Factory License – Bihar Consultant

A factory is a place where goods are manufactured or processed. In Bihar, the operation of a factory is regulated by the Factories Act, 1948. Every factory must obtain a factory license before starting its operations. The license is issued by the Chief Inspector of Factories in the state where the factory is located.

Meaning and Definition: A factory license is a legal permission granted by the government to operate a factory in a particular area. It is a type of industrial license that is mandatory for every factory to obtain before starting operations.

Legal Provisions: The Factories Act, 1948, is the main law governing the operation of factories in India. The act provides guidelines for the safety, health, and welfare of the workers in the factory. It also specifies the rules and regulations that the factory owner must follow to obtain and maintain a factory license.

Process: The process for obtaining a factory license in Bihar is as follows:

Application: The first step is to submit an application to the Chief Inspector of Factories in Bihar. The application should include details of the factory, such as its location, nature of the work, machinery used, number of workers employed, and the proposed date of commencement of operations.
Inspection: Once the application is received, the Chief Inspector of Factories will conduct an inspection of the factory to ensure that it complies with the provisions of the Factories Act, 1948.
Approval: If the factory meets all the requirements, the Chief Inspector of Factories will grant the factory license. The license is valid for one year and must be renewed annually.

Advantages: The following are the advantages of obtaining a factory license:

Compliance: The factory license ensures that the factory is compliant with the safety, health, and welfare regulations specified in the Factories Act, 1948.
Legal Protection: The license provides legal protection to the factory owner in case of any disputes or accidents.
Credibility: The factory license adds credibility to the business and helps build a positive reputation.

Disadvantages: The following are the disadvantages of obtaining a factory license:

Cost: The cost of obtaining a factory license can be high, as it involves fees for inspection and renewal.
Time: The process of obtaining a factory license can be time-consuming, as it involves inspection and compliance with regulations.

Types: The following are the types of factory licenses:

New Factory License: This license is issued to a factory that is being established for the first time.
Renewal of Factory License: This license is issued to a factory that has already obtained a factory license and needs to renew it annually.

Cost involved: The cost of obtaining a factory license in Bihar varies depending on the size of the factory, the type of machinery used, and the number of workers employed. The fee for a new factory license ranges from Rs. 5,000 to Rs. 20,000, while the fee for renewal ranges from Rs. 2,500 to Rs. 10,000.

Time involved: The time taken to obtain a factory license in Bihar depends on the size of the factory and the number of workers employed. It usually takes between 30 to 60 days to obtain a new factory license and around 15 to 30 days to renew the license.

Documents required: The following documents are required to obtain a factory license in Bihar:

Application form
Site plan of the factory
Building plan of the factory
Details of machinery and equipment used
Proof of ownership or lease of the factory premises
Details of workers employed in the factory
Proof of payment of fees.

When you are applying for Factory License for the first time in online mode certain questions in yes/no options are asked to minimize the data input from you. Kindly chose the option carefully.

We help our client to properly understand the location to optimist the cost and provide best time frame for material management for their customers. Various Support and preparation of documents required under the Factories Act 1948 for Registration and obtaining a Factory License from the Department. We are here to provide various services that help them to easily set their venture on Indian land. The Pre Setup Services are very important for the Foreign Companies; These Services help the Companies in understanding the India before starting the business in India.

Eligibility Criteria:

The below-mentioned factories are required to get factory license under the following conditions.

The factory or establishment is holding ten or more workers employed with the use of power for manufacturing activities.
The factory or establishment is holding twenty or more workers employed without the use of power for manufacturing activities.

Factory License Procedure:

Attach Form No 2 & 3 (in three copis)with submission of required fees .
Fees will depend upon present manpower strength / how many manpower strength yo want to take license and Horse Power used.
kindly attach the descripttionn of manufacturing procees , PCB consent , factry license etc
Submit the form 2 & 3 duly signed with fees challan to Factory inspectorate office.
If it is new license them factory inspector of your area will come to visit the premises and compliances as per factory act 1948. If you have to renew the license than depends upon the Factory inspector to visit or not.
If their is no query than you will get the license within 3 to 4 months.

License For Factory Setup for a foreign venture:

The factory setup in India for a foreign venture/otherwise requires a lot of formalities to fulfill. Once a Company Decides to enter into Indian market, it’s important for them to understand the Manufacturing facility location and other benefit.

Inspection Process:

The step by step process is involved in the inspection of the site are specified below:

Identification of Establishments: The establishments which are to be inspected will be identified using the random computerised risk assessment

Inspection by Joint Team: The inspection will be carried out by a joint team of inspectors. The inspecting team will consist of a minimum of two inspectors and one of the respective authority, Assistant Labour Commissioner, Labour Enforcement Officer, Assistant Director Factory as per their availability.
Inspection Report: The report of inspection will be uploaded/submitted by the inspecting team on the departmental portal with a unique number.
The unique number will be managed by the units/establishments/factories to view and download the report of inspection within 48 hours from their web portal account.
Non-Compliance Notice: The department may grant a notice to units / establishments / factories to rectify defects / deviations / non-compliance observed as part of inspection.
The establishment to do the necessary/appropriate compliance within 15 days and inform the Labour Department about the same after uploading the compliance report.

Final Action:

Acceptance of compliance report or initiation of proceedings.

