Gujarat Factory License : Registration of Factories

The cost of a factory license in Gujarat is totally based on the maximum number of workers on any day and the amount of horsepower installed. At Professional Utilities, we charge a minimal fee that starts from ₹29,999/- only. Applicants must pay a government fee based on their factory size, scale, and employee headcount. The professional fee is exclusive of 18% GST. Read the table below to understand our fee criteria:

Here is the process for factory license registration online through the OFRIS portal:

• Step 1: Register on the Portal Navigate to the Online Factory Registration Information System (OFRIS) available on the Investor Facilitation Portal (IEP) of Gujarat. Click on New User Registration to create a profile.
• Step 2: Fill Common Application Form Fill out Form 2 and provide the necessary details such as occupier’s name, factory details, number of installed machinery, and total number of workers.
• Step 3: Upload Documents Submit the scanned copies of important documents as mentioned above in the prescribed PDF format only.
• Step 4: Pay the Required Fees Initiate a payment through the online gateway and complete it. The fees will be charged on the basis of the maximum number of installed H.P and the total number of workers in a factory.
• Step 5: Wait for an Inspection The Chief Inspector of Factories will conduct a physical inspection of the premises. If the safety measures are followed and are in accordance with the labor codes, they will grant a factory license.
• Step 6: Issuance of Factory License Download the factory license from the portal and keep the license as legal proof to start a manufacturing unit.

Before registration, it is essential to obtain prior permission for construction or extending a building. Read the steps in detail:

• Step 1: Draft Map Hire a professional architect and draft a building layout and site plan that follows the local building codes.
• Step 2: Obtain NOCs Clear all the rules and regulations and get NOCs from GPCB ( Gujarat Pollution Control Board) and a Fire NOC.
• Step 3: Site Inspection The Chief Inspector of Factories will examine the location and nearby areas and then approve the building construction and extension.

A Factory Registration Certificate is a license given to factories operating in Gujarat. The purpose of factory registration is to regulate the working conditions and safety of the workers in the factories. Factory Registration is a very important authorization granted by local authorities depending upon the eligibility.

In Gujarat, a Factory License is a legal requirement under the Factories Act, 1948, for establishments engaged in manufacturing processes and certain other specified activities. Obtaining a Factory License offers several benefits to both the government and the business owner:

• Legal Compliance: Obtaining a Factory License ensures that the business complies with the legal requirements outlined in the Factories Act. This helps in avoiding legal issues and penalties for non-compliance.
• Safety and Health Standards: The Factories Act mandates certain safety and health standards for factories. Obtaining a Factory License ensures that the business adheres to these standards, providing a safe and healthy working environment for employees.
• Regulatory Oversight: The issuance of a Factory License involves inspection and approval from the Factory Inspectorate. This regulatory oversight helps in maintaining and improving workplace conditions.
• Employee Welfare: The Factories Act includes provisions related to working hours, leave policies, and welfare amenities for workers. By obtaining a Factory License, a business demonstrates its commitment to the welfare of its employees.
• Insurance Coverage: Some insurance companies may require a valid Factory License as a prerequisite for providing insurance coverage to the factory. This can be crucial in mitigating financial risks associated with accidents or other unforeseen events.
• Government Monitoring: A Factory License facilitates government monitoring of industrial activities. This is essential for planning and implementing policies related to industrial development, labor welfare, and environmental protection.
• Access to Government Incentives: In some cases, having a valid Factory License may make the business eligible for government incentives, subsidies, or support programs aimed at promoting industrial growth and compliance with regulations.
• Credibility: Possessing a Factory License enhances the credibility of the business. It signals to customers, suppliers, and other stakeholders that the business operates within the legal framework and is committed to maintaining high standards.
• Environmental Compliance: Factories are often required to adhere to environmental norms. The Factory License process may include checks to ensure that the industrial activities do not adversely impact the environment, promoting sustainable and responsible business practices.
• Facilitates Expansion: Facilitates Expansion: When a business in cities like Ahmedabad, Surat, Vadodara (Baroda), Rajkot, Anand, Jamnagar, Valsad, and Kutch (Kachchh) plans to expand its manufacturing operations, having a valid Factory License is crucial. It streamlines the process of obtaining necessary approvals and permits for expansion.

Factory license registration is important in Gujarat because it helps businesses to get legal authorization under the Factories Act of 1948. With a proper certification, both the employers and the authorities ensure that safety, health, and compliance meet expectations that were set for the welfare of workers and environmental safety.

Let’s understand its importance in detail:

• Protects businesses from legal fines, prosecution, and forced business closure from the Chief Inspector of Factories.
• Examines the workers' safety, proper lighting, sanitation and medical facilities, and clear drinking water.
• Helps businesses to secure loans from banks, government subsidies, and industrial schemes.
• Creates a sense of credibility, trust in the market, and with global partners.
• Promotes a better environmental space for employees and builds brand recognition.

Under the Factories Act of 1948, the eligibility criteria for a factory license are decided on the basis of workers and power thresholds. Here are the points defining the eligibility criteria for a factory license in Gujarat:

• Any manufacturing entity employing 10 or more workers and engaged in some production of goods and products with the aid of power.
• Any manufacturing entity employing 20 or more workers and involved in producing goods and products without the aid of power.

In Gujarat, the validity and renewal time vary from other states. Read the table mentioned below to understand it:

Operating a manufacturing entity without a valid license is a breach of the law, as per the Factories Act of 1948. It can result in heavy fines, imprisonment for years, and closure of premises and activities until the license is granted.

Here are the consequences of operating a factory without a license:

• Under Section 92, monetary fines of ₹1,00,000 and imprisonment for 2 years.
• The fine may extend up to ₹2,00,000 for repeating the same offences under Section 94.
• If an offence continues even after a legal notice, ₹1000 will be charged on a daily basis.

The following are the statutory compliances that the factory owner must meet:

• Health benefits
• Safety measures
• Welfare programs
• Employment of minors
• Working hours for adults
• Annual leave and wages

Getting a factory license registration is an essential process in Gujarat. It facilitates businesses to commence a manufacturing unit anywhere in Ahmedabad, Surat, Vadodara (Baroda), Rajkot, Gandhinagar, Bhavnagar, Anand, Jamnagar, Valsad, and Kutch (Kachchh).

Operating a factory without a license can cause challenging situations for occupiers and issues in availing government incentives and schemes. At Professional Utilities, we deliver exceptional service to our clients. With years of experience and a professional team, we assist in the building plan approval process, registration, and licensing.

If you are planning to establish a factory in different states of India, contact us; we help in providing a factory license in Maharashtra, Delhi, Uttar Pradesh, and all over India.