The Khadi and Village Industries Commission Act, 1956 was enacted for the development of Khadi and Village Industries in India. The Khadi and Village Industries Commission is governed by the provisions of the said act. It is administered and recognised by the Ministry of Micro, small and medium Enterprises, Government of India. It is responsible for organisation, planning, promotion and implementation of programmes of the development of Khadi and other village industries in the rural areas. It has to coordinate with other agencies engaged in rural development. The implementing agencies are KVIC boards and KVIC directly aided institutions. Details of the same are specifically uploaded in the official website of the Commission. It has been held by the Andhra Pradesh High court in 23rd April 2002, in Usha Enterprises V. Khadi and Village Industries Commission that the commission is a state or authority within the meaning of Article 12 and thus it is expected to act fairly and reasonably.
The Commission is assisted by All India Khadi and Village Industries Board. It is an advisory body for the commission. Under the act, the Commission has to consult the board in discharge of its functions. The Commission has its offices in every state. Khadi and Village industries board have been set up in all the states and two Union Territories i.e. Delhi and Chadigarh. The State Boards oversee the actual implementation of the development work in respect of Khadi and Village industries.
Section 4 , clause 2 provides for the constitution of the Commission . It should consist of six members having specialised knowledge and not less than ten years’ experience in Khadi or Village Industries. Four additional members as experts from science and technology, marketing, rural development, technical education and training, Chairman of the State Bank of India, Chief Executive Officer and Financial Adviser. All the members are appointed by the Central Government.
Section 6 provides for the grounds for disqualification of which are lunacy, adjudged insolvent, convicted of an offence involving moral turpitude or has a financial interest in the undertaking. It has to be noted that a member does not ipso facto becomes disqualified by being a shareholder of a company provided that he discloses to the Central Government, the nature and extent of shares held by him in such a company. Section 6 A is the source of power of the Central Government to remove members of the commission. Section 9 provides for temporary association of persons with the members of the Commission. It provides that he Commission may associate itself with persons whose advice or assistance may be necessary. Such persons can preside over the meetings of the commission but do not have the right to vote. Section 10 provides for the constitution of the National Khadi and Village Industries Board. It is prescribed that the board has to meet at least twice a year, while the Commission has to meet twice in every month. The Commission has to also constitute zonal committees for each of the geographical areas referred to in the act. The functions of the commission have been detailed out in section 16.
Under the act, the Commission has to submit returns in time to the Central Government and Parliament. However in the State Board Acts there is no provision to submit returns to the Government, thus one drawback is that the Commission is not able to exercise the same level of degree of authority on the state boards to obtain the necessary information and data. Thus, its expenditure goes unaccounted. It has been pointed out by the Report of the Planning Commission that the commission suffers from some drawbacks as there is absolutely no coordination with the State Board. Apparently the State Government is also not actively involved in the development of Khadi and Village Industries. The Commission is not appropriately equipped and hence only a small number of artisans are covered. The Commission also does not cover certain village and cottage industries and hence such industries remain outside the purview of developmental activities.
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