The TAMIL NADU OIL PALM (REGULATION OF PRODUCTION AND PROCESSING) ACT, 1994

THE TAMIL NADU OILPALM(REGULATION OF 
PRODUCTION AND PROCESSING) ACT, 1994 
 
The following Act of the Tamil Nadu Legislative Assembly received the assent of the 
Governor on the 28th June 1994 and is hereby published for general information 
 
ACT No. 34 OF 1994. 
 
An Act to provide for the regulation of cultivation of oilpalm and for orderly 
growth and processing thereof and for matters connected therewith. 
 
BE it enacted by the Legislative Assembly of the State of Tamil Nadu in the Forty -fifth 
Year of the Republic of India as follows:- 
 
1. (1) This Act may be called the Tamil Nadu Oilpalm (Regulation of Production 
and processing)  Act, 1994. 
 
(2) It extends to the whole of the State of Tamil Nadu. 
(3) It shall come into force on such date as the Government may, by 
notification, appoint and different dates may be appointed for different areas and for 
different provisions of this Act. 
2.   In this Act, unless the context otherwise requires,- 
(a) “factory” means any  premises including the precincts there of or any part 
of which any  manufacturing  process connected with the processing  of oilpalm FFB is 
carried on with aid of mechanical power. 
(b) “factory zone” means and area assigned to a factory under section 11; 
(c) “Government” means the State Government; 
(d) “Occupier of the factory” means the person who, or the authority which 
has the ultimate control over the affairs  of the factory and, where the said affairs are 
entrusted to a Secretary, Manager, Managing Dir ector, Executive Director or Chief 
Executive Director, such Secretary, Manager, Managing Director, Executive Director or 
Chief Executive Director shall be deemed to be the  occupier of the factory. 
(e) “Oilpalm” means the palm of the genus, clacis and incl udes the species, 
clacis guineensis and its hybrids: 
(f) “Oilpalm Commissioner” means the Oilpalm  Commissioner appointed or 
designated under section 8  
(g) “Oilpalm FFB”   means the unprocessed oilpalm fresh fruit bunch and 
includes its loose form also. 
(h) “Oilpalm grower” means a person who cultivates oilpalm whether by 
himself or by his own servants or by hired labour or by members of his family or  by his 
tenant’s and includes Oilpalm Growers Co -operative Society but not a member  thereof 
and a company as defined in section 3 of the Companies Act, 1956; 
(i) “Oilpalm Growers Co-operative Society” means a society registered under 
the Tamil Nadu Co -operative Societies Act 1983 Which has among its objects and 
functions the cultivation and sale of oilpalm FFB by its members, and   includes the union 
or federation of any such societies; 
(j) “Oilpalm Inspector”  means the Oilpalm Inspector appointed or designated 
under section 9; 
Short title 
extent and 
commence-
ment 
Definitions 
Central Act 
1 of 1956 
Tamil Nadu 
Act 30  of 
1983 
(k) “oilpalm product” means any product obtained directly  
from the oilpalm and includes palm oil.  Palm kernel, Palm kernel  cake, palm 
fatty acids, oilpalm seeds, oilpalm seedlings and palm kernel oil; 
(l) “Project Management Committee” means the Tamil Nadu Oilpalm Project 
Management Committee constituted under section 3; 
(m) “Zomal Committee” means a Zon al Committee constituted under  
section- 5. 
3. (1) As soon as may be after the commencement of this Act, the Government 
shall, by notification, constitute a committee for the State to be called the Tamil Nadu 
Oilpalm Project Management Committee.  
   (2) The Project Management Committee shall consist  of the following 
members, namely:- 
(a) the secretary to Government in -charge of Agriculture, who shall be the 
Chairman, ex-officio; 
(b) the Secretary to Government in-charge of Finance, ex-officio. 
(c) the secretary to Government in -charge of Planning and Development , ex-
officio; 
(d) the secretary to Government in -charge of Co -operation, Food and 
Consumer Protection, ex-officio; 
(e) the secretary to Government in-charge of Industries, ex-officio; 
(f) a representative of the Indian Council for Agricultural Research, New Delhi;  
(g) a r epresentative of the Department of Agriculture and Co -operation 
(Technology Mission on Oilseeds and Pulses), Government of India; 
(h) a representative of the National Bank for Agriculture and Rural 
Development; 
(i) a representative of the Tamil Nadu Agriculture Un iversity to be nominated 
by its Vice-Chancellor; 
(j) a representative of the oilpalm processing factories nominated by the 
Government; 
(k) one person from among the oilpalm growers  nominated by the 
Government; 
(l) the Director of Agriculture, who shall be the Member-Secretary, ex-officio. 
 
