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THE ENGINEERI!\G TECHNICIANS' CO-OPERATIVE
SOCIETIES (ACQUISITION AND TRANSFER
OF UNDERTAKINGS) ACT, 1977
Preamble
Sections
(Act 20 of 1977)
CONTENTS
1 . Short title and commencement.
2 Defimtions
3. Undertakings of Engineermg Technicians' Co-operative Societies to vest in thl' Government.
4. General effect of vesting
5. Duty to deliver possession of property aq uirea, and documents relatmg thereto
6. Duty to furm~h particulars.
7. Termination of service of existing employees.
8. Payment of amount
9 Penalties. ,.. 10. Offences by companie'i.
11. Protection of action taken i o good faith.
12. Power to make rules.
13. Repeal and saving.
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>~' TI-IE EN'GlNEERING TECHNICIANS' CO•OPERATIVE
SOCIETIES (ACQUISITION AND TRANSFER OF
UNDERTAK1NGS) ACT, 1977 ~
(ACT 20 OF 1977)
An Act to provide for the acquisitwn nj the undertakings oj the Kcrala State $"~ E11gzneermg Technzcwns (Workshop) Indust1ial Co-ope1alwe Socuty Linztted S. lud (ST) No. I and the soc1eltcs promoted by zt and fm matters
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connected t/ze1 ewzth or mczdental thereto ' Preamble -WHEREAS the Ker<~la State Engmcer ing 'I echnrCJans (Work~hop) Industt~al Co-operative Society Ltd., S. !nd (ST) No. I, a society deemed to be registered under the .Kerala Co-ope1 a tzve Societies Act, 1969, with the "hole of the State ofKerala as the area of it~ opetattOn, and havtng as its objecl th<" takmg up and running of Industt ial ProJects w1th a view to providing employment opportunitzes to Engineers, Technzcians. etc., based on the concept of share-partinpation-cum•employment (hereinafter referred to as the ENCOS) took up the Implementation of a number of lndustrzal Projects;
AND WHEREAS the ENCOS had promoted the tegzstratton of the Kerala Auto Industrzal Co-operative Limited IND. (EP) No. I TrivanJrum, the Co-opez attvc Scooters Limited IND. (SP) No. 2 Alleppey and the Co-operat1ve Foundries Limited S. IND. (P) No. 45, Ottappalam (herein- after referred to as the promoted ~ncicties) for 1 mplementing the Industrial Projcc: s undertaken by the EN COS;
AND WHEREAS the Gover11mcnt of Ke1.1la and the Plannmg
Comm1s~ion wh1ch have been financing the said projects have coma to the conclusiOn that on acc~unt of organisational, financ1al and managerial problems it has Lccome impossible for the ENCOS and the promoted societies to implement the Industnal Projects undertaken by the :E:NCOS; AND W~EREAS the functwnmg of the EN COS and the p1 omotecl soczet1e~ have come to a standsull on acr-ount of the financial cnsis facing th<"m and a substanttal portion of the ,lssct~ of the soctcties consistmg of machinery and implements ~~ lying idle; • •
AND WHEREAS the contmued exrstenre of the ENCOS and the promoted societieS zs causmg huge losses to those societies, wh1ch are recci• ving financial assistance from the Government ;
AND WHEREAS 1t 1s expedient in the public intetest to dzssolve the ENCO~ and the ptomoted societies and to acquire their undertakings with a v1ew to making usc of the a5sets and other fac• litics of such undertakings for productive purposes,
* Received the assent of the President on the 12th da) of August 1 1977 and published in the Kcrala Gazette Extra·ordmary No. 477 dated 12th August, 1977.
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BE it enacted in the Twenty-eighth Year of the Republic of India as follows:-
!. Short tztle and commencement.-( 1) This Act may be called the Engine ering Technicians' Co-operative Societies (Acquisttion and Transfer or Undertakings) Act, 1977.
