The Andhra Pradesh Public Sector Undertakings (Reconstruction of Management) Act, 1996

Short title extent and commencement:

1. (1) This Act may be called the Andhra Pradesh Public Sector Undertakings (Reconstruction of Management) Act, 1996.
2. (2) It extends to the whole of the State of Andhra Pradesh.
3. (3) It shall be deemed to have come into force on the 26th December, 1995.

Definitions: In this Act, unless the context otherwise requires,—

1. (a) "Appointed day" means the date on which the management of a Public Sector Undertaking is taken over by the Government under section 3;
2. (b) "Government" means the State Government of Andhra Pradesh;
3. (c) "Public Sector Undertaking" means any company as defined in the Companies Act, 1956, in which not less than fifty-one percent of the paid-up share capital is held by the State Government, and includes a Corporation or any other body owned or controlled by the State Government, but does not include a Co-operative Society registered under the Andhra Pradesh Co-operative Societies Act, 1964.

Reconstruction of Management:

1. (1) Notwithstanding anything contained in the Memorandum and Articles of Association of a Public Sector Undertaking, the Government may, by order, for the purpose of reconstruction of the management of the Public Sector Undertaking, reconstitute the Board of Directors of such Public Sector Undertaking: Provided that the Board of Directors so reconstituted shall be in accordance with the provisions of this Act.
2. (2) On the issue of an order under sub-section (1), all the existing directors of the Public Sector Undertaking shall stand removed from their office.
3. (3) The Government shall appoint new directors in place of the directors removed under sub-section (2).
4. (4) The new directors appointed under sub-section
5. (3) shall hold office during the pleasure of the Government.

Power to remove directors etc:

1. (1) Notwithstanding anything contained in the Memorandum and Articles of Association of a Public Sector Undertaking, the Government may, for reasons to be recorded in writing, remove any director, including the Chairman, managing director or any other whole-time director of a Public Sector Undertaking, if the Government is of the opinion that such director—
   • (a) has acted in a manner prejudicial to the interests of the Public Sector Undertaking or the Government; or
   • (b) has failed to discharge his duties efficiently; or
   • (c) is otherwise disqualified to continue as such director.
2. (2) Any director removed under sub-section
3. (1) shall not be entitled to any compensation or damages for such removal.

Power to appoint directors.—

1. (1) Notwithstanding anything contained in the Articles of Association or Memorandum of Association of any Public Sector Undertaking, the Government may, for the purpose of reconstruction of management, appoint such number of directors as they think fit on the Board of Directors of such Public Sector Undertaking.
2. (2) The directors so appointed shall hold office during the pleasure of the Government.

Power of the Government to issue directions.—

1. (1) The Government may, in the public interest, issue such directions as they may think fit to any Public Sector Undertaking in respect of its functioning and the Board of Directors of such Public Sector Undertaking shall comply with such directions.
2. (2) Without prejudice to the generality of the foregoing power, such directions may include directions,—
   • (a) to manage the affairs of the Public Sector Undertaking in such manner as may be specified in the directions;
   • (b) to adopt such measures as may be necessary for the reconstruction of the management of such Public Sector Undertaking;
   • (c) to incur such expenditure as may be necessary for the purpose of the said reconstruction.

Inquiries

1. (1) The Government may, at any time, direct the Commissioner or any other officer not below the rank of a Deputy Secretary to Government or any other person or agency as authorized by the Government to conduct an inquiry into any matter relating to the performance, functioning, management or financial affairs of a Public Sector Undertaking.
2. (2) The officer or person authorized under sub-section
3. (1) shall have the same powers as are vested in a Civil Court under the Code of Civil Procedure, 1908, while trying a suit in respect of the following matters, namely:—
   • (a) the summoning and enforcing the attendance of any person and examining him on oath;
   • (b) the discovery and production of documents;
   • (c) receiving evidence on affidavits;
   • (d) any other matter which may be prescribed.
4. (3) The officer or person conducting the inquiry shall submit a report to the Government within such time as may be specified by the Government.

Protection of action taken in good faith No suit, prosecution or other legal proceedings shall lie against the Government, the Commissioner, the Special Officer or any officer, or person acting under the direction of the Government or the Commissioner for anything which is in good faith done or intended to be done in pursuance of this Act or any rule or order made thereunder.

Power to make rules.-

1. (1) The Government may, by notification, make rules to carry out all or any of the purposes of this Act.
2. (2) Every rule made under this Act shall, immediately after it is made, be laid before the Legislative Assembly of the State if it is in session and if it is not in session, in the session immediately following for a total period of fourteen days which may be comprised in one session or in two successive sessions, and if, before the expiration of the session in which it is so laid or the session immediately following the Legislative Assembly agrees in making any modification in the rule or in the annulment of the rule, the rule shall from the date of notification of such modification or annulment have effect only in such modified form or shall stand annulled 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.

Power to remove difficulties.- If any difficulty arises in giving effect to the provisions of this Act, the Government may, by order published in the Andhra Pradesh Gazette, make such provisions not inconsistent with the provisions of this Act as appear to them to be necessary or expedient for removing the difficulty: Provided that no such order shall be made after the expiry of two years from the commencement of this Act.