Factory License Registration, updated for the 2026 Labour Codes
Get your manufacturing unit legally licensed under the Factories Act, 1948 and stay ahead of the worker-threshold and renewal changes rolling out under the new Occupational Safety, Health & Working Conditions Code. Handled end-to-end by SSA Tax.
The Basics
What is a Factory License?
A Factory License is the legal authorisation, granted under Section 6 of the Factories Act, 1948, that permits a premises to be used as a factory and to carry on a manufacturing process. It is issued by the state's Chief Inspector of Factories in the name of the occupier, after verifying worker-safety, health and welfare arrangements.
The Act applies to any premises employing 10 or more workers with power, or 20 or more workers without power though this threshold is changing under the new labour reforms (see the 2026 update below). The license is not automatically transferable: a change of occupier or ownership triggers a fresh application.
SSA Tax prepares your site layout plan, files the application on your state's labour portal, and liaises with the Inspector's office so your factory can legally commence operations without delay.
1948
Factories Act (Central Act 63 of 1948)
§6
Section granting the license requirement.
10/20
Worker threshold with/without power
State
Administered by State Chief Inspector
2026 Regulatory Update
New Labour Code Rules Reshaping Factory Licensing
India's four new Labour Codes took effect on 1 April 2026, and the Occupational Safety, Health & Working Conditions (OSH) Code is steadily replacing the Factories Act state by state. Here's what's changing.
29 labour laws, 4 codes.
The OSH Code, 2020 consolidates 13 central laws including the Factories Act, 1948, the Contract Labour Act and the Inter-State Migrant Workmen Act into one framework.
Worker threshold raised
The OSH Code lifts the factory-license trigger from 10 to 20 workers with power, and from 20 to 40 workers without power, easing the burden on smaller units.
Transition is state-led
States must individually notify their OSH Code rules; until then, the Factories Act, 1948 and its original thresholds continue to apply in that state.
Contract labour threshold raised
The applicability limit for contract-labour licensing rises from 20 to 50 workers, reducing compliance load for smaller contractors.
Mandatory safety committees
Establishments with 500 or more workers must now form joint employer-worker safety committees under the Code.
Compliance-first enforcement
Many first-time violations now attract monetary fines rather than imprisonment, shifting the regime from purely punitive to corrective.
Eligibility
Who Needs a Factory License?
Manufacturing Units
Any unit converting raw material into a finished or semi-finished product above the worker threshold.
Assembly Plants
Electronics, automotive and component assembly lines using powered machinery.
Processing Units
Food, chemical, textile and material processing facilities.
Packaging Factories
Units running powered packaging or filling lines at scale.
Warehouses with Manufacturing
Storage facilities that also carry out assembly, repackaging or processing on-site.
Hazardous Process Units
Facilities under Schedule 1 of the Act explosives, chemicals, radioactive material need extra Chapter IVA approvals.
Don't Confuse These
Factory License vs. Other Licenses & Registrations
A Factory License is frequently mixed up with other premises-based approvals. Here's the real difference.
| Parameter | Factory License | Drug License | Shop & Establishment (Gumasta) | Pollution NOC |
|---|---|---|---|---|
| Governing Law | Factories Act, 1948 (transitioning to OSH Code, 2020) | Drugs & Cosmetics Act, 1940 | State Shops & Establishments Acts | Water Act, 1974 / Air Act, 1981 |
| Regulator | State Chief Inspector of Factories | State/Central Drug Licensing Authority | State Labour / Municipal Dept. | State / Central Pollution Control Board |
| Who Needs It | Manufacturing units above worker threshold | Pharma & cosmetic manufacturers/sellers | Every shop, office or commercial establishment | Factories with effluent or emission discharge |
| What It Certifies | Safe premises, machinery & worker welfare | Authorisation to deal in drugs/cosmetics | Legal operation of a commercial establishment | Compliance with environmental discharge norms |
| Where to Apply | State Labour/Factories portal | State Drug Control Dept. | State Shop Act portal | SPCB / CPCB portal |
Step-by-Step
Factory License Registration Process
Here's exactly how SSA Tax takes your factory from blueprint to a licensed, operating unit.
Eligibility & State-Rule Check
We confirm your worker count, power load, and whether your state is under the Factories Act or the new OSH Code rules.
Document & Site Plan Preparation
We compile your premises, employer and machinery documents and draft a compliant site layout plan.
Online Application Filing
Your application is filed on the state Labour Department's online factory licensing portal.
Site Plan & Section 7 Notice Submission
The layout plan and statutory occupier notice are submitted for the Inspector's record.
Inspection (Where Required)
A Labour/Factory Inspector verifies welfare facilities, fire safety and machinery guarding on-site.
Approval & License Issuance
On approval, the Chief Inspector issues your Factory License and we track your renewal date going forward.
Paperwork
Documents Required for Factory License
- ID & address proof of the employer/occupier
- Address proof and site/layout plan of the factory
- List of installed equipment and machinery
- Consent from relevant local authorities
- Partnership Deed / Certificate of Incorporation
- Power sanction letter from the electricity board
- Previous Factory License copy
- Updated worker count and details
- Form 2 application for renewal
- Renewal fee payment receipt
- Report of any structural changes
- Fire & pollution clearance, where applicable
Why Businesses Choose SSA Tax Over Other Consultants
Most consultants provide a document checklist and disappear. At SSA Tax, we stay accountable from your first site inspection to license approval and future renewals.
Dual-Regime Compliance Tracking
We continuously monitor state-specific Factory Act and OSH Code requirements, ensuring your business always complies with the latest regulations.
Professional Site Layout Support
Our experts prepare factory and premises layout plans in the format expected by labour inspectors, reducing approval delays and queries.
Transparent Pricing Structure
Government fees and professional charges are clearly itemized before work begins, ensuring complete transparency with no hidden costs.
End-to-End Department Liaison
We coordinate directly with Labour Departments and assist with related approvals involving fire safety, pollution control, and local authorities.
Lifetime Renewal Alerts
Never miss a renewal deadline. Our team tracks your license validity and sends timely reminders well before renewal becomes due.
Trusted by Over 1 Lakh Businesses
With 1.03 lakh+ clients served, 18,000+ startups supported, and thousands of positive reviews, our results speak for themselves.
Frequently Asked