The Jharkhand Khadi and Village Industries Act, 1956

(1) This Act may be called the Jharkhand Khadi and Village Industries Act, 1956. (2) It extends to the whole of the State of Jharkhand. (3) It shall come into force on such date as as the State Government may, by notification in the Official Gazette, appoint.

In this Act, unless there is anything repugnant in the subject or context, - (a) "Board" means the Jharkhand State Khadi and Village Industries Board established under Section 3; (b) "Chairman" means the Chairman of the Board appointed under Section 4 of the Act; (c) "Chief Executive Officer" means the Chief Executive Officer of the Board appointed under Section 4 of the Act; (d) "Commission" means the Khadi and Village Industries Commission established under Section 4 of the Khadi and village Industries Commission Act, 1956 (61 of 1956); (e) "Financial Adviser" means the Financial Adviser to the Board appointed under Section 4 of the Act’ (f) "Khadi" means any cloth woven on handlooms in India form cotton, silk or woolen yarn handspun in India , or form a mixture of any two or all of the yarns; (g) "prescribed" means prescribed by rules made under this Act; and (h) (i) "Village Industries" means all or any of the industries specified in the schedule of this Act, and shall include such other industry as the State Government may, by notification in the Official Gazette, specify in this behalf; (ii) any other industry specified in the Schedule to the Khadi and Village Industries Commission Act, 1956 (61 of 1956).

(1) As soon as may be after the coming into force of this Act, there shall be established, for the purpose of this Act by the State Government of Board to be Called the Jharkhand State Khadi and Village Industries Board. (2) The Board shall be a body corporate and shall have perpetual succession and a common seal and shall by the said name sue and be sued.

(1) The Board shall consist of not more than eleven members appointed by the State Government among whom the Chief Executive Officer Shall be an ex-officio member besides three other official members. (2) The State government shall nominate one of the non-official members to be the Chairman of the Board. (3) The State Government Shall appoint an officer of the State Government to be the Chief Executive Officer of the Board. (4) The State Government shall appoint a person , not being a member of the Board, to be the Financial Adviser to the Board. (5) The Board may invite for discussion of any matter before it officers of the State Government and experts specially qualified to advise on it: Provided that any member so invited shall not be entitled to vote. (6) The term of office of the non-official members of the Board shall be three years from the date of publication of their names in the Official Gazette and shall include any further period which may elapse between the expiration of the said period of three years and date of publication in the Official Gazette of the names of the members of the succeeding Board. (7) The non-official members may be re-appointed. (8) The non-official members of the Board shall be paid such allowances form the funds of the Board as may be prescribed. (9) The term of office and the terms and conditions of services of the Chief Executive Officer of the Board shall be determined by the State Government. (10) The term of Officer and the terms and conditions of the Financial Adviser to the Board shall be such as may be prescribed.

The Chairman, or any other non-official member of the Board may, at any time, resign his office by submitting his resignation to the State Government.

A Person shall be disqualified for being appointed, or for continuing, as a member of the Board, if he – (a) Does not wear khadi; or (b) Holds any office of profit under the Board; or (c) Is of unsound mind or stands so declared by a competent Court; or (d) is an undercharged insolvent or has applied for being adjudged an insolvent; or (e) has been convicted of an offence, which involves, in the opinion of the State Government, moral turpitude; or (f) has directly or indirectly be himself, by his wife or son, or by any partner, any share or interest in any subsisting contract or employment with, by, or on behalf of, the Board; or (g) is a director or secretary or manager or other salaried officer of any incorporated company or any co-operative society, which has any share or interest in any contract or employment with, by or on behalf of, the Board: Provided that a person shall not be disqualified under clauses (f) and (g) or be deemed to have any share or interest in any contract or employment with, by or on behalf of the Board, by reason only of – (i) his, or of the incorporated company or of a co-operative society of which he is a director, secretary, manager or other salaried officer, having a share or interest in any newspaper in which any advertisement relating to any affairs of the Board is inserted, or (ii) his being a share- holder of such a company or society, if he has disclosed to the State government the nature and extent of the share held by him from time to time : Provided further that the provisions of clauses (a) and (b) of this section shall not apply to an official member of the Board.

