LexThe Kerala Spinners, Alappuzha(Acquisition and Transfer of Undertaking)Act 2010(4 of 2010)
Kerala · state statute
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. 0000a GVERNMENT OF KERALk
Law (Legislation-C) Department
.,
NOTIFICATION tt
I - No 17249/Leg.C2I09iLaw Date4 Thinvananthapurwn 7th Arrtl 2OO
17th Chathra 1932
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In pursunce of clause (3) of Artick 348 oth Cd ititiicof India, the - I .. ..,. S • S• •
Governor is pleased to authorise the publication in the Gazette of the following
translation in the English language of the Kerala Spinners, Alappuzba
)- çAcquston and Traimfer of Undertaking) Act, 2010 (4 of 2010)
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- By order of . the Governor.
K. MADHUUDA NAN NAIR,
Special Secreta'y
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[Translation in English of "ioio-oi. Ijcnl6lJ eo amcr
(cn000eo nflesaoj noço io) pbiished under the
authority bf the Govenor] •-- - - -.
- . AC14 OF 2010
THE KERALA SP1NERS, ALAPPUZ}L4 (ACQUISITION AND TRANSFER
-. - OF UNDERTKJNG) ACT, 2010
An Act to provide for the acquisition and trfrnsfer of tire Xerala Spinner3
Ltd., Komalapuram, AFappiha andtjo r thelacquiJition and tranfer 4of
the right title and interest of the owners in respect of the rajdertdkmg
with-a view to reorganizing and -reviving the undertaking and'for
matters connectei-L there*'iih ot Incidental thereio: .
-• Preamble.__WHEEAs, -it is expedient to provide for the. acquisition and
transfer of the Keraa Spinners Ltd. rna1pirram Alappu -zha arid lot the
acquisition and transfr of the i4gjit, title and interest of the ownes in respect
of the unctertaking with v 'ie%% to reorganmng and reviving the. undertkng and
for matters. connected 'thetwithor incideitaI theTeto;_-
BE it enacted in. the Sixty first year of the Reub1ic of India as olls----
CHAPTER.! [
PREL1M1NA1Y
Sito,rt title and comrnec — ement.(i) This Ac thay be called the
Kerala Spinnei-s, Alappiizha .(Aequisition and Tansfrr of undertaking) Act, 2010. -. - I . ,
(2) It shall be deemed to have come into force on the 19th da of
November, 2009. .
Deflnirions.—In this Act, -unless the context otherwise- eqnres,—
"appointed day" means the 7th day of September, 2006;
"authorised person" zans the prson, or body of persons appointed .
under sdction 1 8AA of the Industries (DéveIpment and ReguIntion) Act, 1951 -
(Central Act 65 of 151), to take Q.ver the rnanagernnt of the Sjk Texlile
undertakings;
.1 ,
.
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. 27 ....000032 (c) "bank" means, "the Indian Oierseas nk", a Scheduled 'Bank as
defined in clause (e) of section of ,the Bank of India Act, :1934.
(Central Act 2 of 1934);
(d) f "Commissioner? means the Commisó'ner of payments appointed,
under sectioli 16;,
j'owner" when used in reFation. to the sick textile undertaking, means
the person or'flrm who or which was, immediately before the take-over' of the
management of the' undertaking under section 18AA of the Industries
(Developnent and' Regulation) Act, 1951 (Central Act 65 of 1951), the . imrnediate lpropriefor or lessee or occupier of the sick textile undertaking.or
'any part thdreof,
1'pr'escribed" means, prescribed by rules n'Iade under this Act;
'(g) 'sik textile undertaking" means the; textile u'ndeftaking specified 'in
the First Schedule and has been declared as sick company by the Board, for
Industrial 'atd' Financial Reconstruction (BIFR);
(h) 'spëcified 'date" means such date as the Government may, for the'
purpose of'ny provision of this Act,, by notification in. the Gazette', specif' and
different dates may be specified' for different provisions of this Act;
" (i) I'Ste Textile Corporation" means the Kerala State Textile
Corporation. Limited formed and. registered under the' Companies Act, 1956
'(Central Act l.,of 1956);
(j) "textile company',' means a cornpany specified in column (2) of the
First Schedule as owning the undertaking specified in the corresponding entry
-in column (1) of that Schedule; • • . .. • -
- (k) ''subsidiary textile corporatipn" means a company formed by the
State Textile Corporation. as its subsidiary; • '
'(2)' Words and exprsions used but. not defined in this Att and defined in
the industries (Development and Regulation) Act, 1951 (Central Act'65 of;
1951), shall have the meanings respectively assigned to them in that Act.
(3) Wrds and éxprssions used but not defined either in this Act'
- or in the Industries (Development and Regulation) Act, 1951 (Central Act 65 of
,1951) .but dkinedin 'the Companies Act, 1956 '(Central Act 1 of 1956), shall
have the meanings respectively assigned to tbem in the Co'mpanies Act, '1956
(Central Act L of,l 956). :
' ' • - . ' ' : , . ,
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cUAFtERU k
ACQUISITION OFHE,R1G}LT OFOWNERS OF
SIC}ç TEXTILE UNDEkTAKTh1G
Acquisition of righzs of owners Urlrespea of rick textife underta ing---(l )*
On the appointed day, the sickte xtilL rt3king and the right title and interest
of the owner in relation, to such Sick textile n4erakhg shall, by vfrtüe of this
Act, stand transferred to, and .shall e.st absolutel!y 'in the State Goverw,neiit.
