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Report No. 158

1.2. The Background.-

The object behind the enactment of the Industries (Development & Regulation) Act, 1951 is to provide the Central Government with the means of implementing their industrial policy which was announced in their Resolution No. 1(3)-44(13) 48, dated 6th April, 1948 and approved by the Central legislature. The Act brings under Central control the development and regulation of a number of important industries the activities of which affect the country as a whole and the development of which must be governed by economic factors of all-India import.

The planning of future development on sound and balanced lines is sought to be secured by the licensing of all new undertakings by the Central Government. The Act confers on Government power to make rules for the registration of undertakings and for regulating the production and development of the industries specified in the schedule. The Act also provides for the constitution of a Central Advisory Council, prior consultation with which will be obligatory before the Central Government takes certain measures such as the revocation of a licence or taking over the control and management of any industrial concern (Refer to the statement of Objects and Reasons of the Bill concerning the Act cited in the AIR Manual, Vol. 30, p. 891, 5th Edn.).

The Act was amended by the Amending Act 72 of 1971; Amending Act 67 of 1973; Act 4 of 1984. Section 2 of the Industries (Development & Regulation) Act, 1951 declares that it is expedient in the public interest that the Union should take under its control the industries specified in the First Schedule. Chapter II of the Act provides for establishment of Central Advisory Council and Development Councils. Chapter III deals with regulation of scheduled industries. Section 10 requires registration of existing industrial undertakings.

Section 10A empowers the Central Government to revoke registration in certain cases. Section 11 deals with the licensing of new industrial undertakings. Section 11A is concerned with the requirement of a licence for producing or manufacturing new articles by the owner. Section 11B empowers the Central Government to specify the requirements which shall be complied with by small scale industrial undertakings. Section 12 deals with the revocation and amendment of licences in certain cases. Section 14 deals with the procedure for the grant of licences or permission.

Section 15 confers power of investigation to be made into scheduled industries or industrial undertakings. Section 15A empowers Central Government to investigate into the affairs of a company in liquidation. Under section 16 the Central Government is empowered to carry out action as is desirable on completion of the investigation under section 15. Further Chapter IIIA deals with the direct management of control of industrial undertakings by Central Government in certain cases.

Chapter IIIAA deals with the management of control of industrial undertakings owned by companies in liquidation. Chapter IIIAB confers power on the Central Government to provide relief to certain industrial undertakings. Chapter IIIAC is concerned with the liquidation or reconstruction of companies. Chapter IIIB of the Act contains section 18G whereby the Central Government is empowered to control the supply, distribution and price etc. of certain articles, for securing equitable distribution and availability at fair prices of any article or class of articles relatable to any scheduled industry.

The Amendment of the Industries (Development  Back

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