The Jute Companies (Nationalisation) Act, 1980
# THE JUTE COMPANIES (NATIONALISATION) ACT, 1980

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 ARRANGEMENT OF SECTIONS

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CHAPTER I

PRELIMINARY

SECTIONS

1. Short title.

2. Definitions.


CHAPTER II

ACQUISITION AND TRANSFER OF THE UNDERTAKINGS OF THE JUTE COMPANIES

3. Transfer to, and vesting in, the Central Government of the undertakings of the jute companies.

4. General Power of vesting.

5. Jute companies to be liable for certain prior liabilities.

6. Power of Central Government to direct vesting of the undertakings of the jute companies in

Jute Manufactures Corporation.

CHAPTER III

PAYMENT OF AMOUNTS

7. Payment of amount.

8. Payment of further amount.

CHAPTER IV

MANAGEMENT, ETC., OF THE UNDERTAKINGS OF THE JUTE COMPANIES

9. Management, etc., of the undertakings of the jute companies.

10. Duty of persons in charge of management of the undertakings to deliver all assets, etc.

11. Duty of persons to account for assets, etc., in their possession.

CHAPTER V

PROVISIONS RELATING TO EMPLOYEES OF THE JUTE COMPANIES

12. Continuance of employees.

13. Provident fund and other funds.

CHAPTER VI

COMMISSIONER OF PAYMENTS

14. Appointment of Commissioner of Payments.

15. Payment by Central Government to the Commissioner.

16. Certain powers of Central Government or Jute Manufactures Corporation.

17. Claims to be made to the Commissioner.

18. Priority of Claims.

19. Examination of claims.

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SECTIONS

20. Admission or rejection of claims.

21. Disbursement of money by the Commissioner.

22. Disbursement of amounts to the jute companies.

23. Undisbursed or unclaimed amounts to be deposited with the general revenue account.

CHAPTER VII

MISCELLANEOUS

24. Act to have overriding effect.

25. Assumption of liability.

26. Management to continue to vest in certain persons until alternative arrangements have been

made.

27. Contracts to cease to have effect unless ratified by the Central Government or Jute

Manufactures Corporation.

28. Penalties.

29. Offences by companies.

30. Protection of action taken in good faith.

31. Delegation of powers.

32. Power to make rules.

33. Power to remove difficulties.

THE FIRST SCHEDULE.

THE SECOND SCHEDULE.

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# THE JUTE COMPANIES (NATIONALISATION) ACT, 1980

 ACT NO. 62 OF 1980

[21st December, 1980.]

# An Act to provide for the acquisition and transfer of the undertakings of the jute companies,
 specified in the First Schedule with a view to securing the proper management of such undertakings so as to subserve the interests of the general public by ensuring the continued manufacture, production and distribution of articles made of jute, which are essential to the needs of the economy of the country and for matters connected therewith or incidental thereto.

WHEREAS the said jute companies had been engaged in the manufacture and production of articles

mentioned in the First Schedule to the Industries (Development and Regulation) Act, 1951 (65 of 1951),
namely, textiles made wholly or in part of jute;

AND WHEREAS the management of the undertakings of each of the said jute companies was

taken over by the Central Government under the Industries (Development and Regulation)
Act, 1951 (65 of 1951);

AND WHEREAS it is necessary to acquire the undertakings of the said jute companies to ensure that the

interests of the general public are served by the continuance, by the undertakings of the said jute
companies, of the manufacture, production and distribution of the aforesaid articles which are essential to
the needs of the economy of the country;

BE it enacted by Parliament in the Thirty-first Year of the Republic of India as follows:—

CHAPTER I

PRELIMINARY

**1. Short title.—This Act may be called the Jute Companies (Nationalisation) Act, 1980.**

**2. Definitions.—In this Act, unless the context otherwise requires,—**

(a) “appointed day” means the date of commencement of this Act;

(b) “Commissioner” means the Commissioner of Payments appointed under section 14;

(c) “jute companies” means the companies (being companies as defined in the Companies

Act, 1956 [1 of 1956]) specified in the First Schedule;

(d) “Jute Manufactures Corporation” means the National Jute Manufactures Corporation

Limited, a company incorporated and registered under the Companies Act, 1956 (1 of 1956);

(e) “notification” means a notification published in the Official Gazette;

(f) “prescribed” means prescribed by rules made under this Act;

(g) “specified date”, in relation to any provision of this Act, means such date as the Central

Government may, by notification, specify for the purposes of that provision and different dates may
be specified for different provisions of this Act;

(h) words and expressions used herein and not defined but defined in the Companies

Act, 1956 (1 of 1956), shall have the meanings respectively assigned to them in that Act.