(3) The term of the Project Management Committee shall be three years, but the 
Government may, for reasons to be recorded in writing, reconstitute the Committee at 
any time before the expiry of the term. 
(4) In case a Secretary to Government, who is anex-officio member, is unable 
to attend the meetings of the  Project Management Committee for any  reason, he  may 
depute any officer of his department  n ot lower in  rank than that of a Deputy Secretary 
to  Government to  attend the meeting. 
4. It shall be the duty of the  Project Management Committee to advise the 
Government on the following matters. namely:- 
(a) extension of the areas under cultivation of oilpalm; 
(b) problems relating to the cultivation of oilpalm; 
Project 
Manage-
ment 
Committee 
(c) problems faced by the oilpalm processing industry; 
(d) co-ordination between the oilpalm growers and industry and sorting out of all 
matters which may arise; 
(e) to bring to the notice of the Government any  measures that will suit the orderly 
development of the oilpalm cultivation and industry; 
(f) such other matters as may be prescribed. 
 
5. (1) The Government may, by notification, declare each area specified therein 
attached to a processing factory as a Zone (hereinafter referred to as ‘a factory zone’) 
and the Oilpalm Commissioner may constitute a Zonal Committee for each such zone;  
Provided that the Oilpalm Commissioner may, with the  approval of the 
Government, con stitute one Zonal Committee for more than one factory zone or more 
than one Zonal Committee for each factory zone, if it is deemed necessary in the 
interests of effectively carrying out the purposes of this Act. 
 (2) The Zonal Committee constituted under sub -section (1), shall consist of the 
following members, namely:- 
(a) a Chairman nominated by the Oilpalm Commissioner,  with the approval of 
the Government,  from among the oilpalm growers residing in the factory zone; 
(b) one person representing the factory located in the factory zone to be 
nominated by the Managing Director of the factory concerned; 
(c) four persons from among the oilpalm growers to be nominated by the oilpalm 
commissioner; 
(d) the Joint Director of Agriculture, the Assistant Director of Agriculture and the 
Executive Engineer (Agricultural Engineering), representing the area; 
(e) a representative of the Tamil Nadu Agricultural University to be nominated by 
its Vice-Chancellor; 
(f) the Oilpalm Inspector concerned, who shall be the Member -Secretary of the 
Committee: 
Provided that the members specified in clause (d) shall have  the right  to take 
part in the meetings of the Zonal Committee but shall not be entitled to vote at any 
such meeting : 
(3) The Zonal Committee shall be a body corporate  having perpetual succession 
and common seal with power to acquire, hold and dispose of property and to enter into 
contracts and shall by the said name succeed be sued. 
(4) The term of the Zonal Com mittee shall be three years and upon its expiry, the 
Committee shall be reconstituted in accordance with the provisions of sub-section (1) 
Provided that if the Oilpalm Commissioner is satisfied that it is necessary so to 
do, he may with the approval of the  Government, by order, dissolve the committee, 
before the expiry of its term; 
Provided further that the Oilpalm Commissioner shall not pass any such order 
unless the committee has had an opportunity of making its representation. 
(5) When a Zonal Committee is dissolved, the following consequences shall 
follow:- 
(a) all the members shall  vacate their offices on the date specified in the order but 
without prejudice to their eligibility for renomination as members; 
(b) the committee may be reconstituted within three m onths of its dissolution by the 
Oilpalm Commissioner in accordance with the provisions of sub-section (1) 
Constitution 
of Zonal 
Committee 
(c) the powers and functions of the committee shall, pending its re -constitution be 
exercised and performed by the Member -Secretary subject to such restrictions 
as may be specified in the order. 
(6) The Oilpalm Commissioner may, with the approval of the Governmen t, 
remove any member of the Zonal Committee, including the Chairman, from his office 
after recording the reasons in writing for such removal: 
Provided that the order removing a member shall not be passed by the Oilpalm 
Commissioner unless such member has had an opportunity of making his representation. 
(7) Subject to the provisions of this Act or any rule made there under, the Zonal 
Committee may, by order, regulate its procedure in respect of the conduct of meetin g. 
6. (1) The functions of the Zonal Committee shall  be to ---- 
(a) consider the programme of development of oilpalm cultivation in the factory 
zone. 
(b) deliberate on the problems faced by the factory or the growers in cultivation, 
transport and processing or oilpalm; 
(c) devise plans for removal of such problems with the fund as may be available 
with the Committee and to recommend to the Government such action as is necessary 
for solving the problems; 
(d) recommend to the local bodies, Highways and Rural Works and Publi c 
Works Departments of the Government for proper improvement and upkeep of roads 
leading to the factory zone from the cultivating centres including feeder roads;  
(e) take steps for prevention and control of oilpalm  diseases and pests affecting 
oilpalm and render all possible help for the development of oilpalm cultivation; 
(f) draw up plans for training of the cultivators and for extension work in respect 
of oilpalm with the fund as may be available with the committee; 
(g) consider grievances and complaints of the growers regarding transportation, 
purchase of oilpalm FFBs and payment of price by the factory to the oilpalm cultivators; 
and  
(h) administer the fund as may be available. 
(2) The Government or the Oilpalm Commissioner, may call a joint meeting of the 
Chairmen and the Members  of all the Zonal Committees for deliberating on  the  issues 
common to all the factory zones. 
7.(1) There shall be a fund at the disposal of the Zonal Committee for the 
performance of the various functions  entrusted to it.   
  (2) The fund of the Committee shall consist of – 
  (a) grants made by the Government either for a general purpose  or for any  
specific purpose for thperformance of the functions of the Committee. 
  (b) such contributions as may be made by the factories oilpalm growers.  
Oilpalm Growers Co -operative Societies or such other organizations interested in the 
development of oilpalm cultivation and processing.  
8. Subject to such rules as may be made in this behalf, the Government shall 
appoint or designate any officer of the Agriculture Department, not below the rank of 
Additional Director of Agri culture, as Oilpalm Commissioner to exercise the powers and 
perform the functions of the Oilpalm Commissioner under this Act. 
 
