Factory Act Registration

Factory owners had to compulsorily register their premises with local authorities before the Factories Act, 1948 came into force. The local authorities gave a license to run their factories and carry out manufacturing activities. The Factories Act, 1948 (‘Act’) provides that certain factories that fulfil the conditions given in the Act must register and obtain a factory license under the Act to ensure the safety of the workers. The factory owners can renew the factory license upon its expiry by applying to the respective state labour department or department of factories.

Definition of Factory as per Factories Act, 1948

Under the Factories Act, “factory” means any premises:

Where ten or more than ten workers are working or were working on any day of the preceding twelve months, and in any part of which a manufacturing power is being carried on with the aid of power, or is ordinarily so carried on, or

Where twenty or more than twenty 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.

Types of Factories

The Factories are broadly divided into two subcategories depending on the process-

Hazardous- Hazardous factories mean such kinds of factories whose manufacturing process is hazardous process. As per section 2(cb) of the Factories Act, 1948 hazardous process means any process or activity in relation to an industry specified in the first schedule where unless special care has been taken, raw materials used therein or the intermediate or finished products, by-products, wastes and effluents thereof would cause harm to the person engaged or working in that factory. Also if such kinds of waste or effluents cause harm to the environment and create pollution.

Non- Hazardous- Non-Hazardous Factories are the ones whose manufacturing process does not include hazardous processes. It simply means that the waste or effluents of the factory do not create any harm to the workers working there or to the environment.

Advantages of Getting a Factory License

Obtaining a factory license is beneficial to all the employees working at such establishments as it ensures the safety and well-being of these workers. Some of these advantages include;

1. Legal Benefits- The factory owner would be eligible to avail of legal benefits provided by the government, depending on the scheme chosen

2. Specified Provisions for Employees- Female and young workers are looked after under this in regard to salaries, health and safety, work conditions, and the number of hours they put in

3. Additional Matters- Holidays, leaves, number of hours, wages, enlisting of women, enlisting children, hiring, firing and many other factors are taken care of when one gets the factory license.

4. Productivity Enhancement- Complying under the guidelines set by the Factories Act 1948 further enhances the productivity of all the workers

5. Equality- The license ensures that every employee under the establishment gets equal rights and treatment

Documents Required For Factory Registration

Following is the list of documents needed for Factory Registration:

1. Form No-2 or Combined application form for establishment of industries in form 1AA.

2. Construction completion report from management as per the approved plan.

3. Requisite Fee in shape of treasury Challan in proper Head of Account as per fee structure notified in from time to time.

4. Resolution of Director/partners nominating one to act as occupier under section 2(n) of Factories Act.

5. Original copy of Stability Certificate issued by a recognized competent person.

6. Safety & Health Policy for 2(CB) and MAH category factories and other factories are employing 50 or more workers.

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-

1. 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.

2. Avails Legal Benefits- The factory owner can avail of the legal benefits provided by the government under different schemes.

3. Enhances Productivity- Proper enactment of compliances and guidelines of the Factories Act, 1948 enhances the employees' productivity.

4. Regulates Various Matter- It helps in regulating various matters such as-

Working hours,

Wages/payments,

Leaves,

Holidays,

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.

5. Ensuring Equal Benefits- Proper Compliances of the Factories Act helps in ensuring that every employee receives equal benefits.

A Checklist of all the Requirements for Obtaining the Factory Licence

The factory owner/s will be required to take permission well in advance from the State government as to where the factory will be located. To be able to occupy the premises, the owner will also need to send a legal notice to the chief inspector under the Section 7 Act a minimum of 15 days before any activity or occupancy can be achieved there. The following details would be needed at this time;

Name of the occupier

Address of the occupier

Name of the manager that will run the show

Number of employees that will be hired

Type of manufacturing process which shall be carried out at the said factory

Any other details which require close monitoring

The procedure of Registering a Factory in India

Since it is mandatory to obtain a Factory License before starting a factory in India, you need to register your factory first and given below are the steps for the same-

1. Submission of Business Plan- The plan related to your factory like how it is going to work, where it is going to establish and the limits and boundaries of the factory etc should be submitted as per the rules laid down by the state government regarding the establishment of the factory. Consent of the State Government or Chief Reviewer must be taken for the establishment of the factory as it is mandatory to take as per the rules and regulations. It must also contain the precautions taken by the factory related to health, welfare, and safety measures for the employees of the factory.

2. Details provided by the Owner- Following are the details which must be provided by the owner-

Manufacturing Process Type must be provided by the owner

Number of employees, who will work in the factory

Address of the factory where it will be established

Name of the manager of the factory

Details of machinery deployed in the factory

3. Filing of Application for Approval- The Application for approval is required to be submitted with the help of the form called Form -1 in the prescribed manner along with all duly signed documents as per the rules and regulations.

4. Payments of Fees Regarding License- Payment of fees for the license is mandatory once approval of Application is obtained by the applicant of the license. Approval can be taken as per the rules and regulation of the license.

5. Verification and Inspection- In the event that the application and proposals are in accordance with the rules and regulations provided under the Factories Act, 1948 and Factories Rules, 1950. The factory plan shall be approved or verified by the Factories Director after review of the recommendations of the Deputy Factories Director.

6. Grant of License- After payment of fees and valid verification by the inspection department that all the documents and application forms are as per desired rules and norms, then the license is issued by the concern Department.

Procedure to get Factory License in India

Section 6 of the Factories Act, 1948 which was made for the safety of the workers of the factory and it gives the authority to the government to govern make the rules relating to the licensing and registration of factories under the Act on the matters which are given below-

1. Rules and Regulations for Submission- The State Government may make the rules and regulations for the submission of plans or the representation of manufacturing plants. The association requires the prior consent of the State Government or the Chief Review Officer to develop or increase any industrial facility for the workers or employees of the factory. In any case, the expansion or substitution of existing hardware does not increase unless the protected working space is reduced and, in addition, it is not hazardous to well-being and soundness perspective.

2. Inspection Process- The step-by-step process which is involved in the inspection or verification is provided below-

Establishment Identification is required

Joint Team Inspection will be done

Report on inspection must be submitted by the concern authorities

Notice of non-compliance should be serve

3. License Approval is Needed- In the event that an application is made for the purpose of approval with respect to the development or expansion of the processing plant, it shall be drawn up by registered post or through the Government portal of the State government or the Chief Inspector. In case if no reply is received within one month from the date of use, it shall be assumed that it is confirmed by the authorities. If not approved within thirty days of the date of the application by the applicant, the framework will naturally be presumed as rejected.

Penalties:

If any person violates the rule made by the factories act 1948, they will be penalized according to the act.

Imprisonment for a term which may extend to one year, or Fine, which may extend to one lakh, or both.

Conclusion

The registration and licensing of factories under the Factories Act 1948 are essential to guarantee the security, well-being, and government assistance of modern labourers in India. By complying with these guidelines, factory owners satisfy their lawful commitments as well as add to the general development and improvement of the contemporary area. Both government specialists and factory owners must cooperate to implement these arrangements, making a more secure and helpful workplace for all.