The BIST INDUSTRIAL CORPORATION LIMITED (ACQUISITION OF UNDERTAKING) ACT, 1970

48 
 
THE BIST INDUSTRIAL CORPORATION LIMITED (ACQUISITION OF UNDERTAKING) ACT, 
19701 
[Uttar Pradesh Act No.7 of 1971] 
 
[Passed by in Hindi by the Uttar Pradesh Legislative Assembly on December 14, 1970 and by the 
Uttar Pradesh Legislative Council on December 17, 1970.  
 
Received the assent of the President on January 13, 1 971 under Article 201 of ‘the Constitution of 
India’, and was published in the Uttar Pradesh Gazette Extraordinary, dated January 16, 1971] 
AN 
ACT 
to provide for the acquisition of the idle pla nt and other property belon ging to or held by  the Bist 
Industrial Corporation Limited, for the purpose of enabli ng the State Government in the  public interest to 
commission the said plant with a view to bringing to use, to the fullest extent possible, the surplus sugarcane 
grown in and around the Tarai area in thereby helping the sugarcane growers of that area, utilizing the said 
plant for the production of sugar, which is an essential commodity by and providing employment to a 
considerable number of people and so managing the undertaking as best to sub-serve the common good.   
It is HEREBY enacted in the Twenty-first Year of the Republic of India as follows: - 
Short title 1. This Act  may be called the Bist Industrial Corporation Limited (Acquisition of 
Undertaking) Act, 1970.  
 
Definitions  2. In this Act, unless the context otherwise requires-  
(a) "the Company" means the Bist In dustrial Corporation Limited, being a 
company as defined in the Companies Act, 1956, having its registered office at 
Kichha, district Naini Tal;  
(b) "the Collector" means the Collect or of Naini Ta l District and includes any 
officer authorised by hi m to perform the functions of the Collector under this 
Act ;:  
(c) "the Court" means the Court of District Judge, Naini Tal;  
(d) "the ' undertaking" of the Company means the entire land and buildings 
belonging to the company  situated at Kichha, district Naini Tal, including 
drains, culverts, bridges roads, store-house and the chimney turbine and boilers 
(including the foundations super­structure and rooting) and railway siding tube-
well electric installation and other appurtenance s and fixtures, and also lease -
hold rights or any other interest held by the Company in land and buildings 
situated at Kichha, an d the entire plant and machi nery a nd other equipment 
(including milling plant, boiling house equipment and other sugar machin ery, 
workshop machinery cane unloading equipment and power plant , furniture, 
locomotives, and other-vehicles, weigh-bridges and cranes ) and stores, plans, 
sections, drawings, designs and other document s relating to the establish ment 
and running    of a sugar factory at Kichha [for which licence was obtained by 
the Company under the Industries (Development and Regulation) Act, 1951) , 
as was immediately before the 12th day of September, 1970, in the 
 
 
 
1.       For statement of Objects and Reasons, see Uttar Pradesh Gazette Extraordinary, dated  
 December 14, 1970. 
  
 
49 
 
[The Bist Industrial Corporation Limited (Acquisition of Undertaking) Act, 1970]      [Section 3-5] 
  ownership possession, power or control of the company but does not include 
cash balances, cash in hand, reserve fund, investments a nd book debts or 
any proper ties and assets (other than prop erties and assets hereinbefore 
specified as comprised in the u ndertaking) not connected with the proposed 
establishment and running of the said sugar factory or any rights  or 
obligations arising out of any contract other than contracts pertaining to the 
properties and a ssets hereinbefore specified as  comprised in the 
undertaking. 
 
Vesting  3. On the commencement of this Act, the undertaking of the Com pany shall  by 
virtue of this, Act, be and stand transferred to and vest, in the State Government 
free from  any debt mortgage, charge or other encumbrance or lien, trust or 
similar obligation of the Company or attaching to the undertaking: 
           Provided that any such debt, mor tgage, charge or other encum brance or 
lien, trust, o r similar obligation shall attach to the compen sation referred to in 
section 8 in substitution for the undertaking.  
 
General effect 
of vesting  
4. Subject to the other provisions contained in this Act all contracts, relating to the 
undertaking of the. Company, which are sub sisting immediately before the 12th 
day of September 1970 and affecting the Company, other than contracts creating 
any debt, mortgage, charge or other encumbrance or lien, trust or simi lar 
obligation referred to in section 3 shall cease to have effect or be en forceable 
against the Com pany or any person who has surety , or had guar anteed the 
performance thereof and shall be of as full force and e ffect against or in favour 
of the State Government and enforceable as fully and effectually and instead of 
the Company the State Government had been named therein or had been a party 
thereto. 
 
