The Richardson and Cruddas Limited (Acquisition and Transfer of Undertakings) Act, 1972 (Act no. 78 of 1972) was enacted to acquire and transfer the undertaking namely, “Richardson and Cruddas Limited”, for the purpose of reconstructing the register of its members. The Act further, speaks of transfer of all assets, rights, powers and properties of Richardson and Cruddas Company under the authority of the Central Government and also for the nationalisation of said company. The provisions of the Act are divided under four parts and then under chapters in it.
The first Part of the Act containing provisions as to acquisition of the said company. Section 3 says that the undertaking should be transferred and vested in the Central Government and the Central Government should convert it into new company. Similarly, the Act says for transfer of assets, rights, properties, etc. of such undertaking in the new company. Even the books of accounts, registers, records, etc. along with contracts, deeds bonds, etc. of undertaking should be transferred to new one as its own. However, any suits or proceedings, etc. of that old undertaking should not continue or enforced against new company or even against the Central Government. Section 5 of the Act makes provision for transferring of possession of the properties, records, books, registers, etc. by the persons under whose control such possession is vested or such records or otherwise is kept, to the Central Government. Further, the provisions of the Act requires the transfer of employees or officers of the old undertaking to the Central Government as they were being the employees or officers of the Central Government. And the terms and conditions as to their services and all rights and responsibilities arising out of their employment in such undertaking should be the same even after such transfer. Another important provision under this Part first of the Act is dealing with payment of certain specified amount to the custodian on such transfer of old undertaking to the Central Government. Such amount should be paid by the Central Government and on receipt of such amount by the Custodian, he should credited the same in the account opened in the name of the old undertaking and such amount should be taken as a trust on behalf of the old undertaking, as per the section 8 of the Act.
Section 9 is dealing with the incorporation of new company in the name of “Rechardson and Crudass (1972) Limited” under the provisions of Companies Act, 1956, for the management and administration thereof. Whereas, the affairs of the Old undertaking are required to be managed by the Custodian being public servant, under the provisions Chapter IV of the Part first of the Act.
Further, the Part II of the Act deals with the provisions as to rectification of register of members of old company. The section 13 whereof says that, for said rectification there should be constituted a Tribunal by the Central Government, consisting of such persons, having such powers, etc. as has been given under that section. Similarly, chapter II under this Part is dealing with other powers and duties of the Tribunal as to claims of certain persons, shares determinations, etc. connected with the old undertaking. Moreover, the Chapter III under this Part is dealing with provisions as to reconstruction of registers of members of old company by the Custodian.
Moreover, the next part i.e. Part III of the Act dealing with the penal provisions under the Act. Section 24 wherein explains several offences and punishment under the Act, especially, if any person under whose control any property of the vested undertaking is there, deals with the property wrongfully or withholds the same from the Central Government or new company, or otherwise wrongfully acted in connection therewith, then such act is an offence. And also other acts which are explained under this provision as offence under the Act. The Section further provides for penalty thereof which is extending to 3 years imprisonment or fine, which can extend to 10,000 rupees or even both imprisonment or fine can be inflicted. The Court under this section cannot proceed with the cases unless there is sanction to that effect by the Central Government. Section 26 explains the offences under this Act committed by the any company and persons who should be held responsible for such commission. Notably, the offences under this Act, are strictly, non-compoundable and should be triable First Class Judicial magistrate. The Last part in the Act is dealing with miscellaneous provisions where the along with other, the important provisions is relating to power of the Central Government to make rules as provided under section 31 of the Act.
The Act has been recommended by the Law Commission as obsolete law warranting repeal. Under its project titled “Legal Enactments: Simplifications and Streamlining” the Law commission, by submitting its Fourth interim Report no. 251 as “Obsolete Laws: Warranting Immediate Repeal”, where along with the present Act total 30 enactments were recommended for total repealing. The reason was provided by the Law commission for repealing is that the purpose of the Act has been served and Act also not contains any management relating provision of such new company.
by Faim Khalilkhan Pathan.