The Central India Spinning, Weaving and Manufacturing Company Limited, the Empress Mills, Nagpur (Acquisition and Transfer of Undertaking) Act, 1986

GOVERNMENT OF MAHARASHTRA
LAW AND JUDICIAR Y DEPARTMENT
MAHARASHTRA  ACT  No.  XLVI  OF  1986
THE CENTRAL INDIA SPINNING, WEAVING AND
MANUFACTURING COMPANY LIMITED,
THE EMPRESS MILLS, NAGPUR
(ACQUISITION AND
TRANSFER OF  UNDERTAKING)
ACT, 1986
(As modified upto the 1st November,  2012)
*
 PRINTED IN INDIA BY THE MANAGER, GOVERNMENT  PRESS AND
BOOK DEPOT, NAGPUR AND PUBLISHED BY THE DIRECTOR,
GOVERNMENT PRINTING, STATIONERY AND PUBLICATIONS,
MAHARASHTRA STATE, MUMBAI-400 004.
2012
[ Price—R s. 9.00 ]

THE CENTRAL INDIA SPINNING, WEAVING AND MANUFACTURING
 COMPANY LIMITED, THE EMPRESS MILLS, NAGPUR
(ACQUISITION AND TRANSFER OF UNDERTAKING)
ACT, 1986
CONTENTS
——————
PREAMBLE.
SECTIONS.
CHAPTER  I
PRELIMINARY
1.  Short  title  and commencement.
2. Definitions.
CHAPTER  II
ACQUISTION AND TRANSFER OF THE UNDERTAKING
3. Acquisition and transfer of undertaking and its vesting in State Government and its
transfer and vesting in Corporation.
4. General effect of vesting.
5. Proprietors to be liable for prior liabilities.
6. Power of State Government to direct vesting of undertaking in new Government
Company.
CHAPTER  III
PAYMENT OF AMOUNTS
7. Payment of amount.
8. Payment of further amount.
CHAPTER  IV
MANAGEMENT, ETC., OF THE UNDERTAKING
9. Management, etc., of the Undertaking.
10. Duty of persons in charge of management of undertaking to deliver all assets, etc.
11. Duty of person to account for assets, etc., in their possession.
CHAPTER  V
PROVISIONS RELATING TO EMPLOYEES OF THE PROPRIETORS
12. Employment of certain employees.
13. Provident fund and other funds.
1986: Mah. XLVI ] (i)
J-1785-BK-4. Form-1
CHAPTER   VI
COMMISSIONER OF PAYMENTS
14. Appointment of  Commissioner of  Payments.
15. Payment by State Government to Commissioner.
16. Certain  powers  of  State   Government  or  Corporation  or new Government
   Company.
17. Claims to be made to Commissioner.
18. Priority of claims.
19. Examination of claims.
20. Admission  or  rejection of  claims.
21. Disbursement  of money  by  Commissioner  to  claimants.
22. Disbursement of amounts to proprietors.
23. Possession of machinery etc., not belonging to proprietors to continue.
24. Undisbursed or unclaimed amount to be deposited with general revenue account.
CHAPTER  VII
MISCELLANEOUS
25. Assumption of liabilities.
26. Act to have overriding effect.
27. Contracts to cease to have effect unless ratified by State Governemnt or
Corporation or new Government company.
28. Protection of action taken in goodfaith.
29. Delegation of powers.
30. Penalties.
31. Offences by companies.
32. Company not to be woundup by Court.
33. Power to make rules.
34. Power to remove difficulties.
35. Repeal of Mah. Ord. V of 1986 and saving.
SCHEDULE.
(ii) Central India Spinning, Weaving and  Manufacturing [1986 : Mah. XLVI
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
MAHARASHTRA   ACT  No.  XLVI  OF  1986.1
[THE CENTRAL INDIA SPINNING, WEAVING AND MANUFACTURING COMPANY
LIMITED, THE EMPRESS MILLS, NAGPUR (ACQUISTION AND TRANSFER OF
UNDERTAKING)  ACT, 1986.]
[This Act received assent of the president on the 23rd day of December 1986 ;
assent  was first published in the Maharashtra Government Gazette,
Part IV, Extraordinary, on the 26th day of December, 1986.]
An Act to  provide  for  acquisition  and  transfer  of  undertaking  of  the Central  India
Spinning, Weaving  and  Manufacturing  Company  Limited,  with  a  view  to  securing
the  proper  management  of  such  undertaking  so  as  to  subserve  the   interest  of
the  general  public  by  ensuring  the continued  manufacture,  production  and  distribu-
tion  of  textile  and  paper  products  which are essential to the needs of the economy of
the  country  and  for  matters  connected  therewith  or  incidental  thereto.
