THE TEXTILE UNDERTAKINGS (NATIONALISATION) ACT, 1995 
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ARRANGEMENT OF SECTIONS 
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CHAPTER I 

PRELIMINARY 

SECTIONS 

1.  Short title and commencement. 
2.  Definitions. 

CHAPTER II 

ACQUISITION AND TRANSFER OF THE TEXTILE UNDERTAKINGS 

3.  Acquisition of rights of owners and vesting of the textile undertakings. 
4.  General effect of vesting. 
5.  Owner to be liable for certain prior liabilities. 
6.  Transfer of any textile undertaking or part thereof to a subsidiary textile corporation. 
7.  Shares to be issued by the National Textile Corporation for the value of the assets transferred to it 

by the Central Government. 

CHAPTER III 

PAYMENT OF AMOUNTS 

8.  Payment of amount to owners of textile undertakings. 
9.  Payment of further amount. 

CHAPTER IV 

MANAGEMENT, ETC., OF TEXTILE UNDERTAKINGS 

10.  Management, etc., of textile undertakings. 
11.  Special provision for disposal of assets of the textile undertakings in certain circumstances. 
12.  Duty of persons in charge of management of textile undertakings to deliver all assets, etc. 
13.  Accounts. 

PROVISIONS RELATING TO EMPLOYEES OF TEXTILE UNDERTAKINGS 

CHAPTER V 

14.  Employment of certain employees to continue. 
15.  Provident and other funds. 
16.  Transfer of employees to a subsidiary textile corporation. 

CHAPTER VI 

COMMISSIONERS OF PAYMENTS 

17.  Appointment of Commissioners of Payments. 
18.  Payment by the Central Government to the Commissioner. 
19.  Certain powers of the National Textile Corporation. 

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SECTIONS 

20.  Claims to be made to the Commissioner. 
21.  Priority of claims. 
22.  Examination of claims. 
23.  Admission or rejection of claims. 
24.  Disbursement of money by the Commissioner to claimants. 
25.  Disbursement of amounts to the owners. 
26.  Undisbursed or unclaimed amounts to be deposited to the general reserve account. 

CHAPTER VII 

MISCELLANEOUS 

27.  Assumption of liability. 
28.  Management to continue to vest in the custodian until alternative arrangements are made. 
29.  Act to override all other enactments. 
30.  Contracts to cease to have effect unless ratified by the National Textile Corporation. 
31.  Penalties. 
32.  Offences by companies. 
33.  Protection of action taken in good faith. 
34.  Textile companies not to be wound up by the court. 
35.  Delegation of powers. 
36.  Power to make rules. 
37.  Power to remove difficulties. 
38.  Repeal and saving. 
39.  Validation 

THE FIRST SCHEDULE. 
THE SECOND SCHEDULE. 

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THE TEXTILE UNDERTAKINGS (NATIONALISATION) ACT, 1995 

ACT NO. 39 OF 1995 

[8th September, 1995.]  

An Act to provide for the acquisition and transfer of the textile undertakings, and the right, title 
and  interest  of  the  owners  in  respect  of  the  textile  undertakings,  specified  in  the  First 
Schedule with a view to augmenting the production and distribution of different varieties of 
cloth and yarn so as to subserve the interests of the general public and for matters connected 
therewith or incidental thereto. 

WHEREAS  the  textile  companies  specified  in  column  (3)  of  the  First  Schedule  have,  through  their 
undertakings  specified  in  column  (2)  of  the  said  Schedule,  been  engaged  in  the  manufacture  and 
production of different varieties of cloth and yarn; 

AND WHEREAS, pending acquisition, the management of the said textile undertakings was taken over 
by the Central Government under section 3 of the Textile Undertakings (Taking Over of Management) 
Act,  1983  (40  of  1983)or  under  section  3  of  the  Laxmirattan  and  Atherton  West  Cotton  Mills  (Taking 
Over of Management) Act, 1976 (98 of 1976), as the case may be;  

AND  WHEREAS  large  sums  of  money  have  been  invested  with  a  view  to  making  the  said  textile 

undertakings viable;  

AND  WHEREAS  further  investment  of  very  large  sums  of  money  is  necessary  for  the  purpose  of 
securing  the  optimum  utilisation  of  the  available  facilities  for  the  manufacture,  production  and 
distribution of cloth and yarn by the said textile undertakings of the companies; 

AND  WHEREAS  such  investment  is  also  necessary  for  securing  the  continued  employment  of  the 

workmen employed in the said textile undertakings; 

AND  WHEREAS  it  is  necessary  in  the  public  interest  to  acquire  the  said  textile  undertakings  of  the 
textile companies to ensure that the interest of the general public are served by the continuance by the said 
undertakings  of  the  companies  of  the  manufacture,  production  and  distribution  of  different  varieties  of 
cloth and yarn which are vital to the needs of the country; 

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

CHAPTER I 

PRELIMINARY 

1.  Short  title  and  commencement.—(1)  This  Act  may  be  called  the  Textile  Undertakings 

(Nationalisation) Act, 1995. 

(2) The provisions of sections 31 and 32 shall come into force at once and the remaining provisions of 

this Act shall be deemed to have come into force on the 1st day of April, 1994. 

2. Definitions.—(1) In this Act, unless the context otherwise requires,— 

(a) “appointed day” means the 1st day of April, 1994; 

(b) “bank” means— 

(i) the State Bank of India constituted under the State Bank of India Act, 1955 (23 of 1955); 

(ii)  a  subsidiary  Bank  as  defined  in  the  State  Bank  of  India  (Subsidiary  Banks)  Act,  1959 

(38 of 1959); 

(iii)  a  corresponding  new  bank  constituted  under  section  3  of  the  Banking  Companies 

(Acquisition and Transfer of Undertakings) Act, 1970(5 of 1970); 

(iv)  a  corresponding  new  bank  constituted  under  section  3  of  the  Banking  Companies 

(Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980); 

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(v) any other bank, being a scheduled bank as defined in clause (e) of section 2 of the Reserve 

Bank of India Act, 1934 (2 of 1934); 

(c) “Commissioner” means a Commissioner of Payments appointed under section 17; 

