Do R&D Facilities Need a Factory License? Seeking Insights on Legal Requirements

Do R&D facilities need a factory license to operate? Can anyone shed light on this?

Thanks, Swanand

Dear,

To find out the correct answer to your query, you have to go through the different definitions as laid down in sections 2(k), 2(l), and 2(m) on the manufacturing process, worker, and factory respectively under the Factories Act, 1948.

With Regards,
R.N.Khola

Dear Mr. R.N. Khola,

I have experience in HRD - Generalistic role but no experience in Labour Laws and Statutory compliances. I want to gain experience in that. Can you recommend any good book for that so that I can start reading and get an idea about these activities?

Please recommend a book that explains it clearly with practical examples.

As per my understanding of your situation, as an R&D establishment not directly related to production according to the definitions of a factory under the Factories Act, you should review your constitution documents to confirm if your production criteria align with the Factories Act, 1948.

Prasiddh Narayan,

The unit is a 100% EOU under SEZ. At the same time, they bring samples in very small quantities, then send back results, not the final product. Please advise.

Thanks,
Swanand

Dear,

This thread relates to the Factories Act, but even then, you are advised to utilize the websites of ESIC & EPFO for your query.

With Regards,
R.N.Khola

Dear Swanand,

As per my concern, if you have testing facilities or if you use any compressors in your R&D unit, then you definitely need to apply for a Factory License.

Best Wishes,
Sadhan S.

Dear Swanand Batule,

If you have no process shop, fabrication shop, or the like to make prototypes and limit your activities only to paperwork, the unit will not come under the purview of the Factories Act. On the other hand, if you have any manufacturing process as under Chapter 1, (k), for sure it will be considered a factory, and you have to act accordingly.

Regards,
Kesava Pillai.

Sadhan S.,

Thanks for the reply. As per my understanding, the software industry also has air compressors and other equipment. In that case, will that fall under the purview of the Factories Act? If not, how do we draw the line for them?

If you could provide me with the reference clause of the Factories Act under which the above-mentioned can be referred, it would be of great help to us.

Appreciate your support.

Thanks and Regards,
Swanand

Hi, can somebody help me with this? I am running a production unit with 2 workers for the last 4 years. Do I need a factory license or not? If I require one, what is the procedure now and what penalty will I have to pay?