The ndustries The ndustries

(Development and (Development and

Regulation) Act 1951 Regulation) Act 1951
BY CS.Pradeep Kumar Gupta BY CS.Pradeep Kumar Gupta
Sec Sec- -10 10
Section 10 of the act makes the Section 10 of the act makes the
registration of the all the industrial registration of the all the industrial
undertaking. after that Govt. should undertaking. after that Govt. should
issue Certificate of registration. issue Certificate of registration.
The Govt. should Consider in The Govt. should Consider in
Certificate of registration Certificate of registration- -
1 1- -The productive or nstalled Capacity The productive or nstalled Capacity
2 2- -Level of production immediately Level of production immediately
before three years. before three years.
3 3- -Export factor Export factor
Revocation of Registration Revocation of Registration
Section 10A Section 10A
f it has obtain by f it has obtain by
misrepresentation misrepresentation
Who Require Licence Who Require Licence
Every existing industrial Every existing industrial
undertaking (Not being Central undertaking (Not being Central
Govt.) in the private sector Govt.) in the private sector
require licence require licence
hen Registration is not hen Registration is not
Necessary Necessary
1 1- - Small Scale ndustry Small Scale ndustry
2 2- -otherwise exempt from he otherwise exempt from he
license license
3 3- -not cover in definition of not cover in definition of
Factory Factory
100%EOU/SEZ 100%EOU/SEZ
ndustrial Licence ndustrial Licence
An industrial Licence is a written An industrial Licence is a written
permission from the Govt. to an permission from the Govt. to an
industrial undertaking to manufacture industrial undertaking to manufacture
specified articles listed in First specified articles listed in First
schedule and includes particulars of schedule and includes particulars of
industrial undertaking, its location industrial undertaking, its location
,article to be manufactured the ,article to be manufactured the
capacity on the basis of maximum capacity on the basis of maximum
utilization of plant & machinery etc. utilization of plant & machinery etc.
hen is Licence Required hen is Licence Required
1 1- -Licence for manufacturing of Licence for manufacturing of
New Articles New Articles
2 2- -Licence for carrying on Licence for carrying on
Business without Registration Business without Registration
3 3- -Licence of New undertaking Licence of New undertaking
4 4- -Licence for carrying on Licence for carrying on
business after the revocation of business after the revocation of
certificate of registration certificate of registration
5 5- -Licence for change in location Licence for change in location
Power of Govt. to Power of Govt. to
nvestigation nvestigation
Sec Sec- -15 The Central Govt. may make 15 The Central Govt. may make
investigation in respect of any ndustrial investigation in respect of any ndustrial
undertaking undertaking- -
1 1- -f there has been substantial fall in volume f there has been substantial fall in volume
of production for which there is no of production for which there is no
justification. justification.
2 if there has been marked deterioration in 2 if there has been marked deterioration in
the quality of the articles for which there is the quality of the articles for which there is
no justification. no justification.
3 if there has been rise in the price without 3 if there has been rise in the price without
justification. justification.
4if working against public interest. 4if working against public interest.
5 5- -in case of company Liquidation in case of company Liquidation
Power of Central Government Power of Central Government
after nvestigation Sec after nvestigation Sec- -16 16
1 1- -fix the standard of production fix the standard of production
2 2- -to control the price to control the price
3 3- -to take such step for to take such step for
development of the undertaking. development of the undertaking.