(d) “Custodian”means a Custodian appointed under section 4 of the Textile Undertakings (Taking 
Over  of  Management)  Act,  1983  (40  of  1983)  or  under  section  4  of  the  Laxmirattan  and  Atherton 
West Cotton Mills (Taking Over of Management) Act, 1976 (98 of 1976), as the case may be;  

(e) “National Textile Corporation” means the National Textile Corporation Limited formed and 

registered under the Companies Act, 1956 (1 of 1956); 

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

(g)  “owner”,  when  used  in  relation  to  a  textile  undertaking,  means  any  person  or  firm  who  or 
which is, immediately before the appointed day, the immediate proprietor or lessee or occupier of the 
textile undertaking or any part thereof, and in the case of a textile company which is being wound up 
or  the  business  whereof  is  being  carried  on  by  a  liquidator  or  receiver,  includes  such  liquidator  or 
receiver, and also includes any agent or manager of such owner but does not include any person or 
body of persons authorised under the Textile Undertakings (Taking Over of Management) Act, 1983 
(40 of 1983) or under the Laxmirattan and Atherton West Cotton Mills (Taking Over of Management) 
Act,  1976  (98  of  1976)  to  take  over  the  management  of  the  whole  or  any  part  of  the  textile 
undertaking; 

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

(i)  “specified  date”  means  such  date  as  the  Central  Government  may,  for  the  purpose  of  any 
provision  of  this  Act,  by  notification,  specify;  and  different  dates  may  be  specified  for  different 
provisions of this Act; 

(j) “subsidiary textile corporation” means the National Textile Corporation (South Maharashtra) 
Limited,  the  National  Textile  Corporation  (Uttar  Pradesh)  Limited  or  any  other  textile  corporation 
formed by the National Textile Corporation as its subsidiary; 

(k) “textile” includes yarn or fabrics made either wholly or partly of cotton, wool, jute, synthetic 

and artificial (man-made) fibres; 

(l)  “textile  company”  means  a  company  (being  a  company  as  defined  in  the  Companies  Act, 
1956)  (1  of  1956)  specified  in  column  (3)  of  the  First  Schedule  as  owning  the  textile  undertaking 
specified in the corresponding entry in column (2) of that Schedule; 

(m)  “textile  undertaking”  or  “the  textile  undertaking”  means  an  undertaking  specified  in  
column (2) of the First Schedule, the management of which was before the appointed day, taken over 
by the Central Government under the Textile Undertakings (Taking Over of Management) Act, 1983  
(40 of 1983), or as the case may be, under the Laxmirattan and Atherton West Cotton Mills (Taking 
Over of Management) Act, 1976 (98 of 1976). 

(2)  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 TEXTILE UNDERTAKINGS 

3. Acquisition of rights of owners and vesting of the textile undertakings.—(1) On the appointed 
day, the right, title and interest of the owner in relation to every textile undertaking shall stand transferred 
to, and shall vest absolutely in, the Central Government. 

(2)  Every  textile  undertaking  which  stands  vested  in  the  Central  Government  by  virtue  of  
sub-section (1) shall, immediately after it has so vested, stand transferred to, and vested in, the National 
Textile Corporation. 

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1[(3)  Notwithstanding  the  transfer  and  vesting  of  any  textile  undertaking  to  the  National  Textile 
Corporation by virtue of sub-section (2), the lease-hold rights of the textile undertakings shall continue to 
remain vested in the Central Government on payment of lease-hold rents and shall be discharged, for and 
on  behalf  of  that  Government,  by  the  National  Textile  Corporation  as  and  when  payment  of  such  
lease-hold rents or any amount becomes due and payable. 

(4) Subject to sub-section (3), no court shall have jurisdiction to order divestment from the National 

Textile Corporation of the property vested in it by the Central Government.] 

4. General effect of vesting.—(1) The textile undertakings referred to in section 3 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 and book debts pertaining to the textile undertakings 
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 textile company in relation to the said 
undertakings, 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  and  obligations 
specified in sub-section (2) of section 5. 

(2) All property as aforesaid which have vested in the Central Government under sub-section (1) of 
section  3  shall,  by  force  of  such  vesting,  be  freed  and  discharged  from  any  trust,  obligation,mortgage, 
charge, lien and all other incumbrances affecting it, and any attachment, injunction or decree or order of 
any court or other authority restricting, the use of such property in any manner shall be deemed to have 
been withdrawn. 

(3) Where any licence or other instrument in relation to a textile undertaking had been granted, at any 
time  before  the  appointed  day  to  the  owner  by  the  Central  Government  or  a  State  Government  or  any 
other  authority,  the  National  Textile  Corporation  shall,  on  and  from  such  date,  be  deemed  to  be 
substituted in such licence or other instrument in place of the owner referred to therein as if such licence 
or  such  other  instrument  had  been  granted  to  it  and  shall  hold  such  licence  or  the  textile  undertaking 
specified in such other instrument for the remainder of the period for which the owner would have held 
such licence or the textile undertaking under such other instrument. 

(4) 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  manneras  may  be  prescribed,  an  intimation  to  the  Commissioner  of  such 
mortgage, charge, lien or other interest. 

(5) For the removal of doubts, it is hereby declared that the mortgagee of any property referred to in 
sub-section (2) 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 interest, payment of the mortgage 
money or other dues, in whole or in part, out of the amounts specified in relation to such property in the 
First  Schedule,  but  no  such  mortgage,  charge,  lien  or  other  interest  shall  be  enforceable  against  any 
property which has vested in the Central Government. 

(6) If, on the appointed day, any suit, appeal or other proceeding of whatever nature in relation to any 
property which has vested in the Central Government under section 3, instituted or preferred by or against 
the textile company is pending, the same shall not abate, be discontinued or be, in any way, prejudicially 
affected by reason of the transfer of the textile undertakings or of anything contained in this Act, but the 
suit,  appeal  or  other  proceeding  may  be  continued,  prosecuted  or  enforced  by  or  against  the  National 
Textile Corporation. 