CHAPTER II

ACQUISITION AND TRANSFER OF THE UNDERTAKINGS OF THE JUTE COMPANIES

**3. Transfer to, and vesting in, the Central Government of the undertakings of the jute**

**companies.—On the appointed day, the undertakings of every jute company, and the right, title and**
interest of every jute company in relation to its undertakings shall, by virtue of this Act, stand transferred
to, and vest in, the Central Government.

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**4. General Power of vesting.—(1) The undertakings of each jute company shall be deemed to**

include all assets, rights, lease-holds, powers, authorities and privileges and all property, movable and
immovable, 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 jute company, whether within or outside India, and all books of account, registers
and all other documents of whatever nature relating thereto and shall also be deemed to include the
liabilities specified in sub-section (2) of section 5.

(2) All properties as aforesaid which have vested in the Central Government under section 3 shall, by

force of such vesting, be freed and discharged from any trust, obligation, mortgage, charge, lien and all
other incumbrances affecting them, and any attachment, injunction, decree or order of any court or other
authority restricting the use of such properties in any manner or appointing any receiver in respect of the
whole or any part of such properties shall be deemed to have been withdrawn.

(3) Every mortgagee of any property which has vested under this Act in the Central 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
mortgage, 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 interests, payment of the mortgage
money or other dues, in whole or in part, out of the amounts directed to be given under sections 7 and 8 to
the jute company concerned but no such mortgage, charge, lien or other interest shall be enforceable
against any property which has vested in the Central Government.

(5) Any licence or other instrument granted to a jute company in relation to its undertakings which

have vested in the Central 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 undertakings, and, on and from the date of vesting of such
undertakings under section 6, in the Jute Manufactures Corporation, that Corporation shall be deemed to
be substituted in such licence or other instrument as if such licence or other instrument had been granted
to such Corporation and such Corporation shall hold it for the remainder of the period for which the jute
company would have held it under the terms thereof.

(6) If, on the appointed day, any suit, appeal or other proceeding of whatever nature, in relation to any

matter specified in sub-section (2) of section 5, in respect of the undertakings of any jute company which
has vested in the Central Government under section 3, instituted or preferred by or against that company,
is pending, the same shall not abate, be discontinued or be, in any way, prejudicially affected by reason of
the transfer of the undertakings of such jute company or of anything contained in this Act, but the suit,
appeal or other proceeding may be continued, prosecuted or enforced by or against the Central
Government or where the undertakings of such jute company are directed under section 6, to vest in the
Jute Manufactures Corporation, by or against that Corporation.

**5. Jute companies to be liable for certain prior liabilities.—(1) Every liability, other than the**

liability specified in sub-section (2), of a jute company in respect of any period prior to the appointed day,
shall be the liability of that company and shall be enforceable against it, and not against the Central
Government, or, where the undertakings of the jute company vest in the Jute Manufactures Corporation,
against that Corporation.

(2) Any liability arising in respect of loans advanced by the Central Government or any State

Government, or both, to a jute company (together with interest due thereon) after the management of the
undertakings of the said jute company had been taken over by the Central Government shall, on and from
the appointed day, be the liability of the Central Government and shall be discharged by that Government,
or by the Jute Manufactures Corporation as and when repayment of such loans becomes due
and payable.