(1) The State Government may remove form office the Chairman or any member if he - (a) refuses to act, or (b) has become incapable of acting, or (c) has abused his position in the Board so as to render his continuance on the Board detrimental to its interest, or (d) fails without sufficient reason, to attend three consecutive meeting of the Board, or (e) ceases to reside in the State of Jharkhand or (f) has since his appointment incurred any of the disqualifications specified in section 6, or (g) is considered otherwise unsuitable to continue on the Board. (2) Any action taken under the section shall not be called in question in any court. (3) A member who has been removed under clause (e) of (f) of sub-section (1) shall not be eligible for re-appointment on the Board as member or in any other capacity.

If any of the non-official members of the Board is unable, by reason of his death, resignation, removal or otherwise, to complete his full term of office, the vacancy so caused shall be filled by the appointment of another person and such person shall remain member for the unexpired portion of the term for which the member, in whose place such person as appointed, would otherwise have continued in office.

No act or proceedings of the Board Shall be deemed to be invalid only by reason the existence of a vacancy in the Board or any defect or irregularity in the appointment of member or the constitution of the Board.

(1) The Board may subject to the approval of the State Government, appoint such number of officers and servants as it may consider necessary. (2) The remuneration, allowances and other conditions of service of the officers and servants of the Board shall be such as may be determined by regulations made by the Board.

(1) To advice and assist the Board in the discharge of the functions under this Act, the State Government may, by notification in the Official Gazette, constitute an Advisory Council to be called the Jharkhand Khadi and Village Industries Advisory Council consisting of the Chairman and besides the members of the Board, such number of other members, not exceeding twenty-one as are, in the opinion of the State Government, interested in the development of Khadi and Village Industries. (2) The Chairman of the Board Shall be the Chairman of the Advisory Council. (3) The terms of office of the other members of the Advisory Council Shall be three years form the date of publication of their names in the Official Gazette. (4) The State Government may if it thinks expedient, dissolve at any time the Advisory Council or accept the resignation of any member of the Advisory Council or direct that any person shall cease to be a member there of and any such action of the State Government shall not be questioned in any court of law. (5) The business of the Advisory Council Shall be conducted in such manner as may be prescribed. (6) The non-official members of the Advisory Council shall be paid such allowance from the funds of the Board as may be prescribed.

(1) The Board shall have its Head Office at Ranchi and subordinate offices at such other places as the State Government may be notification determine. (2) (i) The Board shall meet at such time and place and every meeting of the Board shall be summoned in such manner as may be determined by regulations made by the Board: Provided that the Chairman whenever he thinks fit may call special meetings. (ii) Every meeting of the Board and its committees shall be presided over by the Chairman and in his absence the members present shall elect one of their members to preside at the meeting. (3) All question at any meeting shall be decided by a majority of the members present and voting and, in case of an equality of votes, the person presiding shall have and exercise an second of casting vote. (4) The minutes of the proceedings of every meeting shall be recorded in a book to be provided for the purpose. (5) A copy of the minutes of the proceedings of every meeting shall be forth with forwarded to the State Government or to such authority as the State Government may direct.

(1) If at any time the State Government is satisfied that- (a) the Board has, without reasonable cause or excuse, made default in the performance of its duties or the discharge of its functions, imposed by or under this Act, or exceeded or abused its powers, or (b) circumstances have so arisen that the Board is rendered unable or may be rendered unable to discharge its functions under this Act, or (c) it is otherwise expedient or necessary to dissolve the Board, the State Government may, by notification in the Official Gazette, dissolve the Board and declare that the duties, powers and functions of the Board shall, during the period of dissolution, be performed, exercised and discharged by such person or authority, as may be specified in the notification. (2) The State Government may reconstitute the Board in accordance with the provisions of Section 4. (3) The State Government may make such incidental and consequential provisions as may appear to be necessary for giving effect to the purposes of this Section. (4) Any notification or order made by the State Government under this Section shall not be questioned in any Court.

On the Board ceasing to exist by dissolution under Section 13; (i) all properties and funds which immediately before the said date were in the possession of the Board for the purpose of this Shall vest in the State Government; (ii) all members shall vacate office as members of the Board; and (iii) all rights, obligations and liabilities (including any liability under any contract) of the Board shall become the right, obligations and liabilities of the State Government.

