The Oriental Gas Company Act, 1960

GOVERNMENT OF WEST BENGAL 

LAW DEPARTMENT 

West 
Ben. Act 
XXXDI 
o61951. 

Legislative 

West Bengal Act XV of 1960 
THE ORIENTAL GAS COMPANY ACT, 1960. 

[Passed by the West Bengal Legislature.] 
[Assent of the President was first published in the Calcutta Gazette, 

Extraordivary, of the 1st October, 1960.] 
[1st October, 1960.] 

An Act to provide for the taking over for a limited period 
of the management and control, and the subsequent 
acquisition, of the undertaking of the Oriental Gas 
Company Limited. 

WHEREAS it is expedient to provide for increasing the 
production of gas and improving the quality thereof for 
supply to industrial undertakings, hospitals and other welfare 
institutions, to local authorities for street lighting and to the 
public in general for domestic consumption and for that pur-
pose to provide for the taking over for a limited period of the 
management and control, and the subsequent acquisition, of 
the undertaking of the Oriental Gas Company Limited and 
for certain other matters incidental and ancillary thereto; 

It is hereby enacted in the Eleventh Year of the Republic 
of India, by the Legislature of West Bengal, as follows :- 

1. (1) This Act may be called the Oriental Gas.Company Short 
Act, 1960. 	 title and 

(2) It shall come into force on such date as the State commence-
Government may, by notification in the Official Gazette, 
appoint. 

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

(1) "Calcutta" means the area described in Schedule I 
to the Calcutta Municipal Act, 1951, as amended 
by notification under section 594 of that Act 
together with such other area or areas as may, 
from time to time, be specified by the State 
Government by notification in the Official Gazette; 

(2) "Company" means the-  Oriental Gas Company 
Limited referred to in Act V of 1857; 

(3) "undertaking of the Company" means the properties 
of the Company, movable or immovable, other 
than cash balances and reserve funds but including 

Price—Indian, 12 nP.; English, 3d. 



2 	 The Oriental Gas Company Act, 1960. 

[West Ben. Act 

(Sections 3, 4.) 

works, workshops, plants, machineries, posts; 
pipes, pipe-lines, appliances, apparatus, acces-
sories, Surniture, equipments and stores, and lands 
appertaining thereto, actually in use immediately 
before the commencement of this Act, or intended 
to be used, in connection with the production of 
gas or supply thereof in Calcuttta and its 
environs; 

(4) "year" means a financial year. 

3. The State Government may, by notification in. the 
Official Gazette (a copy of which shall be served on the 
Company), take over for a period of five years with effect 
from such date as may be specified in the notification (here-
inafter referred to as the appointed day), not being earlier 
than seven days from the date of publication of the notifica-
tion in the Official Gazette, the management and control of 
the undertaking of the Company for the purposes, and in 
accordance with the provisions, of this Act. 

4. With effect from the appointed day and for a period 
of five years thereafter— 

(a) the undertaking of the Company shall stand trans-
ferred to the State Government for the purpose 
of management and control; 

the Company and its agents, including managing 
agents, if any, and servants shall cease to exercise 
management or control in relation to the under-
taking of the Company; 

(0 all contracts, excluding any contract or contracts in 
respect of agency or managing agency, subsisting 
immediately before the appointed day and affect-
ing the undertaking of the Company shall cease to 
have effect or to be enforceable against the Com-
pany, its agents or any person who was a surety 
thereto or had guaranteed the performance thereof 
and shall be of as full force and effect against or in 
favour of the State of West Bengal and shall be 
enforceable as fully and effectively as if instead 
of the Company the State of West Bengal had been 
named therein or had been a party thereto : 

Provided that— 

(i) except where the State Government by notification 
in the Official Gazette otherwise directs, the 
provisions of this clause shall not apply to any 
contract which was executed after the 1st day of 
January, 1958; 

(ii) any transfer by way of sale, exchange, gift, mort-
gage, lease or otherwise, affecting the under-
taking of the Company or any part thereof, 
made between the date of commencement of 

Taking 
over of 
the 
manage-
ment and 
control of 
the under. 
taking 
of the 
Company. 