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(3) For the removal of doubts, it is hereby declared that—

(a) save as otherwise expressly provided in this Act, no liability, other than the liability specified

in sub-section (2), of any jute company in relation to its undertakings in respect of any period prior to
the appointed day, shall be enforceable against the Central Government or where the undertakings of
such company are directed under section 6, to vest in the Jute Manufactures Corporation, against that
Corporation;

(b) no award, decree or order of any court, tribunal or other authority in relation to the

undertakings of any jute company, passed after the appointed day, in respect of any matter, claim or
dispute, which arose before that day, not being a matter, claim or dispute in relation to any liability
specified in sub-section (2), shall be enforceable against the Central Government or where the
undertakings of such company are directed under section 6, to vest in the Jute Manufactures
Corporation, against that Corporation;

(c) no liability incurred by any jute company before the appointed day for the contravention of a

provision of any law for the time being in force shall be enforceable against the Central Government
or where the undertakings of such company are directed under section 6, to vest in the Jute
Manufactures Corporation, against that Corporation.

**6. Power of Central Government to direct vesting of the undertakings of the jute companies in**

**Jute Manufactures Corporation.—(1) Notwithstanding anything contained in sections 3 and 4, the**
Central Government shall, as soon as may be, after the appointed day, direct, by notification, that the
undertakings of every jute company and the right, title and interest of every jute company in relation to
its undertakings, which have vested in that Government under section 3, and such of the liabilities of
every jute company as are specified in sub-section (2) of section 5, shall, instead of continuing to vest in
the Central Government, vest in the Jute Manufactures Corporation either on the date of the notification
or on such earlier or later date (not being a date earlier than the appointed day) as may be specified in the
notification.

(2) Where the right, title and interest, and the liabilities referred to in sub-section (2) of section 5, of

the jute companies in relation to their respective undertakings vest, under sub-section (1), in the Jute
Manufactures Corporation, that Corporation shall, on and from the date of such vesting, be deemed to
have become the owner in relation to such undertakings, and all the rights and liabilities of the Central
Government in relation to such undertakings shall, on and from the date of such vesting, be deemed to
have become the rights and liabilities, respectively, of the Jute Manufactures Corporation.

CHAPTER III

PAYMENT OF AMOUNTS

**7. Payment of amount.—Every jute company shall be given by the Central Government, for the**

transfer to and vesting in that Government under section 3 of the undertakings of that company and the
right, title and interest of that company in relation to its undertakings, in cash and in the manner specified
in Chapter VI, such amount as is specified against the name of that company in the First Schedule.

**8. Payment of further amount.—(1) Every jute company shall be given by the Central Government,**

for the deprivation of the management of its undertakings, an amount of rupees ten thousand per annum
for the period commencing on the date on which management of the undertakings of that company was
taken over in pursuance of the order made by the Central Government under the provisions of the
Industries (Development and Regulation) Act, 1951 (65 of 1951) and ending on the appointed day.

(2) Every amount specified in the First Schedule or calculated in accordance with the provisions of

sub-section (1) 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 Central Government to the Commissioner.

(3) The amounts determined in relation to any jute company in accordance with the provisions of

sub-sections (1) and (2) shall be given by the Central Government to the jute company in addition to the
amount specified in the First Schedule against that company.

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CHAPTER IV

MANAGEMENT, ETC., OF THE UNDERTAKINGS OF THE JUTE COMPANIES

**9. Management, etc., of the undertakings of the jute companies.—The general superintendence,**

direction, control and management of the affairs and business of the undertakings owned by each of the
jute companies, the right, title and interest in relation to which have vested in the Central Government
under section 3, shall, where a direction has been made by the Central Government under sub-section (1)
of section 6, vest in the Jute Manufactures Corporation and thereupon the Jute Manufactures Corporation
shall be entitled to exercise, to the exclusion of all other persons, all such powers and do all such things in
relation to each such undertaking as the jute company which owned it was authorised to exercise and do
immediately before the appointed day.

**10. Duty of persons in charge of management of the undertakings to deliver all assets, etc.—(1)**

On the vesting of the management of the undertakings of the jute companies in the Central
Government or the Jute Manufactures Corporation, as the case may be, the persons in charge of the
management of such undertakings immediately before such vesting shall be bound to deliver to the
Central Government or the Jute Manufactures Corporation, as the case may be, all assets, books of
account, registers and all other documents in their custody relating to such undertakings.

(2) The Central Government may issue such directions as it may deem desirable in the circumstances

of the case to the Jute Manufactures Corporation and the said Corporation may also, if it is considered
necessary so to do, apply to the Central Government at any time for instructions as to the manner in which
the management of the undertakings of the jute companies shall be conducted or in relation to any other
matter arising in the course of such management.