(7)  Any  person  who,  on  the  date  on  which  the  Textile  Undertakings  (Nationalisation)  Ordinance, 
1995 (Ord. 6 of 1995) was promulgated, was in possession of, or had under his custody or control, the 
whole or any part of any textile undertaking referred to in section 3, the management of which could not 
be  taken  over  by  the  Central  Government  by  reason  of  any  decree,  order  or  injunction  of  any  court  or 
otherwise,  shall  deliver  forthwith  the  possession  of  such  undertaking  or  part  and  all  books  of  account, 

1. Ins. by Act 36 of 2014, s. 5 (w.e.f. 24-10-2014). 

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registers and all other documents of whatever nature relating to such undertaking or part to the Central 
Government or the National Textile Corporation or such other person as the Central Government or the 
National Textile Corporation, as the case may be, may specify in this behalf. 

1[(8)  Notwithstanding  the  fact  that  the  textile  operations  have  been  discontinued  in  any  textile 
undertaking  being  revived,  shall  for  all  effects  and  purposes  be  deemed  that  the  textile  operations  are 
being continued and no suit or proceeding shall be instituted or if instituted be maintainable against the 
National  Textile  Corporation  on  the  ground  that  it  has  discontinued  such  activity  in  the  textile 
undertaking. 

(9) For the removal of doubts, it is hereby declared that the  continued deemed vesting of the lease-
hold land in the Central Government shall not affect, impair or in any manner prejudice the rights of the 
National  Textile  Corporation  to  prosecute  or  defend  any  proceedings  as  a  subsequent  vestee  in  respect  
of any such lease-hold rights and no such proceedings shall fail only on account of the non-impleadment 
of that Government.]   

5.  Owner  to  be  liable  for  certain  prior  liabilities.—(1)  Every  liability,  other  than  the  liability 
specified in sub-section (2), of the owner of a textile undertaking, in relation to the textile undertakings in 
respect  of  any  period  prior  to  the  appointed  day,  shall  be  the  liability  of  such  owner  and  shall  be 
enforceable against him and not against the Central Government or the National Textile Corporation. 

(2) Any liability arising in respect of— 

(a)  loans  advanced  by  the  Central  Government,  or  a  State  Government,  or  both,  to  a  textile 
undertaking (together with interest due thereon) after the management of such undertaking had been 
taken over by the Central Government under section 3 of the Textile Undertakings (Taking Over of 
Management) Act, 1983, (40 of 1983) or as the case may be, under section 3 of the Laxmirattan and 
Atherton West Cotton Mills (Taking Over of Management) Act, 1976 (98 of 1976); 

(b)  amounts  advanced  to  a  textile  undertaking  [after  the  management  of  such  undertaking  had 
been taken over by the Central Government under section 3 of the Textile Undertakings (Taking Over 
of Management) Act, 1983 (40 of 1983), or as the case may be, under section 3 of the Laxmirattan 
and  Atherton  West  Cotton  Mills  (Taking  Over  of  management)  Act,  1976  (98  of  1976)]  by  the 
National Textile Corporation or by a State Textile Corporation, or by both, together with interest due 
thereon; 

(c)  wages,  salaries  and  other  dues  of  employees  of  the  textile  undertaking,  in  respect  of  any 

period after the management of such undertaking 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, 
for  and  on  behalf  of  that  Government,  by  the  National  Textile  Corporation  as  and  when  repayment  of 
such loans or amounts becomes due or as and when such wages, salaries or other dues become due and 
payable. 

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

(a)  save  as  otherwise  expressly  provided  in  this  section  or  in  any  other  section  of  this  Act,  no 
liability,  other  than  the  liability  specified  in  sub-section  (2),  in  relation  to  a  textile  undertaking,  in 
respect of any period prior to the appointed day, shall be enforceable against the Central Government 
or the National Textile Corporation; 

(b)  no award,  decree or  order  of  any  court,  tribunal or  other authority  in  relation  to  any  textile 
undertaking, passed after the appointed day, in respect of any matter, claim or dispute in relation to 
any matter not referred to in sub-section (2),which arosebefore that day shall be enforceable against 
the Central Government or the National Textile Corporation; 

(c)  no  liability  of  any  textile  undertaking  or  any  owner  thereof  in  relation  to  any  textile 
undertaking before the appointed day, for the contravention of any provision of law for the time being 
in force, shall be enforceable against the Central Government or the National Textile Corporation. 

1. Ins. by Act 36 of 2014, s. 6 (w.e.f. 24-10-2014). 

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6.  Transfer  of  any  textile  undertaking  or  part  thereof  to  a  subsidiary  textile  Corporation.— 
(1) The National Textile Corporation may, by order in writing, transfer any textile undertaking specified 
at  serial  numbers  1  to  13  in  the  First  Schedule  or  part  of  any  such  textile  undertaking  to  the  National 
Textile Corporation (South Maharashtra) Limited and any textile undertaking specified at serial numbers 
14 and 15 in the First Schedule or part of any such textile undertaking to the National Textile Corporation 
(Uttar Pradesh) Limited, as the case may be, or to any other subsidiary textile corporation and any such 
transfer shall be subject to such terms and conditions as may be specified in the said order. 

(2) The subsidiary textile corporation shall, on and from the date of such transfer, be deemed to be 
substituted  in  the  licence  or  other  instrument  referred  to  in  sub-section  (3)  of  section  4  in  place  of  the 
National  Textile  Corporation  as  if  such  licence  or  other  instrument  had  been  granted  to  the  subsidiary 
textile  corporation,  and  shall  hold  such  licence  or  other  instrument  for  the  remainder  of  the  period  for 
which the National Textile Corporation would have held such licence or other instrument. 

(3) On the transfer to a subsidiary textile corporation of any textile undertaking or any part thereof, 
the liabilities of the National Textile Corporation, referred to in sub-section (2) of section 5, shall, in so 
far  as  they  relate  to  the  textile  undertaking  or  part  thereof  so  transferred  to  the  subsidiary  textile 
corporation,  become,  on  and  from  the  date  of  such  transfer,  the  liabilities  of  the  subsidiary  textile 
corporation and shall be discharged by the subsidiary textile corporation as and when any such liability is 
required to be discharged. 

(4)  Save  as  otherwise  expressly  provided  in this  Act,  references in  this  Act  to the  National Textile 
Corporation  shall,  in  respect  of  any  textile  undertaking  or  any  part  thereof  which  is  transferred  to  a 
subsidiary textile corporation, be construed as references to the subsidiary textile corporation. 

