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KHADI AND VILLAGE INDUSTRIES COMMISSION ACT

Ministry of Law and Justice

Act nº 61 of 1956


  • Chapter I
  • Chapter II
  • Chapter III
  • Chapter IV
  • Chapter V
  • Schedules
  • Act nº 61 of 1956

Preamble

THE KHADI AND VILLAGE INDUSTRIES COMMISSION ACT, 1956

[Act, No. 61 of 1956]

[25th September, 1956]

PREAMBLE

An Act to provide for the establishment of a Commission for the development of Khadi and Village Industries and for matters connected therewith.

BE it enacted by Parliament in the Seventh Year of the Republic of India as follows:--

Chapter I

Section 1. Short title and extent

(1) This Act may be called The Khadi and Village Industries Commission Act, 1956.

(2) It extends to the whole of India except the State of Jammu and Kashmir.

Section 2. Definitions

In this Act, unless the context otherwise requires,--

(a) "the Board" means the Board constituted under1[section 10];

(b) "chairman" means the chairman of the Commission;

(c) "Commission" means the Khadi and Village Industries Commission established under section 4;

1[(cc) "fixed capital investment" includes investment in plant and machinery and land and building of an industry;]

(d) "khadi" means any cloth woven on handlooms in India from cotton, silk or woollen yarn handspun in India or from a mixture of any two or all of such yarns;

(e) "member" means a member of the Commission2[and includes the chairman3[* * * *];

(f) "prescribed" means prescribed by rules made under this Act;

4[(ff) "rural area" means the area comprised in any village, and includes the area comprised in any town, the population of which does not exceed6[twenty thousand] or such other figure as the Central Government may specify from time to time;]

3[(g) xxx]

3[(gg) xxx]

5[(h) "village industry" means,--

(i) any industry located in a rural area which produces any goods or renders any service with or without the use of power and in which the fixed capital investment per head of an artisan or a worker does not exceed7[one lakh rupees] or such other sum as may, by notification in the Official Gazette, be specified from time to time by the Central Government;

Provided that any industry specified in the schedule and located in an area other than a rural areea and recognised as a village industry at any time before the commencement of the Khadi and Village Industries Commission (Amendment) Act, 1987 shall, notwithstanding anything contained in this sub-clause, continue to be a village industry under this Act;

8[Provided further that in the case of any industry located in a hilly area, the provisions of this sub-clause shall have effect as if for the words "one lakh rupees", the words "one lakh and fifty thousand rupees" had been substituted.].

(ii) any other non-manufacturing unit established for the sole purpose of promoting, maintaining, assisting, servicing (including mother units) or managing any village industry;]

1. Substituted for the words "section 9" by the Repealing and Amending Act, 1957 (36 of 1957), Section 3, second Sch.

2. Substituted for "and includes chairman" by Act 32 of 1961, section 2 (28-8-1961).

3. Words "and the Vice-chairman" and clauses (g) and (gg) omitted, by Khadi and Village Industries Commission (Amdt.) Act (12 of 1987), Section 2 (24-7-87).

4. Inserted by Khadi and Village Industries Commission (Amdt.) Act (12 of 1987), Section 2 (24-7-87).

5. Substituted, by Khadi and Village Industries Commission (Amdt.) Act (12 of 1987), Section 2 (24-7-87).

6. Substituted for the words " ten thousand " by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006 ).

7. Substituted for the words " fifteen thousand rupees " by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).

8. Inserted by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).


Section 3. Power to add to the Schedule

[Omitted by Khadi and Village Industries Commission (Amendment) Act (12 of 1987), Section 3 (24-7-87).

Chapter II

Section 4. Establishment and constitution of the Commission

(1) With effect from such date as the Central Government may, by notification in the Official Gazette, fix in this behalf, there shall be established a Commission to be called the Khadi and Village Industries Commission which shall be a body corporate having perpetual succession and a common seal, with power to acquire, hold and dispose of property and to contract, and may by the said name sue and be sued.

2 [(1A) Save as otherwise provided under this Act and the rules made thereunder, the exercise of all powers and discharge of all functions under this Act, including general superintendence, direction and management of day-to-day affairs of the Commission, shall vest in the Commission.];

1 [(2) The Commission shall consist of the following members appointed by the Central Government, namely:-

(a) six non-official members 3 [having specialised knowledge and not less than ten years of experience of khadi or village industries] and representing such six geographical zones of the country, as may be prescribed;

4 [(b) four non-official members of whom each member shall be from the following disciplines, namely:---

(i) one member having expert knowledge and experience in Science and Technology;

(ii) one member having expert knowledge and experience in Marketing;

(iii) one member having expert knowledge and experience in Rural Development; and

(iv) one member having expert knowledge and experience in Technical Education and Training]

2 [(ba) the Chairman of the State Bank of India constituted under sub-section (1) of section 3 of the State Bank of India Act, 1955(23 of 1955) or an officer not below the rank of the Deputy Managing Director as may be nominated by the Chairman of the State Bank of India--ex-officio;];

5 [(c) a Chief Executive Officer, ex-officio; and

(d) a Financial Adviser, who shall also be the Chief Accounts Officer of the Commission, ex-officio.]

