Licence-free ind too need regulatory clearances: Govt

Government today said the onus for compliance of legal provisions lies on entrepreneurs even in industries which are exempted from licensing.

"It is the responsibility of the entrepreneur to ensure that the manufacturing activity does not come into conflict with other legal provisions or directions or standing orders," the Department of Industrial Policy and Promotion (DIPP) said in a statement.

It said mere filing of industrial entrepreneurs memorandum (IEM) even in areas where industrial licensing is not required, "cannot be construed as a clearance of approval".

As per the existing policy, entrepreneurs are required to submit an IEM  for taking up the manufacture of any article exempted from industrial licence. On submission of the IEM, the entrepreneur is issued an acknowledgement. However, the issue of such an acknowledgement would not mean automatic approval of the proposal, the statement said.

"IEM is meant purely for statistical purposes and the acknowledgement is issued without any further scrutiny beyond checking and the onus for compliance/non-contravention with all the rules, regulations, guidelines, orders and directions etc. Lie with the applicant," the DIPP said.

Even though an entrepreneur is not required to obtain industrial licence in most of the industries, there are several other regulations which need to be met. For instance, while a particular industry may not need government licence, may require environment or other key clearances.

Excepting atomic energy, alcoholic drinks, cigars and cigarettes of tobacco and manufactured tobacco substitutes, hazardous chemicals, drugs and pharmaceuticals, all other industries are exempted from the licence.