Section 13 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986
Provident and other funds.
- (1)Where the Company has established a provident fund, superannuation, welfare or other fund for the benefit of the persons employed in a textile undertaking, the moneys relatable to the officers and other employees whose services have been transferred by or under this Act to the National Textile Corporation shall, out of the moneys standing, on the appointed day, to the credit of such provident fund, superannuation, welfare or other fund, stand transferred to and vest in, the National Textile Corporation.
- (2)The moneys which stand transferred under sub-section (1) to the National Textile Corporation, shall be dealt with by that Corporation in such manner as may, be prescribed.
Summary
- If the original Company created a provident fund, superannuation fund, or welfare fund for its workers, control of that money changes hands.
- The specific money belonging to the employees who are transferred to the new Corporation is moved over.
- This transfer of funds happens automatically on the appointed day.
- The transferred money vests entirely in the National Textile Corporation.
- The Corporation must manage and deal with these transferred funds according to specific rules that will be prescribed.
Practical examples
FAQ
1. What happens to the money we paid into the company provident fund?
The money standing to your credit in the provident fund is transferred to and vested in the National Textile Corporation on the appointed day.
2. Can the original Company keep our welfare fund?
No, any money relatable to the transferred employees in welfare or superannuation funds is legally moved to the new Corporation.
3. How will the new Corporation manage our retirement money?
The Corporation is required to deal with the transferred money in a manner that will be formally prescribed by the rules.
4. Does the Corporation get the entire fund even if it covers people who quit years ago?
The law says the transfer applies to the moneys relatable to the officers and other employees whose services have been transferred under the Act.
Test yourself
Q1.Under Section 13 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986, what specific restriction applies to the funds transferred to the National Textile Corporation?
Q2.Under Section 13 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986, which of the following combinations of funds are explicitly mentioned as being transferred?
Q3.Under Section 13 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986, how is the National Textile Corporation required to manage the funds once they are transferred?
Q4.Under Section 13 of The Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act, 1986, when exactly does the transfer of the provident and welfare funds legally take place?