4.1.3 Business Premises
Figure 12
Factory Land While setting up a factory , acquiring industrial land with a clear title is the key step . State governments have identified industrial corporations which develop land for industrial use . These industrial corporations require that an application be submitted specifying the desired area size along with the proposed business plan . Applications are reviewed and merits considered before land is allotted . The process is not time bound and is subject to availability .
Office Space At the time of the incorporation of the company , it is mandatory to submit particulars of the registered office . Business entities are free to buy or lease office space . The common practice is to use real estate agents , who charge a fee of 1 to 2 per cent of the sale value and , in case of lease , 1 to 2 months rental .
4.1.4 Factory Construction
Taking business premises on lease
( i ) Agree terms with the real estate agent , if involved ( ii ) Always carry out a due diligence of the title deed . ( iii ) Ensure the lease agreement is vetted by a lawyer ( iv ) Register the agreement with the regional sub-registrar / judicial authorities ( v ) Ensure clear clauses on termination , payment of utilities , repairs , etc
Once the land is identified and before commencing construction , the company has to submit a factory plan which will normally require an approval by the concerned industrial corporation . Each state industrial corporation has their own building bye-laws . In addition , there are other clearances or approvals 10 . Once construction is complete , an industrial corporation normally requires the company to obtain a completion certificate .
4.2 Human Resources – Hiring & Management
The working population of India consists of three categories : organized work force , unorganized work force and self-employed individuals . The organized sector accounts for a tenth of India ’ s labor force but earns a fourth of the nation ’ s total wages and income .
4.2.1 Legislative Provisions
The laws governing labor in India , listed below , are somewhat complex . In general , the employment legislation normally addresses concerns of the blue collared staff . Employers are commonly required to provide employees with written terms and conditions of employment . The agreement should detail salary , hours of work , disciplinary rules and complaint procedures , the notice period for termination , holidays , the provident fund , pensions , gratuities and other employee related details . Violation of labor law is viewed with strictness .
10
Schedule 4
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