The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986

Summary of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986
Act to override all other enactments, the summary remains largely unaffected in structure but is refined to highlight the overarching legislative power implied:
Enactment: By Parliament in the Thirty-seventh Year of the Republic of India, asserting its legislative supremacy
Key Provisions
1. Supreme Legislative Action: Acquisition of certain textile undertakings of the Swadeshi Cotton Mills Company Limited, overriding all previous enactments.
2. Public Interest: Ensure continued manufacture, production, and distribution of cloth and yarn, aligning with the State's policy under Article 39 of the Constitution.
3. Operational Control: Transfer undertakings to facilitate efficient management, with the National Textile Corporation implied as a key entity in similar contexts for operational takeover.

Legislative History:

The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986

Act Title - The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986

Act Number/Year - 30 of 1986

Act ID (India Code) - 198630

Presidential Assent Date - May 30, 1986

Enforcement Date - April 1, 1985

Nodal Ministry - Ministry of Textiles

Precedent & Historical Rationale

Industrial Distress and Mismanagement:

Prior to the mid-1980s, the textile undertakings belonging to the Swadeshi Cotton Mills Company Limited suffered from severe operational mismanagement, financial distress, and accumulating liabilities. This led to widespread closures or under-production, threatening large-scale unemployment for thousands of textile workers and causing a severe shortage in the production and distribution of controlled varieties of cloth vital to the general public.

Government Intervention and Public Interest:

To protect the interests of workers, prevent economic disruption, and secure the proper management and revitalization of the sick textile undertakings, the Central Government had previously taken over management control. To provide a permanent statutory footing, nationalize the undertakings, vest them securely under the National Textile Corporation (NTC), and ensure the continued manufacture and distribution of essential textiles, Parliament enacted the formal acquisition legislation.

Parliamentary Trajectory & Enactment

Formulation:

Drafted by the Ministry of Textiles to supersede preceding emergency ordinances, formally providing for the acquisition and transfer of certain textile undertakings of Swadeshi Cotton Mills Company Limited, vesting them in the Central Government and subsequently transferring them to the National Textile Corporation, alongside provisions for settling prior claims and compensating the company.

Parliamentary Passage:

Introduced and passed by both Houses of Parliament (Lok Sabha and Rajya Sabha) during the budget session of 1986 to replace the Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Ordinance, 1986.

Presidential Assent: Received Presidential Assent on May 30, 1986.

Enforcement: Enforced on April 1, 1985.

Source: Official Records of Parliament, India Code, and Ministry of Textiles.