Swc Faces Legal Hurdles On Shifting Base

Liquor major Shaw Wallace & Co will have to take into account certain contentious issues before it can implement its plans of utilising the premises of Wallace House for better commercial returns after the shift of corporate office from Calcutta to Mumbai.

Union sources point out that the land on which the head office is located is Wakf property and since the company has some pending winding up petitions against it, it cannot alienate its tenancy with immediate effect.

Meanwhile, it is learnt that the board of Shaw Wallace and Co, had not passed any resolution for shifting the corporate office from the city to Mumbai as required by the provisions of the Companies Act, PTI reported.

 

The company had announced that its corporate office would be shifted to Mumbai. However, the registered office would continue to stay in Calcutta.

According to a noted company law expert, since this was a major decision involving the books of accounts of the company, it required the board's consent. Further, the reasons for shifting the office were also needed to be dealt with by the board.

A SWC spokesperson when contacted said since the company was not implementing such a proposal immediately, over a period of time these points will be taken into consideration and deliberated upon.

The announcement of shift of corporate office from Calcutta to Mumbai has not come as a surprise to the All India Shaw Wallace Employees' Federation, as the process had been set in motion around two years ago with the progressive shift of the liquor and finance divisions to Mumbai.

Although the AISWEF has not chalked out a plan of action against the management's move to convert the Calcutta office into a regional base, (most of its leaders are at New Delhi for the Company Law Board hearings), union sources feel that the Federation's representatives will not remain 'mute spectators' to the whole process. There are views that they might ask the state government to intervene in the matter.

Most of them seem a little perturbed about the voluntary retirement scheme which means downsizing the corporate office workforce by around 150 people, (majority of whom are white collar workers), who may not be having a suitable opening in the company's new distillery plant coming up at Dankuni.

They are also worried that although plans of setting up a brewery are on the anvil, it will take some time to get the licence from the state government, before which many workers will be eased out through the VRS.

"We are expecting that as few as 15 white collar workers will be absorbed in the brewery," said a union source.

The SWC spokesperson told Business Standard: "We will be relocating our Uttarpara unit to Dankuni and expanding it by 100 per cent to produce 14.4 lakh cases per year. This coupled with the fact that the brewery licence will come in any time now, provides ample opportunity for redeployment of the workforce."

Meanwhile the Company Law Board has not issued any order after four days of hearing between February 3 to February 6. Further hearings have been deferred to the first week of March.