Factory license in delhi## What changed: factory licence now linked to MCD property tax
The Municipal Corporation of Delhi (MCD) has linked the issue and renewal of its factory licence to its online property tax system. In practice, the factory licence fee is paid alongside your property tax, instead of through a separate application process.
How the new system works
Earlier, units dealt with MCD's factory licence as a separate process. Under the linked system, the licence is tied to the property's tax record. When you file and pay property tax for the premises, you also declare the factory use and pay the licence fee.
For a small unit owner, this means one login and one payment cycle instead of two.
Why MCD made the change
The stated aim is to make compliance simpler for industrial and manufacturing units. MCD has described the main benefits as:
- Fewer office visits: less paperwork and fewer trips to zonal offices.
- One platform: property tax and the factory licence fee are handled together.
- Easier renewals: renewal follows the property tax cycle rather than a separate timeline.
We have not seen official figures on how many units are covered, so we do not quote any here.
Who it applies to
The linked process applies to units within MCD's jurisdiction. Delhi also has other civic bodies:
- New Delhi Municipal Council (NDMC) areas follow NDMC's own licensing process.
- Delhi Cantonment Board areas follow the Cantonment Board's own process.
If you are unsure which body covers your premises, check your property tax bill or the address on your existing licence. If you also need state-level approval for a manufacturing unit, see our guide on factory licence registration.
Check the official source: Confirm the current process, fees and eligibility on the MCD website and its property tax portal before you apply or renew. This article is general information, not legal advice for your specific situation. Rules, fees and timelines change, so check the official source or speak to a professional before acting.
MCD factory licence vs Factories Act licence: not the same thing
Many owners assume one "factory licence" covers everything. In Delhi, there are usually two separate permissions, issued by different authorities under different laws.
Two licences, two purposes
The MCD factory licence is a municipal, trade-type permission. It is issued under the Delhi Municipal Corporation Act, 1957. It concerns using a premises within MCD limits for manufacturing.
The Factories Act licence is issued by the Labour Department, Government of NCT of Delhi, through the factories inspectorate. It deals with worker safety, health and welfare under the Factories Act, 1948. The new labour codes may affect this regime.
| Point | MCD factory licence | Factories Act licence |
|---|---|---|
| Issuing authority | Municipal Corporation of Delhi | Labour Department, GNCTD (factories inspectorate) |
| Law | Delhi Municipal Corporation Act, 1957 | Factories Act, 1948 |
| Who needs it | Units carrying on manufacturing within MCD limits | Premises meeting the "factory" definition, broadly based on worker count and use of power |
| How to apply | Online, linked to the MCD property tax portal | Online through the Labour Department's portal |
| Where to check status | MCD property tax / licensing portal | Labour Department portal |
Holding one does not replace the other. If you need help with the labour-side approval, see our factory licence registration service.
Other approvals you may need
Depending on your activity, size and location, a unit may also need:
- Fire NOC from the Delhi Fire Service
- Pollution NOC (Consent to Establish and Consent to Operate) from the Delhi Pollution Control Committee (DPCC)
- GST registration, Udyam registration and labour law registrations
A simple example
Take a small metal-parts unit in an approved industrial area. It runs on electricity and employs enough workers to count as a "factory". It would typically need the MCD factory licence for the premises and a Factories Act licence from the Labour Department. It may also need DPCC consent and a Fire NOC. Check each requirement with the relevant authority before you start operations.
How to apply or renew through the property tax portal
The MCD factory licence is now handled through MCD's online property tax system, so each application is tied to a specific property record. The steps below are a general outline. Screens, menu names and field labels may differ on the live portal.
Step-by-step outline
- Log in with your property ID. Use the property's UPIC (Unique Property Identification Code) to open its property tax record.
- Check the property details. Confirm the owner name, address, covered area and type of use before you go further.
- Select the factory licence option. Choose the factory licence option linked to that property record.
- Enter business and activity details. Add your business name, PAN, the nature of your manufacturing activity and the area used.
- Pay the fee with property tax. Pay the applicable licence fee along with property tax, then download and save the receipt.
