Overview of Composite Woollen Mills in India

Composite mills cover the combination of textile processing with wool, such as dyeing, spinning, weaving, printing and finishing. The woollen textile industry is an essential industry in India’s textile industry. This particular sector plays a vital role in linking the rural economy with the mainstream manufacturing industry and is represented by small, medium and large-scale units that indulge in spinning, weaving, knitting, printing and processing activities. As wool rearing is an indigenous part of India’s rural economy, where farming is difficult, these units are often found in all corners of the country. The woollen milling industry broadly falls under two heads, i.e. organised sector and the decentralised sector. The organised sector comprises composite woollen mills, combing units, machine-made carpet manufacturing units, knitwear and woven garments units and worsted and non-worsted spinning units. The decentralised sector includes power loom units, hosiery and knitting units, hand-made carpets and independent dyeing and process houses. The product portfolio from these two categories is equally divergent from textile intermediaries to finished textiles, garments, knitwear, blankets, carpets etc. The Composite Wool Mill is a capital-intensive industry, and significant industrial hubs are in Rajasthan Telangana, Gujarat, Karnataka, Himachal Pradesh, Himachal Pradesh, Maharashtra, Uttarakhand, Uttar Pradesh and Andhra Pradesh. Any entrepreneur who wishes to start this business must have a fair idea of this industry. This article is an attempt to present an overview of the Composite Woollen Mills in India and will act as a guiding document of the procedural formalities needed to start a composite woollen mill.

Functioning of A Composite Woollen Mill

The organised textile industry in India is characterised by the use of capital-intensive setups with advanced technology for the mass production of woollen products and includes spinning, weaving, processing, and apparel manufacturing. A composite woollen mill is a mill for woven/knitted products which is involved in the following activities within the same premises i.e.

• Spinning and Weaving/Knitting
• Weaving/Knitting and its processing activities
• Processing and Garmenting related activities
• Spinning, weaving and other activities related to its processing
• Spinning, Weaving/Knitting, Processing and Garmenting activities.

Millsengaged in the activities mentioned above will be classified as composite woollen mills and therefore have to apply for the certification for the manufacturing activity to the Textile Commissioner, Ministry of Textiles, GOI, who issues a Composite Mills Certificate for such mills engaged in manufacturing of both yarn and cloths.

Eligibility criteria for units to be categorised as Composite Woollen Mill

Quality certification: certification, such as an ISO certificate, is required by the composite woollen mill for its production/manufacturing activities,

Lab Report: The unit should have an in-house laboratory to check the quality while manufacturing woollen textiles.

Capacity: Minimum capacity requirement of each segment in the composite mill should be observed as per the modified guidelines issued by the office of the Textile Commissioner.

Production capacity: The production capacity of each activity should be calculated based on the average production during the last 3 years or in the case of new units from the products manufactured in the previous year. The machinery details should also be provided when applying for registration of the composite woollen mill.

Licences and Authorisation needed for Composite Woollen Mills Certificate

A composite woollen mill must obtain the following licences and authorisations prior to starting its operation.

Registration with the Ministry of Industry, Department of Industrial Policy & Promotion

Registration with the Ministry of Industry must be done through the Department for Promotion of Industry and Internal Trade through a Government to Business(G2B) Portal, which is an integrated platform that provides access to many G2B services such as filing of IEM or Industrial Entrepreneurs Memorandum and IL or Industrial License applications Online.

Consent NOC

A Composite Woollen mill will need a pollution No objection Certificate (NOC) from the concerned SPCB/ PCC under the Air Act and the Water Act. As this industry uses dyes and chemicals to produce the final product, it has been categorised as a polluting activity and therefore put under the Red category of Industries. The documents required to obtain this licence are

• Duly filled Application Form of concerned SPCB

• Signed Undertaking
• Site Plan with the roadmap 
• Detailed Project Report and total investment.
• Details of sources of air emission, effluent discharge or hazardous waste etc.
• Details of the manufacturing process
• Land documents such as rent /lease agreement
• Industry Registration Documents.
• Consent fee (as applicable)

• Balanced Sheet Certified by a CA
• Laboratory analysis report of the trade effluent and emissions.
• Copy of any environmental clearance or other permission required from the State Government.
• Any other Document specified in the application form

Registration with the Textile Commissioner

The unit must be enlisted with the Office of the Textile Commissioner and regularly submit the applicable statistical returns of the mill. Documents required for registration with the commissioner’s office are

• Copies of Licence/ IEM/SSI Certificate or Udyog Adhaar (as per the case)
• Self-Certified Production details of the unit during the last three years in the case of the existing unit and for the last year (if the unit is new)
• Self-attested statement showing the category-wise number of employees engaged in the unit during the last year.
• Self-attested copy of PAN Card
• In the case of Public/Private Ltd Company/LLP, the self-certified copy of MOA & AOA should be submitted along with the details of the proprietor, director, shareholders etc.
• Duly certified list of machinery installed in the unit (location-wise) with the capacity
• Consent NOC certificate copy
• certificate w.r.t turnover for the last 3 years by CA.
• Self-attested copy of ISO certificate
• Copies of the applicable statistical returns submitted during the last six months to the TxC office (Not required if submitted online and registered with the TxC office for submission of returns)

Factory Licence

Any establishment that falls under the definition of a factory under the Factories Act 1948 must obtain a licence from their respective state department. The factory’s licence is meant to ensure the proper and safe working conditions for the workers in an establishment. The documents required for a factory Licence include

• Online Application form with requisite fees.
• ID proof of Occupier and Manager.
• List of partners and directors with their addresses.
• NOC from other partners or Board Resolution by Directors for the nomination of the occupier.
• Proof/supporting documents of Occupier as Director/ Partner/ Proprietor of the factory.
• Latest electricity bill as proof of the sanctioned load of electricity.
• Proof of occupancy (copy of rent agreement/ownership proof, i.e. conveyance deed).
• Flow chart of the manufacturing process.
• List of raw materials used in the manufacturing process.
• List of machinery installed on the premises.
• CTE/CTO issued by the Pollution Control Board of State
• Copy of Project Report

Additional Licences required to set up a Composite Woollen Mills business

• Udyog Aadhar
• Trader Licence
• CGWA NOC for water abstraction
• Tie-up with TSDF operator/ HWM authorisation.
• Fire NOC

Validity and renewal of Registration with the Textile Commissioner

For Spinning, Processing / Weaving/knitting activity etc., the validity for a Composite Woollen Mill will be co-terminus with the Pollution NOC for three years from the date of issue of the Certificate (or whichever is earlier). For renewal, the unit should apply to the Office of the Textile Commissioner at least 4 months before the Certificate expires.

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