Powers and 
functions of 
Zonal 
Committee 
Zonal 
Committee 
fund 
Appointment 
of Oilpalm 
Commissioner 
9. (1) Subject to such rules as may be made in this behalf, the Government may 
appoint  such number of offic ers of  the Government in the  cadre of Assistant Director of 
Agriculture as Oilpalm Inspectors, for such areas as may be specified, to exercise the 
powers and perform the functions vested in the Oilpalm Inspectors under this  Act. 
   (2) Not with standing anything contained in sub -section(1), the Government 
may designate such number of officers of the Government in the cadre of Assistant 
Director of Agriculture as Oilpalm Inspect ors to exercise the powers and perform the 
functions of  the Oilpalm  Inspectors under this Act. 
10. The occupier of the factory in every factory zone shall maintain in such form 
and in such manner, as may be prescribed, a re gister of oilpalm growers in the zone 
attached to the factory in accordance with the  provisions  of section11.  The register shall 
be updated periodically and at least every year and shall always be  available in the office 
of the factory for inspection b y the  Oilpalm Inspector or any other authority authorized  by 
the Government or Oilpalm Commissioner in this behalf.  A copy of the list of oilpalm 
growers and the Oilpalm Growers’ Co -operative Societies in the zone concerned as in the 
register shall also be made available by the said occupier to the Zonal Committee. It shall 
be competent for the Oilpalm Commissioner, on the report submitted by the inspecting 
authority, to  order such corrections as he deems fit in the register maintained under this 
section. 
11. (1) The Government shall have the power to declare, by notification, any area 
as factory zone for the purpose of supply of oilpalm fresh fruit bunches to the factory 
specified for the purpose or purchase of oilpalm FFBs and any other oilpalm product by 
the factory. 
(2) Where a particular area is declared as factory zone under sub -section (1), the 
oilpalm growers in that area shall supply the fresh fruit bunches from the oilpalm 
plantations grown in that area only to the factory to whom the factory zon e is attached 
and to none else. 
(3) Where a particular factory zone is declared under this section, the occupier of 
the factory in the factory zone concerned and for which the zone is declared, shall buy all 
the oilpalm FFBs produced by all the oilpalm gro wers or their co -operative societies in 
that factory zone as are offered for sale by them at a price which shall not be less than 
the price fixed by the authority empowered to fix the price under this Act. 
12. (1) In the event of failure on the part of the occupier of a factory to buy all the 
oilpalm fresh fruit bunches from the growers in the factory zone declared in relation to a 
factory, without any valid reason, the occupier of the factory shall be liable t o compensate 
the loss that may  have been caused to the grower on account of non -purchase of the 
oilpalm FFBs by the factory in addition to the penalty specified in section 17. 
(2) Where an occupier of a factory refuses to buy particular consignment or 
consignments of oilpalm FFBs from a grower, he shall assign reasons therefor in writing.  
Provided that damage, inefficient running, breakdown of plant machinery, failure 
to use capacities, and any other operational problems shall not be valid reasons for 
refusal of the consignment of oilpalm FFBs and shall be treated as the failure on the part 
of the factory to buy the oilpalm FFBs for purposes of sub-section(1) 
Provided further that the Oilpalm Commissioner shall be the authority to deci de 
whether there are valid reasons for the failure to buy oilpalm FFBs and his decision 
thereon shall be final. 
13. (1) The Government may, suo motu. fix the minimum  price of oilpalm FFBs or 
authorize the Oilpalm Commissioner to do so subject to such guidelines as they may give 
in that regard from time to time.  
Oilpalm 
Inspector 
Registrar of 
Oilpalm 
Growers and 
Oilpalm 
Growers Co-
operative 
Socieities. 
Declaration 
of Factory 
Zone 
Failure to buy 
oilpalm FFBs 
Power to 
fix prices 
(2) Where the Oilpalm Commissioner is authorized to fix  the prices of oilpalm 
FFBs to be purchased by the factory, he shall de clare at such intervals as may be 
directed by the Government the minimum price at which the oilpam FFBs be purchased 
by the factories. 
14. (1) The occupier or owner of an oilpalm factory shall make suitable provision 
to the satisfactory of the Oilpalm Comm issioner for the payment of the price of oilpalm 
FFB supplied to the factory. 
(2) Upon the delievery of oilpalm FFB the occupier or owner of a factory shall be 
liable to pay within fourteen days from the date of such delivery the price of the price of 
the oilpalm FFB so supplied. 
(3) The price of the oilpalm FFB remaining un -paid on the expiration of the period 
specified in sub-section (2) shall carry interest at fifteen per cent per annum from the date 
of delivery of oilpalm FFB and it shall be recovered as if it were an arrear of land revenue. 
(4)  If any occupier or owner of a factory fails to pay the price of the oilpalm FFB 
sold to him in accordance with  the provisions of sub -section (2) or the interest payable  
under sub-section(3), he shall, in addition to the said price or the interest being recovered 
from him as an arrear of land revenue, be liable to the penalty provided for under clause 
(b) of sub -section (4) of section 3 of the Essential Commodities Act, 1955, as if he has  
contravened a direction issued under that clause. 
(5) Without prejudice to the provisions of the foregoing sub -sections, where the 
owner or occupier of a factory or any other person competent in that behalf, enters into 
an agreement with a bank under whic h the bank agrees to give advance to him on the 
