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KHADI AND OTHER HANDLOOM INDUSTRIES DEVELOPMENT (ADDITIONAL EXCISE DUTY ON CLOTH) ACT, 1953
STATEMENT OF OBJECTS AND REASONS “Both the khadi and the handloom cloth Industry have a definite place in our national economy. Khadi makes its contribution towards the relief of rural unemployment and provides a supplementary source of livelihood to our agricultural population. The handloom industry has a substantial part to play in supplying the demand for cloth in the country. Both these industries, however, have been suffering from many handicaps of late, mainly In finding an adequate market for their products. They have to cater to certain special markets and to Individual and local tastes. For this purpose they need assistance In order to obtain adequate supplies of cotton and yarn at reasonable rates, to effect improvement in their methods and technique of production and for organizing the sale and marketing of their goods. In order to finance the development of these industries on these lines, it is proposed that access of three pies per yard should be Imposed on mill-made cloth other than cloth exported out of India. The access would take the-form of a duty of excise and is expected to yield more than rupees five crores per year. The proceeds of the access will be allocated by Government for the development of the khadi and the handloom industry, the proportions being determined each year according to circumstances. Legislation is required for imposing this access as a duty of excise".—Gazette of India, 1953, Pt. II, S. 2, page 3.
An Act to provide for the levy and collection of an additional duty of excise on cloth for raising funds for the purpose of developing khadi and other handloom industries and for promoting the sale of khadi and other handloom cloth. Be it enacted by Parliament as follows: — The Act has been extended to the French Establishments in India by Fr. Est. A.L.O., 1954. It has been now extended to the Union territory of Goa, Daman and Diu by Regn. 11 of 1963.
SECTION 01: SHORT TITLE AND EXTENT
(1) This Act may be called THE KHADI AND OTHER HANDLOOM INDUSTRIES
DEVELOPMENT (ADDITIONAL EXCISE DUTY ON CLOTH) ACT, 1953.
(2) It extends to the whole of India1[* * *].
SECTION 02: DEFINITIONS
In this Act, unless the context otherwise requires,—
2[(a) "appointed day" means,—
(i) in relation to the State of Jammu and Kashmir, the date3on which the Jammu and Kashmir (Extension of Laws) Act, 1956-, comes into force in that State; and
(ii) in relation to the rest of India, the 15th day of February, 1953;]
MODIFICATIONS Goa, Daman and Diu: In section 2, in clause (a), omit 'and' at the end of sub clause (i), and Insert thereafter— "(ia) in relation to the Union territory of Goa, Daman and Diu, the date on which this Act comes into force therein".— Regn. 11 of 1963, section 3 (1) and Schedule (1-8-1965).
4[(b) "cloth" means cotton, woollen,5[silk and rayon or artificial silk fabrics], as defined in the First Schedule to the Central Excises and Salt Act, 1944-.]
Pondicherry: In section 2, in clause (a), for "15th day of February 1953", substitute the words "1st day of November 1954"—Fr. Est. A.L.O., 1954.
(c) "handloom cloth" means any cloth, woven from any material, including silk, artificial silk, staple fibre and wool, on looms worked by manual labour;
(d) "handloom industries" means industries which manufacture khadi or other handloom cloth;
(e) "khadi" means any handloom cloth woven from yarn handspun in India.
SECTION 03: LEVY OF ADDITIONAL DUTY OF EXCISE ON CLOTH
(1) There shall be levied and collected on all cloth manufactured on or after the appointed day in6 [India], and on all cloth lying in stock on the appointed day in any factory where cloth is manufactured or in any premises appurtenant thereto, a duty of excise at the rate of7[1.9 naye paise per square metre]:8[Provided that no such duty shall be levied on cloth— ,
(i) which is exported out of India, or
(ii) which is used in the manufacture of goods which are exported out of India. ]
(2) The duty of excise specified in sub-section (1) shall be in addition to the duty of excise chargeable on cloth under the Central Excises and Salt Act, 1944-, and shall be levied and collected in the same manner as the duty of excise on cloth is levied and collected under that Act.
SECTION 04: APPLICATION OF PROCEEDS
The Central Government may utilise the net proceeds of the duty of excise levied under this Act for meeting the costs of such measures as it considers necessary or expedient to take for developing khadi and other handloom industries, and, in particular, measures for
(a) undertaking, assisting or encouraging khadi and other handloom industries;
(b) encouraging the adoption of improved methods of manufacturing khadi and other handloom cloth;
(c) encouraging and developing research in the technique of production of khadi and other handloom cloth and in the art of designs relating thereto;
(d) maintaining or assisting in the maintenance of institutes for the development of khadi and other handloom industries;
(e) promoting the sale and marketing of khadi and other handloom cloth,'
(f) fixing the grades and standards of khadi and other handloom cloth and enforcing quality control;
(g) promoting and encouraging co-operative effort among manufacturers of khadi and other handloom cloth.
SECTION 05: POWER TO MAKE RULES
(1) The Central Government may, by notification in the Official Gazette, make rules9for carrying out the purposes of, this Act.
(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for
(a) the manner in which the proceeds of the duty of excise levied under this Act may be applied for all or any of the purposes specified in section 4-;
(b) the making of grants or loans from such proceeds to State Governments for all or any of the said purposes;
(c) the allocation of the net proceeds of the duty of excise between khadi and other handloom industries;
(d) the manner in which accounts relating to the proceeds of the duty of excise shall be maintained;
(e) the exemption from the whole or any part of the duty of excise levied under this Act of any variety of cloth which is for the time being exempt from10[the whole or any part of] the duty of excise imposed under the Central Excises and Salt' Act, 1944-.11[Provided that any rule under clause (e) may be made so as to have retrospective effect from any date not earlier than two years before the date of publication thereof.]
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