(1) It shall be the duty of the Board to organize, develop and regulate khadi and village industries and perform such other functions as the State Government may prescribe form time to time. (2) Without prejudice to the generality of the provisions of sub-section (1), the Board shall, in particular, discharge and perform all or any of the following duties and functions, namely:- (a) to start, encourage, assist and carry on khadi and village industries; (b) to help person or associations of persons by providing them with work in their homes and to give them financial assistance in the shape of loans and grants for any of the purposes of this Act on such terms and conditions as may from time to time be laid down- (i) by the Commission in case of loans and grants given by the Board out of the funds received form the commission; (ii) By the State Government in case of loans and grants given by the Board out of the funds received form the State Government or otherwise and such terms and conditions may also provide for the recovery of the loans together with interests thereon, if any, or the grants; (c) to encourage the establishment of co-operative societies for khadi and village industries; (d) to conduct training centers and to train people to such centers or at other centers outside Jharkhand with a view to equipping them with the necessary knowledge for starting or carrying on khadi or village industries; (e) to arrange for the supply of raw materials, tools and implements and for the sale of the finished products of such industries; (f) to arrange for publicity of , and popularizing, finished products of such industries by opening stores, shops, emporiums or exhibitions; (g) to endeavor to educate public opinion and to impress upon the public the advantages of patronizing the products of khadi and village industries; (h) to seek and obtain the advice and guidance of experts in such industries; (i) to undertake and encourage research work in connection with khadi and village industries; (j) to maintain or assist in the maintenance of institutions for the development of khadi or village industries; and (k) to discharge such other duties and to perform such other functions as the State Government may direct for the purpose of carrying out the objects of this Act. (3) The Board shall ordinarily consult the Advisory Council constituted under Section 11 with respect to the discharge of its functions under this Act.

The Board shall, for the purposed of carrying out its functions under this Act, have the following powers, namely:-(i) to acquire and hold such movable and immovable property as it deems necessary and to lease, sell or otherwise transfer any such property: Provided that in the case of immovable property such power shall be exercised with the previous sanction of the State Government; (ii) to incur expenditure and undertake any work in any area in the State for the farming and execution of such schemes as it may consider necessary for the purpose of carrying out the provisions of this Act or as may be entrusted to it by the State Government; and (iii) to enter into any contract for the purpose of this Act; and (iv) to do all things necessary in the furtherance of the objects of the Act.

(1) The Board may constitute form amongst its members, a Standing committee consisting of the following members: (i) The Chairman, (ii) The Chief Executive Officer, and (iii) Three members elected form amongst the members of the Board. (2) The financial Adviser to the Board shall be permanent invitee to the Standing finance Committee. (3) The Standing Finance Committee shall exercise such powers and perform such functions relating to the finances of the Board as may be delegated to it be the Board.

(1) Chairman – The Chairman shall be responsible for the proper functioning of the Board and the implementation of its decisions and discharge of its duties and functions under the Act and shall exercise such powers and discharge functions as may be prescribed. (2) Member – A member of the Board shall be entitled to take part in the meetings of the Board, the Advisory Council and such Committees of the Board of which he is member. (3) Chief Executive Officer – The Chief Executive Officer shall be the Chief executive of the Board and shall work under overall supervision of the Chairman. He shall perform such functions and shall exercise such powers as may be prescribed. He shall be responsible for implementing the decisions of the Board and its Committees and shall exercise all administrative powers in discharge of such responsibilities. (4) Financial Adviser – The Financial Adviser shall advise the Board on matters of policy relating to receipts and expenditure and shall exercise such powers and discharge such duties and functions as may be prescribed.

(1) In each year, on such date as may be prescribed the Board shall prepare and forward in prescribed form to the State Government - (a) a programme for the promotion and development of khadi and village industries; and (b) a schedule of the staff of officers and servants already employed and to be employed in the next year. (2) The programme shall contain – (a) particulars of the scheme which the Board proposed to execute during the next year; (b) particulars of any work which the Board proposed to execute or any undertaking which it proposed to organize during the next year for the purposes of carrying out its functions under this Act; and (c) such other particulars as may be prescribed.

The State Government may sanction the programme and the schedule of staff of officers and servants with such modifications as it deems fit.

The Board may prepare and forward as supplementary programme for the sanction of the State Government in such form and before such date as may be prescribed and the provisions of Section 17 shall apply to such supplementary programme.

The State Government may transfer to the Board, Buildings, lands or any other property, movable or immovable, for the use of and management by the Board on such conditions as the State Government may impose for the purposes of this Act.

All debts or expenditure incurred, all contracts, entered into, and all matters and things engaged to be done by with or for the State Government, in connection with the purposes of this Act before and up to the date of the establishment of Board, shall be deemed to have been incurred entered into or engaged to be done by with or for the Board and in all Suits and other legal proceedings instituted by or against the State Government, the Board shall be deemed to be substituted for the State Government.