Duty to deliver 
possession of 
property  
5. (1)  Where any property has vested in the State Government under section 3 every 
person in whose possession or custody or under whose control the property may 
be shall forthwith deliver the property to the Collector.  
 
(2)  Any person who, on the commencement of this Act, has in his possession or 
under his control any books, documents or other papers relating to the Company 
which have vested in th e State Government under this  Act and wh ich would, 
have, belonged  to the Company if the undertaking of the Company had not 
vested in the State Government shall be liable to acco unt for the said books, 
documents and papers to the State Governm ent and shall deliver them up to the 
Collector.  
 
(3)  Subject to the con trol o f the State Government the Collector may take all 
necessary steps for securing possession of all properties which have been vested 
in it under secti on 3, and in particular may, authority  the use of such force as 
may be necessary.  
 
 
 
50 
 
[The Bist Industrial Corporation Limited (Acquisition of Undertaking) Act, 1970]       [Section 6-8] 
Duty to furnish 
particulars  
6. The Company shall, within such period as the State Government may a llow in 
that behalf, furnish to  the State Government or to such officer as th e State 
Government may specify in that behalf a complete inventory of all properties 
and assets comprised in its undertaking and also of all liabilities and obligations 
of the Company incurred on the security thereof and subsisting on the 12 th day 
of Septe mber, 1970 and also  of all contracts referred to in section 4, and the 
State Governmen t shall afford the Company all reasonable facilities for  this 
purpose.  
 
Right of  
Government to  
disclaim 
certain 
contracts  
7. (1) Where it appears to the State Govern ment that the making of  any contract 
relating to the  undertaking under which the Company has or will have or may 
have liabilities was not reasonably necessary for the 'purpose of the  activities of 
the Company or has not been entered into in - good faith, the State Government 
may within two years from the commencement of this Act, apply  to the Court, 
for relief from the contract, and the Cou rt, if satisfied after making such inquiry 
in the matter, as it thinks fit that he contract was not reasonably necessary for 
the purposes of t he activities of the Company or has not been entered into in 
good faith, may make an order canceling or varying the contract on such terms 
as it may think fit to, im pose a nd the contract shall thereupon cease to have 
effect or, as the case may be, shall have effect subject to such variation.  
(2) Every application under this section shall conform generally to th e requirements 
of Orders VI and VII of the First Schedule to the Code of Civil Procedure, 1908, 
as if su ch application were a plaint and all the  parties to the contract which is 
sought to be cancelled or varied shall be made parties to the proceeding.  
 
Compensation 
for acquisition 
of undertaking  
8. (1) The State Gov ernment shall pay a sum of Rs. 1,31,59,372 (rupees one cror e 
thirty-one Lakh s,  fifty-nine thousand, three hundred and seventy two) as 
compensation to the Company for the  acquisition of the undertaking of the 
Company, after deducting therefrom all amounts of loan and interest thereon 
(including penal interest) and taxes (including penalty)  due to if from' the 
Company.  
(2)  The said, balance of the amount of compensation  shall be paid into court to the 
credit of the Compa ny within six months from the date on which the property, 
books, documents or other papers referred to in section 5, are duly delivered or 
the date on which the particulars refe rred to in section 6,  are duly delive red 
whichever be later (here inafter in this se ction referred to as the said date) and 
any difference or dispute about the said date shall be decided by the court.  
(3)  The said amount of compensation shall carry interest at the rate of six per cent 
per annum from the said date till the date of payment into court.  
(4)  Any difference or dispute about the correctness of the deduc tions referred to in 
sub-section (1) shall be decided by the court and if the court finds that the 
amount deducted exceeds the amount actually due to the State Gov ernment the 
State Government shall pay the difference to gether with-interest as specified in 
sub-section (3).   
 
 
51 
 
[The Bist Industrial Corporation Limited (Acquisition of Undertaking) Act, 1970]     [Section 9-10] 
   (5)  Any claim based on any debt, mortgage, charge or other encumbrance or lien, trust 
or similar obligation attaching to the undertaking of the company, which under the 
proviso to section 3 shall attach to the compensation, whether or not a decree has 
been obtained on the basis thereof, may be preferred to the court within six month 
from the commencement of this Act. Every such claim shall conform  generally to 
the requirements of Orders VI and VII of the first Schedule to the code of Civil 
Procedure, 1908, as if it were a plaint. 
(6)  The court shall give notice of every payment made under sub -section (1) and of 
every clam preferred under sub-section (5) to the company. 
(7)  The sums paid into the court under sub -section (1) or sub -section (4) shall be 
disbursed by the court in accordance with its adjudication of any claim under sub -
section (5), and the court may make such interim orders respecting withdrawal or 
investment of the whole or part of any such sum as it thinks just and expedient.  
 