(2) The sick tetfle undertakjn. whi1i stands .ves.td in the Stte
Government under sub-section (I.) shall, immediately after it hs sà'vested, - -
stand tran.sfcrred to, and. vest in the State Textile Corporation..
(7eneral effect of Vesting..'—(i} The sick textile undertaking referred to
in section 3 shall be -eem4 to include all asaets rights, tease-Ifoltis, powers,
authorities and4 pri'iieges and all property; movable and immovable inlud1rig
'lands, building, workshops, stores, instruments,, machinery and equipsrent, cash
balances cash on hand, reserve fuids, in'estments andbook debts and all tither.
rights and interests in, or ari,sing out of, such property as were immediately
before the appointed 4ay in the, possessio; power or c'ontrol of the authorised
persoi and. all books of account,, registrs and all other documents of whatever
nature relating, theteto and'shalr also.be deemed to. include the liabilities and .
obligations .specified in sub-section ,(2.) of section. 5,t,. . .
All proptrty ai aforesaid fwliich hay vested in . tle State Govebm=t
under sub-section (1) of sèctin 3 shall,.by reason of such vesting t be freed
and discharged from- any trust,-, oi,ligatiqn,, mortgage, charge, lien and all other
encumbntnces affecting it, and any 'ttachment, injunction or decree or order of
any court rstricthg the use of such proj,erty nany manner shall be deemed w
have been withdrawn..
-Where any flence 'or other mstrument in relation to the sick textile
undertaking' haa been 'granted at any, time before the appointed clay to an owner
by the Centra,l Government or a-State Govrnment or any other authority; the
State Textile Corporation shall; on 'and from the appointed day,, be'dened to be
substituted in such licence or other is.trunlent in pace pf the owner referred
,• to therein as if such licence or',ethdr instrurnejit had been' granted to the State
Textile Corporation and it shall .hold such licence or the 'sick textik
undertaking spec'iffed in. such other instnnneht for the 'remainder of the period
for which the owner would have held $uh licence or the sicic textile undertaking
- under such other instrument.
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Every rnortgagec of any prope which has vested• upder this Act in
the State Gove -nment an4 every person holding any,charge, lien or other
intere~vin or in e1ation to any such property shall give within such time and in
such manner as in be prscnbed an intimation toth Commissioner of such
mortgage, cha.re, hen or othr interest
For the removal of doubts it is hereby declared that the mortgagee
of any property jreferred to in sub-section (2) or any other person hqlding an'
charge, flen or ?ther interest in or in relation to any such property shall be
entitled to claim in accordance with his rights and interest, payment of the
mortgage uioney or other dues, in whole or in part, out of the amount specified
.rn relation to ch property in the First Schedule but no such mortgage
Z. charge, lien or dther interest shall be enforceable against any property which
has Vdst6di in the' State Government
If the appointed day , any suit appeal or other proceeding of
whatever nature in ielation to any matter specified in sub section (2) of
section 5 in respect of tha sick textile undertaking, institated or preferred by
or against the textile company or the authorised person is pending the same
shall nt abate, !e discontinued-or be, in any way , prejudicii.ally affected by
reason of the traksfer of the sick textile undertaking or of anything contained
in this Act but Cthe suit, appeal or other proceedings may be continued
prosecuted and ehforced by the State Textile Corporation
5 Owner t be lable for certain prior liabilities —(1) Every liability
I bliscieiother than the i fin
sub-section (2) of the owner of the sick
textile uhdertakin in respect of any period prior to the appointed day shall be
the liability of suh owner and shall be enfoiceable against him and not against
the State Governnent or the State Textile Corporation
(2) Any libility arising in respect of—
(a) io4is advanced by the Central Government or the State
Government to th sick textile undertaking (together with interest due thereon)
after it has been declared a a sick company by the Board for Industrial and
Financial Reconsction (BIFR),
'-(b), amo?nt advanced to the sick textile undertaking dafter it has been
declared as a sick company by the Board for Industrial and Financial
'Reconstruction (BFR)by the State Teitile Corporation together with interest
due kerqp
-4
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(c) wages, galarres and other -dues of employees of the sick textile
undertaking, in respect of aqy period after the company has been declared as a
sick company -by the board for Industrial and Financial Reconstruction (BIER)
shall on and from the appointed day, be the liability of the State Government
and shall te discharged, for and on behalf of that Government, by the Statç
Textile Corporation. as and when repayment of such loans or amounts becomt
due or as and when such wages, salaries or other dues become due and payable.
