The Inter-State Corporations Act, 1957
Administered Ministry: Ministry of Home Affairs / Department of States
Act details
| Short title | The Inter-State Corporations Act, 1957 |
|---|---|
| Long title | An Act to provide for the reorganisation of certain corporations functioning in two or more States by virtue of section 109 of the States Reorganisation Act, 1956, and for matters connected therewith. |
| Act number | 38 of 1957 |
| Act year | 1957 |
| Enactment date | 20 Sep 1957 |
| Ministry | Ministry of Home Affairs / Department of States |
| Department | Department of States |
| Jurisdiction | Central (Parliament of India) |
| Sections | 5 |
| Schedules | 1 |
| Status | Not repealed |
| Last checked on India Code | 4 Nov 2026 |
| Source | India Code, Government of India |
Summary
Summary of the Inter-State Corporation Act, 1957
Key Provisions:
1. Extension of Corporate Powers
o The Act enables the objects and powers of a corporation established under a State law to be extended to another State or States.
o Such extension requires the consent of the Governments of the States concerned.
2. Inter-State Agreements
o The participating States may enter into agreements specifying the terms and conditions for extending the corporation's jurisdiction and operations.
o These agreements may provide for administration, management, financial arrangements, and other related matters.
3. Approval by Parliament
o The extension of a corporation's powers takes effect through a law enacted by Parliament under Article 252 of the Constitution, after resolutions are passed by the Legislatures of the participating States.
4. Administration and Governance
o The Act provides for the continued functioning of the corporation in accordance with the law under which it was established, subject to modifications made through the inter-State arrangement.
5. Rights and Liabilities
o The corporation retains its legal identity, and its rights, obligations, assets, liabilities, and contracts continue to operate in the extended area as provided by the Act and the relevant agreement.
6. Supplementary Provisions
o The Act contains provisions to facilitate the effective implementation of inter-State arrangements, including matters relating to administration, finance, and legal proceedings.
Legislative history
Legislative History: The Inter-State Corporations Act, 1957
Act Title - The Inter-State Corporations Act, 1957
Act Number/Year - 38 of 1957
Act ID (India Code) -195738
Presidential Assent date - September 20, 1957
Enforcement Date - September 20, 1957
Nodal Ministry - Ministry of Home Affairs
Precedent & Historical Rationale
1. Transitional Provisions of Section 109, States Reorganisation Act, 1956: Following the redrawing of state boundaries on November 1, 1956, numerous state-level corporate bodies (such as nursing councils, khadi boards, and electricity boards) suddenly found themselves operating across two or more newly formed States as "inter-state corporations".
2. Reorganization & Asset Division Mechanism: Enacted to establish a statutory mechanism allowing affected State Governments to frame schemes for the reconstitution, division of assets/liabilities, transfer of employees, or dissolution of such inter-state corporations. It empowered the Central Government to issue final statutory orders giving effect to such schemes after consulting the concerned States.
Parliamentary Trajectory & Enactment
● Formulation: Introduced by the Home Ministry to resolve administrative and asset-allocation deadlocks arising out of state reorganization.
● Parliamentary passage: Debated and passed by both Houses of Parliament (Second Lok Sabha and Rajya Sabha) in August–September 1957.
● Presidential Assent: Received Presidential Assent on September 20, 1957.
● Enforcement: Enforced on September 20, 1957.
Source: Official Record of Parliament, India Code, and Ministry of Home Affairs