7. Shares to be issued by the National Textile Corporation for the value of the assets transferred 
to  it  by  the  Central  Government.—(1)  An  amount  equal  to  the  value  of  the  assets  of  a  textile 
undertaking  transferred  to,  and  vested  in,  the  National  Textile  Corporation  under  sub-section  (2)  of 
section 3, shall be deemed to be contribution made by the Central Government to the equity capital of the 
National  Textile  Corporation;  and  for  the  contribution  so  made,  the  National  Textile  Corporation  shall 
issue (if necessary after amending its memorandum and articles of association) to the Central Government 
paid-up shares, in its equity capital, having a face value equal to the amount specified against the textile 
undertaking in the corresponding entry in column (4) of the First Schedule. 

(2)  Where  any  liability  assumed  by  the  Central  Government  under  this  Act  is  taken  over  by  the 
National  Textile  Corporation  under  section  27,  the  Central  Government  shall  surrender  to  that 
Corporation the shares issued to it under sub-section (1) having the face value equal to the amount to the 
extent to which the liability has been so taken over by the National Textile Corporation and thereupon the 
share  capital  of  the  National  Textile  Corporation  shall,  to  the  extent  of  the  face  value  of  the  shares  so 
surrendered, stand reduced. 

CHAPTER III 

PAYMENT OF AMOUNTS 

8. Payment of amount to owners of textile undertakings.—The owner of every textile undertaking 
shall  be  given  by  the  Central  Government,  in  cash  and  in  the  manner  specified  in  Chapter  VI,  for  the 
transfer to, and vesting in, it, under sub-section (1) of section 3, of such textile undertaking and the right, 
title  and  interest  of  the  owner  in  relation  to  such  textile  undertaking,  an  amount  equal  to  the  amount 
specified against it in the corresponding entry in column (4) of the First Schedule. 

9. Payment of further amount.—(1) In consideration of the retrospective operation of the provisions 
of  sections  3,  4  and  5,  there  shall  be  given,  in  cash,  by  the  Central  Government  to the  owner  of every 
textile  undertaking,  the  management  of  which  was  taken  over  by  the  Central  Government,  an  amount 
equal to an amount calculated at the rate specified in section 5 of the Textile Undertakings (Taking Over 
of  Management)  Act,  1983  (40  of  1983),  or  as  the  case  may  be,  as  specified  in  section  5  of  the 
Laxmirattan and Atherton West Cotton Mills (Taking Over of Management) Act, 1976 (98 of 1976) for 
the period commencing on the appointed day and ending on the date on which the Textile Undertakings 
(Nationalisation) Ordinance, 1995 (Ord. 6 of 1995) was promulgated. 

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(2) In addition to the amount referred to in section 8, there shall be given by the Central Government, 
in cash, to the owner of every textile undertaking, simple interest at the rate of four per cent.per annum on 
the amount specified against such owner in the corresponding entry in column (4) of the First Schedule 
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 amount representing interest calculated at the rate specified in sub-section (2) shall be given 

in addition to the amount specified in the First Schedule. 

(4) For the removal of doubts, it is hereby declared that the liabilities of the owners in relation to the 
textile  undertakings  which  have  vested  in  the  Central  Government  under  section  3  shall  be  discharged 
from  the  amount  referred  to  in  the  First  Schedule  and  also  from  the  amounts  determined  under  
sub-sections (1) and (2) in accordance with the rights and interests of the creditors of the owner. 

CHAPTER IV 

MANAGEMENT, ETC., OF TEXTILE UNDERTAKINGS 

10. Management, etc., of Textile undertakings.—The National Textile Corporation or any person 
which  that  Corporation  may,  by  order  in  writing,  specify,  shall  be  entitled  to  exercise  the  powers  of 
general  superintendence,  direction,  control  and  management  of  the  affairs  and  business  of  a  textile 
undertaking, the right, title and interest of an owner in relation to which have vested in that Corporation 
under  sub-section  (2)  of  section  3,  and  do  all  such  things  as  the  owner  of  the  textile  undertaking  is 
authorised to exercise and do. 

11.  Special  provision  for  disposal  of  assets  of  the  textile  undertakings 

in  certain 
circumstances.—If  the  National  Textile  Corporation  considers  it  necessary  or  expedient  for  the  better 
management,  modernisation,  restructuring  or  revival  of  a  textile  undertaking  so  to  do,  it  may,  with  the 
previous sanction of the Central  Government, transfer, mortgage,  sell or otherwise dispose of any land, 
plant, machinery or any other assets of any of the textile undertakings: 

Provided that the proceeds of no such transfer, mortgage, sale or disposal of assets shall be utilised for 

any purpose other than the purpose for which the sanction of the Central Government has been obtained. 

12. Duty of persons in charge of management of textile undertakings to deliver all assets, etc.,—
On the vesting of the management of a textile undertaking in the National Textile Corporation, all persons 
in charge of the management of such 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. 

13.  Accounts.—The  National  Textile  Corporation  shall  maintain  the  accounts  of  the  textile 

undertakings in accordance with the provisions of the Companies Act, 1956(1 of 1956). 

PROVISIONS RELATING TO EMPLOYEES OF TEXTILE UNDERTAKINGS 

CHAPTER V 

14. Employment of certain employees to continue.—(1) Every person who is a workman within the 
meaning  of  the  Industrial  Disputes  Act,  1947  (14  of  1947),  and  has  been,  immediately  before  the 
appointed day, in the employment of a textile undertaking shall become, on and from the appointed day, 
an employee of the National Textile Corporation, and shall hold office or service in the National Textile 
Corporation with the same rights and privileges as to pension, gratuity and other matters as would have 
been admissible to him if the rights in relation to such textile undertaking had not been transferred to, and 
vested in, the National Textile Corporation, and shall continue to do so unless and until his employment 
in the National Textile Corporation is duly terminated or until his remuneration, terms and conditions of 
employment are duly altered by the National Textile Corporation. 

