Introduction: Factory Compliance and Legal Regulations
Hey learners, let's talk and take a closer look at the businesses or factories that are already operating or soon will be operating in India. The factories act, 1948 became operative for the factories in India to control the working environment, rights, and responsibilities in the factories. In India, any setup with more than 20 employees is subject to the Factories Act, 1948. The act ensures the obligations of the Employers and Employees in the factories and controls and protects the workers so that the proper working environment may be given. The meaning of the “Factory” according to the Factories Act, 1948 is ‘any premises including the precincts thereof whereon ten or more workers are working in any part of which a manufacturing process is being carried on with the aid of power, or is ordinarily so carried on, or whereon twenty or more workers are working or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on without the aid of power, or is ordinarily so carried on.
Table of Contents
- Introduction: Factory Compliance and Legal Regulations
- Procedure For The Factory License
- Documents To Be Submitted For Issuance Of New Factory License
- For the confirmation of Industry Location
- State Industrial And Infrastructure Development Corporation Allotment
- Documentation Required For The Factory License Under Household Category
- Documentation Required For The Industries Outside The Industrial Area
- Documents Required For New Factory License From Local Commercial Category
- Documents required for Renewal of License
- Documents required Licensing for the Amendment in the Factory
- Eligibility for Licensing of the Factories
- Regulatory Authority of the Factories
- Fee required
- Penalties for Non-complying Governing Law by the Factories
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Procedure For The Factory License
- Open the website of the Municipal Department of the Concerned State.
- Login using the registration credentials at the Citizen login portal;
- Make sure the information being submitted is correct from your viewpoint and understanding
- On successful registration of the Applicant; log in using essential login credentials(mobile no., username, etc)
- Click on the factory license option Go thoroughly through the guidelines and instructions on the website
- You have the option to change your credentials such as mobile number, and name
- At the factory license portal, all details of all the registered Companies along with their details (such as Registration number, Applicant, Process name Trade name Category, etc)
- For the legacy records, search from the legacy search module using the license number, factory name, etc
- If the validity mentioned in the record is expired, then the renewal process can be processed
- If the documents are valid, an amendment or surrender of the licenses can be made
- For the first timer, who are new and willing to apply, click on Apply for new Factory License
- Fill out the application correctly mentioning the Personal details, Industry type and area of work, trade type, Machinery details and power details, Storage details, factory details, Manufacturing Details, etc., and upload the documents.
- Verify the details, submit the form, and pay the required fee using the Payment gateway
- The application is sent for scrutiny and approval to the MCD officials
- In case any questionnaire is raised by the MCD officials, the applicant needs to provide the required information within a definite period
- If the documents are rejected, the applicant has the option to reply a fresh
- If the application is approved the License is downloadable from the website.
- The applicant whose license is approved has the option to Renew, amend, or Surrender the license as and when required.
Documents To Be Submitted For Issuance Of New Factory License
For the confirmation of Industry Location
- Ownership proof (Such as Lease deed, Perpetual deed along with NoC from the Owner)
- Details of the Company (Memorandum of Understanding, NoC from Partners in case of Partnership deed)
- Authority Letter of the Applicant
- Sanction of the Construction of the Building at the site from the concerned department;
- Self Declaration on the letterhead (Self undertaking)
- Additional documents required (depending on the State Concerned)
- Consent from State Pollution Control Board
- No objection Certificate (NOC) from the fire department
- NOC from Water Board.
State Industrial And Infrastructure Development Corporation Allotment
- Ownership Details (such as Registered occupancy proof perpetual deed, lease deed, and not of the Owner)
- Company Details (Memorandum of Understanding or NoC in case of Partnership deed from the Partners.)
- Authorization letter from the Applicant
- Sanction from the local authorities for the Construction of the Building
- Self-declaration of the correctness of your & documentation
- Additional documents depending on the requirements of the State concerned
- Consent from the State pollution control Board
- No objection certificate from the fire department
- No objection certificate from the Water Board (for the use of well or groundwater)
Documentation Required For The Factory License Under Household Category
- Ownership certificates (such as lease deed and NoC from the Owner);
- Applicant's details (such as ID card, PAN card, etc.)
