The The Industries Industries

(Development (Development and and

Regulation) Regulation) Act,1951Act,1951

The Industries (Development and The Industries (Development and Regulation) Act ,1951 came into Regulation) Act ,1951 came into exist on 8exist on 8thth May, 1952. May, 1952.

It has been amended from time to It has been amended from time to time, the latest being in 1998.time, the latest being in 1998.

The act provides wide powers to the The act provides wide powers to the Govt. of India in relation to Govt. of India in relation to regulation on industries.regulation on industries.

This act applicable to the whole of This act applicable to the whole of India including state of Jammu & India including state of Jammu & Kashmir.Kashmir.

Objectives:Objectives:

To implement the industrial policyTo implement the industrial policy

To look after the regulation and To look after the regulation and development of important industriesdevelopment of important industries

To plan the future development of To plan the future development of new undertakingsnew undertakings

The salient features of the IDR Act 1951

Existing undertakings need to be registered with the Government within the prescribed time limitNew units are permitted only through an industrial license Government has the power to conduct an investigation, assume management control provide relief or control supply and distribution of products of certain industrial undertakings. To change the location of the unit.

Definitions:Definitions:

Central Govt.:Central Govt.: Central Govt. refers to Central Govt. refers to “Government of India”.“Government of India”.

Industry: Industry: The word industry has a The word industry has a wide meaning and it includes any wide meaning and it includes any business, trade, undertaking, business, trade, undertaking, manufacturing or calling of employers manufacturing or calling of employers or any calling service, employment, or any calling service, employment, handicraft or industrial occupation or handicraft or industrial occupation or a vocation of a workman.a vocation of a workman.

Cont…Cont… Central Advisory Council:Central Advisory Council: The Central The Central

Govt. may be by notified order, Govt. may be by notified order, establish a council for the purpose of establish a council for the purpose of advising the Govt. on the issues of advising the Govt. on the issues of development and regulation of the development and regulation of the scheduled industry, in a process of scheduled industry, in a process of making of rules under the act and the making of rules under the act and the overall administration of the act.overall administration of the act.

Development Council:Development Council: The Central The Central Govt. may, by notified order, establish Govt. may, by notified order, establish for any scheduled industry or a group for any scheduled industry or a group of industries a body of persons to be of industries a body of persons to be called a called a Development CouncilDevelopment Council. .

Licensing:Licensing: License is a written permission from License is a written permission from

the Govt. which may include the the Govt. which may include the conditions such as the location, conditions such as the location, minimum size etc.minimum size etc.

License is required for License is required for establishment of new industrial undertakings establishment of new industrial undertakings

pertaining to a scheduled industrypertaining to a scheduled industry Expansion or diversification of an article by a Expansion or diversification of an article by a

scheduled industryscheduled industry Change of location of a licensed/registered Change of location of a licensed/registered

undertakingundertaking Carrying on business of an industry which Carrying on business of an industry which

requires a license but which has not been requires a license but which has not been licensed previouslylicensed previously

Provisions to the Act:Provisions to the Act: To attain the above said objectives, the act To attain the above said objectives, the act

confers very wide powers on the government confers very wide powers on the government in relation to industries.in relation to industries.

1.1. The registration of the existing Industrial The registration of the existing Industrial EnterprisesEnterprises

2.2. Licensing to new undertakingsLicensing to new undertakings

3.3. Investigation into the affairs of any Industrial Investigation into the affairs of any Industrial undertakingsundertakings

4.4. Establishment of a Central Advisory CouncilEstablishment of a Central Advisory Council

5.5. Constitution of Central Advisory CouncilConstitution of Central Advisory Council

6.6. Establishment of a Development CouncilEstablishment of a Development Council

Section-10Section-10 The registration of existing industrial The registration of existing industrial

enterprisesenterprises

Registration of industrial Registration of industrial undertakings as per the notification in undertakings as per the notification in official gazette.official gazette.

A Certificate Of Registration, A Certificate Of Registration, containing product capacity of the containing product capacity of the industrial undertaking and other industrial undertaking and other particulars as prescribed by central govt.particulars as prescribed by central govt.