security of palm oil produced or to be produced in the factory, the said occupier, owner or 
other person, as the case may be, shall provide in such agreement that such percentage 
which shall not be  less than  fifty per cent of the total amount of advance, as may be 
prescribed, shall be set apart and be available only for payment to oilpalm  growers or 
other co-operative societies on account of the quantity of oilpalm FFB purchased or to be 
purchased for the fac tory from those oilpalm growers  or from or through those societies 
and interest thereon and such societies commission in respect thereof.  
(6) Every such occupier, owner or other person as aforesaid shall send a copy of 
every such agreement to the Oilpalm Commissioner within a week from the date on 
which it is entered into. 
15. (1) The Government may, by notification, levy a tax at a rate not  exceeding 
rupees one hundred per MT on the purchase of FFBs required for use. Consumption or 
sale in a factory. 
(2) the Government may, by notification, remit in whole or in part such tax in 
respect of FFBs used or intended to be used in a factory for any  purpose specified in 
such notification.  
(3) The tax levied under sub -section (1) shall be collected from the occupier of 
the factory or from the person receiving oilpalm FFBs or the  processing factory in such 
manner and by such authority, as may be prescribed. 
16. (1). Every occupier of the factory shall maintain such records as are 
prescribed or as required by the Oil palm Commissioner with the approval of the 
Government. 
(2) An Oilpalm Inspector may at any time in spect a factory and verify such 
records, reports, statements and registers as may be required to be maintained in 
connection with due implementation of the provisions of this Act and may also direct the 
occupier of a factory to produce them for his verification. 
(3) The powers under sub-section (2) may be exercised by any officer authorised 
in this behalf by the Oilpalm Commissioner by a general or special order. 
Payment 
of oilpalm 
price 
Central Act 
X of 1955 
Levy of tax 
on purchase 
of oilpalm 
FFBs. 
Maintenance 
of record and 
inspection 
(4) An occupier of the factory who fails to maintain the records as required by this 
section or fails or refuses to produce the same when called for by an authority under this 
Act shall be punishable under section 17. 
17. (1) Every  person or occupier of a factory who contravenes the provisions of 
section 11 shall be punishable with fine which may extend to rupees ten thousand and in 
the case of a continuing contravention of the provisions of the said section with a furthe r 
fine not exceeding  rupees one thousand for each day during which the contravention  
continues. 
(2) Any person or occupier of a factory contravening any of the provisions of 
this Act or of any rule or order made thereunder f or which no penalty in provided in sub-
section (1) shall be punishable with fine which may extend to rupees five thousand.  
18. (1) No Court shall take cognizance of any offence punishable under this Act 
except on complaint in wirting made by the Oilpalm Co mmissioner or any authority of 
officer authorised by him in this behalf. 
(2) No Court inferior to that of Metropolitan Magistrate or a Judicial Magistrate of 
the first class shall try any such offence punishable under this Act. 
19. On the application of a person accused of an offence under this Act or any 
rule or order made thereunder, the Oilpalm Commissioner or any authority  or officer 
authorised  by him in this behalf may, at any st age, compound such offence by levying a 
compounding  fee not exceeding rupees ten thousand. 
20. (1) No suit, prosecution or other legal proceeding shall lie against any person 
for anything which is in good faith done or intended to be done in pursuance of this Act or 
any rule or order made thereunder. 
(2) No suit or other legal proceeding shall lie against the Government for any 
damage caused or likely to be caused by virtue of any provision of this Act or by anything 
which is in good faith done or intended to be done in pursuance of this Act or any rule or 
order made thereunder. 
21. (1) Where the occupier of an oilpalm factory is a firm or other association  of 
individuals, any one or more of  the partners or members thereof may be prosecuted and 
punished under this Act for any offence for which the occupier of the factory or owner 
thereof is punishable. 
Provided that the firm or association may give notice to the Oilpalm 
Commissioner that it has nominated one of its partners or members to be occupier of the 
factory for the purposes of this Act and such individuals shall be deemed to be the 
occupier of factory for the purposes of this Act, until further notice cancelling his 
nomination is received by the Oilpalm Commissioner or until be ceases to be a partner or 
member of thefirm or association, as the case may be. 
(2) Where the occupier of factory is a company or a co -operative society, any 
one or more of the Directors thereof or in the case of a private company any one or more 
of the shareholders thereof may be prosecuted and punished under this Act for any 
offence for which the occupier of the factory is punishable. 
Provided that the company or co-operative society may give notice to the Oilpalm  
Commissioner that it has nominated a Director and a private company may give notice to 
the said officer that it has nominated a shareholder to be the occupier of the factory for 
the purposes of this Act and such Director or shareholder shall be deemed t o be the 
occupier of the factory for the purposes of this Act until further notice cancelling his 
nomination is received by the Oilpalm Commissioner or until be ceases to be a Director 
or shareholder as the case may be. 
 