(3) For the removal of doubts, it is hereby dcclared'that—
(a) save as otherwise qxprssly provided in this section or in any
other section of this Act, no liability, other than the liability 'specitied in
sub-section (2), in relation to the sick textile undertaking in respect of any
period prior to the ap'pointed day, shall be enforceable against 'the State
Government or the State Textile Corporation;
no award, decree or oider of any court, tribunal or other authority
in relation to-this sick textile undertaking passed after the appointed day in
respect of any matter, claim or dispute,. in relation to any matter not referred to
in sub-section (2) whic4 arose before that day, shall be enforceable against the
State Goyernment or the State Textile. Corporation;
no liability of the sick textile undertaking or any owner thereof
for the contravention, before 'the' Company has been declared as a sick company
by the Board for In4ustrial and Financial Reennstructini (BIFR) of any
provision of a law for the the being in force, shall be enforceable against the
State Government or the State Textile Corporation.
6. State Textile Corpo'atioh tç' form subsidiary corporations.—.( 1) The
State Textile Corporation may, if it considers riecessaty to do so, fórin
subsidiary coiporationa under the Companies Act, 1956 (Central Act 1 of 1956)1
and register them under that Act. -
(2) The State Textile Corporation may, by order in writing, transfhr the,
sick textile undertaking or part thereof to a subsidiary texti1e corporation and
any such transfer shall be subject to such teçms and conditions as may be
specified in the said order.
(3). The SubsIdiary Textile Corporation shall, -on and from the date of
such transfer, be deemed to be substituted in the licence or other .instrument
referred to in sib-sectiop (3) of section- 4 in place of the State Textile
Corporation as if such licence or other instrument Iiad beet granted to the
Subsidiary Textile Corporation, and shall hold such licence or other instruthent
for the' remainder of the perid for wlich the State Tçxtile Corporation would
have held such licence or other instrümçnt.
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31 000030 (4) On the itransfer to a Subsidiary Textile Corporation :Of the sick
textile underaki b r. y eef the' ities required to be discharged,
by the State Tectile Corporation under 'hub-section (2) of section 5 shall in so
far as they relate to the sick textile undertaking or part thereof so transferred to
...the-,Subsidiary. Textle Corporatui, be discharged, on and from the date of such
.ransfer, by. the Subkidiary Textile Corporation as and when any such liability is
required to be discharged
- (5) Save as 1 otherwise expressly provided inthis Act, references in this
Act to the State Textile Corporation shall in respect ofthe sick textile
<undertaking or any part thereof which is transferred to a Subsidiary Textile
b -Corporation be codstrued as references to the Subsidiary Textile Cojporation
I •--- 7 Shares to:, , e issued by the Slate Textile Corporation for the value of
the assets transferrJd to it by -Statee Government —(1) An amount equal to the
value of the assets of the sick textile undertaking transferred to and vested in
the State Textile qorporation under sub-section (2) of. section 3 shall be
deemedto be the cbntribution made by the State Government to the equity
r- capital of the State l'extile Corporation and for the contribution so made, the
State Textile Cor9oration shall issue (if necessary after amending its
mernorandum and articles of association) to the State Government paid up
FWshares in its equity fcapitai having a face value equal to the amount specified
against the sick textie undertaking in the corresponding entry in column (3) of
*the First,Sch6dule.
(2)1.. Where any liability.is assumed by the State Government under
b section (1) of selition 25 they may call upon the State -Textile Corporation
to issi.re (if neces ry after amending the memorandum ahd articlest of
association of theCorporation) to the State Government additional paid up
3shares in its equ1tycap1tai having a face value equal to the amount of the
liability assumed by the State Go'emment under the said sub section
CHAPTER III
PAYMENT OF AMOUNT - - -
0, 0 •0 0 ;
0
8 Payment o amount to owners of the sick textile undertaking —
(l) The owner of the sick textile urrdertaking shall
rnn
be given by the State
iCove-ent in cash and in the manner specified in Chapter \VI for the transfer
sand vesting in itunder sub-section (1) of section 3 of such sick textile
undertaking and the right title and interest of the owner in relation to this sick
frtextile undertaking, aji amount equal to the amount specffied against it in the
correspondirg entry in column (3) of the First Schedule
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(2) In addItion to the amount referred to. in sub-section (t) there shall
be given by the State Government, in cash, to the owner of the sick textile
undertaking, simple interest at The rate of four per cent per aniium on the - -
amount specified against such owner in the corresponding entry in column (3)
of the First Schedi1e for the period comxnencig on the appointed day, and
- ending on the date on whicli payment of such amount is made by the. State
Government to the Commissioner, . -
9.' ?ayment offurther amount.---(l) On counto'f the taking over the.
management orthe undertafdag, which has been -dectared as sick by the Bdard
for Industrial arid Einancia1 Recntruction (BIFR), shall be given an amqit of
rupees one thousan& per ansium on-the depriva.tioa of its nianagemant £or.a
period comrnencing ftotxi the appointed, day iip to the dafe on which the
- management of the sick undertakmj
.
has beei t&ken over by the State
Government. . ..,
(2) Theamoirnttalculattd inaccordance with the p aLons of
sub-sect öi '(11 shall carry simple in A at the rate of four per cent. per
annum for theperiod commen9ing qn the appointed day and ending on the date -
on which the payment of such ixrount is made by the State Government to the
Ciuiimissioner.
