Compounding of explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
The closing chapters of the Occupational Safety, Health and Working Conditions (Bihar) Rules, 2026 cover compounding of offences (rule 86), fund sources, the common or single licence, appeals, surveys and a power to amend fees (rules 87 to 93). They are followed by five Schedules and twenty-nine Forms. This article sets out the employer-facing rules, the competent-person qualifications in Schedule I, and a list of the rest.
The rules are the Occupational Safety, Health and Working Conditions (Bihar) Rules, 2026, notified under notification 1/OSHC-01/2021-100, as notified on 30 June 2026 and published in the Bihar Gazette (Extraordinary) No. Patna 699 of 1 July 2026. Rule 1(3) says they come into force on the date of their publication in the Official Gazette. A person served a compounding notice deposits the entire compounding amount within fifteen days, and the certificate follows within ten days (rule 86). A common or single licence is issued within 30 days or is deemed issued (rule 89). The rules print no compounding rupee amount.
Later amendments and State notifications under these rules should be checked in the State Gazette. For a notice or a licence question, a short legal consultation can set the next steps.
Compounding of offences (rule 86)
| Step | Rule 86 |
|---|---|
| Notice | The officer notified by the State Government issues a notice electronically for offences compoundable under section 114(1) of the Code |
| Response | The person noticed applies to the officer electronically and deposits the entire compounding amount, by electronic transfer or otherwise, within fifteen days of receipt of the notice |
| Certificate | The Compounding Officer issues a composition certificate within ten days of receiving the amount |
| Failure to pay | If the amount is not deposited after one month of serving the notice, prosecution proceeds before the competent Court |
| Before prosecution | No prosecution without giving the employer an opportunity to comply, subject to the proviso to section 110(1) and compounding under section 114 |
The amount is the one stated in the notice; the rules do not print it, and the Code's penalty provisions apply. The Central rule is explained in our post on rule 182 of the OSH Central Rules, manner of compounding of offences. A fifteen-day period inside a one-month window means an employer who misses the first still has until the end of the month before prosecution, but should not rely on it.
Fund, common licence, appeal and survey (rules 87 to 93)
- Fund (rules 87 and 88). In addition to the sources in section 115(2)(i), the fund receives State Government grants, grants from the Government of India and other bodies, amounts for registration or renewal of beneficiaries and their contribution, scheme amounts, and contributions or donations from employers, their associations or CSR funds as the State determines. The manner of administering and spending it is to be notified by the State Government. See rule 183 of the OSH Central Rules, Social Security Fund.
- Common or single licence (rule 89). Applied for electronically in Form-XIII on the Online Portal, with the fee under rule 44(2) for contract workers, rule 60(5) for beedi and cigar and rule 64(5) for factories. The authority issues the licence in Form-XIV electronically within 30 days of receipt of the application, failing which it is deemed issued and auto-generated, with the responsibility for the failure on the authority. The licence is non-transferable; a licence for contract labour states the number of inter-State migrant workers employed. A licence obtained on wrong information may be cancelled after a show-cause opportunity.
- Actions and inquiry (rule 90). As notified by the State Government.
- Appeal (rule 91). Against the order of the authority under section 119(1), to the appellate officer appointed by the State Government within thirty days of receipt, electronically; the appeal is registered in an electronic register; if the appellant does not appear it may be dismissed, with restoration on application within thirty days on sufficient cause; the order is to be disposed of within thirty days of receipt of the appeal.
- Survey (rule 92). The Chief Inspector-cum-Facilitator, officer or committee appointed under section 121(2) may, after written notice, survey safety and health in and outside the establishment during working hours or at any time found necessary. The employer or manager affords all facilities, including examination and testing of plant and machinery and collection of samples; a worker or person nearby presents himself for any medical examination needed; and time spent counts as time worked for wages and overtime.
- Fees (rule 93). Any fees under the rules may be amended by the Labour Resources and Migrant Workers Welfare Department through gazette notification. For that reason every fee in this series of articles should be checked against the Gazette before payment.