(1) The Board shall have two separate funds to be called the “Khadi Fund” and “Village” Industries Fund” and all grants and advances made to the funds, form time to time, be the State Government or by the Commission for the purpose of development of khadi or the development of village industries and all other receipts of the Board shall be credited to the “Khadi Fund” or the “Village Industries Fund” as the case may be and all payments by the Board for or in respect of “Khadi or Village Industries” shall be made from the appropriate fund. (2) The Board may accept grants, subventions, donations and gifts and receive loans from Government or a local authority or any body or association, whether incorporated or not, or an individual for all or any of the purposes of this Act. (3) All money belonging to the Board shall be deposited in such manner as the State Government may, by special or general order direct. (4) The accounts of the Board shall be operated upon by such officers of the Board jointly or individually as it may authorize.

All property fund and other assets of the Board shall be held and applied by it subject to the provisions of and for the purposed of this Act.

(1) The State Government may from time to time make subventions and grants and advance loans to the Board for the purposes of this Act on such terms and conditions as the State Government may determine in each case. (2) The Board may with the previous sanction of the State Government and subject to the provisions of this Act and such conditions as the State Government may determine borrow any sum required for the proposes of this act.

The Board shall by such date in each year as may be prescribed prepare and submit to the State Government for approval two separate budgets in the prescribed form for the next financial year, to be called the Khadi Budget and the Village Industries Budget, showing the estimated receipts and expenditure in respect of khadi and Village industries, respectively, during that financial year.

(1) The State Government may sanction the Budget submitted to it with such modifications as it thinks fit. (2) Subject to the provisions of sub-sections (3) and (4) no sum shall be expended by or on behalf of the Board unless the expenditure is covered by a specific provision in the budgets approved by the State Government.

The Board may submit a supplementary budget for the sanction of the State Government in such form and before such date as the State Government may prescribe and the provisions of Sections 24 and 25 shall apply to such supplementary Budget.

(1) The Board shall prepare and forward to the State Government in such manner as may be prescribed, an annual report within three months of the end of the financial year, giving a complete account of its activities during the previous financial year. (2) The report received by the State Government under sub-section (1) shall be laid before both the Houses of the State Legislature as soon as may be after it is received by the State Government.

The Board shall before such date and at such intervals and in such manner as may be prescribed, submit to the State Government a report on such matters and such statistics and such returns as may be prescribed.

The Accounts of the Board shall be maintained and an annual statement of accounts shall be prepared in such manner as may be prescribed. Such accounts shall be audited by an Auditor approved by the State Government.

In the Discharge of its functions, the Board shall be guided by such directions and instructions as may be given to it, form time to time by the State Government.

Members, Officers and Servants of the Board shall be deemed, when acting or purporting to act in pursuance of any of the provisions of this Act, to be public servants within the meaning of section 21 of the Indian Penal Code (XLV of 1860).

No suit, prosecution or other legal proceeding shall lie against any person for anything which is in good faith done or purported to be done under this Act.

(1) All loans and grant under this Act, all interests if any, chargeable thereon all misapplied, misutilised or unutilized grants made under any agreement expressed or implied or otherwise, and cost if any, incurred in making or recovering the same, whether before or after the commencement of the Bihar Khadi and Village Industries (Amendment) Ordinance, 1966 (Bihar Ordinance No. 10 of 1966) shall without prejudice to any other remedy provided by law, be recoverable under the Bihar and Orissa Public Demands Recovery Act, 1914 (Bihar & Orissa Act IV of 1914). (2) If any question arises whether a sum is payable to the Board within the meaning of sub- section (1) the same be referred to the Director of Industries, Jharkhand who shall after making such enquiry as he may deem fit, and after giving the person by whom the sum is alleged to be payable an opportunity of being heard, decide the question and his decision thereon shall be final and shall not be called in question in any court of law. Explanation – For the purposes of this sub-section, Director of Industries means the Director of Industries of the Government of Jharkhand and includes any person not below the rank of a Deputy Director of Industries of the Government of Jharkhand whom the Director of Industries may authorize to perform his functions in this be half.

