Fire Safety & Factory License: State-Level Compliance for Manufacturing Units

Why Factory Licensing Matters for Foreign Manufacturers

The statute changed under the industry's feet. The Occupational Safety, Health and Working Conditions Code, 2020 was brought into force on 21 November 2025, and it repeals and subsumes the Factories Act, 1948 along with twelve other labour enactments. Guidance still written around the 1948 Act — including its 10-and-20 worker thresholds — is describing law that no longer governs. Every manufacturing facility within the Code's scope still needs registration or a licence from the state factory authority and a Fire No Objection Certificate (NOC) from the state fire department before commencing operations, but the source of the obligation, and the size at which it bites, have both moved.

For foreign companies establishing manufacturing units through a wholly owned subsidiary or joint venture, these are non-negotiable pre-operational approvals. Operating without them attracts monetary penalties, closure and stop-work orders, personal liability for the occupier and the manager where a contravention causes injury, and the very real prospect that an insurer resists a fire claim.

The complexity lies in the fact that factory approvals and fire safety are administered at state level. Each Indian state administers its own rules, fee structures, inspection procedures, and digital portals. Turnaround varies by weeks between states — compare the specific authority's own citizen's charter, whether you are building in Gujarat or in West Bengal. Foreign manufacturers entering India under the automatic route for FDI often underestimate these state-level compliance timelines, leading to delayed production starts and cost overruns.

The Governing Statute: the OSH Code, 2020

The Occupational Safety, Health and Working Conditions Code, 2020 consolidates thirteen enactments — the Factories Act, 1948 foremost among them — into a single framework covering registration of establishments, the duties of employers, working conditions, safety committees and inspection. It came into force on 21 November 2025.

When Does the Factory Regime Apply?

The Code raised the coverage thresholds substantially. Premises carrying on a manufacturing process fall within the factory definition where they employ:

• 20 or more workers where the manufacturing process is carried on with the aid of power, or
• 40 or more workers where it is carried on without the aid of power

Under the 1948 Act those numbers were 10 and 20. The practical effect for a foreign manufacturer is that a pilot line or a small assembly and packing operation that would once have been a licensed factory may now sit outside the regime — which is a planning opportunity and a trap in equal measure, because crossing the threshold mid-year brings the whole apparatus with it.

The definition of "manufacturing process" remains broad, covering making, altering, repairing, ornamenting, finishing, packing, breaking up, washing, cleaning and adapting goods for sale, use or transport. Assembly lines, testing facilities and packaging operations should all be assessed against it rather than assumed to be outside it.

Registration and Licensing

The Code requires establishments within its scope to be registered electronically with the registering officer, and the states continue to administer factory approvals — building-plan approval, the grant of the licence and the inspection machinery — under their own rules. State rules under the Code are still being notified, and in the interim most state portals continue to run the process, and the forms, they ran before. Two consequences follow for a project plan: confirm with the state authority which rule set your application is being processed under, and do not assume that a form number quoted in older guidance is still the one in use.

Documents Required for Factory Licence Application

While requirements vary by state, the following documents are generally required:

• The application form for registration and grant of licence prescribed by the state authority
• Factory building plan approved by the local municipal authority
• Certificate of Incorporation of the company (for foreign subsidiaries, include the parent company's details)
• ID proof of the occupier and the factory manager
• Board Resolution nominating the Occupier (mandatory for companies)
• Proof of registered office and factory premises (lease deed or ownership document)
• Electricity load sanction letter or latest electricity bill
• NOC from the Pollution Control Board
• Fire Safety NOC from the state fire department
• Building stability certificate from a licensed structural engineer
• Approved layout plan showing machine placement, worker movement areas, emergency exits, and ventilation

Fire Safety NOC: Process and Requirements

The Fire NOC is a prerequisite for the factory licence in most states. It certifies that the factory premises complies with the fire and life safety standards of the National Building Code of India, as adopted by the state fire services rules and the local building bye-laws. Check the edition before you design to it: the Bureau of Indian Standards now lists a 2026 edition of the Code as SP 7:2026, and the 2016 edition, SP 7:2016, is shown as withdrawn in the BIS standards catalogue. The National Building Code is a standard rather than a statute and binds only through state adoption, so establish which edition your state fire rules and municipal bye-laws currently apply.

