The Khadi and Village Industries Commission Act, 1956

(1) This Act may be called The Khadi and Village Industries CommissionAct, 1956. (2) It extends to the whole of India except the State of Jammu and Kashmir*.

n this Act, unless the context otherwise requires,-- (a) "the Board" means the Board constituted under 1[section 10]; (b) "chairman" means the chairman of the Commission; (c) "Commission" means the Khadi and Village Industries Commission established undersection 4; 2[(cc) "fixed capital investment" includes investment in plant and machinery and land andbuilding of an industry;] (d) "khadi" means any cloth woven on handlooms in India from cotton, silk or woolen yarnhandspun in India or from a mixture of any two or all of such yarns; (e) "member" means a member of the Commission 3[and includes the chairman 4***]; (f) "prescribed" means prescribed by rules made under this Act; 5[(ff) "rural area" means the area comprised in any village, and includes the area comprised in anytown, the population of which does not exceed 6[twenty thousand] or such other figure as the CentralGovernment may specify from time to time;] 7* * * * * 8* * * * * 9[(h) "village industry" means,-- (i) any industry located in a rural area which produces any goods or renders any service withor without the use of power and in which the fixed capital investment per head of an artisan or aworker does not exceed 10[one lakh rupees] or such other sum as may, by notification in theOfficial 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 ruralarea and recognised as a village industry at any time before the commencement of the Khadi andVillage Industries Commission (Amendment) Act, 1987 (12 of 1987), shall, notwithstandinganything contained in this sub-clause, continue to be a village industry under this Act: 11[Provided further that in the case of any industry located in a hilly area, the provisions of thisthis sub-clause shall have effect as if for the words "one lakh rupees", the words "one lakh andfifty thousand rupees" steal.] (ii) any other non-manufacturing unit established for the sole purpose of promoting,maintaining, assisting, servicing (including mother units) or managing any village industry;]

[Power to add to the Schedule.] Omitted by Khadi and Village Industries Commission(Amendment) Act 1987 (12 of 1987), s. 3 (w.e.f. 24-7-1987).

(1) With effect from such date as theCentral Government may, by notification in the Official Gazette, fix in this behalf, there shall beestablished a Commission to be called the Khadi and Village Industries Commission which shall be abody corporate having perpetual succession and a common seal, with power to acquire, hold and disposeof property and to contract, and may by the said name sue and be sued. 1[(1A) Save as otherwise provided under this Act and the rules made thereunder, the exercise of allpowers and discharge of all functions under this Act, including general superintendence, direction andmanagement of day-to-day affairs of the Commission, shall vest in the Commission.] 2[(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 ofexperience 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 andTraining.] 5[(ba) the Chairman of the State Bank of India constituted under sub-section (1) of section 3 ofthe State Bank of India Act, 1955 (23 of 1955) or an officer not below the rank of the DeputyManaging Director as may be nominated by the Chairman of the State Bank of India--ex officio;]; 6[(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.] 7* * * * * (3) The Central Government may appoint one of the members appointed under clause (a) ofsub-section (2) to be the chairman who shall be a full-time member.]

1[5. Powers and functions of the Chief Executive Officer.--2[(1) Subject to the provisionscontained in sub-section (1A) of section 4, the Chief Executive Officer, appointed under clause (c) ofsub-section (2) of section 4, shall exercise such powers and discharge such functions in respect of generalsuperintendence over the affairs of the Commission and its day-to-day management, as may beprescribed. (1A) Without prejudice to the powers and functions referred to in sub-section (1), the Chief ExecutiveOfficer 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 thefunctions referred to in sub-section (1), be responsible] for the furnishing of all returns, reports andstatements 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 itsconsideration and decision any matter of financial import if the Financial Adviser suggests to him inwriting that such matter be placed before the Commission.]