Section 27 in The Railway Companies (Emergency Provisions) Act, 1951
27.
/1391Although all the major Railways in the country are now under government management a few narrow gauge light Railways are still being managed by private companies, Government have statutory control over these Railways in respect of fares and freight rates, and may enforce safety regulations under the Indian Railways Act, 1890; but they have no power to ensure that the day to day administration of the Railways by the companies is in the best interests of the public. Of late Government have been receiving complaints regardng mismanagement by some of these companies thereby causing a great deal of inconvenience to the normal life of the community. It became imperative, therefore, that Government should, in the public interest, take powers to intervene in cases where in the opinion of Government a situation has arisen in the affairs of a Railway Company which prejudicially affects the convenience of persons using the Railway or causes serious dislocation in any trade or industry using the Railway or causes serious unemployment among the persons employed on the Railway.An Ordinance entitled the Railway Companies (Emergency Provisions) Ordinance 1951, was accordingly promulgated on the 14th July 1951. The Ordinance was of a general nature and provided for the application thereof to a delinquent Railway Company by a notified order. The result of such a notification would be that Government is enabled to appoint a new board of directors for the Railway Company in supersession of the existing board of directors and any contract of management between the Railway Company and any managing agent would be automatically terminated. The intention underlying these provisions is that the company should he put hack into its normal position when it would he possible to restore the management of the company to its old board of directors or to a new hoard of directors appointed in pursuance of a resolution passed by the shareholders of the company. The Ordinance contains the usual provision for delegation of powers so that in suitable cases power could be delegated to the State Government to administer the affairs of a Railway company within its jurisdiction, the management of which has to be taken over by the Government.In the case of the Baraset Basirhat Light Railway Company which owns a narrow gauge line about 52 miles long in West Bengal, the Government of West Bengal caused an investigation to be made into the affairs of the company by a high level committee who found considerable evidence of serious mismanagement in the affairs of the company which culminated in a labour strike and consequent suspension of railway service from the 14th April, 1951. The Ordinance was therefore, made applicable to this Railway Company and powers in respect of this company have been delegated to the Government of West Bengal under the Ordinance.The present Bill seeks to replace the Ordinance and to validate all action taken thereunder". - Gazette of India, 1951, Pt. II Section 2, p. 616.[14th September, 1951]An Act to make provision for the proper management and administration of railway companies in certain special cases.