National Building Code Requirements for Factories

The Code places industrial buildings in occupancy Group G and divides them into three hazard categories:

Key NBC requirements applicable to all factory buildings include:

• Minimum two exits per floor, with a maximum travel distance to the nearest exit. The limit is set by occupancy class rather than by a single figure, and is relaxed where the building is sprinklered — read it off the fire and life safety provisions of the edition your state applies, for your specific classification, rather than applying a remembered number
• Exit width derived from the occupant load, computed in units of exit width as the Code prescribes for the occupancy
• Fire-resistant construction with rated fire walls between compartments
• Emergency lighting and illuminated exit signage
• Fire detection and alarm system appropriate to the hazard classification

Documents for Fire NOC Application

The fire department typically requires:

• Two copies of building plans showing floor layout, exits, and fire equipment placement
• Architecture checklist certificate
• Address proof and photographs of the building exterior
• Electrical wiring certificate from a licensed electrical contractor or recognized agency
• Details of fire safety equipment installed (extinguishers, hydrants, sprinklers, detection systems)
• Water storage capacity documentation (overhead tank and underground reservoir for hydrant system)
• Structural stability certificate

Fire NOC Inspection and Timeline

After receiving the application, the state fire department dispatches an inspection team to verify:

• All specified fire safety equipment is installed and functional
• Emergency exits are accessible and properly marked
• Electrical installations meet safety standards
• Water supply for firefighting is adequate
• Building construction matches the approved plans

If deficiencies are found, the applicant receives a deficiency notice and must rectify the issues before a re-inspection. Where documentation is complete and the premises passes at the first attempt, issuance is typically a matter of a few weeks; a failed inspection resets the sequence, and the re-inspection date, not the paperwork, is usually what sets the outer limit. State fire services publish their own service standards — plan to the one that applies to you.

State-Wise Variations: What Foreign Manufacturers Must Know

Each state operates its own factory inspection machinery and digital portal. The following are key differences across major manufacturing states.

Maharashtra

Maharashtra's Directorate of Industrial Safety and Health (DISH) manages factory licences through an online portal. Key points:

• Licence applications are filed online, with the Maharashtra Industry, Trade and Investment Facilitation Cell (MAITRI) portal acting as the single-window entry point for industrial approvals
• Fees are calculated on the number of workers and the connected horsepower of machinery
• Renewal conditions and fee slabs are revised periodically — check the current requirement set on the portal before filing, rather than repeating the previous cycle's paperwork

Karnataka

Karnataka uses the e-Suraksha portal for factory registrations. Key features:

• Auto-calculated fees based on worker strength and machinery HP
• Online payment via UPI, debit card or net banking
• Periodic compliance reporting for higher-risk premises, submitted digitally
• An inspector visit should be assumed rather than hoped against
• Integration with the state's single-window system for industrial approvals

Tamil Nadu

Tamil Nadu operates through the Tamil Nadu Single Window Portal (TNSWP). Important distinctions:

• Online tracking of the fire NOC, with alerting on renewal deadlines
• Renewal applications are expected well before licence expiry — build a lead time of months, not weeks, into the compliance calendar
• Scrutiny fees are banded by the scale of the unit and are published on the portal
• Separate inspection by the Tamil Nadu Fire and Rescue Services Department

Gujarat

Gujarat routes industrial approvals through the Investor Facilitation Portal (IFP), the state's single-window platform run by the Industrial Extension Bureau (iNDEXTb). Key points:

• Fully digital application and payment gateway
• Fees calculated based on worker strength and machinery HP
• Integration with other industrial approvals (Pollution Board, electricity connections)
• The portal publishes the list of empanelled third-party agencies used for fire department inspections — check it before engaging one

Licence Duration, Renewal, and Fees

Licence validity is set by state rules, and several states offer a choice of terms — a longer term reduces renewal overhead at a higher upfront fee. Confirm the terms currently on offer with the state authority, since these are among the provisions being revisited as state rules under the OSH Code are notified.

Fee Structure

There is no national fee schedule. Each state fixes its own, and almost all of them compute the fee from two variables: the maximum number of workers the licence permits and the connected horsepower of the installed machinery. Both are declared by you in the application, which means the fee is a function of a number you choose — and a licence taken out for headcount you do not yet have is a recurring cost, while one taken out too tight forces an amendment the first time you add a shift.

Fire NOC fees are levied separately by the state fire service, generally by built-up area and hazard classification. Take both figures from the state portal at the time you file; they are revised in state budget cycles and any published range dates quickly.

