Factory licence

What counts as a factory

Ten or more workers, where a manufacturing process is carried on with the aid of power. Twenty or more workers, where it is carried on without the aid of power. Counting any day of the preceding twelve months.

Outside the definition

A mine under the Mines Act 1952, a mobile unit of the armed forces, a railway running shed, and a hotel, restaurant or eating place are outside the definition.

How long the licence lasts

Ten years or more, but not exceeding fifteen years at a time

What that rests on

Rule 5(2) as substituted by the Karnataka Factories (Amendment) Rules, 2019 — Notification No. LD 40 KABANI 2018 (P-3) of 7 March 2020, on payment of the sub-rule (1) fees for each year.

One caveat on that date

Those rules come into force on their final publication in the Official Gazette. The copy held is the department's own, stamped “To: Publish in e-Gazette”, so it does not itself record that date.

How the period got here

Rule 5(2) read “not exceeding three years” as substituted in 1993. The Karnataka Factories (Amendment) Rules, 2016 — Notification No. LD 5 KABASE 2016 of 11 October 2017, printed in the Karnataka Gazette Extraordinary Part IVA No. 934 of 12 October 2017 — substituted “ten years” for “three years”. The 2019 rules then replaced the whole sub-rule.

Why the published Rules disagree

The consolidated copy of the Rules that the department publishes still prints “three years”. It is two amendments behind its own notifications page.

Applying

Form 2 in triplicate, or the department's e-surakshate portal, with the list of partners or directors — rule 4(1).

If nobody answers

If an application for registration and grant of licence is sent to the Chief Inspector by registered post and no order is communicated within three months, the registration and licence are deemed to have been granted — rule 5(5).

If it is refused

A refusal to grant or renew must be recorded in writing, with reasons, and communicated to the occupier — rule 5(4).

Certificate of stability

No manufacturing process may be carried on unless a fresh certificate of stability in Form 1A is obtained from a competent person holding a degree in structural or civil engineering, once every five years — rule 3(9).

Renewing

Not less than two months before the licence expires, in Form 2 (triplicate) or through e-surakshate — rule 7(2).

Renewing late

Applied late, the licence is renewed only on payment of a fee 25 per cent in excess of the ordinary fee payable per year — proviso to rule 7(3).

While renewal is pending

Where the renewal application is made, the premises are held to be duly licensed until the Chief Inspector renews — rule 7(4).

Closing for a while

A licensee may surrender the licence temporarily on closure, not less than two months before expiry, to claim exemption from renewal — rule 7(5).

When the licence must be amended

A licence must be amended on a change of factory name, or where the horse-power or number of persons employed moves outside the limits specified in it — rule 6(2)(a).

Amending in time

Apply at least fifteen days before the increase takes effect — rule 6(2)(b).

Hours and overtime in a Karnataka factory

Daily hours

Nine hours a day, which the State Government may extend by notification to twelve including the rest interval — capped at forty-eight hours a week, requiring the worker's written consent, and the remaining days of that week are paid holidays (section 54).

Spread-over and intervals

Spread-over may be increased by notification to twelve hours including rest intervals (section 56(2)); work without an interval may be extended to six hours (section 55(3)).

Overtime

Overtime is twice the ordinary rate, and now depends on the shape of the week: over nine hours a day or forty-eight a week on a six-day week; over ten a day or forty-eight a week on a five-day week; over eleven and a half a day on a four-day week. Work on a paid holiday is overtime (section 59(1) as substituted).

The quarterly ceiling

The quarterly overtime ceiling was raised from seventy-five hours to one hundred and forty-four (section 65(3)(iv)), and overtime now requires the worker's written consent (section 65(3)(v)).

Women workers

Section 66 was substituted: no woman may work except between 6 a.m. and 7 p.m., with a proviso permitting 7 p.m. to 6 a.m. on conditions that begin with the employer's duty to prevent or deter acts of sexual harassment at the workplace.

From The Factories (Karnataka Amendment) Act, 2023 — Karnataka Act No. 33 of 2023, Karnataka Gazette Extraordinary Part IVA No. 379 of 7 August 2023 — President's assent 10 July 2023; in force at once. These are the factory figures; the shops and establishments figures are on their own pages and are not the same.

