Establishing a factory is not just about purchasing land, installing machines, and starting production. The real challenge starts with legal approvals, compliance, and regulatory obligations under the Factories Act, 1948.

The Telangana Government have made the process structured but highly sensitive. Any mistake in documentation, planning, or compliance can lead to rejection, delays, penalties, or even closure of operations. This blog makes it easy to understand the entire lifecycle of factory compliance — from initial setup to inspections and renewals to inspections.

Before applying, we need to understand whether your business qualifies as a factory. As per the Factories Act, 1948:

• If 10 or more workers are employed with power, OR
• If 20 or more workers are employed without power, and a manufacturing process is carried out, the establishment is considered a "factory".

A manufacturing process involves activities like producing, processing, packing, repairing, or even storing goods in cold storage.

When a new factory is setting up, or existing factory is expanding, or there is a change in layout or machinery, the government needs a detailed plan showing how your factory will be constructed, expanded or operated.

These include:

• Site plan with surrounding details
• Building layout (including Factory sheds, Machinery placement, Storage areas & Horsepower details)
• Sections & Elevation (Internal structure view, machinery placement, height & ventilation)

There are strict standards; even minor deviations from these norms can lead to rejection. This stage is critical because once approved, your actual factory must match the plan during inspection.

Note: For HAZARDOUS FACTORY, extra compliance is applicable, the manufacturer is required to submit an Inventory of hazardous substances, HARA Report (Risk Assessment) & Safety Report.

DOCUMENT CHECKLIST:

• Self-certification form
• Registered lease/sale deed
• Mutation order
• Building plan (all floors)
• Site plan
• MOA / Partnership deed
• Flowchart of process
• PAN/Aadhar

Once construction of the factory and the installation of machinery is completed, the next step is to obtain the Factory License, also known as Consent for Operation (CFO). The process involves:

• Online application through TS-iPASS
• Submission of documents
• Payment of government fees
• Physical inspection of the factory

During inspection, the inspecting officer verifies the following

• Whether the factory matches the approved plans?
• Safety measures and machinery setup Worker facilities like toilets and drinking water
• Overall working conditions

If everything is satisfactory, the license is granted. If not, queries or notices are issued.

Documents Required in this Stage:

1. MOA / Partnership deed
2. Process flow chart
3. Plant layout
4. Ownership proof (Registered lease/sale deed)
5. PAN / Aadhaar 

In case of Hazardous Factories, following additional documents are required:

• Hazardous inventory
• HARA report
• Onsite emergency
• plan Safety report

Any of the following changes require updating the license:

• Increase in number of workers
• Increase in installed machinery (HP)
• Change in factory name
• Change in occupier (owner/director)

If these changes are not updated, the license becomes incorrect, and during inspection, it can lead to serious consequences. Even small expansions can trigger additional government fees or fresh approvals

For factories employing less than 150 workers, there is an option to opt for self-certification. Under this scheme, factory is classified as low risk and Inspection is conducted only once every 5 years. However, a security deposit must be paid, which is refundable after 5 years. This scheme reduces inspection frequency but increases responsibility. If compliance is not maintained, the deposit can be forfeited.