Renewal follows a broadly similar route. You log in with the same UPIC, confirm that the details are still correct and pay for the new period.
Documents and details to keep ready
- Property ID (UPIC)
- Ownership proof or rent/lease agreement
- Business PAN
- GST details, if registered
- A short description of the manufacturing activity
- The area used for manufacturing
How the fee works
The fee is generally linked to the property and the nature and scale of the activity carried on there. Do not rely on rates quoted informally. Check the current figures on the portal or with MCD before you pay.
Practical tips
- Clear property tax dues first. Pending dues can hold up the licence.
- Fix wrong property details early. An incorrect area or use category can affect your fee and cause problems later.
- Coordinate with the owner if you rent. The property tax account is usually in the owner's name, so you may need their cooperation.
- Keep records. Save copies of the payment receipt and the licence, both digital and printed, for inspections and renewals.
If you also need a Factories Act licence for the same unit, see our guide to factory licence registration.
Common issues, practical tips and when to get help
Common problems applicants face
- Property records don't match actual use. If MCD records show the property as residential but you run a manufacturing unit, the application may be questioned. Check how your property is recorded before you apply.
- Confusion over who applies. Tenants often assume the owner will handle it, and owners assume the tenant will. This leads to delays and missed renewals.
- Unpaid past property tax. Outstanding dues on the property ID can block the process until they are cleared. Pay or resolve any arrears first.
- Units in non-conforming areas. Factories in areas not permitted for industrial use under Delhi's zoning rules may not get a licence at all.
What tenants should do
If you rent your factory premises:
- Get the property ID from the owner and confirm property tax is paid up to date.
- Agree in writing, ideally in the rent agreement, who applies for the licence, who pays the fees and who handles renewals.
- Ask the owner for copies of tax receipts so you can produce them if needed.
When to get help
Mismatched records, old tax dues or zoning doubts can take time to sort out. Lawgical Guru, led by Satyam Gupta (Company Secretary & Advocate), helps Delhi businesses with factory licence registration, Fire NOC, Pollution NOC (CTE/CTO) and labour law compliance. If you are unsure where your unit stands, you can talk to us.
Key takeaways
- The MCD factory licence is now handled through the property tax system, so your property ID and tax status matter.
- Clear any pending property tax and check that property records reflect actual use.
- Tenants should agree responsibilities with the owner in writing.
- Units in non-conforming areas need to check eligibility first.
- The MCD licence is separate from a Factories Act licence. You may need both.
This article is general information, not legal advice for your specific situation. Rules, fees and timelines change. Check the official source or speak to a professional before acting.
Sources / official references
- Municipal Corporation of Delhi: mcdonline.nic.in
- MCD Property Tax portal
- Government of NCT of Delhi: delhi.gov.in
Frequently asked questions
How do I get an MCD factory licence in Delhi now?
The MCD factory licence is now handled through MCD's online property tax system. You log in with your property's UPIC, confirm the property details, select the factory licence option, enter your business details and pay the licence fee along with property tax.
Is the MCD factory licence the same as a Factories Act licence?
No. The MCD licence is a municipal permission under the Delhi Municipal Corporation Act, 1957, while the Factories Act licence is issued by the Labour Department, GNCTD, under the Factories Act, 1948. Holding one does not replace the other, and many units need both.
Does the property tax route apply to NDMC or Cantonment areas?
No. The linked process applies to units within MCD's jurisdiction. NDMC areas and Delhi Cantonment Board areas follow their own licensing processes.
What documents should I keep ready?
Keep your property ID (UPIC), ownership proof or rent/lease agreement, business PAN, GST details if registered, a short description of the manufacturing activity and the area used.
I rent my factory premises. Who applies for the licence?
The property tax account is usually in the owner's name, so tenants often need the owner's cooperation. Agree in writing, ideally in the rent agreement, who applies, who pays the fees and who handles renewals.
Can unpaid property tax stop my licence?
Yes, outstanding property tax dues on the property ID can hold up or block the process until they are cleared. Pay or resolve any arrears before you apply or renew.