Here, we are going to discuss the what is the registration and licensing of industrial undertakings in a detailed way.
Regulation of scheduled industries:
Registration of existing industrial undertakings:
The owner of every existing industrial undertaking, not being the central government, shall, within such period as the central government may, by notification in the official Gazette, fix in this behalf with respect to undertakings generally or with respect to any class of them, register the undertaking in the prescribed manner.
The central government shall also cause to be registered in the same manner every existing industrial undertaking of which it is the owner.
Where an industrial undertaking is registered under this section, there shall be issued to the owner of the undertaking of the central government, as the case may be, a certificate of registration (containing the productive capacity of the industrial undertaking and such other particulars as may be prescribed.
The owner of each and every industrial undertaking to whom the registration certificate be issued under this section before the commencement of the industries (Development and Regulation) Amendment Act, 1973, would, if the undertaking falls within a particular class of undertakings as the central government may, notification in the official gazette, specifying on this behalf, produce within a certain period as may be specified in such notification, the registration certificate for entering therein the productive capacity of the industrial undertaking and the other particulars that had been prescribed.
In specifying the productive capacity in any certificate of registration issued under sub-section(3), the central government shall take into consideration the productive or installed capacity of the industrial undertaking as specified in the application for registration made under sub-section(1), the level of production immediately before the date on which the application for registration was made under sub-section(1), the level of highest annual production during the three years immediately preceding the introduction in parliament of the industries (development and regulation) amendment bill, 1973, the extent to which production during the said period was utilised for export and such other factors as the central government may consider relevant including the extent of under-utilisation of capacity, if any, during the relevant period due to any cause.
Revocation of registration in certain cases:
If the central government have been satisfied that the registration of any undertaking which has been obtained by misrepresentation as to the essential factor that any industrial undertaking has been ceased to be registrable under this act by the reason of any exemption that is granted under this act becomes applicable thereto or that for any other reason the registration becomes useless or ineffective and hence it requires to be revoked, the central government, after all, giving the opportunity to the owner of undertaking to be heard revoke the registration.
Licensing of new industrial undertakings:
- No person or authority other than the central government, shall, after the commencement of this act, establish any new industrial undertaking, except under and in accordance with a license issued in that behalf by the central government.
Provided that a government other than the central government may, with the previous permission of the central government, establish a new undertaking.
- A license or permission under sub-section(1) may contain such conditions including, in particular, conditions as to the location of the undertaking and the minimum standards in respect of size to be provided therein as the central government may deem fit to impose in accordance with the rules, if any, made under section 30.
License for producing or manufacturing new articles:
The owner of an industrial undertaking not being the central government which is registered under section 10 or in respect of which a license or permission has been issued under section 11 shall not produce or manufacture any new article unless
- In the case of an industrial undertaking registered under section 10, he has obtained a license for producing or manufacturing such new article, and
- In the case of an industrial undertaking in respect of which a license or permission has been issued under section 11, he has had the existing license or permission amended in the prescribed manner.
Power of central government to specify the requirements which shall be complied with by the small-scale industrial undertakings:
The central government may, with a view to ascertaining which ancillary and small scale industrial undertakings and supportive measures, exemptions or other favorable treatment under this act to enable them to maintain their viability and strength so as to be effective in
- Promoting in a harmonious manner of the industrial economy of the country and easing the problem of unemployment, and
- Securing that the ownership and control of the material resources of the community are so distributed as best to subserve the common good.
Specify, having regard to the factors mentioned in sub-section (2), by notified order, the requirements which shall be complied with by an industrial undertaking to enable it to be regarded, for the purposes of this act, the small-scale industrial undertaking, the requirements are different, it is specified for different purposes regards to the industrial undertakings that are engaged in the production or manufacture of articles:
Provided that no industrial undertaking shall be regarded as an ancillary industrial undertaking unless it is, or is proposed to be, engaged in:
- The manufacture of parts, components, sub-assemblies, toolings or intermediates; or
- Rendering of services, or supplying or rendering, not more than fifty percent of the production of its total services, as the case may be, to other units for production of other articles.
The factor referred to in sub-section (1) are the following, namely-
- The investment by the industrial undertaking in-
- Plant and machinery, or
- Land, buildings, plant, and machinery;
- The nature of ownership of the industrial undertaking;
- The smallness of the number of workers employed in the industrial undertaking;
- The cost, quality and the nature of the product of the industrial undertaking;
- If any required for the import of machinery or plant by the industrial undertaking for foreign exchange; and
- Such other relevant factors as may be prescribed.
Every notified order copy proposed to be made under sub-section(1) shall be laid in draft because each house of parliament, it is in the session, for a period of thirty days that may be comprised in one session or some successive sessions, and if, immediately following the session or the successive sessions aforesaid before the expiry of the session, both the houses are agreed with disapproving the issue of the proposed notified order or both the houses agree in making any modification in the proposed notified order, the order would not be made or as the case may be, made only in a modified form that is actually agreed upon by both the houses.
Although anything contained in sub-section(1), an industrial undertaking, according to the law for the time being in force, fell immediately before the commencement of the industries under the “Development and Regulation Amendment act”, 1984, in the definition of an ancillary or a small scale industrial undertaking, after such commencement, continue to be regarded as an ancillary or a small scale industrial undertaking for the purposes of this act until the definition which previously said been altered or superseded by any order made under sub-section(1).
Revocation and amendment of license in certain cases:
If the central government is satisfied, either on a reference made to it in this behalf or otherwise, that any person, or authority, to whom or to which, a license has been issued under section 11, has, without reasonable cause, failed to establish or to take effective steps to establish the new industrial undertaking in respect of which the license has been issued within the time specified therefore or within such extended time as the central government may think fit to grant in any case, it may revoke the license.
Subject to any rules that may be made in this behalf, the central government may also vary or amend any license issued under section 11:
Provided that no such power shall be exercised after the effective steps have been taken to establish the new industrial undertaking in accordance with the license issued in this behalf.
The provisions of this section shall apply in relation to a license issued under section 11A or where a license has been amended under that section, to the amendment thereof, as they apply in relation to a license issued under section 11.
Further provision for licensing of industrial undertakings in special cases:
No owner of an industrial undertaking, other than the central government, shall-
- In the case of an industrial undertaking required to be registered under section 10, but which has not been registered within the time fixed for the purpose under the section, carry on the business of that undertaking after the expiry of such period, or
- In the case of an industrial undertaking the registration in respect of which it has been revoked under section 10A, carry on the business of the undertaking after the revocation, or
- In the case of an industrial undertaking to which the provisions of this act did not originally apply but became applicable after the commencement of this act for any reason, carry on the business of the undertaking after the expiry of three months from the date on which the provisions of this act became so applicable, or
- Effect any substantial expansion of an industrial undertaking which has been registered or in respect of which a license or permission has been issued, or
- Change the location of the whole or any part of an industrial undertaking which has been registered,
Except under, and in accordance with, a license issued in that behalf by the central government, and in the case of a state government, except under and in accordance with the previous permission of the central government.
The provisions of sub-section(2) of section 11 and of section 12 shall apply, so far as may be, in relation to the issue of licenses or permissions to any industrial undertakings referred to in this section as they apply in relation to the issue of licenses or permissions to a new industrial undertaking.
For the purposes of this section, substantial expansion means the expansion of an existing industrial undertaking which increases the productive capacity of the undertaking or which is of a nature to amount virtually to a new industrial undertaking that does not include any such expansion normal to the undertaking having regard to its nature and the circumstances relates to such expansion.