India's textile and clothing industry has a rich history of craftsmanship and global appeal. With a strong manufacturing base and a vast range of raw materials, India is the world's second-largest exporter of textiles and apparel. Setting up a readymade garments manufacturing unit in India requires careful consideration of various aspects, including obtaining the necessary licenses and certifications. In this blog, we will provide a step-by-step guide on how to get a Pollution Board certificate for readymade garments manufacturing, highlighting the essential registrations and procedures involved.
Understanding the Readymade Garments Business
The readymade garments manufacturing sector is a multi-billion-dollar industry globally. In India, it plays a significant role in the economy, contributing around 7% to industry output, 2% to GDP, and 15% to overall export revenues. This sector also provides employment to approximately 4.5 crore people, making it one of the largest job providers in the country.
Establish a Legal Entity
Before starting a readymade garments manufacturing unit, it is crucial to establish a legal entity. In India, there are several options available, including:
Proprietorship: An individual operates the business, and there is no distinction between the company and its owner in terms of assets and liabilities.
Partnership: Two or more individuals operate the business, sharing the assets and liabilities.
Private Limited Company: Two or more persons form a company, sharing profits and liabilities. It is registered under the Companies Act 2013.
Public Limited Company: When seven or more persons come together to form a company, it is registered under the Companies Act 2013 and has a minimum prescribed share capital.
One Person Company: A single individual can establish a private company with limited liability, under the Companies Act 2013.
Limited Liability Partnership (LLP): It allows partners to operate in a structured manner with limited liability benefits while maintaining the internal structure of a partnership.
DIC/SSI/MSME/Udyog Aadhar Registration
Small-scale industries and ancillary units involved in readymade garments manufacturing (with a plant and machinery investment of less than Rs. 10 million) should register with the Director of Industries of the concerned state government. While there is no statutory basis for this registration, it provides access to benefits, incentives, and support from the central and state governments. The benefits may include priority sector lending, interest rate differentials, excise exemption, direct tax laws exemption, statutory support, and more.
Before establishing a readymade garments manufacturing facility, it is mandatory to obtain prior authorization from the State Pollution Control Board. Each state in India has a pollution control department responsible for monitoring pollution within its jurisdiction. The Central Pollution Control Board, under the Ministry of Environment, Forest and Climate Change, classifies industries into categories. Most garment/apparel manufacturing units fall under the Orange category.
The following permissions and certifications are required:
Consent to Establish (CTE): This permission must be obtained before constructing a new plant or installing machinery in an existing premises.
Consent to Operate (CTO): After completing the construction and installation, the occupier must apply for consent to operate. A visit by the concerned officer is conducted to ensure the readiness of the plant for operation.
Hazardous Waste Authorization: If the manufacturing processes involve bleaching, dyeing, printing, or coloring, an application for Hazardous Waste Authorization must be made.
Documents required for State Pollution Board Certificate/NOC/Authorization:
Consent to Establish/Consent to Operate documents
Pan card and UID of the authorized person
Pan card of the unit (except for proprietorship)
Property papers/rent agreement with rent permission
Layout plan
Electricity bill/water bill (if applicable)
Memorandum and Articles of Association (MOA) and Partnership Deed (if applicable)
Procedure to Obtain State Pollution Board Certificate/NOC/Authorization:
Create a user ID and password on the Pollution Control Board's website.
File an application through the user ID and password.
Make the required government fee payment.
An inspection will be conducted by the concerned officer.
After inspection, an Action Taken Report (ATR) is prepared by the department.
The file is sent for a meeting or review by the Regional Officer or Head Office, depending on the case.
Approval is granted in the meeting or by the Regional Officer or Head Office.
Download the certificate from the Pollution Control Board's website.
No-Objection Certificate from Central Ground Water Authority (CGWA)
Any business entity involved in commercial groundwater abstraction must obtain a No-Objection Certificate (NOC) from the Central Ground Water Authority (CGWA). The CGWA was established under the Environment (Protection) Act, 1986, to regulate, monitor, and manage groundwater resources in India. This permission is required to ensure sustainable water usage and environmental protection. Detailed information about the application procedure and requirements can be obtained from the CGWA's official website.
Trademark Registration
To legally distinguish your readymade garments brand from others and protect your intellectual property, it is advisable to register a trademark. A trademark is an identifiable symbol, phrase, word, or symbol that uniquely represents a product and its ownership by a particular business entity. Registering a trademark provides legal recognition and exclusive rights to the brand owner. It helps prevent unauthorized use or infringement by others and adds value to the brand. Trademarks can be registered or unregistered, but registration offers stronger legal protection. The application process can be done online through the Trademark Registry website, and the registration is valid for ten years, renewable indefinitely.
Conclusion
Obtaining a Pollution Board certificate for readymade garments manufacturing is essential to comply with environmental regulations and ensure sustainable operations. By following the step-by-step guide and completing the necessary registrations and certifications, entrepreneurs can establish and operate their garment manufacturing units legally and responsibly. It is crucial to stay updated with any changes in regulations and renew licenses and certificates periodically to maintain compliance. With India's thriving textile industry and global demand for quality garments, setting up a readymade garments manufacturing business holds significant potential for growth and success.
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