**11. Duty of persons to account for assets, etc., in their possession.—(1) Any person who has, on**

the appointed day, in his possession or under his control any assets, books, documents or other papers
relating to any undertaking owned by a jute company which has vested in the Central Government or the
Jute Manufactures Corporation under this Act, shall be liable to account for the said assets, books,
documents and other papers to the Central Government or the Jute Manufactures Corporation and shall
deliver them up to the Central Government or the Jute Manufactures Corporation or to such person or
persons as the Central Government or the Jute Manufactures Corporation may specify in this behalf.

(2) The Central Government or the Jute Manufactures Corporation may take or cause to be taken all

necessary steps for securing possession of the undertakings of the jute companies which have vested in
the Central Government or the Jute Manufactures Corporation under this Act.

(3) Every jute company shall within such period as the Central Government may allow in this behalf,

furnish to that Government a complete inventory of all its property and assets, as on the appointed day,
pertaining to its undertakings which have vested in the Central Government under section 3, and for this
purpose, the Central Government or the Jute Manufactures Corporation shall afford to such company all
reasonable facilities.

CHAPTER V

PROVISIONS RELATING TO EMPLOYEES OF THE JUTE COMPANIES

**12. Continuance of employees.—(1) Every person who has been, immediately before the appointed**

day, employed in any undertaking of any of the companies shall become,—

(a) on and from the appointed day, an employee of the Central Government, and

(b) where the undertakings of the jute companies are vested in the Jute Manufactures

Corporation, an employee of the said Corporation, on and from the date of such vesting,

and shall hold office or service under the Central Government or the Jute Manufactures Corporation, as
the case may be, with the same rights and privileges as to pension, gratuity and other matters as would
have been admissible to him if there had been no such vesting and shall continue to do so unless and
until his employment under the Central Government or the Jute Manufactures Corporation, as the case
may be, is duly terminated or until his remuneration and other conditions of service are duly altered by
the Central Government or the Jute Manufactures Corporation, as the case may be.

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(2) Notwithstanding anything contained in the Industrial Disputes Act, 1947 (14 of 1947), or in any

other law for the time being in force, the transfer of the services of any officer or other person employed
in any undertaking of the jute companies, to the Central Government or the Jute Manufactures
Corporation, shall not entitle such officer or other employee to any compensation under this Act or any
other law for the time being in force and no such claim shall be entertained by any court, tribunal or other
authority.

**13. Provident fund and other funds.—(1) Where a jute company has established a provident fund,**

superannuation fund, welfare fund or other funds for the benefit of persons employed in any of the
undertakings owned by it, the monies relatable to its employees whose services have become transferred
by or under this Act to the Central Government or the Jute Manufactures Corporation shall, out of the
monies standing, on the appointed day, to the credit of such provident fund, superannuation fund, welfare
fund or other funds, stand transferred to, and vest in, the Central Government or the Jute Manufactures
Corporation, as the case may be.

(2) The monies which stand transferred under sub-section (1) to the Central Government or the Jute

Manufactures Corporation, as the case may be, shall be dealt with by that Government or Corporation in
such manner as may be prescribed.

CHAPTER VI

COMMISSIONER OF PAYMENTS

**14. Appointment of Commissioner of Payments.—(1) The Central Government shall, for the**

purpose of disbursing the amounts payable under sections 7 and 8 to the jute companies, by notification,
appoint a Commissioner of Payments.

(2) The Central 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 exercisable 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 India.

**15. Payment by Central Government to the Commissioner.—(1) The Central Government shall,**

within thirty days from the specified date, pay in cash to the Commissioner, for payment to every jute
company,—

(a) an amount equal to the amount specified against the name of that company in the First

Schedule;

(b) a further amount equal to the amount payable to that company under section 8.

(2) A deposit account shall be opened by the Central Government in favour of the Commissioner in

the Public Account of India, 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) Separate records shall be maintained by the Commissioner in respect of each of the jute

companies in relation to which payment has been made to him under this Act.

(4) Interest accruing on the amount in relation to a jute company standing to the credit of the deposit

account referred to in sub-section (2) shall ensure to the benefit of such jute company.