Appeal  9. Every final decision of the court under section 7 or section 8 shall be deemed to be a 
decree, and the statement of the grounds of every such decis ion a judgment, within 
the meaning of clauses (2) and (9) respectively of section 2 of the Code of Civil 
Procedure, 1908 and subject to the provisions of the said code applicable to appeals 
from original decrees, an appeal shall lie therefrom to the High C ourt, and the 
decision of the High Court on such appeal shall be final. 
 
Penalties  10. (1)  Any person who----  
(a) having in his possession, custody or control any property forming part of the 
undertaking of the company, withholds such property from the  Collector in 
contravention of the provisions of section 5; or 
(b) wrongfully obtains possession of any property forming part of the undertaking of 
the Company which has vested in the State Government under this Act; or 
(c)  willfully withholds or fails to deliver to the Collector any document which may 
be in his possession, custody or control and which he is required to deliver 
under section 5; or  
(d)  willfully fails to furnish an inventory as required by section 6; or  
(e) when required to furnish such inventory, furnishes any particulars therein which 
are false and which he either knows or believes to be false or does not believe to 
be true shall be punishable with imprisonment for a term which may extend to 
three years or with fine, or with both. 
(2)  Any court trying any offence under clause (a), clause (b) or clause (c) of sub -section 
(1) may, at the time of convicting the accused person, order him to deliver up or 
refund within a time to be fixed by it any property wrongfully withheld or 
wrongfully obtained or any document willfully withheld or not furnished.  
(3) No court shall take cognizance of an offence punishable under this section except 
with the previous sanction of the State Government or of an officer authorized by 
the State Government in that behalf. 
 
 
52 
 
[The Bist Industrial Corporation Limited (Acquisition of Undertaking) Act, 1970] [Section  11-14] 
Offences by 
Companies  
11. (1) If the person committing an  offence under this Act is a Company, the  Company 
as well as every perso n charge of a nd responsible to the  Company for the 
conduct of its  business at the time of the commission of the offence sh all be 
deemed to be guilty of  the offence and shall be liable to be proceeded  against 
and punished accordingly : 
                 Provided that not hing contained in this sub-section shall render any such 
person liable to any punishment if he proves that the offence was committed 
without his knowledge or that he exercised all due diligence to prevent the 
commission of such offence.  
(2) Notwithstanding. anything contained in sub-section (1), where any offence under 
this Act has been committed by a Company and it is proved that the offence has 
been committed with the consent or connivance of or that the commission of the 
offence is attributable to any neglect on the part of any managing agent, 
secretaries and treasurers, director, m anager or other officer of the Company 
such managing agent, secretaries and treasurers, director, manager or other 
officer of the Company shall also be deemed to be guilty of that offence and 
shall be liable to be proceeded against and punished accordingly.  
Explanation-- For the purposes of this section--  
(a) "Company" means anybody corporate, and includes firm or other association 
of individuals ;and   
(b) "Director", in relation to a firm, means a partner in the firm.  
 
Protection of 
acts done in 
good faith  
12. No suit, prosecution, or other legal proceeding shall lie against the State 
Government or an office r authorised by it to perform any function  under this 
Act, or against any officer or employee serving in connection with the affair  of 
the un dertaking of the Company, for anything which is in good faith done  or 
intended to be done under this Act.  
 
Power to make 
rules  
13. (1)  The State Government m ay, by notification  in the Gazette, make rules to carry 
out the purposes of this Act.  
(2)  All rules made under this Act shall, as soon as may be after they are made, be 
laid before each House of the State Legislature, while it is in session, for a total 
period of not less than fourteen clays, extending in, its one session or more than 
one successive sessions, and shall, unless some later date is appoint ed, take 
effect from the date of their publication in the Gazette subject  to such 
modifications or an nulments as the two Houses of the Legislature may, during 
the said period agree to make, so however, that any such modification or 
annulment shall be without prejudice to the validity of anything previously done 
thereunder.  
 
Repeal of U.P. 
Ordinance no. 
16 of 1970 
14. The Bis t Industrial Corporation Limited (Acquisition of Undertaking) 
Ordinance, 1970, is hereby repealed. 
 
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