6 [***]

(3) The Central Government may appoint one of the members appointed under clause (a) of sub-section (2) to be the chairman who shall be a full-time member.]

1. Substituted by Khadi and Village Industries Commission (Amdt.) Act (12 of 1987), Section 4 (24-7-87).

2. Inserted by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).

3. Substituted for the words "having specialised knowledge and experience of khadi and village industries" by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).

4. Clause (b) substituted by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).

5. Clause (c & d) substituted by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).

6. Proviso omitted by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).


Section 5. Powers and functions of the Chief Executive Officer

1 [5. Powers and functions of the Chief Executive Officer

2 [(1) Subject to the provisions contained in sub-section (1A) of section 4, the Chief Executive Officer, appointed under clause (c) of sub-section (2) of section 4, shall exercise such powers and discharge such functions in respect of general superintendence over the affairs of the Commission and its day-to-day management, as may be prescribed.

(1A) Without prejudice to the powers and functions referred to in subsection (1), the Chief Executive Officer shall exercise such powers and discharge such functions under the general superintendence, direction and management of the Commission.].

(2) The Chief Executive Officer 3 [shall, in addition to exercise of the powers and discharge of the functions referred to in sub-section (1), be responsible] for the furnishing of all returns, reports and statements required to be furnished to the Central Government under Section 24.

(3) It shall be the duty of the Chief Executive Officer to place before the Commission for its consideration and decision any matter of financial import if the Financial Adviser suggests to him in writing that such matter be placed before the Commission.

1. Substituted for Sections 5 and 6 by Khadi and Village Industries Commission (Amdt.) Act (12 of 1987), Section 5 (24-7-87).

2. Substituted by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).

3. Substituted for the words "shall be responsible" by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006)


Section 5A. Powers and functions of the Financial Adviser

The Financial Adviser1[appointed under clause (d) of sub-section (2) of section 4 shall be in charge of such financial matters of the Commission including its budget, accounts and audit, as may be prescribed] and it shall be the duty of the Financial Adviser to bring to the notice of the Commission through the Chief Executive Officer any matter of financial import, which, in his opinion, requires consideration and decision by the Commission.

1.Substituted by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).


Section 6. Disqualifications for membership of the Commission

A person shall be disqualified for being appointed as, and for being, a member of the Commission--

(a) if he is, or is found to be a lunatic or a person of unsound mind; or

(b) if he has been adjudged insolvent; or

(c) if he has been convicted of an offence involving moral turpitude; or

(d) if he has any financial interest in any subsisting contract made with or in any work being done by the Commission, except as a shareholder (other than a Director), in a company as defined in section 3 of the Companies Act, 1956:

Provided that where he is a shareholder, he shall disclose to the Central Government, the nature and extent of shares held by him in such a company; or

(e) if he has any financial interest in any business undertaking dealing with or any other village industry specified or deemed to be specified in the Schedule to the Act.

Section 6A. Removal of Chairman, Member, etc., from the Commission

The Central Government may, by notification in the Official Gazette, remove from office any member of the Commission who--

(a) is or becomes subject to any of the disqualifications mentioned in section 6; or

(b) in the opinion of the Central Government has failed or is unable to carry out his duties; or

(c) absents himself from three consecutive meetings of the Commission without the leave of the Commission:

Provided that before issuing any such notification, the Central Government shall give an opportunity to the member concerned to show cause against such removal.]

Section 7. Resignation of office by member

Any member may resign his office by giving notice in writing to the Central Government and, on such resignation being notified in the Official Gazette by that Government, shall be deemed to have vacated his office.

Section 8. Vacancies, etc., not to invalidate acts and proceedings of the Commission

No act or proceeding of the Commission shall be invalid by reason only of the existence of any vacancy amongst its members or any defect in the constitution thereof.

Section 9. Temporary association of persons with the Commission for particular purposes

(1) The Commission may associate with itself in such manner and for such purposes as may be determined by regulations made under this Act any persons whose assistance or advice it may desire in complying with any of the provisions of this Act.

(2) A person associated with it by the Commission under sub-section (1) for any purpose shall have the right to take part in the discussions of the Commission relevant to that purpose, but shall not have the right to vote, and shall not be a member for any other purpose.

(3) The Central Government may, by notification in the Official Gazette, depute one or more officers of the Government to attend any meetings of the Commission and to take part in the discussions of the Commission, but such officer or officers shall not have the right to vote.

Section 10. Constitution of the Board

1[(1) For the purpose of assisting the Commission in the discharge of its functions under this Act, the Central Government may, by notification in the Official Gazette, consisting of a chairman and such number of other members as the Central Government may think fit, chosen from among persons who, in the opinion of the Central Government, are qualified as having had experience, and shown capacity, in matters relating to the development of2[National Khadi and Village Industries Board].];

3[(2) The Board shall, subject to the provisions of sub-section (3), meet at such times and places and observe such rules of procedure in regard to the transaction of business at its meetings including the quorum at meetings as may be prescribed;

(3) The Board shall meet at least twice in a year.].

___
1.Numbered as sub-section 1 by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).

2.Substituted for the words " Khadi and Village Industries Board " by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).

3.Inserted by the Khadi and Village Industries Commission (Amendment) Act, 2006 (10 of 2006).