. • (3) The aniount determined in. relation tti this textile compaiiy -iii
accordance with the proviions of sub-sections (1) and (2) shall be gwen by the
State Goemment to the textile company, in addition to the amount spczfied in
the First Schedilegainst that.cdmany;
_CHAP-rER IV
'MANAGv1Eff ETC., OF' THE SICK TEXTILE UNPERTAKIN3
10. Managements- etc., of the sick textile undertaking.—The SttC Tei,file
Corporation or any person which 'that Corporation niaj by order in wnting
specify, shall be entitled to exercise, the pb'ers of general superintendence,
direction, coitrol and managenient of the affaith and business of the sick textile
undert4ing,. the right, iftle and interest, of an. bwner in relation to whieb have
vested in that Corporstion tinder sub-seà'tion. (2). ofeçtion. 3,and. do 41 such
things as the o'ner of the 3ick textile undertaking is aitthorised to exercise
and do. . .. . .
'I
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.JOOOO?9 11 Duty of persons in charge of management of ihe sick textile
undertaking to deliver all assets etc —On the vesting 01' the management of
the sick textile undertaking in the State Textile Corporation, all persons in
ch m m arge of the aiageent of such sick textile undertakuig tmwedite1y before
,.'
such vesting shafl be bound to deliver to the State Textile Corporaiion all
assets, bocks of account' registers or other documents m their custody relating
to the sick textile 'undertaknig , - -
12 Accoun1ts —The State Textile Corporation shall maintain the accounts
of the sick textil undertaking in accordance ivith tke pro.vasions of the
Companies Act, 1956 (Central Act I-of 1956)
CBARV -,
PROVISIONS. RELTING TO EMPLOYEES OF SICK-
TEXTILE UNDERTAKING -
If 13 Emplovirent of certain employees to continue —(1) Every person
who- is a workmn within the meaning of the Industria1Dispüte.sAct,..'.l?41
(Central Act 14 of 1047), and has. been, inunediately before the appointed day, '
employed in the sick textile undertaking shall becoinc, on and from the
appointed day, a'n employee of the State Textile Corporation with the sama
". rights and pnvilges as to pension, gratuity and other matters as would have
been admissible to him if the rights in relation to such sick textile undertaking
had not been traisferred to and vested in the State Textile Corporation and shall
c'bntmnue to do [so unless and until his employment i the State Textile
Corpoiation is duly tenninated or until his remuneration, terms and condition of
' employment are du1y altered ,by the State Textile Corporation
(2) Every person who is not a workman within the meaning of the
Industrial Disputes Act, 1947 (Central Act 14 of 1947), and who has been,
mmmrdiately before the .ppointed day, employed in the sick textile undertaking
shall, in so far as such person as emp1oed in connectuop with the sick textile
undertaking which has wted in, the State Textile Corporation, become on and
from the appomkd dav, 4an employee of the State Textile Corporation and shall
bold his office or servit.e th...rein by the same tenure, at the same remuneration
and upon the same terini and rons.thtrns and with the sazn nghts and privileges
as to pension an.d- grat'.ity and other. '-aitters ds,he would have held the same
under the sick textile undertak g r' t had not vested in the State Textile
V Córp&atioat andjshail continue to do so sñiless anduntil his empIorment-irithe
State Textile Corporation as duly teimn'dted or until his remuneration, terms and
cndinons ofeznploymqit ar du1 altured by the State Tectile corporation
-. .,
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Nottithstanding anything ontained in the ludiistriat Disputes Act,,
1947 (Central Act 14 of 1947), or in any other law for the time being in-force,'
the transfer of the ervices of any, officer or other person employed In the sick •
textile undertaking ,to tha StdtTexti CorpOration shall not entitle such
ofces or other empliyee to any compensahoi under'this Act or any other law.
for the time being in force, and no such claim shall be entertained by any
court, tribun4 oi other authority. .. -
Where, under , the terms of 'any contract of iervice or ntherwise-,
any person whose services become trminátdor whole sexvicesbecome
transferred to the Stite Textile- corporation by reasonof the provisions of this
Act is entitled' to any arrears of salary or wages or any payment for any leave
not. availed of or other' payment, not being a payment by way of Otufty or -.
pension; for any period prior tothe date of declaration as a sick company by
the Boaid for lidstrial and Financial Reconttuctiqn (BIFR) sucg pcñcn may,
except to the extent such'liabiity has been taken over by (he State,Covernnient
under sect4on 5, enforce his óluim alainst the owner of the sick textile
undertaking but not against the- State Government or the State- Texftle
Corporation.
14. Provident fhwid and other jund'i.'—{1) Where the ownJof'the sick
textile undertaking has, established a provident fund, superannuation, welfare- Or
other fund for - the benefit of the persons employed in'such sick te*tt:1e
undertaking, the money relatable to-the imployees, whose serviceshave -
become transferred by-or- -under this 'Act to the State Textile Cqrporation shall,
ñt of the money standing, on tj2e appointed day, to the credi(f such piwident
fund, superannuation, welfare or -other fund, stand trangferred.to, and shall vest
in the SttC Textile corporation.
-(2) Te money which stand transferred under sub-ecfion. (TY to the - - -
State Textile Corporation hall be dealt with by that Corporation in swth manner
as may be' prescribed.