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**16. Certain powers of Central Government or Jute Manufactures Corporation.—(1) The Central**

Government or the Jute Manufactures Corporation, as the case may be, shall be entitled to receive, up to
the specified date, to the exclusion of all other persons, any money due to any jute company in relation to
its undertakings which have vested in the Central Government or the Jute Manufactures Corporation, and
realised after the appointed day, notwithstanding that the realisation pertains to a period prior to the
appointed day.

(2) The Central Government or the Jute Manufactures Corporation, as the case may be, may make a

claim to the Commissioner with regard to every payment made by that Government or Corporation, after
the appointed day for discharging any liability of a jute company, not being any liability specified in
sub-section (2) of section 5, in relation to any of the undertakings owned by it in respect of 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 discharged by the
Central Government or the Jute Manufactures Corporation.

(3) Save as otherwise provided in this Act, the liabilities of a jute company in relation to any of the

undertakings owned by it in respect of any transaction prior to the appointed day, which have not been
discharged on or before the specified date, shall be the liabilities of that company.

**17. Claims to be made to the Commissioner.—Every person having a claim against a jute company**

with regard to any of the matters specified in the Second Schedule, pertaining to any undertaking owned
by it, 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 sufficient 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. Priority of Claims.—The claims made under section 17 shall have priorities in accordance with**

the following principles, namely:—

(a) Category I shall have precedence over all other categories and Category II shall have

precedence over Category III, and so on;

(b) the claims specified in each of the categories shall rank equally and be paid in full, but, if the

amount paid to the Commissioner under this Act is insufficient to meet such claims in full, they shall
abate in equal proportions and be paid accordingly; and

(c) the question of discharging any 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. Examination of claims.—(1) On receipt of the claims made under section 17, the Commissioner**

shall arrange the claims in the order of priorities specified in the Second Schedule and examine the same
in accordance with such order.

(2) If, on an examination of the claims against a jute company, the Commissioner is of the opinion

that the amount paid to him under this Act for payment to such company is not sufficient to meet the
liabilities specified in any lower category, he shall not be required to examine any claim in respect of such
lower category.

**20. Admission or rejection of claims.—(1) After examining the claims against a jute company, with**

reference to the priorities set out in the Second Schedule, the Commissioner shall fix a date on or before
which every claimant against the company shall file the proof of his claim.

(2) Not less than fourteen days’ notice of the date so fixed shall be given by advertisement in one

issue of any daily newspaper in the English language having circulation in the major part of the  country
and one issue of any daily newspaper in such regional language as the Commissioner may  consider

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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 jute company concerned an opportunity of refuting the claim and after giving the
claimant a reasonable opportunity of being heard, by order in writing, admit or reject 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 sitting and shall, for
the purpose of making any investigation under this Act, have the same powers as are vested in a Civil
Court under the Code of Civil Procedure, 1908 (5 of 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;

(d) the issuing of any commission for the examination of witnesses.

(6) Any investigation before the Commissioner shall be deemed to be a judicial proceeding within the

meaning of sections 193 and 228 of the Indian Penal Code (45 of 1860), and the Commissioner shall be
deemed to be a Civil Court for the purposes of section 195, and Chapter XXVI, of the Code of Criminal
Procedure, 1973 (2 of 1974).

(7) A claimant who is dissatisfied with the decision of the Commissioner may prefer an appeal

against such decision to the High Court within the local limits of whose jurisdiction the registered office
of the jute company concerned is situated:

Provided that where a person who is a Judge of a High Court is appointed to be the Commissioner,

such appeal shall be heard and disposed of by not less than two Judges of that High Court.

**21. Disbursement of money by the Commissioner.—After admitting a claim against a jute**

company under this Act, the amount due in respect of such claim shall be paid by the Commissioner to
the person or persons to whom such amount is due and on such payment, the liability of such jute
company in respect of such claim shall stand discharged.

**22. Disbursement of amounts to the jute companies.—(1) If out of the monies paid to him in**

relation to a jute company, there is a balance left after meeting the liabilities as specified in the Second
Schedule, the Commissioner shall disburse such balance to such jute company.

