Labour Law & Hr Consultant
Korgaonkar K A

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Would need advice regarding the applicability of Factories acts and Shops and establishments acts in LWE areas. We are a solar power T&D company and operating at Jharkhand-Gumla which is an LWE affected district. We are a private limited company and is a growing organisation. However, we have not yet registered under any act.
May I be guided and advised on the following points:
1. About the impact of nonregistration
2. Business is based on fund received and loans taken. So are we liable for the compliance?
3. The place of operation is absolutely remotest villages-still do we need to comply.
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Since your place of operation, i.e., generation of solar energy is in village areas, it would not be covered under the State Shops and Estt Act but would be covered by the Factories Act,1948 as it is a manufacturing process. Therefore, non-registration under the FA Act,1948 would lead to penal action and result in heavy penalty. Every business is based on funds both own as well as borrowed. That can't be an excuse for legal compliance of any sort.
Dear Queriest,
Though the Govt. is trying to bring more and more schemes, incentives to attract development of LWE affected areas, to my knowledge, there is no concession, exemption or relief granted from obtaining any registration, license, noc etc. or from applying social security schemes, like PF, ESI, EC, Gratuity, etc. However, such areas fall under non implemented areas under ESI Act.
Therefore you have no option but to register yourself under FA, EPF, CLRA if you have a contract system and CLRA is applicable, State PT if applicable, State LWF if applicable and make necessary compliance timely under all applicable labour laws.
As stated by our learned member Shri. Umakanthan, non-registration under the FA Act,1948 would lead to penal action and result in heavy penalty. Your liability under PF and other applicable social security will start from the day
one you employed threshold number of workers, with heavy interest and damages. There is no excuse on the ground the business is based on funds borrowed or otherwise.
Thanks to Mr.Umakanthan and Mr.Keshav for your valuable information.
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