It has been stated in the last chapter that the B.E.S.T. Company Limited purchased from the Bombay Tramways Company the right to run the road transport services in the city. However, it was not a direct transaction between the Bombay Tramways Company and the B.E.S.T. Company. On behalf of A, B bought some rights from C, and the rights finally came to D – D, in this case, being the B.E.S.T. Company quite a circuitous operation, wasn’t it?On 12th March 1901, the Municipality informed the Tramways Company that it was taking over the transport system under the agreement concluded between the Company and the Municipality on 12th March 1873. Simultaneously, by a contract, the civic body gave the Brush Electrical Company of London the sole right to run an electric tram service in the city as well as to supply electricity. The Tramways Company then filed a suit, its plea being that the Municipality had not given it a proper notice as required by the agreement between them. But the plea failed, although the matter went up in appeal to the Privy Council. Meanwhile, on 27th June, 1905, the Bombay Electric Supply and Tramways Company was established in London under the English Companies Act, and on 22nd July 1905, it was registered in Mumbai under the Indian Companies Act of 1882. The Bombay Tramways Company, the Bombay Municipality, the Brush Electrical Company and the B.E.S.T. Company signed an Agreement on 31st July 1905 by which the B.E.S.T. Company was granted the monopoly for electric supply and the running of an electric tram service in the city. The B.E.S.T. Company bought the assets of the Tramway Company for Rs.98,50,000. They included horse-drawn tram cars and horses, bullock-carts and bullocks, immovable property, tramway lines and goodwill. The deed of sale was executed in London on 1st August 1905, and the very next day the B.E.S.T. Company started functioning in Mumbai.
Some of the important items in the agreement signed by the Municipality and the B.E.S.T. Company, granting the latter the monopoly of road transport in the city, were as follows :
(1) All the existing tramway routes will be taken over by the Company.
(2) The Company will have the right to start new routes, with the prior approval of the Municipality and the permission of the government.
(3) If the Municipality desires that a new route should be started, and the Company is not prepared to lay the track, the Municipality will get it laid at its own expense, and it will be handed over to the Company for operation on mutually agreed conditions.
(4) The tram fare between any two points on the system will be one anna.
(5) The maximum charges for lighting will be six annas per unit.
(6) The Company will be required to provide transport for the Municipality, if necessary. The rates for it will be special. They will cover the cost of the electric energy consumed, the wear of the machinery, and the incidental expenditure on the transport, and no more, Transporting night soil will not however be included in this agreement.
(7) For the existing routes the ground rent will be rupees three thousand per mile for a double track, and rupees two thousand per mile for a single track. When new routes are started, the rent will be fifty per cent less.
(8) The Municipality will have the right to purchase the Company 42, 56 or 63 years after the date of the agreement. Notice of intention to purchase will have to be given at least six months in advance. If there is no mutual agreement on the price to be paid, the matter will be left to the decision of an arbitrator. If the Municipality exercises the right of purchase after 42 years, it will pay, as compensation to the Company, rupees forty lakhs, over and above the price; after 56 years the compensation will be twenty lakhs, and after 63 years nil.
THE B.E.S.T. BECOMES MUMBAI-BASED
The B.E.S.T. Company had been established in England under the Companies Act of that country. Its registered office was in London and its Board of Management met there. As a result, the Company had to pay income-tax to the British Exchequer on the profits it earned in India, and as it was registered in Mumbai it had to pay a similar tax in this country too. This double taxation hit the shareholders in India rather badly. The Directors of the Company in London, drawing the attention of the Chancellor of the Exchequer to this in 1909, pointed out the likelihood of the Indian shareholders insisting on shifting the Head Office of the Company to Mumbai. Nothing came of it. And, later the Indian shareholders did insist on the winding up of the B.E.S.T. Company in London. The First world War started about the same time. The rates of the British income tax went up sharply, as did those of the other taxes. This made the double taxation even more unbearable to the Indian shareholders. The Company’s Directors made another fervent plea to the Chancellor of the Exchequer stating that there would soon be no alternative to closing down its London Office. They further argued that the Company made all its purchases in England, thus contributing handsomely to the country’s Treasury. Nothing came of this plea too.
And the London Directors’ apprehensions proved to be right! The Indian shareholders met, with Sir David Sassoon in the Chair, and passed a resolution to the effect that the Board of Directors in London should be abolished and the affairs of the Company should in no way be managed from London.
The British shareholders, meeting in London, passed the following resolution :
(1) The direction, control and management of the company’s affairs will vest in the Mumbai Office, from 1st April 1916, and meetings of every kind of the General Body, the Board of Directors and the shareholders of the Company will be held in Mumbai.
(2) From 1st April 1916 the Board of Directors of the Company will be constituted by Sir David Sassoon, Sir Shapurji Bharucha, Sir Ibrahim Rahimtoola and Mr.G.S. Wardlaw. A Local Board will be set up in London to look after the Company’s legal affairs there.
REORGANIZATION OF THE B.E.S.T. COMPANY
As a result of handling the entire management of the Company from Mumbai the Board of Directors planned to convert the Company’s capital in pound sterling into its corresponding/value in rupees; but, under the Company Law, the only way of achieving it was by winding up the old Company in London and establishing a new one in Mumbai. As the B.E.S.T. Company was registered under the English Companies Act, the law required that the shareholders meet in London in order to wind it up. Thus they met in London on 9th June 1920, and passed a resolution to wind up its affairs. The shareholders in Mumbai met on 30th June 1920, and approved the resolution passed at the London meeting.
The newly established B.E.S.T. Company had a total capital of Rs.3 crore and 90 lakhs, divided into 6 lakh ordinary shares of 50 rupees each, and 1 lakh 80 thousand preference shares of the same value.