IS. Transfer of employees to Subsidiary Textile Corporation—Y1here
the sick textile undertaking or any part thereof is transferred under this Act to
a Subsidiary Tetik Corporatidn,. - 'every prnn referre4 to. in
sub-section (i) and siib-sectioh (2) of section }, shall on and fromthe date of -
such transfer,' becQrne an employee of the Subsidiaxt Teitile corporatioti' and
the provisions of sectiotis43 nd 14 shall apply tQ'suh employee as they apply
to an-employee, of the State Textile Corporation,hsif references in the slid
sections to the Staè Textile Corporation wãe references to tie Subsidiary - ubsidiary
Textile textile LOrporatlOn.
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.. • . •
CHAPTER VI
COMMISSIONER OF PAYMENTS
16 Appbiniment of Commissioner of Payments —(1) For the purpose o'f
disbursing the amounts payabl to the'owner of the sick textile undertaking,
'
specified in the First Schedule, the State Government shall, by'notification in
the Gazette apoint a perón as they may. think fit to be the Commissioner.of
!aYments; .. . • . . •: .
The State Government may, appoint such other persons as they
.
may think fit o assist the Commissioner and thereupon the Commissioner may
authorise one or more of such persons also to exercise all or any of the
powers exercisable by him under this Act and different persons may be
äuthorised to exercise different powers.
'I ''' .
'• O
Any person authorised by the Commissioner to exercise any
powers may xercise those powers in the same manner and witI the same
effect as if thy have been conferred on that person directly by this Act and
not by way of authonsation
0
(4) The salaries and allowances of the Commissioner shall be
defrayed .out of , the Consolidated Fthid of the State of Kerala.
17' Payment by State Government to the Commissioner— ( 1) The State
Government shall within thirty days from the specified date, pay in cash to the
Commissioner,-for payment to the owner of the sick textile undertaking, an
amount equal to the amount specified against the sick textile undertaking in the
Fit Schedule and shall also pay to the Commissioner such sums as may be due
to the owner 1 of the sick textile undertaking under sub-section (2) of
section 8 and section 9
2) 'A separate account shall be opened by the State Government in
favour of the Commissioner and every amOunt paid under this Act to the
Commissionerj shall be deposited by him in that account and thereafter such
account shall be operated by the fCommissioner.
ISeparate records shall be maintained by the Commissioner in
respect of the. sick textile undértakin in relation to which payments have been
made to him underthis Act
Interest accruing on the amounts standing to the credit of the. - . -,-- .
. . account referred to in sub-section (2) shall ensure to the benefit of the owners
r of the sick textile undertaking - . • • 0 ' , 0._ 0 • . 0 •0
'• . 0
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Claims to be' made to the ComMLssioner.---Every person having a
claim against the owner of the, sick textile undertaking shall prefer such claim
before the Commissioner within thirty dais from the specified cfate
Provided that'if the Coramissionr is satisfied that the claimant was'
prevented by sufficient causfrom preferring the claim within the said period
of thfrt days may entertain the claim within a fiitther period ofthirtydays but -- -
not thereafter.
Priorizy of claims?—The claims arisipg out of the matters specified
in the Second Schedule shalr have priorities in accordance with the fbllowing
principles, naniely:—
(al Categbry 1 will have precedence ever #11 other categories and
Category U. will have a precedence over Cory III and so on;
(1) The claims specified in each ofthe dategories, =ept Category
V. shall rank equally and be pid in tZ.ii; but if the amount is insufficient to meet
,sucb claims-'in full, .they. Iball. bate' in equal proportions and be 'paid
accordingly;
(cJ The Iiabilities specified in Category V shall 'be dis4harged subjeci
to the pnorities specified in this sectlon in accordance with the terms of the
secured loans and the priority, inter se,.cf such loans; and -
- (d) The- question ofpayment of a. liability with regard. to a matter
specified in a lower category shall arise pnly if a surplus is left after meeting -
all 'the liabilities specified in the immediately higher'catg9ry .• •
Earniiation of claThzs.—(l) On.. reeeipt of .the claims under section
18, the C,om sioer 'shall arrange the claims in the order of priority specified
in the Second chedule 'and examine the sme in acèordaiice with the said
order.