Schedule I: competent persons
Rule 2(3) lets the Chief Inspector-cum-Facilitator recognise a person or institution as a competent person. Schedule I carries the application forms for a person and for an institution, the form of the certificate of competency, and a table of qualifications, experience and facilities for seven categories:
| Category | Qualification | Minimum experience as printed |
|---|---|---|
| Certificate of stability for buildings | Degree in Civil or Structural Engineering or equivalent | 10 years in design of construction or testing or repairs of structures |
| Dangerous machines | Degree in Electrical, Mechanical or equivalent | 7 years |
| Lifts and hoists | Degree in Electrical and/or Mechanical Engineering or equivalent | 7 years |
| Lifting machinery and lifting tackles | Degree in Mechanical, Electrical or Metallurgical Engineering or equivalent | 7 years |
| Pressure plant | Degree in Chemical, Electrical, Metallurgical or Mechanical Engineering or equivalent | 10 years |
| Precautions against dangerous fumes | Master's degree in Chemistry, or a degree in Chemical Engineering | 7 years in collection and analysis of environmental samples and calibration |
| Ventilation systems | Degree in Mechanical or Electrical Engineering or equivalent | 7 years |
Each row also lists the facilities the person must have at his command, such as non-destructive testing, load testing or calibrated meters. The certificate of competency may be revoked after a hearing, as rule 2(3)(4) provides. Our article on the Bihar OSH notification and registration covers the recognition procedure and the sixty-day period.
The other Schedules (listed)
| Schedule | Subject as printed |
|---|---|
| II | List of hazardous chemicals (referred to in rule 2(7)) |
| III | Fee for factory licences, with Schedule A (factories) and Schedule B (electricity generating and transforming), referred to in rule 64(5) |
| IV | Sub-Schedules of provisions for dangerous manufacturing processes, such as aerated waters and others declared in rule 67 |
| V | Material Safety Data Sheet (rule 69) |
The rules also carry a Schedule of dangerous occurrences within rule 8, covered in our article on accident notices and safety committees.
The Forms (listed)
| Form | Subject | Rule |
|---|---|---|
| I | Application for registration | 3(1)(i) |
| II | Certificate of registration | 3(1)(iii) |
| III | Register of establishments | 3(8) |
| IV | Notice of commencement or cessation | 3(9), 5 |
| V | Annual medical examination proforma | 6 |
| VI | Notice of accident or dangerous occurrence | 8 |
| VII | Notice of periods of work | 26 |
| VIII, VIII (A), VIII (B), VIII (C) | Employee register; attendance-cum-muster roll; register for wages, overtime and deductions; wage slip | 27 |
| IX | Unified annual return | 29 |
| X | Register of accidents and dangerous occurrences | 30 |
| XI | Register for leave with wages | 31 |
| XII | Improvement notice and prohibition order | 34 |
| XIII | Application for licence (including common or single licence) | 43, 89 |
| XIV | Licence | 43, 89 |
| XV | Experience certificate | 52 |
| XVI | Audio-visual worker agreement | 57 |
| XVII | Application for beedi and cigar licence | 60 |
| XVIII | Beedi and cigar licence | 60(3) |
| XIX | Application for permission to work outside industrial premises | 62 |
| XX | Record of outside work | 62 |
| XXI | Home workers log book | 63 |
| XXII | Application to construct, extend or take into use a factory | 64(2) |
| XXIII | Application for factory licence | 64(4), (5) |
| XXIV | Licence to work as a factory | 64(5) |
| XXV | Amendment of factory licence | 64(7) |
| XXVI | Application for transfer of licence | 64(8) |
| XXVII | Application to the Site Appraisal Committee | 68 |
| XXVIII | Health register | 75(1)(c) |
| XXIX | Certificate of fitness for dangerous operation or hazardous process | 75(2) |
Details of each are in our articles on registration and factories.
A worked example
Nalanda Forgings Pvt Ltd receives a compounding notice electronically. It reads the amount, applies electronically and deposits the entire amount within fifteen days of receipt; the Compounding Officer issues the certificate within ten days of receiving it. Earlier, the company had applied for a single factory licence in Form XIII and, as no decision came within 30 days, the licence was deemed issued. It also keeps copies of the Form XXVIII health register for its hazardous process.
Need help with an OSH notice or licence in Bihar?
A compounding notice, a licence application and an appeal each run on their own short period. Our legal consultation service can read the notice, identify the rule and form, and set out the response before the period ends.
Key takeaways
- Compounding: deposit within fifteen days; certificate within ten days; prosecution after one month if unpaid (rule 86).
- Common or single licence in Form XIII; deemed issued if not decided within 30 days (rule 89).
- Appeal to the appellate officer within thirty days (rule 91).
- A survey is allowed on written notice; survey time counts as time worked (rule 92).
- Fees may be amended by the Department through gazette notification (rule 93).
Read next
- OSH (Bihar) Rules, 2026: notification, definitions and registration of establishments
- OSH (Bihar) Rules, 2026: factories, site appraisal, emergency plans and licence
- Rule 182 of the OSH Central Rules: manner of compounding of offences
Disclaimer: Based on the State or Union territory rules named above, as notified under the Labour Codes and consulted on 4 October 2026. Later amendments, State notifications, fees and forms should be checked in the State Gazette and on the State labour department website. This article is general information, not legal advice; check the official text before acting.