The Industries (Development and Regulation) Act,1951

The Industries (Development and Regulation) Act ,1951 came into exist on 8th May, 1952.
It has been amended from time to time, the latest being in 1998.

The act provides wide powers to the Govt. of India in relation to regulation on industries. This act applicable to the whole of India including state of Jammu & Kashmir.

Objectives:

To implement the industrial policy To look after the regulation and development of important industries To plan the future development of new undertakings

The salient features of the IDR Act 1951

Existing

undertakings need to be registered with the Government within the prescribed time limit New 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:

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

Cont

Central Advisory Council: The Central Govt. may be by notified order, establish a council for the purpose of advising the Govt. on the issues of development and regulation of the scheduled industry, in a process of making of rules under the act and the overall administration of the act. Development Council: The Central Govt. may, by notified order, establish for any scheduled industry or a group of industries a body of persons to be called a Development Council.

Licensing:

License is a written permission from the Govt. which may include the conditions such as the location, minimum size etc.
License is required for establishment of new industrial undertakings pertaining to a scheduled industry Expansion or diversification of an article by a scheduled industry Change of location of a licensed/registered undertaking Carrying on business of an industry which requires a license but which has not been licensed previously

Provisions to the Act:

To attain the above said objectives, the act confers very wide powers on the government in relation to industries. The registration of the existing Industrial Enterprises Licensing to new undertakings Investigation into the affairs of any Industrial undertakings Establishment of a Central Advisory Council Constitution of Central Advisory Council Establishment of a Development Council

1.

2.
3.

4.
5. 6.

Section-10

The registration of existing industrial enterprises Registration of industrial undertakings as per the notification in official gazette. A Certificate Of Registration, containing product capacity of the industrial undertaking and other particulars as prescribed by central govt.

When Registration is not Necessary

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

When is Licence Required

1-Licence for manufacturing of New Articles 2-Licence for carrying on Business without Registration 3-Licence of New undertaking 4-Licence for carrying on business after the revocation of certificate of registration 5-Licence for change in location

Licencing to new undertakings (section 11)

License for producing new articles License for effecting substantial expansion Licence for change in location Licence for carrying on business without registration Licence for carrying on benefits after the revocation of certificate of registration

Investigation into the affairs of any Industrial undertakings

Power to government to start an investigation into affairs of IU The government can even take the undertaking under its own management, if it finds that IU is not working satisfactorily and fails to arry out its instructions

Establishment of a central advisory council

The development and regulation of schedule industry. Making rules. Administration of the act.

Constitution of central advisory council

A chairman and other members not exceeding 30 Members appointed by central govt. capable of representing the interest of 1. Owner of I.U. of sch. industry 2. Person employed in I.U. Of sch. industry 3. Consumer of goods manufactured by industry.

Power of Central Government after Investigation Sec-16

1-fix the standard of production 2-to control the price 3-to take such step for development of the undertaking. 4-prohibit any practice which reduce there production

Effect of notified order under section 18A

1-All person holding as a management position shall vacated the office 2-All contracts between IU and management shall be terminated 3-The person authorized by Govt. shall take the management of the IU

Power of IDRA

Power of Inspection To take over the management of the Industrial Undertaking Give order for control the price and distribution of of certain articles(18G)

Penalties
Where any person failure on1-Provison sec10(1)- Failure to get Registration 2-failure to obtain Licence for manufacture new article. 3-failure to comply direction u/s 16 after investigation 4-any order u/s 18 G These contravention attract imprisionment upto 6 months or fine extending upto Rs.5000/

sector open to foreign Investors.

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

List of Industries reserved for public sector

Arms and ammunition and allied of defence equipment Atomic Energy Mineral Oils Railway Transport

Industrial LicenSe is compulsory

Alcoholic drinks Cigar and Cigarettes of tobacco Defence equipment Hazardous chemicals Drugs and pharmaceutics