(2)  Every  person  who  is  not  a  workman  within  the  meaning  of  the  Industrial  Disputes  Act,  1947 
(14 of 1947), and who has been, immediately before the appointed day, in the employment of a textile 
undertaking shall, in so far as such person is employed in connection with the textile undertaking which 
has vested in the National Textile Corporation, become, as from the  appointed day, an employee of the 
National Textile Corporation and shall hold his office or service therein by the same tenure, at the same 

8 

 
remuneration  and  upon  the  same  terms  and  conditions  and  with  the  same  rights  and  privileges  as  to 
pension and gratuity and other matters as he would have held the same under the textile undertaking if it 
had  not  vested  in  the  National  Textile  Corporation  and  shall  continue  to  do  so  unless  and  until  his 
employment in the National Textile Corporation is duly terminated or until his remuneration, terms and 
conditions of employment are duly altered by the National Textile Corporation. 

(3) 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 employee of a 
textile undertaking to the National Textile 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. 

(4)  Where,  under  the  terms  of  any  contract  of  service  or  otherwise,  any  person  whose  services 
become terminated or whose services become transferred to the National Textile Corporation by reason of 
the provisions of this Act is entitled to any arrears of salary or wages or any payment for any leave not 
availed of or other payment, not being payment by way of gratuity or pension, such person may, except to 
the extent such liability has been taken over by the Central Government under section 5, enforce his claim 
against  the  owner  of  the  textile  undertaking  but  not  against  the  Central  Government  or  the  National 
Textile Corporation. 

15.  Provident  and  other  funds.—(1)  Where  the  owner  of  a  textile  undertaking  has  established  a 
provident  fund,  superannuation,  welfare  or  other  fund  for  the  benefit  of  the  persons  employed  in  such 
textile undertaking, the monies relatable to the employees, whose services have become transferred by or 
under this Act to the National Textile Corporation shall, out of the monies standing, on the appointed day, 
to the credit of such provident fund, superannuation, welfare or other fund, stand transferred to, and shall 
vest in, the National Textile Corporation. 

(2)  The  monies  which  stand  transferred,  under  sub-section  (1),  to  the  National  Textile  Corporation 

shall be dealt with by that Corporation in such manner as maybe prescribed.  

16. Transfer of employees to a subsidiary textile corporation.—Where any textile undertaking or 
any part thereof is transferred under this Act to a subsidiary textile corporation, every person referred to in 
sub-section (1) and sub-section (2), of section 14 shall, on and from the date of such transfer, become an 
employee  of  the  subsidiary  textile  corporation,  and  the  provisions  of  sections  14  and  15  shall  apply  to 
such employee as they apply to an employee of the National Textile Corporation as if references in the 
said sections to the National Textile Corporation were references to the subsidiary textile corporation. 

CHAPTER VI 

COMMISSIONERS OF PAYMENTS 

17. Appointment of Commissioners of Payments.—(1) For the purpose of disbursing the amounts 
payable  to  the  owner  of  each  textile  undertaking,  the  Central  Government  shall,  by  notification  in  the 
Official Gazette,— 

(a) appoint such number of persons as it may think fit to be Commissioners of Payments; and 

(b) define the local limits within which the Commissioners of Payments shall exercise the powers 

conferred, and perform the duties imposed, on them by or under this Act. 

(2)  The  Central  Government  may  appoint  such  other  persons  at  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 powers 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. 

9 

 
(5) References in this Act to the Commissioner shall, where more than one Commissioner has been 
appointed, be construed as references to the Commissioner in relation to the textile undertaking within the 
local limits of the jurisdiction specified under clause (b) of sub-section (1). 

18.  Payment  by  the  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  the 
owner of a textile undertaking, an amount equal to the amount specified against the textile undertaking in 
the First Schedule and shall also  pay to the Commissioner such sums as may be due to the owner of a 
textile undertaking under sub-sections (1) and (2) of section 9.  

(2) In relation to the textile undertakings, the management of which was taken over by the Central 
Government under the Textile Undertakings (Taking Over of Management) Act, 1983 (40 of 1983), there 
shall be paid by the Central Government [in addition to the amount referred to in sub-section (1)], to the 
Commissioner, in cash, such amount payable under section 5 of that Act as remains unpaid in relation to 
the  period  commencing  on  the  date  on  which  such  management  was  taken  over  by  the  Central 
Government and ending on the appointed day. 

(3) In relation to the textile undertakings, the management of which was taken over by the Central 
Government under the Laxmirattan and Atherton West Cotton Mills (Taking Over of Management) Act, 
1976 (98 of 1976), there shall be paid by the Central Government [in addition to the amount referred to in 
sub-section (1)], to the Commissioner, in cash, such amount payable under section 5of that Act as remains 
unpaid in relation to the period commencing on the date on which such management was taken over by 
the Central Government and ending on the appointed day. 

(4) 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 in the Public Account of India, and thereafter 
the said deposit account shall be operated by the Commissioner. 

(5) Separate records shall be maintained by the Commissioner in respect of each textile undertaking 

in relation to which payments have been made to him under this Act.  

(6)  Interest  accruing  on  the  amounts  standing  to  the  credit  of  the  deposit  account  referred  to  in  

sub-section (4) shall inure to the benefit of the owners of the textile undertakings. 

19.  Certain  powers  of  the  National  Textile  Corporation.—(1)  The  National  Textile  Corporation 
shall be entitled to receive, up to the specified date, to the exclusion of all other persons, any money due 
to the textile undertaking,realised after the appointed day, notwithstanding that the realisations pertain to a 
period prior to the appointed day. 

(2) The  National Textile  Corporation  may  make  a  claim  to  the  Commissioner  with regard  to every 
payment  made  by  the  Custodian  after  the  appointed  day  but  before  the  date  on  which  the  Textile 
Undertakings  (Nationalisation)  Ordinance,  1995 (Ord.  6  of  1995)  was  promulgated for  discharging  any 
liability of the owner of textile undertaking in relation to 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 Custodian. 

(3) Save as otherwise provided in this Act, the liabilities in relation to a textile undertaking in respect 
of any period prior to the appointed day which have not been discharged by the Custodian shall be the 
liabilities of the owner of that textile undertaking. 

20. Claimsto be made to the Commissioner.—Every person having a claim against the owner of a 
textile undertaking 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. 

