The Richardson and Cruddas Limited (Acquisition and Transfer of Undertaking) Act, 1972
📘 Detailed Explanation
The Richardson and Cruddas Limited (Acquisition and Transfer of Undertaking) Act, 1972 was enacted by the Indian Parliament to take over and transfer the ownership of Richardson and Cruddas Ltd. (a major engineering company) to the Government of India.
Background
Richardson and Cruddas Ltd. was a well-known engineering company in India, engaged in manufacturing heavy steel structures, engineering equipment, and industrial products.
Due to financial mismanagement, corruption, and operational losses, the company faced a crisis.
To protect the public interest, safeguard employment of workers, and ensure industrial production, the Government decided to acquire its undertakings.
Objectives of the Act
To acquire and transfer the undertakings of Richardson and Cruddas Ltd. to the Central Government.
To ensure continuity of production and safeguard jobs.
To manage and reorganize the company efficiently under government control.
To prevent the misuse of company assets and revive the industrial operations.
Key Provisions
Transfer of Ownership: All assets, properties, and undertakings of Richardson and Cruddas Ltd. were transferred to and vested in the Central Government.
Management: The management and control of the company were given to a government-appointed authority.
Compensation: Provisions for payment of compensation to shareholders of the company.
Employees: Safeguards were provided to protect employment, with continuity of service ensured.
Powers of Government: The Central Government was empowered to manage, reorganize, or restructure the undertaking.
Importance
It was a part of India’s wider policy in the 1970s of nationalizing and reviving sick industries.
Protected thousands of jobs and maintained industrial output in the engineering sector.
📊 Summary Table
| Aspect | Details |
|---|---|
| Name of Act | The Richardson and Cruddas Limited (Acquisition and Transfer of Undertaking) Act, 1972 |
| Year Enacted | 1972 |
| Purpose | To acquire and transfer Richardson and Cruddas Ltd. to the Government of India |
| Reason | Financial mismanagement, losses, and protection of public interest |
| Ownership Transfer | Assets and undertakings vested in the Central Government |
| Management | Controlled by Government-appointed authority |
| Compensation | Shareholders to be compensated as per provisions |
| Employees | Service continuity and job protection ensured |
| Significance | Safeguarded employment, revived industrial production, aligned with nationalization policy of 1970s |
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