- Site plan detailing the key plans along with a copy of the Electricity Bill etc.;
- Self-declaration (confirming the proof and documents mentioned);
- Details of the additional documents required;
- Consent from the State Pollution Control Board;
- Consent from the water, fire, and electricity departments
Documentation Required For The Industries Outside The Industrial Area
- Ownership Certificate (Such as occupancy proof/rent agreement/lease agreement along with NoC from the Owner)
- Details of the Company (MoU, Certificate of Incorporation/NoC in case of Partnership deed from the partners)
- Authorization letter
- Consent from the State Pollution Control Board;
- No objection certificate from the Electricity, water, and fire department;
- Additional documents as per the State Board;
- Self-declaration/undertaking for approving the documents mentioned (No further affidavit is required)
- No objection certificate from the Water, fire, and electricity department
Documents Required For New Factory License From Local Commercial Category
- Ownership certificate (lease deed/rent agreement along with NoC from the Owner)
- Copy of electricity bill
- Sanction certificate including key plan, building plan, and site plan (from the local authority)
- The self-authorization on the letterhead (No additional affidavit required).
- Consent letter from the State Pollution Control Board;
- Safety explosive certificate for the concerned State authority;
- No objection certificate from the fire, water, and electricity department.
Documents required for Renewal of License
Along with the documents mentioned above which are personal and Companies information, a few additional documents are required for renewal
- Consent letter from the State Pollution Control Board
- No objection Certificate from the fire department
Documents required Licensing for the Amendment in the Factory
- Constitution certificate of the firm/Incorporation certificate in case of Private/public limited Company (MoU/AoA)
- No objection certificate (NOC) for the authority in favor of the applicant (from the members in case of change in the name of Director/Partner)
- Details of the changes in power load (Horsepower machinery)
- Undertaking/Authorisation on the letterhead (no further certificate is required)
- Consent from the concerned State board (as per the requirement of changes in the Company)
- Additional authorization/bond/affidavit as defined for industrial concentration for redevelopment into the confirmed industrial area.
Eligibility for Licensing of the Factories
For the factories wherein the number of employees exceeds ten and work with the aid of power for the manufacturing process or Factories wherein twenty or more employees are working without the use of power in the Manufacturing units, needs to be registered with the Factories Act, 1948. Every Factory which is at its initial stage and is under development, construction, or planning to extend its business must be approved under the Factories Act, 1948.
Regulatory Authority of the Factories
According to the factories act, 1948 the State government has the power & authority to make rules and regulations with regard to the registration and licensing of the factories, through
The application fee which includes the registration fee, processing fee, factory license fee, and permission fee is required at the time of filling out the application.
For the renewal of the license fee such as permission fees, processing fees, transaction fees, late & arrear fees (if applicable), and a convenience fee is required at the time of renewal of the application. The application fee, renewal fee, amendment fee, or surrender fee varies from State to state and Project to project. For getting detailed information, Consult our Expert, who provides every little information and takes care of their customer and spoonfeeds them a client for every Compliance part when the Company or Project requires it.
The license is valid for the period of one year which is December 31st from of manufacturing Starting date. Every Manufacturing, before the expiry of the license, needs to be renewed to avoid extra charges and penalties, and further documentation.
Penalties for Non-complying Governing Law by the Factories
Startups or Factories under which there are more than 20 employees or which are governed by the Factories act, 1948 must have to comply with the rules and regulations of the Factories Act, 1948 and for contravention of the provisions of the act, the penalties shall be imposed which may extend to 7 years of imprisonment or fine which may extend to Rs. 2 Lakhs/- and for the repeated violation of the provisions of the act, penalties may be imposed which may extend to 10 years and fine of up to Rs. 5 thousand per day.
The Corpseed is one of the best technology services providers which helps Businesses and Startups in the Legal Compliance part, reach out to the Expert team of Corpseed for detailed regulatory Compliance & information for your Startup, Business, or factories.
This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not corpseed, and have not been evaluated by corpseed for accuracy, completeness, or changes in the law.
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