Section 635B- The Companies Act,1956

The Companies Act, 1956

635B. Protection of employees during investigation by inspector or pendency or proceeding before Appellate Tribunal] in certain cases

1[Temporary protection of employees

1 Inserted by Act No. 32 of 1964.

635B. Protection of employees during investigation by inspector or pendency or proceeding before 1[Appellate Tribunal] in certain cases.

(1) If-

(a) during the course of any investigation of the affairs and other matters of or relating to a company, body or person under section 235, section 237 or section 239 or of the membership and other matters of or relating to a company, or the ownership of shares in or debentures of a company or body corporate, or the affairs and other matters of or relating to a company, body or person, under section 247, 2[***]; or

(b) during the pendency of any proceeding against any person concerned in the conduct and management of the affairs of a company under Chapter IVA of Part VI, such company, body or person proposes-

    (i) to discharge, or

    (ii) to punish, whether by dismissal, removal, reduction in rank or otherwise, any employee, the company, body or person, as the case may be, shall send by post to the 3[Tribunal] previous intimation in writing of the action proposed against the employee and if the 3[Tribunal] has any objection to the action proposed, it shall send by post notice thereof in writing to the company, body or person concerned.

    (2) If the company, body or person concerned does not receive within thirty days of the sending of the previous intimation of the action proposed against the employee, any notice of the objection from the 3[Tribunal], then and only then, the company, body or person concerned may proceed to take against the employee the action proposed.

    (3) If the company, body or person concerned is dissatisfied with the objection raised by the 3[Tribunal], it may, within thirty days of the receipt of the notice of the objection, prefer an appeal to the 1[Appellate Tribunal] in the prescribed manner and on payment of the prescribed fee.

    (4) The decision of the 1[Appellate Tribunal] on such appeal shall be final and be binding on the 3[Tribunal] and on the company, body or person concerned.

    (5) For the removal of doubt, it is hereby declared that the provisions of this section shall have effect without prejudice to the provisions of any other law for the time being in force.]

    1. Subs for “Court “, the words by the Companies (Second Amendment) Act, 2002, w.e.f. 13th January, 2003.

    2 The words and figures “section 248 or section 249” omitted by the Companies (Amendment) Act, 2000, w.e.f. 14th. December, 2000.

    3. Subs for “Company Law Board”, the words by the Companies (Second Amendment) Act, 2002, w.e.f. 13th January, 2003.

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