WHEREAS, the Central India Spinning, Weaving and Manufacturing Company Limited,
being an existing company as defined in clause (ii) of  sub-section (1) of section 3 of the
Companies Act, 1956, had been engagged in the manufacture and production of yarn, cloth
and paper through its undertaking which was composite textile mill and paper manufacturing
unit, styled as the Central India Spinning, Weaving and Manufacturing Company Limited,
“The Empress Mills”, Nagpur ;
AND WHEREAS, in Petition No. 183 of 1986 filed by the company for voluntary winding
up, the High Court of Bombay had made an order for appointment of the provisional liquida-
tor and the proceedings for its liquidation were pendings ;
AND WHEREAS, the company had declared lock-out throwing about more
than 6,000 workers out of employment and the undertaking has not been functioning since
3rd  May 1986 ;
AND WHEREAS, it was expedient to acquire the undertaking of the said company to
ensure that the interest of the general public and of the employees of the undertaking were
served by the continuance, by the undertaking of the said company , of the manufacture,
production and distribution of textile and paper products which are essential to the needs of
the country and to provide for matters connected therewith or incidental thereto ;
AND WHEREAS, such acquisition is for giving effect to the policy of the State towards
securing the principle specified in clause (b) of Article 39 of the Constitution ;
AND WHEREAS, both Houses of the State Legislature were not in session ;
I of
1956.
1 For S tatement of Objects and Reasons, see Maharashtra Government Gazette , 1986, P art V, Extra,
PP. 551–– 552, dated the 20th October 1986.
Mah.
Ord.
V of
1986.
Short title
and com-
mencement.
AND WHEREAS, the Government of  Maharashtra was satisfied that circumstances
existed which rendered it necessary for him to take immediate action to make a law for the
puroposes aforesaid ; and, therefore, pomulgated the Central India Spinning, Weaving and
Manufacturing Company Limited, the Empress Mills, Nagpur (Acquisition and Transfer of
Undertaking) Ordinance, 1986, on the 3rd October 1986 ;
AND WHEREAS, it is expedient to replace the said Ordinance by an Act of the State
Legislature ; It is hereby enacted in the Thirty-seventh Year of the Republic of India as
follows :—
CHAPTER  I
PRELIMINARY
1. (1) This Act may be called the Central India Spinning, Weaving and Manufacturing
Company Limited, the Empress Mills, Nagpur (Acquisition and Transfer of Undertaking)
Act, 1986.
(2) It shall be deemed to have come into force on the 3rd October 1986.
2. In this Act, unless the context otherwise requires,—
(a) “appointed day” means the date of commencement of this Act ;
(b) “bank” means —
(i) the  State  Bank  of  India  constituted  under  the  State  Bank of  India
Act, 1955;
(ii) a Subsidiary Bank as defined in the State Bank of India (Subsidiary Banks)
Act, 1959 ;
(iii) a corresponding new bank constituted under section 3 of the Banking
Companies (Acquisition and Transfer of Undertakings) Act, 1970 or under
section  3 of the Banking Companies (Acquisition and Transfer of Undertakings)
Act, 1980 ;
(iv) any other bank, being a scheduled bank as defined in clause (e) of section 2 of
the Reserve Bank of India Act, 1934 ;
(c) “Commissioner” means the Commissioner of Payment appointed
under section  14 ;
(d) “Corporation” means the Maharashtra State Textile Corporation, a Government
company registered under the Companies Act, 1956 ;
(e) “Instituition” means —
(i) The General Insurance Corporation formed under section 9 of the General
Insurance Business (Nationalisation) Act, 1972,
(ii) The Industrial Credit and Investment Corporation of India, a Company being
an existing Company as defined in clause (ii) of section 3 of the Companies
Act, 1956,
2 Central India Spinning, Weaving and  Manufacturing [1986 : Mah.XLVI
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
Definitions.
23 of
1955.
38 of
1959.
5 of
1970.
40 of
1980.
2 of
1934.
I of
1956.
57 of
1972.
I of
1956.
18 of
1964.