(1) The State Government may by notification in the Official Gazette make rules to give effect to the provisions of this Act. (2) In Particular and without prejudice to the generality of the following powers, such Rules may provide for all or any of the following matters, namely:- (a) The allowances of members of the Board and the Advisory Council (aa) The terms of office and the terms and conditions of service of the Financial Adviser of the Board including his salaries and allowances to be paid to him by the Board; (b) The manner and form in which contract shall be entered into; (c) the functions of the Board; (cc) the powers and duties to be exercised and performed by the Chief Executive Officer and the Financial Adviser of the Board; (d) The form and particulars of the programme for the promotion and development of khadi and village industries and schedule of the staff of officers and servants; (e) the from in which and the date before which the supplementary budget shall be submitted; (f) the manner in which the annual report shall be preparation and forwarded to the State Government; (g) the manner of maintenance of accounts and preparation of annual statement of accounts; and (h) any other matter which is or may be prescribed under this Act.

(1) The Board may, with the previous sanction of the State Government make regulations not inconsistent with this Act and the rules made thereunder and publish them in the official Gazette. (2) In particular and without prejudice to the generality of the foregoing power, the Board may make regulations providing for – (a) The procedure and disposal of its business; (b) remuneration, allowances and other conditions of service of members of the staff of the Board other than the Chief Executive Officer and the Financial Adviser of the Board; and (c) functions and duties of the members of the staff of the Board other than the Chief Executive Officer and the Financial Adviser of the Board.

(1) Nothing in this Act Shall be deemed to apply to any industry declared to be a scheduled industry under the industries (Development and Regulation) Act, 1951 (LXV of 1951), or to effect of the provisions of that Act. (2) The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force relation to Khadi and Village industries.

“4. Constitution of Board and term of office – (1) The Board shall consist of not less than three and not more than five members appointed by the State Government, one of them being nominated by the State Government to be the President thereof. (2) The State Government in consultation with the Board, may appoint a person, who may or may not be a member of the Board, to be the Secretary of the Board. (2-A) The State Government Shall appoint a person not being a member of the Board, to be the Financial Advisor and Chief Accounts Officer to the Board. (3) The Board shall have power to co-opt for the discussion of any particular matters before it, any officer of the State government of experts specially qualified to advise on the matter or having special knowledge of local conditions in any area where the industry in question is situated: Provided that any member so co-opted shall not be entitled to vote. (4) The term of office of the President and other members of the Board shall be three years from the date of publication of their names in the Official Gazette and shall include any further period which may elapse between the expiration of the said period of three years and the date for publication in the official Gazette of the names of the members of the next succeeding Board. (5) The President and other members shall be eligible for re-appointment. (6) The non-official members of the Board shall be paid such allowances form the funds of the Board as may be prescribed. (7) The term of the office and the terms and conditions of service of the Financial Advisor and Chief Accounts Officer to the Board shall be such as may be prescribed.

“5. Resignation by the President or a member. – The President, or any other member of the Board may, at any time, resign his office by submitting his resignation to the State Government, but no such resignation shall take effect until it is accepted by the State Government.”

7. Removal or suspension of a member of the Board. – (1) The State Government may, after such inquiry as may be necessary, remove form office the Chairman or any member if he - (a) refuses to act, or (b) has become incapable of acting, or (c) has abused his position in the Board so as to render his continuance on the Board detrimental to its interest, or (d) fails without sufficient reason, to attend three consecutive meeting of the Board, or (e) ceases to reside in the State of Bihar; or (f) has since his appointment incurred any of the disqualifications specified in Section 6; or (g) is otherwise unsuitable to continue on the Board. (2) No order of removal under sub-section (1) shall be made, unless the member concerned has been given an opportunity to submit his explanation to State Government: Provided that a member may be suspended by the State Government pending an inquiry against him. (3) A member who has been removed under clause (c) of (f) of sub-section (1) shall not be eligible for appointment to the Board as member or in any other capacity.

“8. Filling of casual vacancies.- If any the President or any other member of the Board in unable, by reason of his death, resignation, removal or otherwise, to complete his full term of office, the vacancy so caused shall be filled by the appointment of another person and such person shall fill such vacancy for the unexpired portion of the term for which the President or the member, as the case may be, in whose place such person is appointed would otherwise have continued in office.”

[See Section 2(d)] 1. Bee – keeping. 2. Cottage matches industry. 3. Cottage pottery industry. 4. Cottage soap industry. 5. Flaying, curing and tanning of hides and skins and ancillary industries connected with the same and cottage leather industry. 6. Ghani oil industry. 7. Hand – made paper. 8. Manufacture of gur and khandsari. 9. Palm gur making and other palm products industry. 10. Hand processing of cereals and pulses. 11. Woolen Blanket industry