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*.
2. Definitions.—In 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 under
section 4;
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[(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 woolen yarn
handspun 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;
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[(ff) “rural area” means the area comprised in any village, and includes the area comprised in any
town, the population of which does not exceed 6
[twenty thousand] or such other figure as the Central
Government may specify from time to time;]
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8
* * * * *
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[(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 exceed 10[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:
1. Subs. by Act 36 of 1957, s. 3 and the Second Schedule, for “section 9” (w.e.f. 17-9-1957).
2. Ins. by Act 12 of 1987, s. 2 (w.e.f. 24-7-1987).
3. Subs. by Act 32 of 1961, s. 2, for “and includes the chairman” (w.e.f. 28-8-1961).
4. The words “and the vice-chairman” omitted by Act 12 of 1987, s. 2 (w.e.f. 24-7-1987).
5. Ins. by s. 2, ibid. (w.e.f. 24-7-1987).
6. Subs. by Act 10 of 2006, s. 2, for “ten thousand” (w.e.f. 15-5-2006).
7. Omitted by Act 12 of 1987, s. 2 (w.e.f. 24-7-1987).
8. Omitted by s. 2, ibid. (w.e.f. 24-7-1987).
9. Subs. by s. 2, ibid., for clause (h) (w.e.f. 24-7-1987).
10. Subs. by Act 10 of 2006, s. 2, for “fifteen thousand rupees” (w.e.f. 15-5-2006).
*. Vide notification No. S.O. 3912(E), dated 30th October, 2019, this Act is made applicable to the Union territory of Jammu and
Kashmir and the Union territory of Ladakh.
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Provided that any industry specified in the schedule and located in an area other than a rural
area and recognised as a village industry at any time before the commencement of the Khadi and
Village Industries Commission (Amendment) Act, 1987 (12 of 1987), shall, notwithstanding
anything contained in this sub-clause, continue to be a village industry under this Act:
1
[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” 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;]
3. [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).