1986 : Mah.XLVI] Central India Spinning, W eaving and  Manufacturing 3
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
(iii) The Industrial Devlopment Bank of India established under section 3 of the
Industrial Devlopment Bank of India Act, 1964,
(iv) The Industrial Finance Corporation of India established under section 3 of the
Industrial Finance Corporation of India Act, 1948,
(v) The Industrial Re-construction Bank of India established under section 3 of the
Industrial Re-construction Bank of India Act, 1984,
(vi) The Life Insurance Corporation of India established under section 3 of the
Life Insurance Corporation Act, 1956,
(vii) The Maharashtra  State Finance Corporation  established under section 3 of the
State Financial Corporation Act, 1951,
(viii) The State Industrial and Investment Corporation of Maharashtra a Company
registered under the Companies Act, 1956, or
(ix) The Unit Trust of India established under section 3 of the Unit Trust of India Act,
1963 ;
(f) “new Government company” means a Government Company (including a subsidiary
Government Company) formed and registered under the Companies Act, 1956, in which the
undertaking is directed to vest under sub-section (1) of section 6 ;
(g) “prescribed” means prescribed by rules made under this Act ;
(h) “proprietors” means the Central India Spinning, Weaving and Manufacturing
Company Limited, an existing company as defined in clause (ii) of sub-section (1) of
section 3 of the Companies Act, 1956 with Registered Office at Army and Navy Building,
148, Mahatma Gandhi Road, Fort, Bombay -400 023 and includes the liquidator appointed
in petition No. 183 of 1986 in the Bombay High Court ;
(i) “Schedule” means the Schedule appended to this Act;
(j) “specified date”, in relation to a provision of this Act, means such date as the
State Government may , by notifiaction in the Official Gazette, specify for the purposes
of that provision, and different dates may be specified for different provisions of this
Act ;
(k) “undertaking” means the industrial undertaking known as “the Central India
Spinning, Weaving and Manufacturing Company Limited, ‘the Empress Mills’, Nagpur”;
(l) words and expressions used herein and not defined, but defined in
the  Companies Act, 1956, shall have the meanings respectively assigned to them in
that Act.
XV of
1948.
62 of
1984.
31 of
1956.
63 of
1951.
I of
1956.
52 of
1963.
I of
1956.
I of
1956.
I of
1956.
J-1785-BK-4. Form-2
4 Central India Spinning, Weaving and  Manufacturing [1986 : Mah.XLVI
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
CHAPTER  II
ACQUISITION AND TRANSFER OF THE UNDERTAKING
3. (1) On the appointed day , the undertaking and the right, title and interest of the
proprietors in relation to the unedertakings, shall, by virtue of this Act, stand transferred to,
and vest absolutely in, the State Government.
(2) The undertaking which stands vested in the State Government by virtue of
sub-section (1) shall, immediately after it has so vested, stand transferred to, and vested in,
the Corporation.
4. (1) The undertaking shall be deemed to include all assets, rights, lease-holds,
powers, authorities and privileges, and all property, moveable and immoveable,  including
lands, buildings, workshops, stores, instruments, machinery and   equipment, cash balances,
cash on hand, reserve funds, investments, book debts and all other rights and interests, in or
arising out of, such property as were immediately before the appointed day in the ownership,
possession, power or control of the proprietors, whether within or outside India, and all
books of account, registers and all other documents of whatever nature relating thereto.
(2) All properties as aforesaid which have vested in the State Government under sec-
tion 3 shall, by force of such vesting, be freed and discharged from any trust, obligation,
mortgage, charge, lien and all other encumbrances affecting them, and any
attachment, injunction, decree or order of any court, tribunal or other authority restricting
the use of such properties in any manner shall be deemed to have been withdrawn.
(3) Every mortgagee of any property which has vested under this Act in the S tate
Government and every person holding any charge, lien or other interest in, or in relation, to
any such property shall give, within such time and in such manner as may be prescribed, an
intimation to the Commissioner of such mortagage, charge, lien or other interest.
(4) For the removal of doubts, it is hereby declared that the mortgagee of any property
referred to in sub-section (3) or any other person holding any charge, lien or other interest
in, or in relation to, any such property shall be entitled to claim, in accordance with his rights
and interest, payment of the mortgage money or other dues, in whole or in part, out of the
amount specified in section 7 and also out of the amounts referred to in section 8, but no
such mortgage, charge, lien or other interest shall be enforceable against any such property
which has vested in the State Government, the Corporation or new Government company.
(5) Any licence or other instrument granted to the proprietors in relation to  the undertak-
ing  which  has  vested  in  the  State  Government  under  section   3, at any time before the
appointed day and in force immediately before that day , shall continue to be in force on
and after such day in accordance with its tenor in relation to, and for the purposes  of such
Acquisition
and transfer
of under-
taking and its
vesting in
State
Government
and its
transfer and
vesting in
Corporation.
General
effect of
vesting.
Proprietors
to be liable
for prior
liabilities.
1986 : Mah.XLVI] Central India Spinning, W eaving and  Manufacturing 5
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
undertaking, and on and from the date of vesting of such undertaking under section 3 in the
Corporation, or under section 6 in the new Government company, the Corporation, or new
government company, as the case may be, shall be deemed to be substituted in such licence
or other instrument as if such Licence or other instrument had been granted to the  Corpora-
tion, or new Government company , and that the  Corporation, or the new Government
company, shall hold it for the remainder of the period for which the proprietors would have
held it under the terms thereof.