The new Company got the formal approval of the Municipality. During the next twenty-seven years it underwent no fundamental changes. It is just a story of expansion. The city kept growing, and the Company’s activities kept pace with it, as was inevitable. The growth of the Company in fact provided a fairly accurate measure of the growth of the city, so closely linked they used to be. So they are even today.
It was an all-round expansion. There were more and more people working in the Company’s head-office, and the need for a spacious enough building for them became more and more pressing. So the Company purchased a plot of land situated on the Ormiston Road, and next to the Electric House, for one lakh and forty-four-thousand rupees from the Municipality to whom it belonged. Soon a modern structure started coming up on the plot.
This office building had Messrs. F. Mekint as the architects and Gannon Dunkeley & Co. as the contractors. The building work was supervised by Shri G.G. Lazaras and Shri K.M. Khareghat, the Company’s engineers.
The new building, named BEST House, was very modern in more than its facade. It was so in a variety of items from the doors and windows to the minor fixtures, not to speak, of course, of the furniture. On the first floor was a spacious auditorium equipped for the screening of films. An upto date device was an electric indicator on the ground floor which repeated, from the name plates outside the chambers of the officers, the ‘engaged’ or ‘out’sign. Near the indicator was the inquiry clerk’s counter. Another special feature was that the entire office building was air-conditioned. it was the first office building in Mumbai with this convenience, and served as a model to many in the years that followed.
The building was ready for occupation in 1936. Into it moved all the departments accommodated in the Electric House till then. Such departments as Consumers’ Services, Cash, Shares, Provident Fund, Audit and Accounts, which had to deal with the public, were housed on the ground floor, and the office of the General Manager on the first floor. The Traffic Department was housed in Electric House. When the BEST House was inaugurated, it received warm praises from the newspapers and leading city architects as a handsome structure.
It was an American who first thought of setting up such a concern in Mumbai to provide electricity and transport. Messrs Sternes Hobart, an American Company, first applied for permission to set it up. That was in 1865. The permission was granted. But it proved to be unavailing, because the economic life of the city was badly upset following the end of the American Civil War. The application was renewed in 1872, but there were two more applicants this time : Messrs. Lawrence and Company, and the British and Foreign Tramway Company.
By 1905, the British seem to have become more alert and enterprising, for in that year a British concern bagged the twin monopoly of supplying electricity and transport to the city. Oddly enough, Mr.Remington, the Managing Director of the Bombay Tramways Company, the American concern, was British and he became the Managing Director of the B.E.S.T. Company.
The B.E.S.T. Company won repute as a model organisation. It served the city well, by efficiently supplying two very real needs of its people. But ‘service’ was no more than a means to it, the end being making profit. And profits were made using every legitimate way! Legally an Indian concern, the B.E.S.T. Company somehow always bore a British impress!. The ‘Sahib’ cast a long shadow on it, – this was understandable, considering those days. All the equipment the Company needed used to be imported from England; so were the technical experts! Even when, after the reorganization, the London Office was closed down, Mr. A.T. Cooper was appointed Agent to the Company in London, in 1924, to make purchases on its behalf. Mr.Cooper had been earlier Managing Engineer of the B.E.S.T. Company. On retirement he went to London, where the Agent’s job seemed to be the very thing for him! There was another assignment for him too as consulting Engineer to the Company! The emoluments were generous; and, of course, there were the other benefits like gratuity and provident fund. Finally on 1st January 1945, Mr.Cooper retired from these posts. But by then, the times had changed. A new era was round the corner. May be because of this, or perhaps because it was more convenient, the London agency of the Company was entrusted to the London Office of an Indian concern, the Tata Company.
The Company had “Sahibs’ raj” till 7th August 1947, and that not merely in its administration. Even the social and festive occasions showed it. The New Year was ushered in with a ball dance in a big way, and a large number of Indian officers joined it, several of them with dutiful zest! Nowadays the Dassera is celebrated in the Head Office with lovely rangoli patterns decorating the floor. Times have changed indeed! One ‘Peel Sahib’ was the lord in the Kingsway Depot area. The Officers’ Quarters now house twelve or thirteen families. In those days, just three officers used to occupy all the space between themselves, each one being allotted about three thousand square feet of area! Even their poultry enjoyed spacious accommodation, right next to the masters’ flats. To enable Peel Sahib to reach the Workshop directly from his residence, a special staircase was put up.
This is not intended to cavil at it all, but to bring you the flavour of those spacious times. We must not forget that these ‘Sahibs’ did not just enjoy the good things of life, they also put in hard work. And in work, they laid down valuable traditions, and they gave the organization a strong foundation.
In course of time, the Board of Directors of the Company had a majority of Indians on it. But they did not meddle with the structure of the Company or with its norms of working.
It would seem that, on the whole, the ‘Sahibs’ had little faith in the efficiency of the ‘natives’. A glance at a list of the Company’s employees in those days will make it clear that a ‘native’ occupying a responsible position was an exception. In the workshops, even such relatively lower posts as foreman or assistant foreman were virtually reserved for whites. In fact, outside the administrative section, all the important posts were occupied by ‘Sahibs’.
The B.E.S.T. Company came into existence on 7th August 1905; it was dissolved on 6th August 1947, to make room for the B.E.S.T. Undertaking. Once before there had been a similar taking over when the Bombay Tramways Company ceased to exist. But this take-over was not quite ‘similar’. Now the ownership of the concern came to the Municipal Corporation. This was a week before the country became free. it was therefore a significant event in several ways. The B.E.S.T. Undertaking was the first ‘public’ enterprise in the country. To run it successfully was a national duty.