(2) If, o examjnation'of the claims, the eornmuiss'ioner is of the"
opiniqn that the amount paid to hinr pnder this Act is' not sufllcieni to meet the
liabilities specified in any lower hategciry, he shall not be reqiired to xarnine
the ljabiliiis in respect of such lower category. - -:
ifdmissio, or' ejeqton 'of the c1aims.—(lAftr examining the claim - -
with. reference to the priority pet out in the Second Schedule, the
Commissioner shall fix a certain date one or hefor&'which every claünaut shall
file the proOf-of his clin,, otherwise he excludçd 1rpn the benefit of the
disbursement made by the Commissioiier ' -
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-37 £000027
(2) Not less than fourteen days' notice of the date so fixed shall be
given by adverisement in one issue of a daily newspaper in the English
Language andoid issue of a daily newspaper in the Regional Language js the
Commissioner niay consider suitable and every such notice shall call upon the
claimant to file the proof of his claim with the Commissioner within the time
specified in the advertisement
(3) Any claimant who fails to file the proof of h s claim within the
time specified by the Commissioner shall be excluded from the disbursement
- made by the Commissioner 0: ... 0
(4) The1Commissioner shall, after such investigation as may, in hm
opinion, be necessary and ?after giving the owner of the sick textile undertaking
an opportunity cJf refuting the claim and after giving the claimants a ?easonable
tç opportunity of bing heard, in writing admit or reject the claim in whole or in
part
(5) The Commissioner hall have the power to regulate his own
procedure in aiiJ matters ansing out of the discharge or his functions, including
...... . . 0•,., ......... 0 • the place or places at winch, he will hold his rittings and shall, for.the purpose 0
of making ny ihvestigation under this Act have the same powers as are vested
in a civil courtjunder the Code of Civil Procedure, 1908 (Central Act 5 of
1908), while trying a suit in respect of t'he following matters, namely -
(a summoning and enforcing the attcndance of any persot and
examining him n oath
N. dLcovery and production of any document or other material
object producibe as evidence
reception of evidence on affidavits
appointment of commissions for the examination of witnesses
(6) Any investigation before the Commissioner shall be deemed to be a
judicial proceed 1ing within the meaning of sections 193 and 228 of the Indian
Penal Code (Central Act 45 of'1860) anti the Commissioner shall be deemed to
be a civil court tfor the purposes of section 195 and Chapter XXVI of the Code
of Criminal Propedure, 1973 (Central Act 2 of 1974)
I i
(1) A plaimant who is dissatisfied with the decision of the
Commissioner may prefer an appeal against the decision to the principal civil
court .of.origindi jürisdiction within the. focal limits of whôsë jurisdiction the
sick textile undrtaking is situ&ted
33/1432120lb/DTP
\0 V
'.
0
4593800/2020/IND(OS)
31
- - 38
-Z2 i)isbur'semejt of money by rhe Commissioner to claimants._—ijter
* admitting a claim under this Act, the -amount due in respect of such claim shall
be credited by the Commissioner to the relevant fund or be paid to the person
or persons to vhom such sums are due and on such credit or paythent the-
liability of the owner in reSpect of such claim shall stapd discharged.
23. Disbursement ofimount to %fhe owner of sick textile undertaking.—..
(I) If, out of the amount paia to him in relation to the.sick textile undèrtakiijg,
there is a balance left after. meeting the liabihttiesas specified in the Second s
Schedule, the Commissioner shall disburse such balance to th6 ownerof such
sick textile 'undertaking.
(2)- Before making any payment to the owndr of the sick textile
undertaking under sub-setion (ir the Commissioner shall satisfj b:iniself ai to - the right of such person to recCive. the whole or any part of such amount axd
in the event of there being a doubt or dispute as to the right. of the person to,
receive the whole or any payt of the amount referred to in sbction S. the- •:'
Commissioner shall refer the n4tet to, the court aiid make 'the disbursement in
accordance with the decisiçrn of the* court. • .
1r the rtrnóval of doubts, it is Eereb)r declared that the entries in column (2) àf the Fjrst Schedule shall not be deemed' to be conclusive as to the right,-.title and intei 4es-t of any person in re'ation to thç sick textile
undertaking specified in the corresponding entries in column (I) of the said
Schedule and evidence s,hali be admissibte to establish the right, title and
ihterest of any prso1r in relation to such sick- textile udertaking.' -
Where any mach,inery, eajiiment or other ythe , sick textile undertaking, has vested in, the state Textile Corporation but such
machinej-, equipinenr or other property does not belong, tb the. owxer of suh
sick textile undertaking,the amount specified in column (3) of theFjrst.' - - Schedule against such sick textile undertaking shall, on 'a Wereiit5i made to "it by ,
- the Comtnissiouier; be apportioned'by the court between the owpev of sjieh sick
textile. undertákjng and the owner ofeh machinery, equipment or other
propefty having due regard to -the vahi of such machinery equipment or other - - - 'property on the appointed day.
Explanation:—.-In this section, "court.",in relatidn to We sick textile '
undertaking, means the principal civil court of oiiginal jurisdiction withixi
- the lodal limits of wliose- jurisdictjoji, ,the sick iextile undertaking is situated. • - • -
24. Undisbursed or u'1aimed amounts to be deposited to the general
revenue accounl.—Ang .amouint paid to the Commissioner which remains
undisbursed or uiclaimed for a period bf three years from- the last day on
•', . •:
4593800/2020/IND(OS)
32
S. S S 4' -. "S S •,
'5•
4 - - S •,,
''
39 •z000026
T -S., ,.
-'which the disbiirement was made; shall be transferred by the CQrnmiSsioner to
t~tlli6 generaL revenie account of the State Govemment, but a claim to any money
'. so transferred may be preferred to the' , State GovernmexTt by the person enjitled
t such payment and shall be dea"lt with as if such' transfer had not been made
and the order, if ini for payment of the ctaim being treated as an order for the
refund. of revenue.
0•• , , ' S
CHAPTER VII -
MISCELLANEOUS
. 4 .