4 4- -prohibit any practice which prohibit any practice which
reduce there production reduce there production
Power to take management of the undertaking by Power to take management of the undertaking by
Central Govt. Sec Central Govt. Sec- -18A 18A
here central govt. is of opinion here central govt. is of opinion
that that- -
1 1- -Not comply direction u/s Not comply direction u/s- -16 16
2 2- -managed against public managed against public
interest interest
Power to take U without Power to take U without
nvestigation 18 AA nvestigation 18 AA
1 1- -The person of the U have by The person of the U have by
reckless investment or creation reckless investment or creation
of the in cumbrances on the of the in cumbrances on the
assets of the U assets of the U
2 2- -Close for a period more than 3 Close for a period more than 3
months months
Effect of notified order under Effect of notified order under
section 18A section 18A
1 1- -All person holding as a All person holding as a
management position shall management position shall
vacated the office vacated the office
2 2- -All contracts between U and All contracts between U and
management shall be management shall be
terminated terminated
3 3- -The person authorized by The person authorized by
Govt. shall take the Govt. shall take the
management of the U management of the U
Cancellation of contracts in bad Cancellation of contracts in bad
faith(18c) faith(18c)
No compensation to terminated No compensation to terminated
directors(18D) directors(18D)
Application of Companies Act Application of Companies Act
1956(winding up) 1956(winding up)
Take over of U owned by Take over of U owned by
Company in Liquidation Sec Company in Liquidation Sec- -18FA 18FA
After the necessary investigation have After the necessary investigation have
been made u/s 15A the Central Govt. is of been made u/s 15A the Central Govt. is of
the opinion that there are possibilities of the opinion that there are possibilities of
running or restarting U, and the Central running or restarting U, and the Central
Govt. is further satisfied that the U should Govt. is further satisfied that the U should
be run for maintaing or increasing the be run for maintaing or increasing the
production, supply or distribution of articles production, supply or distribution of articles
needed by the general public. Then needed by the general public. Then
application to high court & after that High application to high court & after that High
Court shall order to central Govt.to appoint Court shall order to central Govt.to appoint
any person or body to take over the any person or body to take over the
management. which should not be management. which should not be
exceeding more than 5 years. exceeding more than 5 years.
Power of DRA Power of DRA
Power of nspection Power of nspection
To take over the management of To take over the management of
the ndustrial Undertaking the ndustrial Undertaking
Give order for control the price Give order for control the price
and distribution of of certain and distribution of of certain
articles(18G) articles(18G)
Penalties Penalties
here any person failure on here any person failure on- -
1 1- -Provison sec10(1) Provison sec10(1)- - Failure to get Failure to get
Registration Registration
2 2- -failure to obtain Licence for failure to obtain Licence for
manufacture new article. manufacture new article.
3 3- -failure to comply direction u/s 16 failure to comply direction u/s 16
after investigation after investigation
4 4- -any order u/s 18 G any order u/s 18 G
These contravention attract imposition These contravention attract imposition
upto 6 months or fine extending upto upto 6 months or fine extending upto
Rs.5000/ Rs.5000/- -
Power to Exempt in Certain Power to Exempt in Certain
Cases (Section 29 Cases (Section 29- -B) B)
Some condition such Some condition such
1 1- - The smallness of the number of The smallness of the number of
worker employed worker employed
2 2- -Amount invested in the U Amount invested in the U
3 3- -Desiirability of encouraging Desiirability of encouraging
small U small U
ndustrial Licensing Policy ndustrial Licensing Policy- -
Locational Policy Locational Policy
U are free to select location of the U are free to select location of the
project. however in the case of cities project. however in the case of cities
with population more than one with population more than one
million the proposed location should million the proposed location should
be at least more than 25 KM away or be at least more than 25 KM away or
it should be located in ndustrial it should be located in ndustrial
area. area.
ndustries related to electronic , ndustries related to electronic ,
computer software and printing are computer software and printing are
exempt from such restriction. exempt from such restriction.
Policy Regarding Foreign Policy Regarding Foreign
nvestment nvestment
Approval will be given for upto Approval will be given for upto
51% investment 51% investment
Payment of dividend should be Payment of dividend should be
monitored by RB monitored by RB
To provide access international To provide access international
market market
n SS 24 % allowed foreign n SS 24 % allowed foreign
nvestment nvestment
Other sector open to foreign Other sector open to foreign
nvestors. nvestors.
Hotel & tourism 51% Hotel & tourism 51%
Advertising Sector 74% Advertising Sector 74%
nsurance sector26% nsurance sector26%
100%in power sector with 100%in power sector with
approval approval
Telecommunication 49% Telecommunication 49%
Film ndustry100% Film ndustry100%
Drugs & Pharmaceuticals 100% Drugs & Pharmaceuticals 100%
List of ndustries reserved for List of ndustries reserved for
public sector public sector
Arms and ammunition and allied Arms and ammunition and allied
of defence equipment of defence equipment
Atomic Energy Atomic Energy
Mineral Oils Mineral Oils
Railway Transport Railway Transport
ndustrial Licence is ndustrial Licence is
compulsory compulsory
Alcoholic drinks Alcoholic drinks
Cigar and Cigarettes of tobacco Cigar and Cigarettes of tobacco
Defence equipment Defence equipment
Hazardous chemicals Hazardous chemicals
Drugs and pharmaceutics Drugs and pharmaceutics