5. (1) Every liability of the proprietors in relation to the undertaking in respect of any
period prior to the appointed day, shall be the liability of the proprietors and shall be enforce-
able against them and not against the State Government or against the Corporation or, where
the undertaking is directed under section 6 to vest, in a new Government company, against
the new Government company.
(2) For the removal of doubts, it is hereby declared that.—
(a) save as otherwise expressly provided in this section or in any other provision of
this Act, no liability, shall be enforceable against the State Government or the Corpora-
tion, or, where the undertaking is directed under section 6 to vest in any other new
Government company, against such new Government company ;
(b) no award, decree or order of any court, tribunal or other authority in relation to the
undertaking passed on or after the appointed day , in respect of any matter , claim or
dispute, which arose before that day, shall be enforceable against the State government
or the Corporation or, where the undertaking is directed under section 6 to vest in any
other new Government company, against such new Government company ;
(c) no liability incurred by the proprietors before the appointed day , for the
contravention of any provision of any law for the time being in force, shall be enforceable
against the State Government or the Corporation, or where the undertaking is directed
under section 6 to vest in any other new Government company , against such new
Government company ;
(d) notwithstanding anything contained in sub-sections (1) and (2) of  section 12 or
any other provisions of this Act, or any other law for the time being in force or any
contract, agreement, settlement, award or decree or order of any court, tribunal or other
authority, no liability towards claims of whatever nature of any employee against the
proprietors in respect of his employment in the undertaking for the period prior to the
appointed day shall be enforceable against the State Government or the Corporation, or
where the undertaking is directed under section 6 to vest in any other new Government
company, against such new Government company.
Power of
State
Govern-
ment to
direct
vesting of
undertaking
in new
Govern-
ment
company .
Payment of
amount.
Payment of
further
amount.
6. (1) Notwithstanding anything contained in sections 3 and 4, where the undertaking
vests, under sub-section (2) of section 3, in the Corporation, the S tate Government may,
subject to such terms and conditions as it may think fit to impose, direct, by notification in
the Official Gazette, that the undertaking and the right title and interest of the proprietors in
relation to the undertaking, which had vested in the State Government and which on its
transfer vest in the Corporation under section 3, shall instead of continuing to vest in the
Corporation, vest in a new Government company with effect from the date specified in the
notification.
(2) Where the right, title and interest of the proprietors in relation to their undertaking
vest, under sub-section (1), in the new Government company, such Government company
shall, on and from the date of such vesting, be deemed to have become the owner in relation
to such undertaking, and all the rights and liabilities of the State Government and the Corpo-
ration in relation to the undertaking shall, on and from the date of such vesting, be deemed
to have become the rights and liabilities of such Government company.
CHAPTER III
PAYMENT OF AMOUNTS
7. For the transfer to, and vesting in, the State Government under section 3, of the
undertaking and the right, title and interest of the proprietors in relation to the undertaking,
there shall be paid by the State Government to the proprietors, in cash, and in the manner
specified in Chapter VI, an amount of rupees six crores and ten lakhs :
Provided that, where any liability of the proprietors specified in the Schedule is
discharged by the State Government or the Corporation according to the order of the
priorities mentioned in the Schedule, the amount to be paid to the proprietors under this
section shall stand reduced to that extent.
8. (1) The amount payable in accordance with the provisions of section 7 shall carry
simple interest at the rate of four per cent. per annum for the period commencing on the
appointed day and ending on the date on which payment of such amount is made by the
State Government to the Commissioner.
(2) The amount representing interest calculated at the rate specified in sub-section ( 1)
shall be given by the State Government to proprietors in addition to the amount specified in
section 7.
(3) For the removal of doubts it is hereby declared that the liabilities of the proprietors in
relation to their undertaking which has vested in the State Government or the Corporation
under section 3 shall be discharged from the amounts specified in section 7 and also from the
amounts specified in sub-section (1) in accordance with the rights and interests of the
creditors of the proprietors.
6 Central India Spinning, Weaving and  Manufacturing [1986 : Mah.XLVI
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
Manage-
ment, etc.
of the
undertaking:
1986 : Mah.XLVI] Central India Spinning, W eaving and  Manufacturing 7
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
CHAPTER IV
MANAGEMENT, ETC. OF THE UNDERTAKING
9. (1) The general superintendence, direction, contol and management of the affairs
and business of the undertaking, the right, title and interest in relation to which have vested
in the State Government under sub-section (1) of section 3, shall—
(a) by virtue of the provisions of sub-section (2) of section 3, vest in the
Corporation or in such person and to such extent or limitations as the Corporation may by
order in writing, specify ; or
(b) where  a direction has been issued by the State Government under sub-section
(1) of section 6, vest in the new Government company or in such person and to such
extent or limitations as the new Government company may, by order in writing, specify ;
and thereupon the Corporation or the new Government company or, as the case may be, such
persons shall be entitled to exercise, to the exclusion of all other persons, all such powers
and do all such things as the proprietors were authorised to exercise and do in relation to
their undertaking.