.5....
c...-
.5
25 Assumption of liability —(1) Where any liability of the sick textile
undertaking arising out of any claim spectfied in Category I Category II or
Category Ill or, C&tegory IV in the Second Schedule is not dis.charged fully by
Commissioner out of the amouiit paid to him under 'this Act, the
Commissioner shall intimate in writing to the State Government the extent of
the liability whicl remains undischarged and that liability shall be assumed by
:.-.the Statê Government.
(2) The liabihty assumed by the State S Government under sub-section
l) shall be dis"charged by' payment of the amount of the liability in;negtiable
'5 S bonds redeemable after the expiry of ten years and carrying simple interest at
he rate, of seven 'and a half per cent pe,r annum with effect from the,
appointed day.
26 Act to over-rzd all other enactments —The provisions of this Act
shall have effect notwithstanding anything inconsistent therewith cbntained in
any other law, for the time being in force or, in any intrument having effect by
-
virtue of any lawother than this Act or in any decree or order of any court,
tribunal or authority. . .
I . . . .
27 Contracts to cease to have effect unIes ratified by State Textile
' Corporation —(l)]Any €ontract entered into by the owner or occupier of the
sick txti1e undertaking for any service, sale or supply aid in force immediately
sfbefore the appointed day.shal1,.on and frorn.the expiry of one hundrd and'
"c?.-"eighty days from the date of commencement of this Act, cease to have effect
' un1ess such contrast is, before the expiry of that period ratified, in wntmg by
+;he State Textile Corporation and in ratifying such contract the State Texiile
,Corporation may, with the previous approval of the State Government, make
''juâh altératiois or modificatiOns therein as it may' think fit:. 5
5
5
5
•0 0
5
0
4593800/2020/IND(OS)
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. .-, 40
- lrovided that State Textile Corporation shall not omit to ratify a ctittact
and shall not make any alteration or' modification in a contract an1essit is
satisfied that such contract is u.diiIy àñerons or has been enterd into in bad
faitfi or is' detriffiental to the interests of the sick textile indetakmg
(2)'The State liextile Corporation shall not omit to ratify a cntraei an&
shall not make any alteraiioa or modification therein -except after giving to th
parties to the contract .a redonable opporwntty of being heath and except after -
recording. inwritiag.its reastn fortfiisa1 o ratify the contract. 'or fr making .
any alteration or modifications therein,-
28. PenaWes.—Any person who,—
(a) ha''ing in-his pssession, custOdy or contl'ol of any property lbrmiiig
part of the sick textile unUertaking'or' wronfully withholds such prQperty from
the State Gov.ernmenl or the State Textile Corporation or any 'person uthorsed
by that Government or Corporatioit, as the cqs may be in this behalf or-
wrongfully obiains. posse"ssion of or ietaftfs. any property forpiin
part of the sick 'textile un&rtaking or willfully withholds or fails to furnish .to
the State .Government, the State Textile Corporation er any person specified by
that Qovernment br Corporation,. s the case may be any document felating to,
such sic¼ textile undertaking 'which rtfay be in his possessiari, ctody or
control or fails to deiier, to the State 'textile Corporation- or- any rsQn -
specified by that Corporation any' ass eis, books of account, registers or 6ther i
dQcunients in his custody ftiating to the,sick textile -undertaking; pr
wrongfully removes 'or destroyes any property forming part of the
sick textile- undertaking or' prefers any claim under'the Act whlh he knows or
has redsonable cause to believe in be false or giossl-y inaccur4te hall be
punishable with imprisonment for i term. which may extend to twD years or with, (
fine which my extend to ten thousand rupees, or with lth.
29. Offenes by compantes--(1) Where aoffénce n4er'th&Act has '
been-committed. by a company, every pérson-whô at the time the offence was V
comznitted was in char.ge of, and wa r,esponsiblç tQ, the company fdr -tb. - -
conduct of the business of the 'company as well as the company, ball be
deethed to be guilty of the offehce ahd• shall be liable to.be proceedd against
and punished accor6ingly:
Provided that nothing containe4 in this sub-section shall render ny such
person liable to -any punishmnt,- if h'e proves that the Offence was tomnitted '
without his kno'Cvledge or that të had exercised all due diligence to prtvent the
commission of such offence. - • '-
1
4593800/2020/IND(OS)
34
Li 'i
41o
ntaiedins' n vhere any N1 twfistan dinganything cn -secti ,
offence underjthis Act has been committed by a company and it is pro'ed that
the offence has been committed with the consent or connivance of or is
attributable any neglect on the part of any director manager, secretary or
other officer f the company, such director, manager, secretary or other officer
shall be dëem'ed 'to be guilty of that offence and shall be liable to be proceeded
again't and ptuusMW hed acording1y
Explanation —For the purposes of this section -
(a)1 company means a company as defined in section 3 of the
Companies 4ct, 1956 (Central Act 1 of 1956) and includes in it a ,firm or a -
t: Co-operatxvd Society or , other association of individuals and
(b)/ director in relation to a firm means a partner in the firm
R. Prttectzon of action taken in gopd faith —No suit, prosecutioa or
other legal proceeding shall lie against the State Government or any officer of
4 that Governnent or the authorised person or the State Textile Corporation or
any Subsidiry Textile Corporation or anyoflicer or other personauthorisd by
- either of such Corporation for anything which is in good faith done or -intended
- to be done tinder this Act
31 Delegatzon of powers State Government may, by notification
in the Gazette, direct that all or any of the powers exercisable by them cinder g .
