The Britannia Engineering Company Limited (Mokameh Unit) and the Arthur Butler and Company (Muzaffarpore) Limited (Acquisition and Transfer of Undertakings) Act, 1978

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An Act of Central Government being the Britannia Engineering Company Limited (Mokameh Unit) and the Arthur Butler and Company (Muzaffarpore) Limited (Acquisition and Transfer of Undertakings) Act, 1978 (Act no. 41 of 1978), was enacted with the purpose and object to make provisions as to acquiring and transferring the rights, title, etc. of the Undertakings of the ‘Britannia Engineering Company Limited’ relating to its Mokameh unit and also the Undertakings of the ‘Arthur Butler and Company Limited’ to ensure the continued manufacture of railway wagons as other goods being essential for Country’s need in generally and in particularly needs of Railways. The Act was enacted by the Parliament of India in the 29th year of republic of India and was assented by the President on 8th day of December, 1978. Prior to the enactment, it was seen that the said undertakings of the respective companies were engaged in manufacturing the wagons, etc. of railway, however, due to certain fall in the manufacturing of said, the management of the said units were taken over by the Central Government as per the provisions of the Industries (Development and Regulation) Act, 1951. And by enacting the present law, the said units were sought to acquire by the Central Government. Both these companies are now amalgamated to form the Bharat Wagon and Engineering Company Limited which is being the subsidiary of the Bharat Bhari Udyog Nigam Limited.

The most important provisions relating to the purpose of the Act are contained under its second chapter, where the Mokameh unit of the Britannia Engineering Company Limited and the undertakings of Muzaffarpore of the Arthur Butler and company limited were acquired and vested with the Central Government along with the right, title, etc. thereof. Also along with such undertakings, the rights, assets, power, etc. and also properties without any obligations, charge, encumbrances, etc should also be transferred. And in case of any legal proceedings where such earlier companies were the parties, then such proceedings should be continued by the Central Government or the Government Company as the case may be if the Central Government transfers the undertakings to the Government company under this Act. Section 5 of the Act empowers the Central Government as to vesting of such acquired undertakings, with the Government Company if such Government Company is willing as to compliance of terms and conditions which that Government can impose. The chapter under its last provisions make it clear that for every previous liabilities in relation to the acquired undertakings of the earlier companies, should not be transferred to the Central Government or Government Company, but should be continued to be the liabilities of those companies.

The next chapter being Chapter III of the Act makes provisions as to payment of amount to the earlier companies for acquiring and vesting of their undertakings with the Central Government. The amount of specified rupees should be paid by the Central Government under this Act for such vesting. Further, the specified amount is also required to be paid by the Central Government, annual basis, for taking over of management of such undertakings of those companies, for the period starting from the date of such taking over and till the appointed day on which those undertakings were acquired under this Act.

Chapter IV of the Act makes provisions as to general supervisions, management, etc. the acquired undertakings. Such management, control, etc. of the undertakings after such acquiring and vested with the Central Government should be vested with the Government Company where such undertakings were vested with the Government Company under the previous provisions or if so vesting is not made there, then such management, control, etc. to be vested with such Central Government appointed person or body.

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Further, chapter V of the Act makes provisions as to transferring of the employees of the earlier companies who were employed in relation to the concerned undertakings or units earlier to the transfer thereof under this Act. Such employees should be treated as that of the Central Government or of the Government Company as the case may be with all their similar rights and privileges and terms and conditions of their employment. Similar provisions as to acquisition of provident fund and other funds are given under subsequent provisions. Moreover, for making provisions payment and dealing with claims under this Act, the provisions of chapter VI of the Act provides for appointment of the Commissioner of Payments by the Central Government.

Last chapter of the Act makes miscellaneous provisions, where it is specified that the provisions of the Act should have overriding effect, even otherwise the provisions of any law contain contrary provisions. Also the penal provisions are also provided under this chapter. The Central Government, its officers and Government Company and its officers are protected against legal actions for anything done or any damage caused in good faith or done or caused in pursuance with this Act. The Central Government is empowered under this Act for directing delegation of the Powers to any specified person or persons. Also it is further empowered to make rules on the matters provided under section 31 of the Act and for any difficulties the Central Government is again empowered to provide for order removing such difficulties and such power of removing difficulties can only be exercised by that Government for the period of 2 years from date of making of such acquisition. It is declared under section 33 of the Act that the said Act is enacted to effect the policy of the State provided under the provisions of the Article 39(b) of the Constitution of India.

In the year 2014 the present Act was recommended for its repealing by the report of the Law commission of India, being its ‘Fourth Interim Report – ‘Obsolete Laws- Warranting Immediate repeal’ on its study ‘Legal Enactments: Simplifications and Streamlining’ (LESS). The reason put forwarded for such recommendation is that the purpose of this Act has been served insofar the nationalisation of the concerned entity was concerned and also the present Act is not making any provisions as to the management of the said entity, hence the same is treated as is not having any provisions to serve for continuing purpose.

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