When Registration is not When Registration is not NecessaryNecessary

1- Small Scale Industry1- Small Scale Industry 2-otherwise exempt from the license2-otherwise exempt from the license 3-not cover in definition of Factory3-not cover in definition of Factory 100%EOU/SEZ100%EOU/SEZ

When is Licence When is Licence RequiredRequired

1-Licence for manufacturing of New 1-Licence for manufacturing of New ArticlesArticles

2-Licence for carrying on Business 2-Licence for carrying on Business without Registrationwithout Registration

3-Licence of New undertaking3-Licence of New undertaking 4-Licence for carrying on business 4-Licence for carrying on business

after the revocation of certificate of after the revocation of certificate of registrationregistration

5-Licence for change in location5-Licence for change in location

Licencing to new Licencing to new undertakingsundertakings(section 11)(section 11)

License for producing new articlesLicense for producing new articles License for effecting substantial License for effecting substantial

expansionexpansion Licence for change in locationLicence for change in location Licence for carrying on business Licence for carrying on business

without registrationwithout registration Licence for carrying on benefits Licence for carrying on benefits

after the revocation of certificate after the revocation of certificate of registrationof registration

Investigation into the Investigation into the affairs of any Industrial affairs of any Industrial

undertakingsundertakings Power to government to start an Power to government to start an

investigation into affairs of IUinvestigation into affairs of IU The government can even take the The government can even take the

undertaking under its own undertaking under its own management, if it finds that IU is not management, if it finds that IU is not working satisfactorily and fails to working satisfactorily and fails to arry out its instructionsarry out its instructions

Establishment of a central Establishment of a central advisory counciladvisory council

The development and regulation The development and regulation of schedule industry.of schedule industry.

Making rules.Making rules.

Administration of the act.Administration of the act.

Constitution of central Constitution of central advisory counciladvisory council

A chairman and other members not A chairman and other members not exceeding 30exceeding 30

Members appointed by central govt. Members appointed by central govt. capable of representing the interest of capable of representing the interest of

1.1. Owner of I.U. of sch. industryOwner of I.U. of sch. industry

2.2. Person employed in I.U. Of sch. Person employed in I.U. Of sch. industryindustry

3.3. Consumer of goods manufactured Consumer of goods manufactured by industry.by industry.

Power of Central Power of Central Government after Government after

Investigation Sec-16Investigation Sec-16 1-fix the standard of production1-fix the standard of production 2-to control the price2-to control the price 3-to take such step for development 3-to take such step for development

of the undertaking.of the undertaking. 4-prohibit any practice which reduce 4-prohibit any practice which reduce

there productionthere production

Effect of notified order Effect of notified order under section 18Aunder section 18A

1-All person holding as a 1-All person holding as a management position shall vacated management position shall vacated the officethe office

2-All contracts between IU and 2-All contracts between IU and management shall be terminatedmanagement shall be terminated

3-The person authorized by Govt. 3-The person authorized by Govt. shall take the management of the IUshall take the management of the IU

Power of IDRAPower of IDRA

Power of InspectionPower of Inspection To take over the management of the To take over the management of the

Industrial UndertakingIndustrial Undertaking Give order for control the price and Give order for control the price and

distribution of of certain distribution of of certain articles(18G)articles(18G)

PenaltiesPenalties Where any person failure on-Where any person failure on-1-Provison sec10(1)- Failure to get 1-Provison sec10(1)- Failure to get

RegistrationRegistration2-failure to obtain Licence for 2-failure to obtain Licence for

manufacture new article.manufacture new article.3-failure to comply direction u/s 16 3-failure to comply direction u/s 16

after investigationafter investigation4-any order u/s 18 G4-any order u/s 18 GThese contravention attract These contravention attract

imprisionment upto 6 months or fine imprisionment upto 6 months or fine extending upto Rs.5000/-extending upto Rs.5000/-

sector open to foreign sector open to foreign Investors.Investors.

Hotel & tourism 51%Hotel & tourism 51% Advertising Sector 74%Advertising Sector 74% Insurance sector26%Insurance sector26% 100%in power sector with approval 100%in power sector with approval Telecommunication 49%Telecommunication 49% Film Industry100%Film Industry100% Drugs & Pharmaceuticals 100%Drugs & Pharmaceuticals 100%

List of Industries List of Industries reserved for public reserved for public

sectorsector Arms and ammunition and allied of Arms and ammunition and allied of

defence equipmentdefence equipment Atomic EnergyAtomic Energy Mineral OilsMineral Oils Railway TransportRailway Transport

Industrial LicenSe is Industrial LicenSe is compulsorycompulsory

Alcoholic drinksAlcoholic drinks Cigar and Cigarettes of tobaccoCigar and Cigarettes of tobacco Defence equipmentDefence equipment Hazardous chemicalsHazardous chemicals Drugs and pharmaceuticsDrugs and pharmaceutics