10 

 
 
 
21. Priority of claims.—The claims arising out of the matters specified in the Second Schedule 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, except category IV, shall rank equally and be 
paid  in  full,  but  if  the  amount  is  insufficient  to  meet  such  claims  in  full,  they  shall  abate  in  equal 
proportions and be paid accordingly; 

(c) the liabilities specified in category IV shall be discharged, subject to the priorities specified in 
this section, in accordance with the terms of the secured loans and the priority, inter se, of such loans; 
and 

(d)  the  question  of  payment  of  a  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. 

22. Examination of claims.—(1) On receipt of the claims under section 20, the Commissioner shall 
arrange  the  claims  in  the  order  of  priority  specified  in  the  Second  Schedule  and  examine  the  same  in 
accordance with the said order. 

(2) If, on examination of the claims, the Commissioner is of the opinion that the amount paid to him 
under  this  Act  is  not  sufficient  to  meet  the  liabilities  specified  in  any  lower  category,  he  shall  not  be 
required to examine the liabilities in respect of such lower category.  

23. Admission or rejection of claims.—(1) After examining the claims with reference to the priority 
set  out  in  the  Second  Schedule,  the  Commissioner  shall  fix  a  certain  date  on  or  before  which  every 
claimant shall file the proof of his claim or be excluded from the benefit of the disbursement made by the 
Commissioner. 

(2)  Not less  than fourteen days’  notice  of  the  date  so  fixed  shall  be  given  by  advertisement  in  one 
issue of the daily newspaper in the English language and one issue of the daily newspaper in the regional 
language as the Commissioner may consider suitable, and every such notice shall call upon the claimant 
to file the proof of his claim with the Commissioner within the time specified in the advertisement. 

(3)  Every  claimant  who  fails  to  file  the  proof  of  his  claim  within  the  time  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  owner  of  the  textile  undertaking  an  opportunity  of  refuting  the  claim  and  after  giving  the 
claimants  a  reasonable  opportunity  of  being  heard,  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 sittings 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; and 

(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). 

11 

 
(7)  A  claimant  who  is  dissatisfied  with  the  decision  of  the  Commissioner  may  prefer  an  appeal 
against  the  decision  to  the  principal  civil  court  of  original  jurisdiction  within  the  local  limits  of  whose 
jurisdiction the textile undertaking is situated: 

Provided that where a person who is a Judge of a High Court is appointed to be the Commissioner, 
such appeal shall lie to the High Court for the State in which the textile undertaking is situated, and such 
appeal shall be heard and disposed of by not less than two Judges of that High Court.  

24.  Disbursement  of  money  by  the  Commissioner  to  claimants.—After  admitting  a  claim  under 
this Act, the amount due in respect of such claim shall be credited by the Commissioner to the relevant 
fund or be paid to the person or persons to whom such sums are due and on such credit or payment the 
liability of the owner in respect of such claim shall stand discharged. 

25. Disbursement of amount to the owners.—(1) If, out of the monies paid to him in relation to a 
textile undertaking, there is a balance left after meeting the liabilities as specified in the Second Schedule, 
the Commissioner shall disburse such balance to the owner of such textile undertaking. 

(2)  Before  making  any  payment  to  the  owner  of  any  textile  undertaking  under  sub-section  (1),  the 
Commissioner shall satisfy himself as to the right of such person to receive the whole or any part of such 
amount,  and  in  the  event  of  there  being  a  doubt  or  dispute  as  to  the  right  of  the  person  to  receive  the 
whole or any part of the amount referred to in sections 8 and 9, the Commissioner shall refer the matter to 
the court and make the disbursement in accordance with the decision of that court. 

(3) For the removal of doubts, it is hereby declared that the entries in column (3) of the First Schedule 
shall  not  be  deemed  to  be  conclusive  as  to  the  right,  title  and  interest  of  any  person  in  relation  to  any 
textile undertaking specified in the corresponding entries in column (2) of the said Schedule and evidence 
shall  be  admissible  to  establish  the  right,  title  and  interest  of  any  person  in  relation  to  such  textile 
undertaking. 

(4)  Where  any  machinery,  equipment  or  other  property  in  a  textile  undertaking  has  vested  in  the 
National  Textile  Corporation,  but  such  machinery,  equipment  or  other  property  does  not  belong  to  the 
owner of such textile undertaking, the amount specified in column (4) of the First Schedule against such 
textile  undertaking  shall,  on  a  reference  made  to  it  by  the  Commissioner,  be  apportioned  by  the  court 
between  the  owner  of  such  textile  undertaking  and  the  owner  of  such  machinery,  equipment  or  other 
property having due regard to the value of such machinery, equipment or other property on the appointed 
day. 

Explanation.—In this section, “court”, in relation to a  textile undertaking, means the principal civil 
court  of  original  jurisdiction  within  the  local  limits  of  whose  jurisdiction  the  textile  undertaking  is 
situated. 

26.  Undisbursed  or  unclaimed  amounts  to  be  deposited  to  the  general  reserve  account.—Any 
money  paid  to  the  Commissioner  which  remains  undisbursed  or  unclaimed  for  a  period  of  three  years 
from the last day on which the disbursement was made, shall be transferred by the Commissioner 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, the order, if any, for payment of the claim being treated as an order for 
the refund of revenue. 

CHAPTER VII 

MISCELLANEOUS 

27.  Assumption  of  liability.—(1) Where any  liability  of  the  owner of  a textile  undertaking  arising 
out  of  any  item  specified  in  category  I  of  the  Second  Schedule  is  not  discharged  fully  by  the 
Commissioner out of the amount 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. 

12 

 
(2) The Central Government may, by order, direct the National Textile Corporation to take over any 
liability assumed by that Government under sub-section (1), and on receipt of such direction, it shall be 
the duty of the National Textile Corporation to discharge such liability. 

