Central Government or a Government company under this Act but suchmachinery equipment or other property does not belong to the Company it shallbe lawful for the Central Government or the Government company to continue topossess such machinery or equipment or other property on the same terms andconditions under which they were possessed by the Company immediately beforethe appointed day.

 

24.Undisbursedor unclaimed amount to be deposited with the general revenue account: Any money paid to the Commissioner which remains undisbursed orunclaimed on the date immediately preceding the date on which the office of theCommissioner is finally wound up, shall; be transferred by the Commissionerbefore his office is finally wound up to the general revenue account of theCentral Government; but a claim to any money so transferred may be preferred tothe Central Government by the person entitled to such payment and shall bedealt with as if such transfer had not been made, and the order, if any for thepayment of the claim being treated as an order for the refund of revenue.

CHAPTER VII

MISCELLANEOUS

 

25.Actto have over riding effect: The provisions of this Act shallhave effect notwithstanding anything inconsistent therewith in any other lawfor the time being in force or in any instrument having effect by virtue of anylaw, other than this Act, or in any decree or order of any court tribunal orother authority.

 

26.Contractsto cease to have effect unless ratified by Central Government or Governmentcompany: Every contract entered into by the Company in relation to any ofits undertakings which was vested in the Central Government under section 3,for any service, sale or supply, and in force immediately before the appointedday, shall on and from the expiry of a period of thirty days from the date onwhich this Act receives the assent of the President, cease to have effectunless such contact, is before the expiry of that period, ratified in writingby the Central Government or the Government company in which such undertakinghas been vested under this Act and in ratifying such contract, the CentralGovernment or the Government company may make such alterat8ons or modificationsthere in as it may think fit:

 

Providedthat the Central Government or the Government Company shall not omit to ratifya contract and shall not make any alteration or modification in a contract–

 

(a) unless it is satisfied that such contract is unduly onerous orhas been entered into in bad faith or is detrimental to the interests of theCentral Government or the Government company; and

(b) except after giving the parties to the contract a reasonableopportunity of being heard and except after recording in writing its reasonsfor refusal to ratify the contract or for making any alteration or modificationtherein.

 

27.Penalties:Any person who, –

 

(a) having in his possession, custody or control any propertyforming part of the undertakings of the Company, wrongfully with holds suchproperty form the Central Government or the Government company; or

 

(b) wrongfully obtains possession of or retains any propertyforming part of the undertakings of the Company; or

 

(c) wilfully withholds or fails to furnish to the CentralGovernment or the Government company or any person or body of persons specifiedby that Government or Government company, any document relating to suchundertakings which may be in his possession, custody or control; or

 

(d) fails to deliver to the Central Government or the Governmentcompany or any person or body of persons specified by that Government orGovernment company any assets books of account, registers or other documents inhis possession custody or control, relating to the undertakings of the Company;or

 

(e) wrongfully removes or destroys any property forming part ofthe undertakings of the Company or prefers any claim under this Act which heknows or has reasonable cause to believe to be false or grossly inaccurate,

 

shall bepunishable with imprisonment for a term which may extend to two years, or withfine which may extend to ten thousand rupees, or with both.

 

28.Offencesby companies: (1) Where an offence under this Act hasbeen committed by a company, every person who at the time the offence wascommitted was in charge of, and was at the time the offence was committed wasin charge of, and was responsible to the company for the conduct of thebusiness of the company as well as the company, shall be deemed to be guilty ofthe offence and shall be liable to be proceeded against and punishedaccordingly;

 

Providedthat nothing contained in this subs–action shall render any such personliable to any punishment if he proves that the offence was committed withouthis knowledge or that he had exercised all due diligence to prevent thecommission of such offence.

 

(2)Notwithstanding anything contained in subs–action (1), where any offenceunder this Act has been committed by a company and it is proved that theoffence has been committed with the consent or connivance of or is attributableto any neglect on the part of any director, manager, secretary or other officerof the company, such director, manager secretary or other officer shall bedeemed to be guilty of that offence and shall be liable to be proceeded againstand punished accordingly.

 

Explanation:For the purposes of this section, –

 

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

 

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

 

29.Protectionof action taken in good faith: (1) No suit prosecutionor other legal proceeding shall lie against the Central Government or anyofficer or other employee of that Government or the Custodian or the Governmentcompany or other person authorised by that Government Custodian or Governmentcompany for anything which is in good faith done or intended to be done underthis Act.

 

(2) Nosuit or other legal proceeding shall lie against the Central Government or anyofficer or other employee of that Government or the Custodian or the Governmentcompany or other person authorised by that Government, Custodian or Governmentcompany for any damage caused or likely to be caused by anything which is ingood faith done or intended to be done under this Act.

 

30.Delegationof powers: (1) The Central Government may, by notification direct that allor any of the powers execrable by it under this act, other than the powers conferredby this section and sections 31 and 32, may also be exercised by such person orpersons as may be specified in the notification.

 

(2)Whenever any delegation of power is made under subs–action (1), theperson to whom such power has been delegated shall act under the direction,control and supervision of the Central Government.

 

31.Powerto make rules: (1) The Central Government may bynotification make rules for carrying out the provisions of this Act.

 

(2) Inparticular and without prejudice to the generality of the foregoing power, suchrules may provide for all or any of the following matters, namely:–

 

(a) the time within which and the manner in which an intimationreferred to in subs–action (3) of section 4 shall be given;

 

(b) the form and manner in which and the conditions under whichthe Custodian or Custodians shall maintain the accounts as required by section12.

 

(c) the manner in which the moneys in any provident fund or otherfund referred to in section 14 shall be dealt with;

 

(d) any other matter which is required to be or may be prescribed.

 

(3)Every rule made by the Central Government under this Act shall be laid as soonas may be after it is made before each House of Parliament while it is insession, for a total period of thirty days which may be comprised in onesession or in two or more successive sessions, and if before the expiry of thesession immediately following the session or the successive sessions aforesaidboth Houses agree in making any modification in the rule or both Houses agreethat the rule should to be made, the rule shall thereafter have effect only insuch modified form or be of no effect, as the case maybe so however, that naysuch modification or annulment shall be without prejudice to the validity ofanything previously done under that rule.

 

32.Powerto remove difficulties: If any difficulty arises ingiving effect to the provisions of this Act, the Central Government may byorder not inconsistent with the provisions of this act, remove the difficulty;

 

Providedthat no such order shall be made after the expiry of a period of two years fromthe date on which this act receives the assent of the President.

 

THE SCHEDULE

[See sections 18, 20(1), 21(1) and 23(1)]

ORDER OF PRIORITIES FOR THE DISCHARGE OF LIABILITIES OF THECOMPANY

Post-take-over management period

 

 

Category I

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

 

Category II

 

Loans advanced by the Central Government.

 

Category III

Any credit availed of by the Company for the purpose of carryingon any trading or manufacturing operations.

 

Category IV

 

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

 

 

Pre-take-over management period

 

Category V

 

Arrears in relation to contributions to be made by the Company tothe provident fund, salaries, ages and other amounts due t the employees of theCompany

 

Category VI

 

Revenue, taxes, cesses, rates or any dues including Employees’State Insurance contributions to the Central Government, a Local Authority or aState Electricity Board.

 

Category VII

 

(i) any credit availed of by the Company for the purpose ofcarrying on any trading or manufacturing operations.

 

(ii) Any other dues.

 

 

 

 

 

**