License Approval: If an application is made for the approval of the site for construction or extension of the factory and required plans and specifications, have been submitted by registered post or through the portal to the State Government or the Chief Inspector and if no reply is received within one month from the date of application will be automatically approved. If not approved with thirty days from the date of application is rejected by the system automatically and also the email or SMS is sent to the registered applicant in such cases the applicant is supposed to resubmit the application form by rectifying the mistakes or apply in person.

Renewal of License: The validity of the factory license is for one year, so the expired license has to renewed by applying for renewal in the same registration process as mentioned above.

FAQS

Q:1, What is a ‘Factory’ as per Factories Act 1948?

Factory means any premises where in 20 or more workers are working to carry out a manufacturing process with the aid of powers OR whereon 40 or more workers are working to carry out a manufacturing process without the aid of power.

Also Government has made this act applicable to power looms, saw mills, certain industries which use hazardous chemicals, and certain processes carried out using flammable solvents by publishing a notification, even if the number of workers are less than 10.

Q.2, How the licence is obtained?

After submitting the form no.1 duly filled with all respect and with necessary fees paid and if the factory plans are approved, the officers of directorate visit the factory & if he finds that construction of the factory and machinery layout is as per the approved plan and if the conditions of plan approval are complied , then he recommends to Director Industrial Safety & Health for issuance of licence through his superiors and after getting the approval from the Director, licence is issued.

Licence renewal can be done by Additional director or Joint director.

Q.3, How the Licence under Factories act can be renewed?

Licence renewal Form no.1 has to be duly filled and submitted through online system on the portal of Industrial safety & health along with necessary fees paid and all other necessary documents. The last date for submission of this Form is 31st October every year. If the application is made after this date, additional 5% fees has to be paid for every month of delay (maximum up to 25%). Licence can be renewed maximum up to 10 years at any single time.

Q.4, For what reasons, the license under factories act needs to be get amended?

If there is change in name of the factory.
If there is change in number of workers, or change in Horse power, then application for amendment in licence has to be made in form no. 2 with 10 Rs court fee stamp duly affixed. Difference of fees is required to be paid if the fee structure is changed due to this amendment. Necessary documents like Partnership deed, Board of Directors Resolution etc are required to be submitted for evidence. Form no. 5 is required to be submitted if there is change in Manager.

Q.5, How the management of a factory is supposed to inform any accident under provisions of factories Act 1948?

Any accident which is fatal or any serious accident causing loss of part of body, if worker becomes unconscious or gets severe burn injuries or incident of any dangerous occurrence has to be informed to the Directorate of industrial Safety & Health office within 4 hours by telephone or by a special messenger. And a written report in form 24 is required to be submitted within 12 hours to the Directorate of industrial Safety & Health office.

If accident takes place, which will prevent or will probably prevent the person injured from working for a period of 48 hours, the information of such accident has to be given within next 24 hours.

In Bihar, the Factories Act, 1948 governs the registration and regulation of factories. Any person who intends to set up a factory in Bihar is required to obtain a factory license from the Department of Labour Resources.

Definition: A factory is defined under the Factories Act, 1948 as “any premises, including the precincts thereof, in any part of which a manufacturing process is being carried on or is ordinarily so carried on, whether with the aid of power or without the aid of power.”

Legal Provisions: The Factories Act, 1948 lays down certain provisions that govern the registration and regulation of factories. Some of the important provisions are:

Registration of factories: Every factory is required to obtain a license from the Department of Labour Resources before the commencement of its operations.
Health and safety measures: The Act lays down certain provisions for ensuring the health and safety of workers employed in factories. This includes the provision of clean drinking water, adequate ventilation, lighting, and first aid facilities.
Welfare measures: The Act also provides for certain welfare measures for workers, such as canteens, restrooms, and crèches.
Working hours: The Act lays down the maximum number of working hours per day and week for workers employed in factories.

Process: The process for obtaining a factory license in Bihar is as follows:

Application: The first step is to submit an application for the factory license to the Department of Labour Resources.
Inspection: After receiving the application, the department will conduct an inspection of the premises to ensure that it meets the requirements under the Factories Act, 1948.
Approval: If the department is satisfied that the premises meet the requirements, it will grant the factory license.

Advantages: Some of the advantages of obtaining a factory license are:

Legal compliance: Obtaining a factory license ensures that the factory complies with the provisions of the Factories Act, 1948.
Health and safety: The Act lays down provisions for ensuring the health and safety of workers employed in factories.
Welfare measures: The Act also provides for certain welfare measures for workers, such as canteens, restrooms, and crèches.

Disadvantages: Some of the disadvantages of obtaining a factory license are:

Compliance costs: Obtaining a factory license involves certain costs, such as inspection fees and renewal fees.
Time-consuming: The process for obtaining a factory license can be time-consuming and may delay the start of operations.

The cost of obtaining a factory license in Bihar depends on the size and nature of the factory. The fees for inspection and renewal also vary depending on the size of the factory.

The time required to obtain a factory license in Bihar depends on various factors, such as the size and nature of the factory, the availability of documents, and the inspection process.

The documents required for obtaining a factory license in Bihar include:

Application form
Site plan of the factory
Building plan of the factory
Details of machinery and equipment
Details of the proposed manufacturing process
Proof of ownership or lease of the premises
Proof of payment of inspection fees.