(2) Notwithstanding anything contained in sub-section (1) or any other law for the time
being in force, it shall be lawful for the Corporation or the new Government company to
reorganise the functioning of the different units and offices of the undertaking and the
employees employed therein and thereby restructure such units and offices with such strength
of employees as the Corporation or such new Government company deems fit.
10. (1) On the vesting of the management of the undertaking in Corporation or the new
Government company all persons in charge of the management of the undertaking immedi-
ately before such vesting, including the liquidator appointed by the Court shall be bound to
deliver to the Corporation, or new Government company , as the case may be, all assets,
books of account, registers and other documents in their possession or custody or under
their control, relating to the undertaking.
(2) The State Government may issue such directions as it may deem desirable in the
circumstances of the case to the Corporation or new Government company , and such
corporation or new Government Company may also, if it is considered necessary so to do,
apply to the State Government at any time for instructions as to the manner in which the
management of the undertaking shall be conducted or in  relation to any other matter arising
in the course of such management.
11. (1) Any person who has on the appointed day , in his possession or custody
or under his control, any assets, books, documents or other papers relating to the
undertaking, which have vested in the State government or in the Corporation, or in the new
Government company under this Act, shall be liable to account for the said  assets,  books,
Duty of
persons in
charge of
management
of undertak-
ing to
deliver all
assets, etc.
Duty of
person to
account for
assets, etc.,
in their
possession.
8 Central India Spinning, W eaving and  Manufacturing [1986 : Mah.XLVI
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
documants and other papers to the State Government, or the Corporation or the new
Government company, as the case may be, and shall deliver them to the State Government or
the Corporation or the new Government company or to such person or persons as the State
Government  or the Corporation or the new Government company may specify in this behalf.
(2) The State Government or the Corporation or the new Government company
aforesaid may take, or cause to be taken, all necessary steps for securing posession of the
undertaking which has vested in the State Government or the Corporation or the new
Government company under this Act.
(3) The proprietors shall, within such period as the State Government may allow in this
behalf, furnish to that Government a complete inventory of all its properties and assets, as on
the appointed day, pertaining to the undertaking which has vested in the State Government
under sub-section ( 1) of section 3 and in the Corporation, by virtue of the provisions of
sub-section (2) of that section, or the new Government company and, for this purpose the
State Government or the Corporation or the new Government company shall afford to the
proprietors all reasonable facitities.
CHAPTER V
PROVISIONS RELATING TO EMOLOYEES OF THE PROPRIETORS
12. (1) Where services of a person who is a workman within the meaning of the
Industrial Disputes Act, 1947, and who has been, immediately before the appointed day ,
employed in the undertaking, are, in the opinion of the Corporation necessary having regard
to requirements of the units restructured as a result of re-organisation of the undertaking, he
shall become, from the date of his apointment by the Corporation, an employee of the
Corporation and shall hold office or service in the Corporation with the same rights and
privileges as to pension, gratuity and other matters as would have been admissible to him if
the rights in relation to the undertaking had not been transferred to, and vested in, the
Corporation and continue to do so unless and until his employment in such Corporation is
duly terminated or until his remuneration and terms and conditions of employment are duly
altered by the Corporation.
(2) Where  services  of  a  person  who  is  not  a  workman  within  the meaning of the
Industrial Disputes Act, 1947, and who has been immediately before the appointed day ,
employed in the undertking, are, in the opinion of the Corporation necessary having regard
Emoloyment
of certain
employees.
14
of
1947.
14
of
1947.
1986 : Mah.XLVI] Central India Spinning, Weaving and  Manufacturing 9
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
to the requirements of the units or offices of the Corporation restructured as a result of
re-organisation of the undertaking, he shall become, from the date of his appointment by the
Corporation, an employee of the Corporation and shall hold office or service in the
Corporation on such terms and  conditions of employment as may be determined by the
Corporation.
(3) ( a) The services of  every person employed by the proprietor before the appointed
day shall  stand terminated—
(i) on the designated date if such person is not employed before that date by the
Corporation under sub-section (1) or (2), and
(ii) on the date of his appointment if such person is employed before the designated
date by the Corporation under sub-section  (1) or (2).
(b) A person whose services stand terminated under sub-clause (i) of clause (a) shall
not be entitled to claim employment in the Corporation as of right.
(4) ( a) Every person whose services stand terminated under sub-clause ( i) of clause
(a) of sub-section (3) shall be entitled to—
(i) payment of gratuity and of compensation for retrenchment or closure in accor-
dance with the provisions of the Payment of Gratuity Act, 1972 and the Industrial Desputes
Act, 1947 if he is a workman within the meaning of the latter Act, and
(ii) payment of gratuity if he is not such a workman :
Provided that, no person whose services are terminated on his superannuation on or
before the designated date, shall be entitled to payment of compensation for
retrenchment.
