Getting Factory License: Fees, Procedure, and Online Registration

Over the years, the manufacturing industry in India has shown steady growth. Technological advancements, the advent of new manufacturing techniques, and the increasing usage of modern equipment and machinery have worked as catalysts for the industry’s growth and increased production output.

Also, several schemes launched by the Government of India, like the ‘Made in India’, have given the industry much-needed support. At the current growth rate, India is expected to have the 5^th largest manufacturing industry in the world by 2025. While the manufacturing units in the country are growing, it is important to safeguard the interest of the labourers working in these units as well as give them a safe and healthy work environment.

To ensure that all the owners of the manufacturing units, i.e., factories, the government introduced the Factory Act in 1948. The act mandates all factory owners to register their manufacturing units with the concerned authorities and obtain a factory registration certificate. This license allows the factory to operate legally and affirm all the rules and regulations.

As per the government of India regulations, the following types of factories must be registered under the Factory Act and adhere to its norms.

• Factories that have a minimum workforce of 10 workers and consume power
• The manufacturing units that produce hazardous and non-hazardous products
• Factories that have a workforce of 20 workers or more and do not consume any power

What is the procedure for registering the factory and getting a license?

Since it is mandatory for all manufacturing units, i.e., factories in India, to register their establishment and get a license, you must take the following steps to get your license and operate the unit legally.

• First and foremost, you must get the relevant form No. 2 and submit it along with the required documents and registration fees at the Directorate of Factories and Boilers office.
• Once you submit the application form, the concerned authorities will review the form and the documents you submit. If all the documents are in order, the form is sent to the concerned authority for further processing.
• If there are any discrepancies in the documents, or if something is amiss in the application form, the authorities will notify you about it and ask you to correct the errors and submit the form again within a specific time frame.
• If all is well on the first attempt, and once the errors are fixed, the authorities will approve them, and you will get the registration certificate and the factory license.

Documents required for factory registration and getting the license

As mentioned above, you must submit Form 2 along with the necessary documents. Here is a list of documents you would need.

• Form No.2 correctly filled and duly signed
• The factory license fees as per the structure provided
• The partner or director solution which nominates one of them to act as the occupier
• Health and safety policies for all the factors that have a workforce of more than 50 workers
• An attested copy of the stability certificate issued by the concerned authority
• In case of a factory renewal license application, you must also submit a copy of the original factory license

It is important to note that just as it is important to register the factory, it is equally critical to get factory license renewal done periodically. Here is the process for renewing the factory license

If your factory registration or license has expired or is nearing expiration, you must renew it promptly to legally keep the manufacturing unit operational.

• You must submit duly filled Form No.2 at the time of renewing your factory license
• The designated authority from the Directorate of Factories and Boilers office will review your license renewal application as well as scrutinise the documents
• After the verification process is done, if all the documents are in place and there are no errors in the form, the authorities will start the approval process
• If there are any errors in the form or discrepancies in the documents, the authorities from the Directorate of Factories and Boilers office will notify you about it and allow you to do the corrections and submit the missing documents
• Once done, the application, along with the corrections and the right documents, will be sent for approval
• After the approval, you will receive a copy of the renewed licenses, which is attested by the designated government authority

Benefits of getting a factory license and renewing

• First and foremost, getting the factory license and renewing it periodically allows you to operate the unit legally. Also, as a factory owner, getting the license allows you to avail various government benefits.
• Obtaining a factory license is mandatory for all factory owners as it sets the legal framework for workers' safety, holidays, and wages, ensuring that their needs are met.
• The factory license ensures that all the employees working in the establishment get equal rights and treatment.

Conclusion

Obtaining a factory license is a mandatory requirement for all factory owners. Running a factory can be quite tedious; apart from taking care of the legal requirements and complying with the law, you may need a regular flow of funds in the business to keep the manufacturing process running consistently and for a long. As a factory owner, if you need financial support, you can trust Udyog Plus, which is a part of Aditya Birla Finance Limited, to be your trusted partner.

It is one of the leading NBFCs in India that has a reputation for offering business loan solutions. You can get a loan of up to Rs. 2 Lakh without any documentation. Also, the quick online application and approval process, the flexible repayment terms and extended tenure give you a hassle-free borrowing experience.