Transfer. 

lb) 



Th, Oriental Gas Corrupany Act, 1960. 	3 

XV of 1960.] 

(Section 5.) 

this Act and the appointed day shall have 
no effect whatsoever and shall stand cancelled, 
so, however, that such cancellation shall not 
affect any rights which the transferor and the 
transferee may otherwise have against each 
other; 

(d) subject to the provisions of clause (c), any proceeding 
pending or any cause of action existing before the 
appointed day in relation to the undertaking of 
the Company may be continued or enforced by or 
against the State of West Bengal and shall cease 
to be continued or enforced by or against the 
Company, its agents, sureties or guarantors; 

(e) persons employed by the Company in. connection with 
the undertaking of the Company and continuing 
in. office immediately before the appointed day 
shall be employed by the State Government on 
such terms and conditions, not being less advan-
tageous than what they were entitled to imme-
diately before the appointed day, as may be deter-
mined by the State Government: 

Providedthat the State Government may, if it considers 
any such person to be unsuitable, discharge him, 
so, however, that, in the case of any such person 
who has been in continuous service under the 
Company for not less than one year immediately 
before the appointed day, the provisions of section 

14 of 	 25FF of the Industrial Disputes Act, 1947, shall 
1947. 	 be applicable, that is to say, such discharge shall 

not take effect until the State Government has— 
(i) given him notice or paid him wages in 

lieu of notice, as provided in clause 
(a), and 

(ii) paid him compensation as provided in 
clause (b), 

of section 25F of the said Adt. 

5. (1) On the transfer of the undertaking of the Company 
to the State Government, for the purpose of management and 
control, under clause (a) of section 4, every person including 
a transferee referred to in the proviso to clause (c) of section 
4, in whose possession, custody or control the undertaking of 
the Company or any part thereof may be, shall forthwith 
deliver possession of the undertaking of the Company or part 
thereof, as the case may be, to the State Government. 

(2) If any person refuses or fails to comply with the 
provisions of sub-section (1), an officer authorised by the 
State Government in this behalf, shall,— 

(a) if he is a Magistrate, enforce the delivery to the 
State Government of possession of the undertaking 

Delivery 
of posses. 
sion of 
under-
taking of 
the 
Company 
to the 
State 
Govern-
ment 
and 
penalty. 



4 	The Oriental Gas Company Act, 1960. 

[West Ben. Act 

Running 
.and use of 
the under-
taking 
of the 
Company. 

Acquisi-
tion 
of the 
under-
taking 
of the 
Company 
and trans-
fer of its 
manage-
ment and 
control to 
the Com-
pany in 
case of 
non-acqui-
sition. 

(Sections 6, 7.1  

of the Company or any part thereof, in respect 
of which such refusal has been made or failure 
has been committed, or 

(b) if he is not a Magistrate, apply to a Magistrate or, 
within the town of Calcutta, as defined in section 
3 of the Calcutta Police Act; 1866, to the 
Commissioner of Police, and such Magistrate or 
Commissioner, as the case may be, shall enforce 
the delivery to the State Government of possession 
of the undertaking of the Company or part 
thereof, as the case may be. 

(3) Whoever refuses or wilfully obstructs the delivery to 
the State Government of possession of the undertaking of the 
Company transferred to the State Government, for the pur-
pose of management and control, under clause (a) of section 
4, or any part thereof, shall, on conviction before a Magis-
trate, be punishable, without prejudice to any other penalty 
to which he may be liable under any other law for the time 
being in force, with fine which may extend to one thousand 
rupees. 

6. (1) The undertaking of the Company shall be run by 
the State Government and shall be used and utilised by the 
State Government for purposes of production of o‘as and 
supply thereof to industrial undertakings, hospitals' 	and 
other welfare institutions, to local authorities for street 
lighting and for other purposes, if any, and to the public in 
general for domestic consumption, and for this purpose the 
State Government shall have all the powers of the Company 
under Act V of 1857. 

