Nowadays, with the increase in awareness among people and scrutinisation of the producers’ activities affecting the environment, the scrap business is proving very beneficial. According to data presented for the market overview, the metal scrap is worth more than 500 billion dollars, with India sharing 11 billion dollars which is estimated to be up to 2.2% of global production. Further, India is expected to generate steel worth over 110 million dollars.
Apart from this, in 2013-14, India generated around 26.9 million tons of steel from scrap metal, estimated to increase to 12.48 per cent in the following five years. These numbers encourage producers to set up more scrap businesses for which Pollution Control License for Scrap is needed. This blog will give a detailed account of the steps to acquire a Pollution Control License for Scrap.
Advantages of Starting a Metal Scrap Business
Starting Scrap business is not profitable regarding market overview it also has many advantages including: –
- Setting up a scrap metal business makes the extraction of new metal less frequent, ultimately contributing to the environment and decreasing pollution caused during metal extraction.
- Setting up a scrap business also saves the energy consumed during the extraction from the ground.
- Scrap metal business is also cost-effective compared to setting up operations to extract new metal from the ground.
Overview of Metal Scrap
For starting any business, it is essential to understand the subject matter of that business. For the scrap business, it is essential to understand the different metal scrap present, which is divided according to the presence of iron. The different categories of metals are ferrous and nonferrous metals. Where on the one hand, ferrous metal is magnetic and contains iron which is more robust than non-ferrous metal, which does not contain iron and is resistant to corrosion. The metals that are included under these categories are: –
- Alloy steel
- Stainless steel
- Cast iron
- Carbon steel
- Wrought iron
Process of Acquiring Pollution Control License for Scrap
Scrap dealer must comply with the rules to register a business under the company’s registration laws, such as the Limited liability Partnership Act, 2008, Companies Act, 2013 and Partnership Act, 1932, which would require the owner to submit the following document.;
- Limited Liability Partnership– Scrap dealers have to file documents related to identification along with Business tax returns and Registrar of Companies
- One person Company– Scrap dealers for One Person Company also have to file documents related to Identification along with Business tax returns and Registrar of Companies.
- Private limited Company– For Private Limited Company have to file documents related to Identification along with Business tax returns and Registrar of Companies, returns for which audit is mandatory.
- Public Limited Company-At last, for Public Limited Company only, the business tax return is to be filed, followed by mandatory auditing.
If a Scrap dealer wants to register their business under Factories Act, in that case, they are mandated to get a Factory license, which the Chief Inspector approve of the Labour Commissioner Organisation after examining the operation site as mandated under the Factories Act, 1948. For the Factory license, the documents that are required are: –
- Form 1
- Layout plan/site plan
- Aadhar Card
- List of directors
- Partnership deed
- Account Details
- Commencement date
- Payment receipt
- Land deeds
- Consent form from SPCB/PCC
- Details of Hazardous and Non-Hazardous waste
- Tax receipt
Additionally, the Scrap dealer must provide production understating after the Pollution Control License for Scrap is granted.
Pollution Control License for Scrap
The Air and Water (Pollution and Control) Act prescribes the process for obtaining Consent certificates which are parts of the Pollution Control License for Scrap. The steps included in the application process are filing the application, review of the submitted application and at last granting of the license.
Documents Required for Consent to Establish
According to Air and Water Act for acquiring Pollution Control License for Scrap one have to submit the following documents: –
- Land documents, including registration/lease or sale deed
- Detailed Project Report that contains financial breakup relation Pollution Control Measures Break up of land used, Manufacturing process details, Procedure Flow chart, Control Equipment for Air Pollution, Details for ETP and Solid Waste Management, Generation of Waste Water.
- Layout Plan/Site Plan
- GST Certificate
- Aadhar Card
- Copy of Self Declaration form with signatures
Documents Required Under Consent to Operate
According to Air and Water Act for acquiring Pollution Control License for Scrap one have to submit the following documents:-
- Electricity Bill or water bill
- Proof of ownership, including rent agreement or lease agreement
- Pan Card
- Aadhar Card
- Municipality or Industry license for trading business
- Health Trade License
- Site Plan/layout
- CA Letter on the financial breakup of the scrap trading business
- GST certificate
- Form-V under Rule 14 of the Environmental (Protection) Act
- Authorization Letter
- Factory/Trade License
- Proof of Registration of unit under Companies Act or LLP Act
- Consent to establish a certificate
Process for Acquiring Consent Certificates
- After registering the business, the scrap dealer needs to obtain the consent certificate which is part of the Pollution Control License for Scrap, that is granted as per the establishment of the business in different stages; under the mandated law, it is attained in two stages first is
- Consent to establish prescribed under the Air and Water Act is required by the scrap dealer before establishing the industry or manufacturing process.
- After Consent to Establish, Consent to operate is granted by the State Pollution Control Board/Pollution Control Committee after the Industry is established and the manufacturing process is ready to Operate.
- In case the Scrap dealer does not have a GST certificate. They must apply for a GST number from GSTIN through their official government site. The documents required for GST Certificate are: –
- PAN Card of either individual or a company
- Memorandum Of Association
- Article of Association
- PAN of the signatory
- Address proof (Aadhar card)
- Bank details
- LLP proof of registration (If applicable)
- The Scrap dealer also needed to get authorisation for a Digital signature certificate that would let any means of transport, primarily trucks, transport scrap without unnecessary restrictions.
- The Scrap dealer must also register a scrap business as an enterprise for medium-small and micro-enterprises (MSME).
- In the end, authorisation from the government department is also required for a hassle-free scrap trade business.
- The trader, on top of this, also requires licences from the Local municipal area to complete the metal scrap trade license procedure.
Pollution Control licenses for scrap have proven to be very beneficial for authorities to monitor and regulate the activities of scrap dealers properly as well as provide many incentives for scrap dealers, including hassle free permission for trade. Although the license process is pretty elaborative and confusing, the authorities provide proper assistance to the applicant for registration.