How to Get Factory License & Approval for Your Manufacturing Unit
- dsouzaemily64
- 1 hour ago
- 2 min read
What is a Factory License?
A factory license is a formal document that is granted by the state government's Director of Industrial Safety and Health (DISH) or Chief Inspector of Factories. Under the Factories Act of 1948, it provides legal authorization to run a manufacturing facility while guaranteeing adherence to labor, safety, and health laws.
Who Needs a Factory License?
The Factories Act mandates that factory license registration be done for:
Manufacturing units with 10 or more workers using power
Units with 20 or more workers without using power
This applies to factories in sectors like food processing, textiles, electronics, engineering, chemicals, etc.
Process of Factory License Registration
Step 1: Factory Plan Approval
Before applying for the license, get the site and building plans approved by the state’s Directorate of Factories or DISH.
Documents Required:
Site and layout plan
Flow diagram of the manufacturing process
Details of machinery
Consent from local authority
Step 2: Submit Factory License Application
After plan approval, submit the application for factory license registration.
Common Platforms:
Labour Department Portal (state-specific)
Shram Suvidha Portal (in some states)
Details to Fill:
Owner and manager details
Nature of manufacturing
Number of workers
Installed machinery HP
Step 3: Upload Required Documents
Typical Documents Include:
Identity proof of applicant
Lease deed or property papers
Electricity bill or utility document
Partnership deed/MOA (if company)
Site and building plan approval copy
Consent to Establish (from Pollution Board)
List of machinery installed
Step 4: Payment of Factory License Fees
Factory license fees are calculated based on:
Number of workers
Installed power capacity
Factory area
Each state has its own fee structure. For example, a unit with 10–50 workers may pay ₹3,000–₹10,000 annually.
Step 5: Inspection and Approval
A factory inspector may visit the premises to verify compliance with:
Safety equipment
Ventilation and sanitation
Fire exits and lighting
Machine guards and fencing
Once satisfied, the license is issued.
Factory License Renewal – Process & Form 2
Factory licenses are typically valid for 1 year or up to 10 years (depending on the state policy). Before it expires, you must apply for factory license renewal.
What is Form 2 in Factory License Renewal?
Form 2 is the standard application form used for renewing an existing factory license under the Factories Act.
Renewal Process:
Download or fill Form 2 on the respective portal
Provide details of:
Number of workers
Type of manufacturing process
Previous license number and validity
Attach updated documents
Pay the renewal fee online
Receive renewed license after inspection/approval
Factory License Fees – An Overview
Factory licensing costs vary by state and are determined by:
Number of employees
Installed horse power (HP)
License validity duration
Here’s a general estimate (may vary):
Small factory (up to 20 workers): ₹2,000–₹5,000/year
Medium factory (50–100 workers): ₹5,000–₹15,000/year
Large factory (200+ workers): ₹20,000–₹50,000/year
Final Thought
Maintaining legal compliance and guaranteeing worker safety depend on obtaining and renewing your manufacturing license. Every stage, from plan approval to Form 2 filing for license renewal, needs to be done with care. Ignoring these regulatory requirements may lead to fines, closure letters, or legal action.
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