Penalties 
Cognizance of 
any offences 
Compounding 
of offences 
Protection of 
action taken 
in good faith. 
Determination 
of occupier of 
factory for 
purposes of 
this Act. 
22. The Government may, subject to the provisions at this Act by order, direct the 
Oilpalm Commissioner or any other officer to make an enquiry or to take appropriate 
proceeding under this Act in respect of any matter specified in the order and the Oilpalm 
Commissioner or the other officer as the case may be  shall report to the Government in 
due course, the result of the enquiry made or the proceeding taken by him.  
23. The Government may by notification, delegate all or any of their powers 
under this Act except section 24 to any person or authority subordinate to them sub ject to 
such conditions and to such control and revision as may be specified in the notification 
and they may in the like manner withdraw any powers so delegated. 
24. (1) The Government may make rules for carrying out all or any of the 
purposes of this Act. 
(2) In particular and without prejudice to the generality of the foregoing power 
such rules may provide for all or any of the following matters namely:- 
(a) conditions governing the declaration of a factory zone and the alterations or 
cancellation thereof. 
(b) plucking, collection and delivery of the oilpalm FFBs by the growers or as the 
case may be, by the companies and the prescription of collection centres by the Oil palm 
Commissioner. 
(c) any other matter which is to be or may be provided for by rules under this Act.  
(3) Every rule or order made or notification issued under this Act shall as soon as 
possible after it is made or issued be placed on the table of the Leg islative Assembly and 
it before the expiry of the session in which it is so placed or the next session, the 
Legislative Assembly makes any modification in any such rule or order or notification or 
the Legislative Assembly decides that the rule or order or notification should not be made 
or issued the rule or order or notification shall thereafter have effect only in such modified 
form or be of no effect, as the case may be, so, however that any such modification or 
annulment shall be without prejudice to the validity of anything previously done under that 
rule or order or notification. 
 
(By order of the Governor) 
 
 
M. MUNIRAMAN, 
SECRETARY TO GOVERNMENT 
LAW DEPARTMENT 
Power to give 
direction. 
Delegation of 
powers 
Power to make 
rules 

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