In a major relief to thousands of industrial units operating in industrial belts in the national capital, the Municipal Corporation of Delhi (MCD) has abolished the need for obtaining and renewing factory license from the civic agency. In the notified industrial areas, under the new system, the Factory License Fee will be fixed at five per cent of the Property Tax and will be collected annually along with Property Tax, simplifying both payment and compliance. For industrial units located in designated industrial areas, the Ministry of Micro, Small and Medium Enterprises (MSME) Udyam Registration Certificate or the Allotment/Lease Deed issued by Delhi Governments DSIIDC (Delhi State Industrial and Infrastructure Development Corporation) will be treated as a deemed Factory License under Section 416/417 of the Delhi Municipal Corporation (DMC) Act, 1957. This will eliminate the need for a separate factory license from MCD, thereby reducing compliance burden on entrepreneurs. Beside this currently, license fees are calculated based on the electrical horsepower (HP) used by the unit, which often requires physical inspection. The new system will reduce unnecessary inspections by MCD officials. Responsibility for ensuring compliance with fire safety, environmental clearances and structural norms will rest solely with the factory owner/occupier, who must obtain all necessary approvals from the competent authorities. Necessary changes will be made to the MCD Property Tax portal to integrate factory license issuance and automate the payment and compliance workflow. Mayor Sardar Raja Iqbal Singh stated that in order to promote Ease of Doing Business, the civic agency has taken a historic decision today to eliminate the Inspector Raj from the process of factory license renewal. Raja Iqbal Singh further informed that in notified industrial areas, factory licenses have now been linked with property tax. As a result, factory owners will be required to pay five per cent of the annual property tax as license fee to the MCD. The Mayor said that various Industrial area associations and industry bodies have underlined the need for reforms in the area of MCD licensing for factories/industrial units highlighting that entrepreneurs are rather facing unease in doing business in connection with running their industrial units in Industrial area due to regulation by MCD.

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