(2) The State Government may for effectively carrying 
out the purposes of this Act add, at its own cost, to the under-
taking of the Company such new works, workshops, plants, 
machineries, posts, pipes, pipe-lines, appliances, apparatus, 
accessories, furniture, equipments, stores, lands, buildings, 
erections or fixtures as it may consider necessary. 

7. (1) The State Government may, if it so thinks fit, at 
i.a.ny time within the period of five years referred to in section 
4, acquire the undertaking of the Company by notification pub-
lished in the Ojficia4 Gazette for the purposes of this Act. 

(2) On the publication of the notification under sub-
section (1), the undertaking of the Company shall, on and 
from the beginning of the clay on which the notification is so 
published, vest absolutely in the State Government free from 
all iiacumbrances. 

(3) If the undertakino,  of the Company be not acquired 
by the State Government in accordance with the provisions 
of sub-section (1), the State Government shall, on the expiry 
of the period of five years referred to in section 4, by order 

Ben. Act 
IV of 
1866. 



The Oriental Gas Company Act, 1960. 	5 

XV el 1960.1 

(Section 8.) 

made in this behalf, transfer the management and control 
of the undertaking to the Company after removing or dis-
posing of such additions to the undertaking as may have 
been made by the State Government at its own cost in 
accordance with the provisions of sub-section (2) of section 6, 
unless the Company agrees to pay the amount being the cost 
of such additions less such depreciation as may be,, agreed 
upon or, in the absence of agreement, determined by a 
Tribunal appointed for the purpose. The amount so agreed 
upon or determined shall be paid by the Company to the 
State Government within such time as may be agreed upon 
or allowed by the Tribunal and until such payment, the 
amount shall be a charge on the undertaking of the Company. 

8. (1) In respect of the taking over of the management 
and control, under section 3, or acquisition under section 7, 
of the undertaking of the Company, there shall be paid by the 
State Government to the Company compensation to be deter-
mined under sub-section (2), as follows, that is to say,— 

(a) in the case of the taking over of the management and 
control of the undertaking of the Company, the 
annual compensation payable shall be a sum calcu-
lated at two per centum of the sum representing 
the purchase price of the undertaking of the 
Company reduced by such depreciation as Pay 
be allowed by the Tribunal referred to in sub-
section (2) after considering the period and the 
nature of the use and the present condition of the 
properties concerned on the appointed day; 

(b) in the case of acquisition of the undertaking of the 
Company, the total compensation payable shall 
be,— 

a sum representing the purchase price of the 
undertaking of the Company reduced by such 
depreciation as may be allowed by the Tribunal 
referred to in sub-section (2) after considering 
the period and the nature of the use and the 
present condition of the properties concerned on 
the date of vesting in the State Government 
under section 7, 

or 

a sum representing eight times the average net 
income of the undertaking of the Company over 
a period of five complet years preceding the 
year in which the undertaking of the Company 
has been transferred to the State Government 
under clause (a) of section 4 for the purpose of 
management and control, 

whichever is less. 

Compen-
sation. 



6 	 The Oriental Gas Company Act, 1960 

[West Ben. Act 

(Section S.) 

Explanation.—In this.  sub-section— 

(i) "purchase price of the undertaking of the Com-
pany" means the aggregate of the prices of 
the different parts of the undertaking of the 
Company at the respective dates en which such 
parts were purchased, acquired or constructed 
by the Company; 

(ii) "net income of the undertaking of the Company" 
means the difference between the amount of 
gross revenue receipts and other general receipts 
accountable in the assessment of Indian income-
tax arising from, and ancillary or incidental to, 
the business of the Company and the amount of 
expenditure incurred on the following— 

(a) rents, rates and taxes, 

(b) interest on loans and security deposits, 

(c) maintenance and repair, 

(d) collection charges, 

cost of management, including the remuneration 
of managing agents, if any, 

other expenses admissible under the law for the 
time being in force in the assessment of Indian 
income-tax and arising.  from, and ancillary 
or incidental to, the business of the Company, 
and 

(g) such other expenses as may be prescribed by rules 
made under this Act. 

