Compliance for a Garment Unit: What You Actually Need

The order to do them in

Udyam registration

Udyam is the government's MSME registration. It is free and done online at the official Udyam portal using PAN and Aadhaar — there is no legitimate reason to pay an agent a fee for it, and the sites that charge one are not the government.

It classifies your business as micro, small or medium based on investment in plant and machinery and on annual turnover. Those limits were revised in 2025, so read the current figures on the portal rather than an older article. What registration gives you in practice:

• Eligibility for MSME schemes, subsidies and priority-sector lending.
• The protection of the delayed-payment provisions — a real advantage when a large buyer is slow to pay.
• A registration number buyers increasingly ask for during vendor onboarding.

GST registration and HSN

Registration becomes compulsory once you cross the turnover threshold for your state and category, and immediately if you make inter-state supplies. A Tiruppur unit selling to a wholesaler in another state is making an inter-state supply from day one.

Once registered, every invoice needs the right HSN code and the right rate. For cotton innerwear that means 6108 21 00 for briefs and panties, at 5% up to ₹2,500 a piece. Both are covered properly on our HSN codes and GST rates pages.

E-way bills when goods move

An e-way bill is an electronic document generated before goods move, carrying the consignment details, the vehicle and the invoice. It is generated on the e-way bill portal and the transporter must be able to produce it in transit.

• The trigger is consignment value — commonly ₹50,000 — for inter-state movement.
• Intra-state limits vary by state. Tamil Nadu sets its own, as does every other state, so check yours rather than assuming a national number.
• Validity is tied to distance, and a bill that expires in transit is a problem at a checkpoint. Generate it as close to dispatch as is practical.
• Cancel or update promptly if a dispatch changes. A stale bill against a vehicle that never moved is an easy question to be asked.

For a garment unit sending cartons across states weekly, this is the single most routine piece of compliance you will do, and the one where sloppiness shows up fastest.

IEC, if you export

An Importer Exporter Code is issued by the DGFT and is required to export from India. It is applied for online, linked to your PAN, and issued as a ten-digit code.

The part people forget: an IEC must be updated every year, in the April–June window, even when nothing has changed. An IEC that is not confirmed annually can be deactivated, and finding that out at the moment a consignment is ready to ship is an expensive way to learn it.

If you only sell domestically, you do not need one. Plenty of Tiruppur units supply the whole country without ever exporting.

Trademark: Class 25

Trademarks in India are registered by class, and clothing, footwear and headgear are Class 25. A garment brand registers there; if you also want to protect the name for retail services, that is a different class again.

Three things worth knowing before you apply:

• Search first. The public trademark search is free. Finding a conflicting mark before you print labels and cartons is far cheaper than after.
• A descriptive name is hard to register. "Cotton Comfort Innerwear" describes the goods; invented or arbitrary names are far easier to protect.
• Concessional fees exist for individuals, startups and small enterprises — which is one practical reason to have Udyam registration in place first. Check the current fee schedule on the IP India site.

Once accepted and advertised, a mark can be opposed, so the process takes time. Start it when you choose the name, not when you have grown enough to worry about copying.

What must appear on a label

Pre-packed goods sold in India carry declarations under the Legal Metrology (Packaged Commodities) Rules. For a packed garment, the declarations usually required are:

• Name and complete address of the manufacturer, packer or importer
• Common or generic name of the commodity
• Net quantity — for garments, the number of pieces
• Month and year of manufacture or packing
• Retail sale price as "MRP ₹… inclusive of all taxes"
• Consumer care contact — name, phone or email for complaints

Beyond the legal minimum, the useful additions are size and fibre composition. We print the size on the garment itself in centimetres rather than only on the pack, because a stickered size disappears the first time the pack is opened and the customer can never re-order the same fit.

Requirements do change, and e-commerce listings have their own display rules. Confirm the current position with your packing supplier or a compliance consultant before ordering fifty thousand printed labels.

Common questions

Is Udyam registration mandatory for a garment unit?

It is not a licence to operate, but it is what makes you an MSME on paper — needed for schemes, lending, delayed-payment protection and increasingly for vendor onboarding. It is free, so there is no good reason to skip it.

Do I need an e-way bill for every consignment?

Only above the value threshold, commonly ₹50,000 for inter-state movement. Intra-state limits are set by each state, so check the rule for yours.

Do I need an IEC to sell across India?

No. An IEC is only for import and export. Domestic supply across states needs GST registration, not an IEC.

Which trademark class is clothing?

Class 25 — clothing, footwear and headgear.

What has to be printed on a garment pack?

Manufacturer or packer name and address, common name of the product, net quantity, month and year of packing, MRP inclusive of all taxes, and a consumer care contact. Size and fibre composition are worth adding even where not strictly required.

Do I need to update my IEC if nothing changed?

Yes. It has to be confirmed annually in the April–June window, or it can be deactivated.