(b) Notwithstanding anything contained in Chapter VI and notwithstanding that the
liability for payment of gratuity and compensation for retrenchment or closure under clause
(a) is that of the proprietors such liability shall be discharged by the State Government or the
Corporation, according to the order of priorities mentioned in the Schedule and on discharge
of such liability by the State Government or the Corporation the proprietors shall stand
discharged to the extent of the liability so discharged.
(5) Where,—
(a) the services of any person employed before the appointed day in the undertaking
are terminated.—
(i) under the terms of any contract or service or otherwise, or
(ii) under sub-section (3), and
(b) such person is entitled to any arrears of salary or wages or any payment for any
leave not availed of or other payment not being payment by way of gratuity or compen-
sation for retrenchment,
39 of
1972.
14 of
1947.
such person may, except to the extent such liability of payment has been discharged by the
State Government or the Corporation under the proviso to section 7, enforce his claim
against the proprietors of the undertaking but not against the State Government or the
Corporation :
Provided that, notwithstanding anything contained in the Industrial Disputes Act,
1947, the Payment of Wages Act, 1936, and the Payment of Gratuity Act, 1972,––
(a) the State Government or the Corporation shall not be liable,—
(i) to any person who has become an employee of the Corporation under
sub-section (1) for payment of gratuity or any arrears of wages, or
(ii) to any person whose services stand terminated under sub-clause (i) of clause
(a) of sub-section (3) for payment of gratuity or any arrears of wages or compensation
for retrenchment or closure,
for the period commencing from the day on which the undertaking was closed and ending on
the day on which such person becomes an employee of the Corporation or, as the case may
be, on which  his services stand terminated irrespective of whether such closure was in
accordance with the provisions of  the Industrial Disputes Act, 1947 or not ;
(b) the termination of services of a person under sub-clause ( ii) of clause (a) of
sub-section (3) on his becoming an employee of the Corporation under sub-section (1) shall
not entitle such person to payment of any gratuity.
Explanation.––In this Chapter––
(a) the expression “Corporation” includes “ new Government company ” ; and
(b) the expression “ designated date ’’ means such date as the State Government may,
by notification in the Official Gazette, designate.
13. (1) Where the proprietors have established a provident fund, superannuation fund,
welfare fund or any other fund for the benefit of the persons employed in the undertaking,
the monies relatable to the officers or other employees, whose services have been continued
on appointment to the Corporation shall, out of the monies standing on the appointed day to
the credit of such provident fund, superannuation fund, welfare fund or other fund, stand
transferred to and  vested in, the Corporation.
(2) The monies which stand transferred under sub-section ( 1) to the Corporation shall
be dealt with by the Corporation in such manner as may be prescribed.
10 Central India Spinning, W eaving and  Manufacturing [1986 : Mah. XLVI
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
14 of
1947.
IV of
1936.
39 of
1972.
14 of
1947.
Provident
fund and
other funds.
1986 : Mah. XLVI] Central India Spinning, Weaving and  Manufacturing 11
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
CHAPTER VI
COMMISSIONER OF PAYMENTS
14. (1) The State Government shall, for the purpose of disbursing the amounts
payable under sections 7 and 8 to the proprietors, by notification in the Official Gazette,
appoint a Commissioner of Payments.
(2) The State Government may appoint such other persons as it may think fit to assist
the Commissioner and thereupon the Commissioner may authorise one or more of such
persons also to exercise all or any of the powers exercisable by him under this Act and
different persons may be authorised to exercise different powers.
(3) Any person authorised  by the Commissioner to exercise any of the powers exercis-
able by the Commissioner may exercise those powers in the same manner and with the same
effect as if they have been conferred on that person directly by this Act and not by way of
authorisation.
(4) The  salaries and allowances of the Commissioner and other persons appointed
under this section shall be defrayed out of the Consolidated Fund of the State.
15. (1) The State  Government shall, within thirty days from the specified date pay in
cash to the Commissioner for Payment to the proprietors,––
(a) an amount equal to the amount specified in section 7, after deducting there-
from any amount paid under clause (b) of sub-section (4) of section 12 ; and
(b) an amount equal to the  amount payable to the proprietors under section 8.
(2) A deposit account shall be opened by the State Government in favour of the
Commissioner in the Public Account of the  State, and every amount paid under this Act to
the Commissioner shall be deposited by him to the credit of the said deposit account and the
said deposit account shall be operated by the Commissioner.
(3) Records shall be maintained by the Commissioner in respect of the undertaking in
relation to which payment has been made to him under this Act.
(4) The interest accruing on the amount standing to the credit of the deposit account
referred to in sub-section (2) shall accrue to the benefit of the proprietors.
