Factory License

What is Factory License?

The occupier of a factory is needed to obtain a license under the provisions of the Factories Act, 1948. The factory act deals with various problems concerning safety, health, efficiency and well-being of the persons at work places. This is regulated by the Ministry of Labour and Employment. The factory license helps in facilitating the risk management at workplace and the total implementation of safety and health management systems in factory premises. The act is applicable throughout the country and it covers all the establishments which come under the definition of a factory.

What is the applicability of the factory license?

  • The factory act is applicable to any factory employing 10 or more workers and 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.

  • The factory act is also applicable to any factory employing 20 or more workers 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.

  • The factory act is not applicable to a mine, or a mobile unit belonging to the armed forces of the union, a railway running shed or a hotel, restaurant or eating place.

What is the procedure for applying for factory license?

  • Applicants are required to apply with duly filled in Form 2 along with a set of required documents and fees prescribed in the proper head of account in the form of treasury challan in the office of Director of Factories and Boilers of the state.
  • Once the application is received, it is scrutinized by the concerned officer.
  • After the scrutiny if the documents are correct, it is processed for approval by the competent authority.
  • If imperfections are observed, then the applicant is asked to submit the corrected application in a time bounded manner.
  • Once the authorities receives the application corrected from the applicant, the application is processed to get approval.
  • After the approval, a registration certificate and a license duly signed by the competent authority are sent to the applicant with a covering letter.

What are the forms required under the Factory Act?

  • Form 1: Form 1 is required to be filled for the application for the permission to construct, extend or take into use any building as a factory. The form has to reach Chief Inspector of Factories.
  • Form 2: Form 2 is required to be filled for the application for the registration and grant of renewal of license for the year. The license is valid upto 31 st December of the year in which it has been granted. An application for renewal of License which is complete in all respects is needed to be made in advance delivered in the office of the Director of Factories at least 30 days before the due date of expiry of the license.
  • Form 3: Form 3 is the prescribed format for the certificate of stability.
  • Form 4: This form is a notice of change of manager of the factory. It should be given in the prescribed format to the factory inspectorate.
  • Form 5: Form 5 is the certificate of fitness. It is certified by a surgeon and granted to a young person in the given format. Certificate of fitness is required to work in a factory as a child, if he is satisfied that the young person has completed his fourteenth year, that he has attained the prescribed physical standards and that he is fit for such work. Certificate of fitness is required to work in a factory as an adult, if he is satisfied that the young person has completed his fifteenth year and is fit for a full day’s work in a factory.
  • Form 9: Form 9 is required to be filled for the registration of workers employed for work on or near machinery in motion. The name and other particulars of every such worker is to be given in the prescribed format.
  • Form 14: Form 14 is for the registration of compensatory holidays. The manager must maintain a register in given format to maintain compensatory holidays given to employees. Except in the case of workers engaged in any work which for technical reasons must be carried on continuously throughout the day, the compensatory holidays to be allowed I to be placed that not more than two holidays are given in one week
  • Form 15: Form 15 is the prescribed format showing the normal piece work rate of pay, or the rate of pay per hour, of all employees exempted for overtime.
  • Form 16: Form 16 is the prescribed format for the notice of periods of work for adult workers.
  • Form 17: Form 17 is the prescribed format for the register of adult workers in the factory.
  • Form 18: Form 18 is the notice of periods of work for child workers.
  • Form 19: Form 19 is prescribed format for the registration of child workers in the factory.
  • Form 20: Form 20 is the prescribed format for the register of leave with wages. This should be preserved for a period of three years after the last entry in it and it shall be produced before the inspector on demand.
  • Form 21: Form 21 is the prescribed format of the leave book.
  • Form 24: Form 24 is the given format of the health register.
  • Form 25: Form 25 is the given format for registering the report of accident or dangerous incidents resulting in death or bodily injury.
  • Form 26: Form 26 is the given format for registering the report of dangerous incidents which does not result in death or bodily injury.
  • Form 29: Form 29 is the given format for the annual return to be furnished to the inspector or other officer appointed by the State Government in this behalf.
  • Form 30: Form 30 is the prescribed format for the annual return to be furnished to the inspector or other officer appointed by the State Government in this behalf.
  • Form 31: Form 31 is the prescribed format of the muster roll.
  • Form 32: Form 32 is the prescribed format for the register of accidents and dangerous occurrences in the factory.

What are the documents required for Factory License Registration?

  • Form 2 duly filled.
  • Certificate of stability (Form 3) duly signed by the Chartered Engineer/ Chartered Architect.
  • Resolution passed by Board of Directors in which one of the directors has been declared as occupier or resolution passed by partners in case of firm in which one of the partners has been declared as occupier or declaration of proprietor in case of proprietorship concern.
  • List of directors or partners (Parentage and complete residential addresses of directors or partners may be clearly mentioned).
  • List of partners with their parentage and complete residential address.
  • In case of proprietorship name, parentage and complete address of the proprietor is needed to be given through a self-attested declaration.
  • Certificate regarding incorporation from registrar of company in case of company.
  • Copy of power sanction certificate from concerned authorities.
  • NOC from chief fire officer.
  • NOC from pollution control board.
  • All the documents are required to be signed by occupier and to be uploaded.

What if you violate the law?

  • If a person violates the provisions of the factory act is liable to a penalty of imprisonment for two years or a fine up to rupees 1,00,000 or both.
  • The continuation of violation of the provisions of the factory act will lead to a penalty of fine of rupees 1000 per day.
  • The violation of chapter IV related to the safety or dangerous operations will lead to a penalty of imprisonment up to 3 years or fine not less than rupees 10,000 which may extend to rupees 2,00,000.
  • If a person performs an act to obstruct the inspectors is liable to a penalty of imprisonment up to six months or fine up to rupees 10,000 or both.
  • A person wrongfully disclosing result related to results of analysis will be liable to a penalty of imprisonment up to 6 months or fine up to rupees 10,000 or both.
  • A person who violate the provisions of section 41B, 41C and 41H will be liable to a penalty of imprisonment up to seven years with fine up to rupees 2,00,000 and on continuation fine at rupees 5000 per day. There will be an imprisonment of 10 years when violation continues for one year.

Conclusion

Being a factory owner in India, one must possess the factory license. It is required for them to strictly follow the rules and regulations according the Factory Act. Failing to comply with these will lead to punishable offenses under the act.

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