28.  Management  to  continue  to  vest  in  the  Custodian  until  alternative  arrangements  are 
made.—  Notwithstanding  the  vesting,  under  this  Act,  of  a  textile  undertaking  in  the  National  Textile 
Corporation,— 

(a)  the  Custodian  who  has  been  managing  the  affairs  of  such  undertaking  before  the  date  on 
which the Textile Undertakings (Nationalisation) Ordinance, 1995 (Ord. 6 of 1995) was promulgated 
shall, until alternative arrangements have been made by the National Textile Corporation, continue to 
manage  the  affairs  of  such  undertakings  as  if  the  Custodian  had  been  authorised  by  the  National 
Textile Corporation to manage the affairs of such undertaking; and 

(b)  the  Custodian  or  any  person  authorised  by  him  for  this  purpose  shall,until  alternative 
arrangements  have  been  made  by  the  National  Textile  Corporation,  continue  to  be  authorised  to 
operate, in relation to the textile undertaking, any account of such undertaking in a bank as if such 
Custodian  or  the  person  authorised  by  the  Custodian  had  been  authorised  by  the  National  Textile 
Corporation to operate such account. 

29.  Act  to  override  all  other  enactments.—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 authority. 

30.  Contracts to  cease to have  effect  unless ratified  by  the  National  Textile  Corporation.—(1) 
Every contract entered into by the owner or occupier of any textile undertaking for any service, sale or 
supply and in force immediately before the appointed day shall, on and from the expiry of one hundred 
and  twenty  days  from  the  date  on  which  the  Textile  Undertakings  (Nationalisation)  Ordinance,  1995  
(Ord. 6 of 1995) was promulgated, cease to have effect unless such contract is before the expiry of that 
period, ratified, in writing, by the National Textile Corporation and in ratifying such contract the National 
Textile Corporation may make such alterations or modifications therein as it may think fit: 

Provided that the National Textile Corporation shall not omit to ratify a contract, and shall not make 
any alteration or modification in a contract, 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 textile undertaking. 

(2)  The  National  Textile  Corporation  shall  not  omit  to  ratify  a  contract  or  make  any  alteration  or 
modification  therein  except  after  giving  to  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. 

31. Penalties.—Any person who,— 

(a)  having  in  his  possession,  custody  or  control  any  property  forming  part  of  a  textile 
undertaking,  wrongfully  withholds  such  property  from  the  Central  Government  or  the  National 
Textile Corporation, or any person authorised by that Government or Corporation, as the case may be, 
in this behalf, or 

(b)wrongfully  obtains  possession  of,  or  retains,  any  property  forming  part  of  the  textile 
undertaking or wilfully withholds or fails to furnish to the Central Government, the National Textile 
Corporation  or  any  person  specified  by  that  Government,  or  Corporation,  as  the  case  may  be,  any 
document relating to such textile undertaking which may be in his possession, custody or control or 
fails to deliver to the National  Textile Corporation or any person specified by that Corporation any 
assets,  books  of  account,  registers  or  other  documents  in  his  custody  relating  to  the  textile 
undertaking, or 

13 

 
 
 
(c)  wrongfully  removes  or  destroys  any  property  forming  part  of  any  textile  undertaking  or 
prefers  any  claim  under  this  Act  which  he  knows  or  has  reasonable  cause  to  believe  to  be false or 
grossly inaccurate,  

shall be punishable with imprisonment for a term which may extend to two years, or with fine which may 
extend to ten thousand rupees, or with both. 

32.  Offences  by  companies.—(1)  Where  an  offence  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. 

33. Protection of action taken in good faith.—No suit, prosecution or other legal proceeding shall 
lie against the Central Government or any officer of that Government or the Custodian or the National 
Textile  Corporation  or  any  subsidiary  textile  corporation  or  any  officer  or  other  person  authorised  by 
either  of  such  Corporations  for anything  which is  in good  faith  done  or intended  to  be  done  under  this 
Act.  

34. Textile companies not to be wound up by the Court.—No proceeding for the winding up of a 
textile  company,  the  right,  title  and  interest in  relation  to the textile  undertaking  owned  by  which  have 
vested in the National Textile Corporation under this Act or for the appointment of a receiver in respect of 
the business of the textile undertaking shall lie or be proceeded with in any court except with consent of 
the Central Government. 

35. 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  power  under  section  36,  may  also  be 
exercised by any 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.  

36. Power to make rules.—(1) The Central Government may, by notification,make rules to carry 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 (4) of 

section 4 shall be given; 

(b) the manner in which monies in any provident or other fund referred to in  section 15 shall be 

dealt with; 

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

14 

 
 
 
(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. 

37. Power to remove difficulties.—(1) 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 date on 

which the Textile Undertakings (Nationalisation) Ordinance, 1995 (Ord. 6 of 1995) was promulgated. 

(2) Every order made under this section shall, as soon as may be after it is made, be laid before each 

House of Parliament. 

38.  Repeal  and  saving.—(1)  The  Textile  Undertakings  (Nationalisation)  Ordinance,  1995 

(Ord. 6 of 1995), is hereby repealed. 

(2) Notwithstanding such repeal, anything done or any action taken under the said Ordinance shall be 

deemed to have been done or taken under the corresponding provisions of this Act. 

1[39.  Validation.—Notwithstanding  anything  contained  in  any  judgment,  decree  or  order  of  any 

court, tribunal or other authority,— 

(a)  the  provisions  of  this  Act,  as  amended  by  the  Textile  Undertakings  (Nationalisation)  Laws 
(Amendment and Validation) Act, 2014 (36 of 2014), shall have and shall be deemed always to have 
effect for all purposes as if the provisions of this Act, as amended by the said Act, had been in force at 
all material times; 

(b) any lease-hold property divested from the National Textile Corporation to any person under 
the  provisions  of  this  Act,  as  it  stood  immediately  before  the  commencement  of  the  Textile 
Undertakings  (Nationalisation)  Laws  (Amendment  and  Validation)  Act,  2014  (36  of  2014),  shall 
stand transferred to and vest or continue to vest, free from all encumbrances, in the National Textile 
Corporation  in  the  same  manner  as  it  was  vested  in  the  National  Textile  Corporation  before  such 
divesting of that property under the provisions of this Act as if the provisions of this Act, as amended 
by the aforesaid Act, were in force at all material times; 