this Act other than the power under section 3 may also be exercised by any
person or jLrson as may be specifiediin the notification -
.. : .•
(2) Whenever any 1 delegation of power is made under sub-section (1)
the person Ito whom such power has beeq delegated shall act under the direction,
j.j control ani suervision of the State Government
32 -Power to remove dfJIculties —If any difficulty arises in giving effect
to he prvisions of this Act, the Stats Government may by order not
inconsistent with the provisions of this Act, remove such difficulty
Provided that no such order shall be made after the expiry of a period of
two yeard from the date of cOtrimencement of this Act
33 E.eclaratzon as to the policy of the State —It is hereby declared that
this Act ts for giving effect to the policy of the State towafds securing the
!'pnncipIe specified in clause (b) of Article 39 of the Constitution
4593800/2020/IND(OS)
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42.
Explanation:—In this 'section "tatehas the samà meaning as in Article 12 of
the Constitution.
VI
34. Power to make rulës.—(1) The Government may, b n'oiflction in the
Gazette, make rules to carry out the prQvisions of thiS'Act,
(2) In particular; and without preju4ice to the gneraiity of the -
fo-egoing power, such ruIernay provide for all or, any of the llowig" -
matters,- iamely:— . .
- - (a) the, time within irhich and the mahner in which 'an intirxation
referred to win sub-section (4) of section '4 shall be-given .. -
. ' V -,
- __\ . .
the n1anne in which money in any provident or other fin
-
d -
referred to in section '14 shall be dealt with V V ,
any other matter which is required to be, pr may be prescn1ed. -
(3) Every rule mad"e under. this Act shall be laid, as soon as may bç - '-
after it , is made, before the Legislative Asembl-, while itis"in session, for a'
totaI period of fourteen days which. may be comprised -in one -session or in twa.
succtssive sessions, and if, before the epiry of the -session' in which i is. -so •
laid or the session imiñediately 'following, the Legis1aive Assenbly -makes any
amendment in the rule or decides that the rule should not be macte, the rule
shall' thereafter have effe6t only in such' amended form or , be ofio effect, as • -
the case may .be; so however, that any - s'uch amendxñnt oe annu1rnnt''shall be '
without prejudice to the vhdity of anything previously done under that rul
35.. Repeal and'Savzng,L-_(l) The Kerala Spinners, Alapoizha (Mqqiiiti6V,
,and Transfer of 'Undertaking) Ordinance, 2010 (9of 2010) is .herey'reealed.
(2) NotwihstandinI such repe"al', anythiftg'-don' or any action taken
under the said Ordinance shall be deemed to have beer done or taken
under this Act " - - - '. ,... -' .' •, - - ,
V • • • . -
- ;•
- -
4593800/2020/IND(OS)
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- . S
- : •.
43.
The First Schedule • &00024 [Se2 sections 2(g), 2(j), 4(5) and 81
Na,n' of the .zck Yame of the / Amoun
textild undèrtaki.n Owner - (in Rupees)
(1) (2) (3)
Kerala1 Spinners Ltd ., Kerala Spinners Ltd ,_354 67 lakhs
Kdmalapüran Koi6a1aurani,
Alappuzha Alappuzha
-- . -
. . S •S •• -
The-Second Schedule
(Seésections19, 20;. 21and Z5) . .'
ORDER OF PRIORITIES FOR THE DISCHARGE OF LIABILfrIES IN
RESPECT OF THE SICK 'TEXTILE uNQERTAKING S.
•. 4 S
PARTI - .' S
- S
• •'•':. ....
Category-1 \ I
Arrears in relation to provident fund, sniaries and wages and other
amounts du to an employee for the pre take over management per4od
PARTII
/ OTHERLIABTL1TIES
'- (A) Post-tikeover Management Period
Category7411
Loaiis advanced by a Bank
Loai.s advanced by an Institution other than a Bank
Any; other loap
- (d) Any cretht availed of for pui -pQses of trade or manufacturing operations
4Category-j_-III /
(a) Re'venue, taxes, cesses, rates or any other duds Pb the Central
- Government or a State Govemmçnt. • - .. ' • •• :- •
- (b) Ady othei dues. • •• . . • S • •
4593800/2020/IND(OS)
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.4
(B) Preta'keover Management Period -
Cat egory—I V
Principal amounts of the secired loans advanced by any Nationalised Bank
or public, financial in'titution.
Category—V -
Secured loans other than those specified uider Category IV. *
Category—VT
Revenue, taxes1, c.esses rates or any other dues to the Central Government,
a State Government, a locaL'authority or a State Electricity Board.
Category—VII
(a) Any credit availed of for purpose of trade or. mantfaètu.ring
operations.
(b) Any other dues.
Ccrtegory—VllI' . .
Interest amounts on the secured loans advanced by any Nationalised Bank
or public financial Institution..
S .
:
I .
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