(2) Where the possession of any machinery, equipment or other property possessed by a jute company

has vested in the Central Government or the Jute Manufactures Corporation under this Act but such
machinery, equipment or other property does not belong to such jute company, it shall be lawful for the
Central Government or, as the case may be, the Jute Manufactures Corporation, to continue to possess
such machinery or equipment or other property on the same terms and conditions under which they were
possessed by such jute company immediately before the appointed day.

**23. Undisbursed or unclaimed amounts to be deposited with the general revenue account.—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 Central
Government, but a claim to any money so transferred may be preferred to the Central Government by the
person entitled 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.

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CHAPTER VII

MISCELLANEOUS

**24. Act to have overriding effect.—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.

**25. Assumption of liability.—(1) Where any liability of a jute company arising out of any item in**

any category specified in Part I of the Second Schedule is not discharged fully by the Commissioner out
of the amounts paid to him under this Act, the Commissioner shall intimate in writing to the Central
Government the extent of the liability which remains undischarged and that liability shall be assumed by
the Central Government.

(2) The Central Government may, by order, direct the Jute Manufactures Corporation to take over the

liability assumed by the Central Government under sub-section (1), and on receipt of such direction, it
shall be the duty of the Jute Manufactures Corporation to discharge such liability.

**26. Management to continue to vest in certain persons until alternative arrangements have been**

**made.—Notwithstanding the vesting under this Act of the undertakings of any jute company in the**
Central Government or the Jute Manufactures Corporation—

(a) any person who has been managing the affairs of such undertakings before the date on which

the undertakings had so vested shall, until alternative arrangements have been made by the Central
Government, or, as the case may be, the Jute Manufactures Corporation, for the management of such
undertakings, continue to manage the affairs of the undertakings, as if such person had been authoried
by the Central Government, or, as the case may be, the Jute Manufactures Corporation, to manage
such undertakings;

(b) such person shall, until alternative arrangements have been made by the Central Government,

or, as the case may be, the Jute Manufactures Corporation, continue to be authorised to operate, in
relation to the undertakings of such jute company, any account of such undertakings in any bank as if
he had been authorised by the Central Government or the Jute Manufactures Corporation to operate
such account.

**27. Contracts to cease to have effect unless ratified by the Central Government or Jute**

**Manufactures Corporation.—Every contract entered into by any jute company in relation to any of the**
undertakings owned by it, which has vested in the Central 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
a period 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 Central Government or the Jute Manufactures
Corporation, and in ratifying such contract, the Central Government or the Jute Manufactures Corporation
may make such alterations or modifications therein as it may think fit:

Provided that the Central Government or the Jute Manufactures Corporation 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 interests of the Central Government or the Jute Manufactures Corporation; 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. Penalties.—Any person who,—**

(a) having in his possession, custody or control any property forming part of the undertakings

owned by any jute company, wrongfully withholds such property from the Central Government or the
Jute Manufactures Corporation; or

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(b) wrongfully obtains possession of, or retains any property forming part of, the undertakings

owned by any jute company; or

(c) wilfully withholds or fails to furnish to the Central Government or the Jute Manufactures

Corporation or any person or body of persons specified by that Government or Corporation, as the
case may be, any document or inventory relating to the undertakings, owned by any jute company,
which may be in his possession, custody or control; or

(d) fails to deliver to the Central Government or the Jute Manufactures Corporation or any person

or body of persons specified by that Government or Corporation, any assets, books of account,
registers or other documents in his possession, custody or control relating to the undertakings owned
by any jute company; or

(e) wrongfully removes or destroys any property forming part of the undertakings owned by any

jute company or prefers any claim under this Act which he knows or has reason to believe to be false
or grossly inaccurate,

shall be punishable with imprisonment for a term which may extend to two years and also with fine which
may extend to ten thousand rupees.

**29. Offences by companies.—(1) Where an offence punishable under this Act has been committed**

by a company, every person who, at the time the offence was committed, was in charge of, and was
responsible to, the company for the conduct of the business of the company, as well as the company, shall
be deemed to be guilty of the offence and shall be liable to be proceeded against and punished
accordingly:

Provided that nothing 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 had 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 is attributable to any neglect on the part of, any director, manager, secretary or other
officer of the company, such director, manager, secretary or other officer shall 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 any body corporate and includes a firm or other association of

individuals; and

(b) “director”, in relation to a firm, means a partner in the firm.