(2) The compensation payable in respect of the taking 
over under section 3 of the management and control, or in res-
pect of the acquisition under sub-section (1) of section 7, 
of the undertaking of the Company or the amount payable 
by the Company under sub-section (3) of section 7 for the 
additions made by the State Government at its own cost to 
the undertaking of the Company shall be determined by a 
Tribunal which shall be appointed by the State Government 
consisting of a person who is or has been a Judge of a High 
Court, or a District Judge or an Additional District Judge 
and such Tribunal shall make an award in respect of the 
compensation so determined. 

(3) The State Government may appoint one or more persons 
possessing knowledge of any matter relating to the inquiry 
to assist the Tribunal in determining the compensation. 

(e) 

(I) 



The Oriental Gas Company Act, 1960. 

XV of 1960.] 

(Sections 9, 10.) 

(4) The Tribunal shall have the powers of a civil 
Act v 	court while trying suits under the Code of Civil Procedure, 
of 1908. 	1908, in respect of the following matters :— 

(a) summoning and enforcing the attendance of any 
person and examining him on oath, 

(b) requiring the discovery and production of documents, 
(c) receiving evidence on affidavits, and 
(d) issuing commissions for the examination of 

witnesses or documents. 

(5) Any party aggrieved by the award of the Tribunal 
made under sub-section (2) may appeal to the High Court 
within thirty days from the date of such award. 

9. (1) In the case of the taking over of the management 
and control of the undertaking of the Company, the State 
Government shall pay to the Company the amount of the 
compensation determined under section 8 in cash— 

(a) in respect of the period prior to the date of the 
award, within sixty days from the date of the 
award made by the Tribunal, or, as the case may 
be, from the date of the order of the High Court 
in the case of an appeal, and 

(b) thereafter, annually on the close of the year in 
respect of which the compensation is payable. 

(2) In the case of acquisition of the undertaking of the 
Company, as soon as possible after the date of the award 
made by the Tribunal, or, as the case may be, the date or 
the order of the High Court in the case of an appeal, the 
State Government shall pay to the Company the amount 
of compensation determined under section 8 in bonds 
carrying interest at the rate of three per centum per annum 
with effect from the date of issue and payable in twenty 
equal annual instalments : 

Provided that the State Government may at any time 
or from time to time pay one or more instalments, even 
before such payment is due, with interest up to the date of 
payment after giving notice in the Official Gazette of its 
intention to do so : 

Provided further that interest on such instalment or 
instalments shall cease on the expiry of the date of payment 
if payment of such instalment or instalments be not taken 
in pursuance of the notice referred to above. 

Bfaimer of 
payment 
of com-
pensation. 

10. (1) The State Government may make rules for carry- Power to 
make rules. ing out the purposes of this Act. 



8 	The Oriental Gas Company Act, 1960. 

[West Ben. Act XV of 1960.] 

(Section 11.) 

(2) In particular, and 
-generality of the foregoing 
provide for any or all of the 

(a) the manner of service 
under section 3 on 

without prejudice to the 
provision, such rules may 

following matters, namely :— 
of the copy of the notification 
the Company, 

Removal 
of diffi-
culties. 

(b) the procedure to be followed by the Tribunal in 
determining the amount of compensation under 
section 8, 

(c) the determination of expenses referred to in item (g) 
of paragraph (ii) of the Explanation to sub-
section (1) of section 8. 

11. If any difficulty arises in giving effect to the provi-
sions of this Act, the State Government may take such steps 
or issue such orders not inconsistent with this Act as it may 
consider necessary for removing the difficulty. 

WBGP-6011-547A-5M 


	Page 1
	Page 2
	Page 3
	Page 4
	Page 5
	Page 6
	Page 7
	Page 8