(2) It shall be deemed to have come into force on the 17th day of March, 1977.
2. Defmitzons.- In this Act, unless the context otherwise reqmres,-
(a) "appointed day" means the date on whtch this Act comes into force ;
(b) "Director of Industries and Commerce" means the Directm of Industrirs and Commerce oft he State vf Kerala .md includes any offi ·er authonsed by the Government to perform the functions of the Director of lndustries and Commerce under th1s Act ;
(c) "Engineering Technicians' Co-operative Society" or "society"
means the EN COS or any of the promoted societies,
(d) "member-employee" means an employee of a society who has taken shares in the society for the purpose of securing employment in the fCI vice of the soc1ety ;
(c) ''prescribed" means prescribed by'tules made under this Act;
(f) "share" means a share in the capital of the society.
3. Undertakmgr of Engmeering Technwans' Co-ope1atwe Souettes to 1:est tn the Gnvemment.-On the appomted day, the undertakings of the Engmeering Techmctans' Co-operative Societies shall, by virtue of this Act, stand trans- fernd to and vested in the Government, and the ~oc1et1es shall be deemed to havC' been d1ssolved.
4. General effect qf vestmg.- ( 1 ) The unde1 takings of the societies shall be deemed to include .Ill assets, tights, powers, authonties and privileges and all properties, movable and immovable, including lands, bUildings, workshops, stores, mstr.;ments, machinery and equipment, cash balances, cash on I1and, reserve fund, investments and book d{.bts, letters of intent, licences and all other rights and mterests in, or ansing out of such property as were Immediately before the appomted day in the ownership, possession, power or control of the societi( s m relation to their wldertakings, and all books of account, register~ and all other documents of whatever nature relating thereto, and shall also be deemed to include all borrowings, liabilities and obligations of whatever kind then ~ubs1sting of the societies in relation to their unde'r takmgs and thetr employees.
(2) All contracts and wotking arrangements wh1ch are subststing Immediately before thc·appomted day and affecting any of the societies shall, in so far as they relate to the undertakmg of that socitty, cease to have effect or be entorceabl:: agamst that '>oc•ety or any officet thereof or any person who was surety or had guaranteed the perfo1·mance thereof, and shall be of as
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full force and effect against or in favour of the Gove1nment and may tie enfot ced or acted upon as fully and effectually as tf, instead of the society, Government had been named or had bren a party thrreto.
(3) Any proceeding or cause of action pendmg or existing immediately before the appointed day by or against any of the soc1eties in relatiOn to its undertaking may, a~ from that day, be continued and enforced by or against the Government as 1t might have been enforced by or against the society if this Act had not been passed and shall cease to be enforceable by or against the society, 1ts officers, sureties or guaranto1 s
5. Duty to d /rver posseszon of pnperty acquzred and documents relattng thereto.-(!) Where any p10perty has vested m the Government under this Act, every person, in whose possession or custody or under who~e control the property may be, shall deliver the property forthwith to the Government or to such person as the Government may authori~e in. this behalf.
(2) Any pc: ~on who, on the appointed day, ha~ in lm possession or under his control any books, documents or other papers relating to the under takings of the sncieties wluch have vested in tl1c Gove1 nment undet this Act, shall be liable to account f01 the said books, documents and papers to the Government and shall delivrr them up to the Government or to such per~on a~ the Government may authorise in this behalf .
(3) The Government may take, or cause to be taken, all necessar·y ~teps for securing possesswn of all propertie~ w11lch have ve~ted in the Governmens under this Act.
6. Duty to furnish parlzculms._;_(I) Notwithstanding anything contained in sectwn 7, the Government may dtrect the Managing Director of the EN COS and any other officer or emplo:ree employed in connection with the affairs r f the undertaking of any of the societies tmmediately before the appointed day to furuish to the Government within one month from the appointed day or such further perwd as the Government may allow m this behalf, a complete inventory ofall the properties and assets of the societies on the appointed day, all the liabilities and obligatiOns rf the societie~ subsisting on that day and also all agreements entered into by the societies and in force on that day (including agreements, whether express or implied,' relating to leave, pension, gratuity and other terms of servrce of officers or other employees of the societies) under whtch, by virtue of this Act, the Government have or will have or may have Iiabrhtres or obligations.