16. (1) The State  Government or the Corporation or, where a direction has been issued
by the State Government under sub-section (1) of section 6, the new Government company,
as the case may be, shall be entitled to receive up to the specified date, to the exclusion of all
Apointment
of Commis-
sioner of
Payments.
Paymen t by
State
Government
to Commissioner.
Certain powers
of State
Government or
Corporation or
new Government
company .
12 Central India Spinning, Weaving and  Manufacturing [1986 : Mah. XLVI
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
other persons, any money due to the proprietors, in relations to their undertaking which has
vested in the State Government, or the Corporation or in the new Government company, and
realised after the appointed day , notwithstanding that the realisation pertains to a  period
prior to the appointed day.
(2) The State Government or the Corporation or the new Government company, as the
case may be, may make a claim to the Commissioner with regard to every payment made by
it after the appointed day , not being payment made under the proviso to section 7, for
discharging any liability of the proprietors, in relation to any period prior to the appointed
day, and every such  claim shall have priority, in accordance with the priorities attaching,
under this Act, to the matter in relation to which such liability has been dischar ged by the
State Government, or the Corporation or the new Government company.
(3) Save as otherwise provided in this Act, the liabilities of the proprietors in respect of
any period prior to the appointed day, shall be the liabilities of the proprietors.
17. Every person having a claim other than the claim relating to gratuity or compensa-
tion for retrenchment or closure against the proprietors with regard to any of the matters
specified in the Schedule pertaining to the undertaking, shall prefer such claim before the
Commissioner within thirty days from the specified date :
Provided that, if the Commissioner is satisfied that the claimant was prevented by suffi-
cient cause from preferring the claim within the said period of thirty days, he may entertain
the claim within a further period of thirty days  but not thereafter.
18. The claims arising out of the matters specified in the Schedule shall have priorities
in accordances with the following principles, namely :—
(a) category I shall have precedence over all other categories and category II shall
have precedence over categories III and IV ; and category III shall have precedence over
category IV ;
(b) the claims arising out of matters specified in each category except category III
shall rank equally and be paid in full, but if the amount is insufficient to meet such claims
in full, they shall abate in equal proportions and be paid accordingly;
(c) the liabilities specified in category III shall be discharged in the manner agreed to
by the State Government of one part with the banks and institutions of other part subject
to the priorities specified in this section, in accordance with the terms of the secured loans
and the priority inter se of such loans ; and
Claims to
be made to
Commis-
sioner .
Priority of
claims.
(d) the question of  payment of a liability with regard to a matter specified in a lower
category shall arise only if a surplus is left after meeting all the liabilities specified in the
immediately higher category.
19. (1) On receipt of the claims made under section 17, the Commissioner shall arrange
the claims in the order of priorities specified in the Schedule and examine the same in
accordance with such order of priorities.
(2) If, on examination of the claims, the Commissioner is of opinion that the amount paid
to him under this Act, is not sufficient to meet the liabilities specified in any lower category,
he shall not be required to examine the claims in respect of such lower category.
20. (1) After examining  the claims with reference to the priorities set out in the
Schedule, the Commissioner shall fix a date on or before which every claimant shall file the
proof of his claim or be excluded from the benefit of the disbursement made by the
Commissioner.
(2) Not less than fourteen days’ notice of the date so fixed shall be given by
advertisement in one issue of such daily newspaper in the English language, and one issue
of such daily newspaper in the Marathi language as the Commissioner may consider
suitable, and every such notice shall call upon the claimant to file the proof of his claim with
the Commissioner within the period specified in the advertisement.
(3) Every claimant, who fails to file the proof of his claim within the period specified by
the Commissioner shall be excluded from the disbursements made by the Commissioner.
(4) The Commissioner shall, after such investigation as may, in his opinion, be necessary
and after giving the proprietors an opportunity of refuting the claims and after giving the
claimant a reasonable opportunity of being heard, admit or reject, by order in writing, the
claim in whole or in part.
(5) The Commissioner shall have the power to regulate his own procedure in all matters
arising out of the discharge of his functions, including the place or places at which he may
hold his sittings and shall, for the purpose of making an investigation under this Act, have
the same powers as are vested in a civil court under the Code of Civil Procedure, 1908, while
trying a suit, in respect of the following matters, namely :—
(a) the summoning and enforcing the attendance of any witness and examining him
on oath ;
(b) the discovery and production of any document or other material object producible
as evidence ;
(c) the reception of evidence on affidavits ; and
(d) the issuing of any commission for the examination of witnesses.
1986 : Mah.  XLVI] Central India Spinning, Weaving and  Manufacturing 13
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
Examina-
tion of
claims.
Admission
or rejection
of claims.
V of
1908.