Building plan approval, before any of this

No site may be used for a factory, and no building constructed, reconstructed, extended or taken into use as one, without the Chief Inspector's previous written permission — rule 3(1). The same permission is needed to install additional machinery, or prime movers above the horse-power already installed.

Applying

Form No. 1 in triplicate, or through the department's e-surakshate portal — rule 3(2), the portal route inserted by the 2017 amendment.

The fee

Not established — see below. The department's published consolidation gives ₹250 for factories employing up to 500 workers and ₹500 above that, substituted in 1999. But its own draft Karnataka Factories (Amendment) Rules, 2024 propose replacing “rupees one thousand” and “rupees two thousand for factories employing above 1000 workers” — wording that does not appear in that consolidation. An amendment between the two added bands that neither the consolidation nor the department's notifications page carries, so this desk does not print a current fee for rule 3.

Single Window projects

Where the project is cleared by the State High Level Clearance Committee, or a State or District Level Single Window Clearance Committee, the application is made on the Combined Application Form instead, with the same fee and documents — proviso to rule 3(2).

The Chief Inspector may ask for more

Any other particulars he requires — rule 3(3).

What he checks

The documents and any further particulars, and compliance with the building bye-laws of the Karnataka Industrial Area Development Board or the local authority — rule 3(4). Permission may be given subject to conditions.

How permission is recorded

Noted on the plans and specifications and signed by the Chief Inspector; one copy is returned to the applicant — rule 3(5).

Building to the approved plans

The factory must be built as approved and satisfy the conditions — rule 3(6)(a). No machine, prime mover or permanent fixture absent from the approved plans may be installed, except replacing one that occupies no more floor area — rule 3(6)(b).

Who may draw the plans

A person holding a degree or diploma in civil engineering, or an equivalent qualification — rule 3(7).

Before manufacturing starts

A certificate of stability in Form No. 1-A from a person holding a degree in structural or civil engineering — rule 3(8).

And every five years after

A fresh stability certificate in Form 1-A, from a competent person holding such a degree, once in every five years — rule 3(9), inserted by the 2017 amendment and absent from the department's published consolidation.

What goes with the application

• A flow chart of the manufacturing process, with a detailed description of each stage — including any chemicals used, and the steps proposed for removing dust, fumes and gases and for disposing of trade waste and effluent — rule 3(2)(a)
• Plans in triplicate, drawn to scale, showing the site and its immediate surroundings including adjacent buildings, roads and drains — rule 3(2)(b)(i)
• The plan, elevation and necessary cross-sections of each building, with natural lighting, ventilation and means of escape in case of fire — rule 3(2)(b)(ii)
• The position of the plant and machinery, aisles and passageways — rule 3(2)(b)(iii)

If the process is hazardous

Pollution Board certificate — rule 3(2)(c)

A certificate from the Karnataka State Pollution Control Board that arrangements are made for disposing of industrial liquid waste, effluent and air pollutants, and that the steps taken are effective.

When it is needed

Required for factories engaged in hazardous processes. That is the whole of the difference between the hazardous and non-hazardous tracks in rule 3: one procedure, one extra document.

Whose rules those are

This is the point at which a factory application depends on a different regulator under different law — the Water Act 1974 and the Air Act 1981, administered by the Board rather than by the Chief Inspector. That consent has its own page on this desk.

What the Pollution Board certificate involves

A draft Karnataka Factories (Amendment) Rules, 2024 — Notification No. LD 118 KBN 2023 of 16 August 2024, published in the Karnataka Gazette Part 4A, Volume 159, Issue 166 of 22 August 2024 — would raise the rule 3(2) fees roughly tenfold and replace the civil-engineering qualification in rules 3(8) and 3(9) with “a competent person recognized by the Chief Inspector”. It is a draft, published for forty-five days of objections, and comes into force only on final publication. Nothing in it is stated here as law.

Boilers

Boilers are a separate regime under the Indian Boilers Act, 1923, administered by the same department. This desk has not yet read the Karnataka Boiler Rules, 1982 or the Karnataka Boiler (Amendment) Rules, 2019, both of which the department publishes. Registration, inspection periodicity and renewal for boilers are therefore not stated here rather than guessed from the factory licence cycle.

Licence and renewal from the Karnataka Factories Rules, 1969, read together with the amending notifications named above; the definition of a factory from the Factories Act, 1948 (Central Act 63 of 1948). All as published by the Department of Factories, Boilers, Industrial Safety and Health.