(2) The Managing Director of the EN COS and the officers and employees required to furnish the inventory under sub-section (I) shall. for the period referred to in that sub-section, be entitled to the same salaries and allowance~ and be subJeCt to the ~arne condttions of service "lS they were entitled or subject to Immediately before the app'ointed day.
7. Termmatzon of seru zce of existing emploJ>ees.-( I) The services of every offic('r or other employee employed, immediately beforr the appointed day, in connectiOn with the affairs of the undertaking of any cf the societie!, 34/430/B.
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except officers and other Gove1 nment of Kerala on <>tand termmated.
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employees of the Central Government ur the deputation, shall, as from the appointed day,
(2) Any officer or other employee of the Centr
vert tn the service of the Cc:ntral. Gove1 nment or the Government of Kctala, : s the case may be.
(3) Not"ithstanding anything to the conllary contai1 ed m the Industrial D1sputes Act, 1947 (Central Act 14 of 1947) or 111 any other law for the tJmf' bcmg m force, no person ,, hose serv1ccs stand termmated by virtue of sub-section (I) shall be entitled to any compensation or other paymen• under that Aet·Ol such other law a• d no claim for such co.npen<>a- tion or payment shall be entertained by any court, tribun,•' or other authority.
( 4) Notwithstal'ding anythiug contained in <>ub-~ection (3), every officer or other employee ar pomted under a contract executed by hm1 and any of the ~ccieties, shall be paid the amount to which he is ent1tlc:d under such contract.
(5) The amount payable to an officer or employee under sub-section (4) shall be pa•d by the Director of Industnes and Commerce in cash within a period of six months fs om the appointed day.
Provided that if the amount IS not paid within the penod aforesaid, the Director of Industries and Commerce shall pay mterest on the amount at tht rate of four per cent per annum from th«:> date of eKpiry of the said period.
8. PaJmunt of amow11. -(1) For the transfer under sectiOn 3, of the under· takings of the societies to the Government, there shall be paid by the Government to every shareholder of each of the socJetiCs an amount equal to the value oftheshases held by him Ill the societv immed1ately before the appointed d,ly after dcductmg any amount due by hm. to the society.
(2) Not,qthstandlllg anythmg contained m <>ub-scctwn (1), where a member-employee has obtamed a loan from any bank for purchase of shares in any of the '>OeictJcs and the society has stood suret1 for such loan with interest thereon or h,ls undertaken to Ieeover the loan hom the salaiy fthe member-employee, the balance, if dll)', of the loan together with interest remaimng outstanding on tile aopointed day ~hall be paid by the Govern- ment to th.: bank and the member-employee shall be paid only the balance after deducting the am >unt paid to the bctnk under th.s sub-sectiOn from the amount to whsch he ts entitled under sub.section ( 1).
C) The amount payable to a sh,ucholder under this <;CCtion shall be paid b) the.Dircctoi of Industrie• and Commerce in cash W!lhin a period of six months from the appointed day on productiOn and suts cnder of valid share certificates issued by the societies:
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Provided that if the am•mnt is not paid w1•hm the penr>cl aforesaid, the Di• cctur of lndus1 nes and G mmerce shall pay interest on the amount at the rate of four per cent per an'lum from the date of expiry of the said pcnod.
