Section 26
Contracts to cease to have effect unless ratified by National Textile Corporation.
The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986
About this Act
An Act to provide for the acquisition and transfer of certain textile undertakings of the Swadeshi Cotton Mills Company Limited, 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 different varieties of cloth and yarn and thereby to give effect to the policy of the State towards securing the principles specified in clauses (b) and (c) of article 39 of the Constitution and for matters connected therewith or incidental thereto.
Every
contract, entered into by the Company in relation to any textile undertaking which has vested in the
National Textile Corporation under sub-section (2) of 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 date on which the Ordinance 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--
(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 textile undertaking concerned, 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.
Provided that the National Textile 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 textile undertaking concerned, 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.