MANAGEMENT, ETC., OF THE TEXTILE UNDERTAKINGSCentral

Section 11 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986

On the vesting of a textile undertaking in the National Textile Corporation, all persons in charge of the management of a textile undertaking immediately before such vesting shall be bound to deliver to the National Textile Corporation, all assets, books of account, registers or other documents in their custody relating to the textile undertaking.

Summary

This provision forces former managers of the textile undertakings to hand over everything to the National Textile Corporation.
It takes effect as soon as the textile undertaking officially vests in the Corporation.
The managers must surrender all physical assets, like machinery and inventory, that they have in their custody.
They are also required to hand over all books of account, registers, and any other related documents.

Practical examples

1Mr. Sharma was the general manager of the Naini branch of the Swadeshi Cotton Mills. When the undertaking vested in the National Textile Corporation, he immediately handed over the keys to the warehouse, the company cars, and all the employee attendance ledgers to the new Corporation officials.

2Mrs. Gupta worked as the head accountant for the Udaipur Cotton Mills. Even though she kept the financial registers in a safe at her home office for security, Section 11 requires her to deliver those specific registers directly to the National Textile Corporation once the change in ownership takes place.

FAQ

1. Who has to hand over the assets under Section 11 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986?

Any person who was in charge of the management of a textile undertaking right before it vested in the National Textile Corporation must hand over the assets.

2. What exactly needs to be delivered under Section 11 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986?

The former management must deliver all assets, books of account, registers, and other documents related to the textile undertaking that are in their custody.

3. Who receives the assets and documents under Section 11 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986?

Everything must be delivered directly to the National Textile Corporation.

Test yourself

Q1.Under Section 11 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986, to whom must the former managers deliver the books of account?

Q2.What event triggers the duty to deliver assets under Section 11 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986?

Q3.If a former manager only has old employee registers and no physical assets, what must they do under Section 11 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986?

Q4.Which people are specifically targeted by the duty in Section 11 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986?

10APreviousSection 10A Special provision for disposal of assets of the textile undertakings in certain circumstances.12NextSection 12 Continuance of employees of the textile undertakings.

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