9. Pma{ltes.-(I) Any per <;On who-- ( a) l'aving 111 hts possc~sion, cu•tody ?t . contl ol any ~10perty forming part of the unde1 tak111g of ;1 ny of the soctetles wrongfully w1thholds ~uch proper! ie~ f10m the Govcrnm, nt; or
(b) wrongfully obtam~ p ·ssess1on of auy propctty formwg part of the undertaking of any of thr sr cicttcs, whtch has vested in rhc' Govcrnm~nt under this Acr; OJ'
(c) wilfully wtthhnich ( r fail~ to lilllll~h to tlle Government as requircrl by <;uh-scctinn (2) of secti0n 3 any bonk~, docmn< nts or other p.1pcrs which may be in hi~ po~<.c<;~ion, cmtody o control, shall he puni~hclblc \\'lth impri~omncnt fn1 " 1< rrn wldch may C\.tend tu two yea1 s, or with fine, 01 with both:
Pro\'lrlrd that the C('lll t trying any ofTcncc under rlausc (a) PI clause (b) or clause (c) may, at tlw titne d ronviC'mg the accnsed person, ordet him to dehver up ot refund wtthtn a time to be fix~d by the court any property or ca~h wrcnglttily Withheld cr obtamed 01 any document wilfully withheld or not furmshrd .
(2) No cou1 t ~hall take cognt:tancc of a. 1 offence punishable under this section e'\ccpt wtth the prcvwu~ sanction of the Government or of an ofircer author1sed by tl e Government rn tim behalf . . .
10. Ojjmccs by rnmjJat!U'L- ( 1) Whcl c alt offence unaer this Act has been commttted by a company, every pcr~on w'•o at the time the offence was comm1tLed was m charge of, and was respoJ.sible trJ, the company for the cvnduct of the businc'>S of 1 he company, as wrll as the company, shall be deemed to be gudty ofthe nffcncc and shall be !table to be proceeded against and pumsncd acc01dmgly:
Provided that noth •ng contained in this sub-section ~hall render any such person liable to <1ny punishment, tf he proves that the offence was committed without hi~ knowlrdge 01 that he had exen..ised all due diligence to prevent the commrssion of such offrn< e
(2) NotwJthst,tndtng anythwg contamcd m mb- e' tJOn (I), where any offence undeJ this Act has been commtttcd by a company and it is proved that the offence ha<> been commttted with the consent or cot·mvance of, or is attnbutahle to any neglect on the part of. any dnector, manager, sec1etary or other officer of the company, such dJrector, manager, secretary or other officer sl!all be deemed to be guilty of 1 hat offence and shall be liable to be proceeded agamst and punished accntdingly.
Explanatwn.-For the purposes of th1s sectJOn,-
(a) "company" means any body and includes
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(b) "director", in relation to a firm, means a partner m the firm. 11 . Pro tee tion of actzon taken m good faz th.- ( 1) No suit, prosecution or other legal proceedmgs shall lie against the Government or any officer or other person for anything which IS in good faah done or intended to be done under this Act.
(2) No suit or othe1 legal prrceedings shall lie against the Government or any officer or othe1 petson for any damage caused or likely to be caused by anything which is in good fatth done or intendt.d to be done under this Act . .
12. Power lo make rules.-(!) The Government may, by notification in the Gazette, make rilles to carry out the provis1ons of this Act.
(2) Every rule made under thts section shall be laid, as soon as may be after it is made, before the Legislative Assembly while it is in session for a total period of fourteen days which may be comprised in one session or in two succe3sive ses~ions, and if before the expiry of the session in which it is so laid or the sess10n 1mmediately followmg, the Legislative Assembly makes any modification in the rule or decides that he rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect, as the case may be; so however that any such modification or annul- ment shall be without prejudice to the validity of anything previously done under that rule.
13 Repeal and Saving.-(!) The Engmeering Techmcians' Co-operative Societies (Acquisition and Transfer of Undertakings) Ordinance, 1977 ( J 2 of 1977), is her~ by repealed.
t2) Notwithstanding such repeal, anything done or deemed to have been done or any action taken or deemed to have been taken under the said Ordinance shall he deemed to have been done or taken under this Act.
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