Renewal Process

The factory licence must be renewed before expiry. Late renewal attracts penalties and can result in a closure notice from the factory inspector. The renewal process is simpler than initial registration and typically requires:

• Updated worker count and machinery details
• Valid Fire NOC (renewal if expired)
• Valid Pollution Control Board consent
• Compliance certificate from the Factory Manager

Penalties for Non-Compliance

Non-compliance with the OSH Code and with state fire safety regulation carries serious consequences:

• Operating without registration or a licence: a monetary penalty under the OSH Code, escalating for repeat contraventions. The Code restructured the penalty provisions of the thirteen Acts it replaced, so any figure quoted from the Factories Act, 1948 is no longer the operative one — take the current amount from the Code and the state rules made under it
• Operating without a Fire NOC: penalties under state fire services legislation, which differ substantially between states, together with sealing or stop-work powers
• Accident caused by a safety contravention: the Code retains personal liability for the occupier and the manager, with imprisonment available where a contravention causes death or serious bodily injury
• Insurance implications: fire and property insurance claims can be resisted where the factory was operating without a valid Fire NOC at the time of the incident — frequently the largest number in the whole exposure

For foreign manufacturers, the reputational and operational risk is often greater than the financial penalty. A factory closure order disrupts supply chains, delays customer commitments, and signals regulatory non-compliance to potential partners and customers. Companies should maintain an annual compliance checklist to track all renewal deadlines.

Integrating Factory Compliance with Other Approvals

The factory licence and Fire NOC are part of a broader matrix of approvals that a foreign manufacturer must obtain. These include:

• Pollution Control Board consent: Consent to Establish (CTE) before construction and Consent to Operate (CTO) before production
• Building plan approval: From the local municipal authority or industrial development authority
• GST Registration: Required before any sale or purchase of goods
• IEC (Import Export Code): Required if the factory will import raw materials or export finished goods
• Shop and Establishment Registration: For the company's administrative/office premises (separate from factory)
• Labour law registrations: EPF and ESI registration and the related welfare filings. All four labour codes were commenced on 21 November 2025, but only the OSH Code and the Industrial Relations Code took effect in their entirety; the Code on Wages and the Code on Social Security were commenced as to specified sections only, and rule-level operationalisation is still under way. Treat the EPF and ESI position as transitional and confirm the current filing route before you register

For foreign companies setting up manufacturing operations as part of India market entry, establishing the subsidiary and obtaining factory compliance should be planned as parallel workstreams. The FDI advisory and factory compliance processes can run concurrently if started early in the project timeline.

The Occupier and Factory Manager: Legal Responsibilities

Under the OSH Code, two specific individuals bear personal legal liability for factory compliance: the occupier and the factory manager. The Code defines the "employer", in relation to a factory, as the occupier — or, where a person has been named as manager of the factory, the person so named.

Who Is the Occupier?

The occupier is the person who has ultimate control over the affairs of the factory. For a company, that means a director nominated by the board through a formal resolution; in a foreign-owned subsidiary it is typically the Indian resident director. One trap: the Code's deeming proviso lets any one of the directors be the occupier except an independent director within the meaning of section 149(6) of the Companies Act, 2013 — an independent director cannot be put up for the role. The occupier carries personal liability for safety contraventions and can be prosecuted, which is why the nomination should be a deliberate decision rather than a default to whoever signs the incorporation papers.

Who Is the Factory Manager?

Every factory must have a named manager responsible for day-to-day compliance, whose name is notified to the authority and appears on the licence. Both the occupier and the manager can be proceeded against for the same contravention; the manager's presence does not discharge the occupier. Separately, section 22 of the Code requires a safety committee and the appointment of safety officers in establishments above the prescribed size — a distinct role from the manager's, with its own prescribed qualifications.

Practical Implications for Foreign Companies

Foreign manufacturers must carefully select both the Occupier and Factory Manager, as these individuals accept personal criminal liability. The resident director serving as occupier should understand their obligations under the Code before accepting the nomination. Some foreign companies appoint a dedicated Indian national as an additional director specifically to serve as the Occupier, rather than burdening their primary business directors with this liability.

Compliance Calendar for Manufacturing Units

Factory compliance is not a one-time exercise. Manufacturing units must maintain ongoing compliance throughout the year:

Foreign manufacturers should integrate these obligations into their compliance deadline tracking system from day one. Missing a single renewal can cascade into operational disruptions, particularly if the factory inspector issues a stop-work notice.

Key Takeaways

• The Factories Act, 1948 was repealed by the Occupational Safety, Health and Working Conditions Code, 2020, in force from 21 November 2025 — check any guidance you are working from against that date.
• The factory thresholds are now 20 workers with the aid of power and 40 without, up from 10 and 20 under the 1948 Act.
• Factory approvals remain state-administered, with different portals, fees, timelines and inspection standards across Maharashtra, Karnataka, Tamil Nadu, Gujarat and elsewhere; state rules under the Code are still being notified.
• The Fire NOC turns on the National Building Code's fire and life safety requirements as adopted by your state, where the industrial hazard classification (G-1, G-2, G-3) sets the level of infrastructure required. BIS now lists a 2026 edition (SP 7:2026) and shows the 2016 edition as withdrawn — confirm which edition your state applies.
• The sharpest financial consequence of a missing Fire NOC is usually not the penalty but the insurer's ability to resist a claim after a fire.