**30. Protection of action taken in good faith.—(1) No suit, prosecution or other legal proceeding**

shall lie against the Central Government or any officer of that Government or the Jute Manufactures
Corporation or other person authorised by that Government or Corporation for anything which is in good
faith done or intended to be done under this Act.

(2) No suit or other legal proceeding shall lie against the Central Government or any of its officers or

other employees or the Jute Manufactures Corporation or any officer or other person authorised by that
Corporation for any damage caused or likely to be caused for anything which is in good faith done or
intended to be done under this Act.

**31. Delegation of powers.—(1) The Central Government may, by notification, direct that all or any**

of the powers exercisable by it under this Act, other than the powers conferred by this section and
sections 32 and 33, may also be exercised by such person or persons as may be specified in the
notification.

(2) Whenever any delegation of power is made under sub-section (1), the person to whom such power

has been delegated shall act under the direction, control and supervision of the Central Government.

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**32. Power to make rules.—(1) The Central Government may, by notification, make rules for**

carrying out the provisions of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may

provide for all or any of the following matters, namely:—

(a) the time within which, and the manner in which, an intimation referred to in sub-section (3)

of section 4 shall be given;

(b) the manner in which the monies in any provident fund or other fund, referred to in

sub-section (2) of section 13, shall be dealt with;

(c) any other matter which is required to be, or may be, prescribed.

(3) Every rule made by the Central Government under this Act shall be laid, as soon as may be after it

is made, before each House of Parliament, while it is in session, for a total period of thirty days which
may be comprised in one session or in two or more successive sessions, and if, before the expiry of the
session immediately following the session or the successive sessions aforesaid, both Houses agree in
making any modification in the rule or both Houses agree that the 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 annulment shall be without prejudice to the validity of anything previously done
under that rule.

**33. Power to remove difficulties.—If any difficulty arises in giving effect to the provisions of this**

Act, the Central Government may, by order, not inconsistent with the provisions of this Act, remove the
difficulty:

Provided that no such order shall be made after the expiry of a period of two years from the appointed

day.

THE FIRST SCHEDULE

[See sections 2(c), 7, 8 and 15(1)(a)]

Sl. No Name of the jute company Amount (Rupees in
lakhs)

1. Alexandra Jute Mills Limited, Chartered Bank Buildings,

4, Netaji Subhas Road, Calcutta-700001    .   .   .  . 353.60

2. Union Jute Company Limited, Chartered Bank Buildings,

4, Netaji Subhas Road, Calcutta-700001   .   .   .  . 461.32

3. Khardah Company Limited, 7, Red Cross Place, Calcutta-700001 486.68

4. The Kinnison Jute Mills Company Limited, Chartered Bank

Buildings, 4, Netaji Subhas Road, Calcutta-700001   .   . 644.70

5. R.B.H.M. Jute Mills Private Limited, P.O. Katihar Mills,

Katihar (Bihar)    .   .   .  .   .   .   .   .   .    .  . 17.04

TOTAL 1963.34

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THE SECOND SCHEDULE

[See sections 17, 19 (1), 20 (1), 22 (1) and 25 (1)]

ORDER OF PRIORITIES

PART I

_Category I—_

Employees’ dues on account of unpaid salaries, wages, provident fund, Employees’ State

Insurance contribution or premium relating to the Life Insurance Corporation of India and any other
amounts due to employees in respect of any period whether before or after the management of the
undertakings of any jute company had been taken over by the Central Government.

_Category II—_

Secured loans obtained by any jute company from nationalised banks and public financial

institutions during any period whether before or after the management of the undertakings of that
company had been taken over by the Central Government.

_Category III—_

Any credit availed of for trade or manufacturing purpose during the post-take-over management

period.

_Category IV—_

Revenue, taxes, cesses, rates or other dues to the Central Government, State Governments and

local authorities or State Electricity Board for any period whether before or after the management of
the undertakings of any jute company had been taken over by the Central Government.

_Category V—_

Any credit availed of for trade or manufacturing purpose during the pre-take-over management

period.

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