14 Central India Spinning, Weaving and  Manufacturing [1986 : Mah. XLVI
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
(6) Any investigation before the Commissioner shall be deemed to be a judicial proceed-
ing within the meaning of sections 193 and 228 of the Indian Penal Code, and the Commis-
sioner shall be deemed to be a civil court for the purposes of section 195 and Chapter XXVI
of  the Code of Criminal Procedure, 1973.
(7) A  claimant, who is dissatisfied with the decision of the Commissioner, may prefer an
appeal against such decision to the principal civil court of original jurisdiction within the
local limits of whose jurisdiction the registerd office of the proprietors is situated :
Provided that, where a person who is a Judge of a High Court is appointed to be the
Commissioner, such appeal shall lie to the High Court of Bombay and such appeal shall be
heard and disposed of by not less than two Judges of that High Court.
21. After 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
whom such amount is due, and on such credit or payment, the liability of the proprietors in
respect of such claim shall stand discharged.
22. If, out of the monies paid to him in relation to the undertaking, there is a balance left
after meeting the liabilities as specified in the Schedule, the Commisssioner shall disburse
such balance to the proprietors.
23. Where the possession of any machinery , equipment or other property has vested
in the State Government, or Corporation, or new Government company under this Act, but
such machinery, equipment or other property does not belong to the proprietors, it shall be
lawful for the State Government or the Corporation or such Government company to
continue to possess such machinery or equipment or other property on the same terms and
conditions under which they were possessed by the proprietors immediately before the
appointed day.
24. Any money paid to the Commissioner which remains undisbursed or unclaimed on
the date immediately preceding the date on which the office of the Commissioner is finally
wound up, shall be transferred by the Commissioner before his office is finally wound up, to
the general revenue account of the State Government ; but a claim to any money so
transferred may be preferred to the State Government by the person intitled to such payment
and shall be dealt with as if such transfer had not been made, and the order , if any, for
payment of the claim, being treated as an order for the refund of revenue.
Disburse-
ment of
money by
Commis-
sioner to
claimants.
Disburse-
ment of
amounts to
proprietors.
Possession
of
machinery
etc. not
belonging
to
proprietors
to continue.
Undisbursed
or
unclaimed
amount to
be deposited
with general
revenue
account.
XLV
of
1860.
II of
1974.
1986 : Mah.XLVI] Central India Spinning, Weaving and  Manufacturing 15
Company Limited, The Empress Mills, Nagpur
(Acquisition and Transfer of Under taking)
Act, 1986.
CHAPTER  VII
MISCELLANEOUS
25. (1) Where any liability of the proprietors arising out of any item specified in
category I of the Schedule is not discharged fully by the Commissioner out of the amount
paid under this Act, the Commissioner shall intimate in writing to the State Government the
extent of the liability which remains undischarged and that liability shall be assumed by the
State Government.
(2) The State Government may, by order, direct the Corporation to take over any liability
assumed by the Government under sub-section (1) and on receipt of such direction, it shall
be the duty of the Corporation to discharge such liability.
26. The provisions of this Act shall have effect notwithstanding anything inconsistent
therewith contained in any other law for the time being in force or in any instrument having
effect by virtue of any law, other than this Act or in any decree or order of any court, tribunal
or  other authority.
27. Every contract entered into by the proprietors in relation to their undertaking, which
has vested in the State Government under section 3, for any service, sale or supply, and in
force immediately before the appointed day, shall on and from the expiry of one hundred and
eighty days from the appointed day, cease to have effect unless such contract is, before the
expiry of that period, ratified, in writing by the State Government, or the Corporation, or new
Government company, in which such undertaking has been vested under this Act, and in
ratifying such contract, the State Government, or the Corporation or the new Government
company, as the case may be, may make such alteration or modification therein as it may
think fit:
Provided that, the State Government, or the Corporation, or the new Government
company shall not omit to ratify a contract and shall not make any alteration  or modification
in a contract,—
(a) unless it is satisfied that such contract is unduly onerous, or has been entered
into in bad faith, or is detrimental to the interest of the State Government, or the Corpora-
tion or the new Government company ; and
(b) except after giving the parties to the contract a reasonable opportunity of being
heard  and except after recording in writing its reasons for refusal to ratify the contract or
for making any alteration or modification therein.
28. No suit, prosecution or other legal proceeding shall lie against the State   Govern-
ment, or the Corporation, or the new Government company or any officer or other employee
of that Government, or the Corporation or the new Government company, or other person
authorised by the State Government or the Corporation,  or the new Government company
for anything, including any damage caused or likely to be caused by anything , which is in
good faith done or intended to be done under this Act.
Assumption
of liabilities.
Act to have
overriding
effect.
Contracts to
cease to have
effect unless
ratified by
St

Excerpt shown. Open the full act in Lexace.

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