Overview of Factory License
To protect the workers and ensure that the owner provides a healthy environment, the government has introduced the Factory Act 1948. As per the Factory Act 1948, every factory owner must register their premises with the local authorities before commencing their business. A factory License acts as a document of approval given by authorities to carry out manufacturing activities. The Department of Factories and Boilers issues Factory License. The Factories and Boilers Department must keep a check on workers' health, safety, and welfare.
Also, a factory registering under the Factories Act, 1948 must obtain its building plan approval from the labour and employment department before covering themselves for a factory registration.
Guidelines to be adhered to by the Factories
The government has laid down the guidelines that are required to be followed by those Factories which-
The factories are broadly divided into two sub-categories depending on the process-
Benefits of Obtaining a Factory License
The main motive for obtaining the factory license is to ensure that appropriate safety measures are adopted to promote the employees' safety, welfare, and health. The benefits of getting a Factory License are mentioned-below-
Provides Specific Provision For Employees
The Act specifies the provisions associated with female employees and young people, wages for employees, work hours, working conditions, etc.
Avails Legal Benefits
The factory owner can avail of the legal benefits provided by the government under different schemes.
Proper enactment of compliances and guidelines of the Factories Act, 1948 enhances the employees' productivity.
Regulates Various Matter
It helps in regulating various matters such as-
- Working hours,
- Enlistment of juveniles/women,
- Hiring and termination of work,
- Other terms of service or any conditions related to the individuals working in shops, commercial establishments, public amusement establishments, etc.
Ensuring Equal Benefits
Proper Compliances of the Factories Act helps in ensuring that every employee receives equal benefits.
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Documents required for Obtaining the Factory License
Registration Procedure of Factory License in India
Section 6 of the Act empowers the State government to monitor the Licensing and registration rules of the factories Act.
The government of India has set a simple process to obtain a Factory license. The process varies in the case of hazardous factory licenses and non-hazardous factory licenses. The process for obtaining a Factory License involves the following steps: -
Before applying, the applicant needs to get factory plan approval from the respective authorities. Once this approval has been obtained, the applicant can start obtaining a factory license.
Step 1 Submission of Plan
The plan should be submitted as per the rules laid down by the state government. There is a requirement of prior consent for expansion or construction of any Industrial facility by the State Government or Chief Reviewer.
Step 2 Details by Owner
- Manufacturing Process Type
- Number of employees
- Address of the factory
- Name of the manager
- Details of machinery deployed
Step 3 Filing of Application
The Application for approval is required to be submitted in Form -1 in the prescribed manner along with all duly signed documents.
Step 4 Payments of Fees
Payment fees for the license are to be submitted once approval of Application is obtained.
Step 5 Grant of License
After payment of fees and inspection is Department is satisfied that all documents and application form is as per desired rules and norms, then the license is issued by the Department.
Factory License Renewal
Factory License is valid for up to one year, and so it should be renewed before its expiry. The process for renewal of license is the same as the registration process. Documents required for renewal of Factory license are:
In case default has been made in the renewal of the Factory license, a minimum of 10% of the license fee has been prescribed as a penalty which shall increase by 10 % every month.
Process for Suspension of a Factory License Voluntarily
In case the licensee needs to surrender the factory license to the government, the below-mentioned process should be followed-
CorpBiz Procedure for Factory License
Frequently Asked Questions
Documents are required for the renewal of the factory license:
- Treasury or Online Challan
The basic responsibilities of an occupier are to make sure-
- The welfare of workers,
- Their health conditions,
- Their work environment,
- Time of duty is well within the guidelines of the government.
Steps are required for obtaining the Factory License:
- Payment of requisite Fee
- Obtaining a license.
The factories are broadly divided into 2 sub-categories-