(c)  no  suit  or  other  proceedings  shall,  without  prejudice  to  the  generality  of  the  foregoing 
provisions, be maintained or continued in any court or tribunal or authority for the enforcement of any 
decree  or  order  or  direction  given  by  such  court  or  tribunal  or  authority,  notwithstanding  any 
undertaking filed by the National Textile Corporation in any court or tribunal or authority, directing 
divestment  of  such  lease-hold  property  from  the  National  Textile  Corporation  vested  in  it  under 
section  3  of  this  Act,  as  it  stood  before  the  commencement  of  the  Textile  Undertakings 
(Nationalisation)  Laws  (Amendment  and  Validation)  Act,  2014  (36  of  2014),  and  such  lease-hold 
property  shall  continue  to  vest  in  the  National  Textile  Corporation  under  section  3  of  this  Act,  as 
amended by the aforesaid Act, as if the said section was in force at all material times; 

(d) any transfer of any property, vested in the National Textile Corporation, by virtue of any order 
of  attachment,  seizure  or  sale  in  execution  of  a  decree  of  a  civil  court  or  orders  of  any  tribunal  or 
other authority in respect of lease-hold property vested in the National Textile Corporation which is 
contrary to the provisions of this Act, as amended by the Textile Undertakings (Nationalisation) Laws 
(Amendment  and  Validation)  Act,  2014  (36  of  2014),  shall  be  deemed  to  be  null  and  void  and 
notwithstanding such transfer, continue to vest in the National Textile Corporation under this Act.] 

1. Ins. by Act 36 of 2014, s. 7 (w.e.f. 24-10-2014). 

15 

 
 
 
                                                           
THE FIRST SCHEDULE 

[See sections 2(l) and (m), 8 and 18(1)] 

Sl. 
No. 

(1) 

1. 

2. 

3. 

4. 

5. 

6. 

7. 

8. 

9. 

Name of the textile undertaking 

Name of the owner 

(2) 

(3) 

Amount 
(in rupees) 

(4) 

Elphinstone  Spinning  and  Weaving 
Mills, Elphinstone Road, Bombay. 

The  Elphinstone  Spinning  and  Weaving 
Mills  Co.  Ltd.,  Kamani  Chambers,  32, 
RamjiBhaiKamaniMarg, Bombay-38. 

4,56,98,000 

Finlay  Mills,  10/11,  Dr.  S.S.  Rao 
Road, Bombay. 

The  Finlay  Mills  Ltd.,  Chartered  Bank 
Building Fort, Bombay-23. 

8,14,87,000 

Gold Mohur Mills, DadasahebPhalke 
Road, Dadar, Bombay. 

The Gold Mohur Mills Ltd.,Chartered Bank 
Building, Fort, Bombay-23. 

5,45,55,000 

Jam  Manufacturing  Mills,  Lalbaug, 
Parel, Bombay. 

The  Jam  Manufacturing  Co.  Ltd.,  Lalbaug, 
Parel, Bombay-12. 

2,79,62,000 

Kohinoor  Mills  (No.  1),  Naigaum 
Cross Road, Dadar, Bombay. 
Kohinoor  Mills  (No.  2),  Naigaum 
Cross Road, Dadar, Bombay. 

Kohinoor  Mills 
Jamshedji Road, Dadar, Bombay. 

(No.  3),  Lady 

The  Kohinoor  Mills  Co.  Ltd.,  Killick 
House,  CharanjitRaiMarg  (Home  Street), 
Fort, Bombay-1. 

2,33,38,000 

New City of Bombay Manufacturing 
Mills,  63,  Tukaram  B.  KadamMarg, 
Bombay. 

The  New  City  of  Bombay  Manufacturing 
Co.  Ltd.,  63,  TukaramBaisajiKadam  Path, 
Bombay-33. 

4,23,57,000 

Podar  Mills,  N.M,  Joshi  Marg, 
Bombay. 

The  Podar  Mills  Ltd.,  Podar  Chambers, 
Syed Abdulla Brelvi Road, Fort, Bombay-1. 

7,46,30,000 

10.  Podar  Mills 

(Process  House), 

GanpatRaoKadamMarg, Bombay. 

The  Podar  Mills  Ltd.,  Podar  Chambers, 
Syed Abdulla Brelvi Road, Fort, Bombay-1. 

1,91,94,000 

11.  Shree 

Madhusudan 
PandurangBudhkarMarg, Bombay. 

Mills, 

Shree  Madhusudan  Mills  Ltd., 
Chowringhee Road, Calcutta-16. 

31, 

2,70,85,000 

12.  Shree  Sitaram  Mills,  N.M.  Joshi 

Marg, Bombay. 

Shree Sitaram Mills Ltd., N.M. Joshi Marg, 
Bombay-11. 

1,95,20,000 

13.  Tata  Mills,  Dr.  Ambedkar  Road, 

Dadar, Bombay. 

The  Tata  Mills  Ltd.,  Bombay  House,  24 
HomiMody Street, Fort, Bombay- 23. 

9,33,47,000 

14.  Laxmirattan  Cotton  Mills,  Kalpi 

Road Kanpur. 

Laxmirattan  Cotton  Mills  Company 
Limited, 
ChataiMahal, 
Kanpur. 

BehariNiwas, 

2,22,39,000 

15.  Atherton  West  Cotton  Mills,  Anwar 

Ganj, Kanpur. 

Atherton  West  and  Company  Limited, 
Anwarganj, Kanpur. 

1,10,95,000 

16 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
THE SECOND SCHEDULE 

(See sections 21, 22, 23 and 27) 

Order of priorities for discharge of liabilities in respect of a textile undertaking 

PART A 

Post-take-over management period 

Category I.— 

(a) Loans advanced by a Bank. 

(b) Loans advanced by an institution other than a Bank. 

(c) Any other loan. 

(d) Any credit availed of for purpose of trade or manufacturing operations. 

Category II.— 

(a) Revenue, taxes, cesses, rates or any other dues to the Central Government or a State Government. 

(b) Any other dues. 

Category III.— 

PART B 

Pre-take-over management period 

Arrears in relation to provident fund, salaries and wages, and other amounts, due to an employee. 

Category IV.— 

Secured loans.  

Category V.— 

Revenues, taxes,  cesses,  rates  or  any  other  dues  to  the  Central  Government, a  State  Government, a 

local authority or a State Electricity Board. 

Category VI.— 

(a) Any credit availed of for purpose of trade or manufacturing operations. 

(b) Any other dues. 

17 

 
