Trade License under Shop and Establishment Act, 1954
Shop and Establishment Act had been introduced in the year 1954, with an object of regulation of hours of work, payment of wages, service-related terms and conditions in shop, establishment and other commercial establishments and matters ancillary to it. The shop and establishment license differs from state to state and each entity has to get a license from the Department of Labor to operate the business.
What is the Trade License?
Every business is required to get approval from the Department of Labour and it can be obtained from the Chief Inspector, Shop and Establishment appointed under the Act.
What are the documents required for the shop and establishment license?
- Identity and address proof of the applicant.
- In the case of Company Memorandum of Association (“MOA”) and Article of Association (“AOA”) and certificate of incorporation.
- Identity proof and an affidavit of every director or member.
- PAN Card of the Company.
- Proof of premises like electricity bill, property tax receipt, etc.
- Rent agreement in case of rental property or the No Objection Certificate (“NOC”) of the owner of the property.
What is the procedure to obtain a Trade License?
- Trade license is issued by the licensing department of the Municipal Corporation.
- Firstly the applicant needs to visit on the portal of Municipal Corporation.
- Applicant should fill a required application form if the applicant is an individual Aadhaar Card is mandatory.
- Once the documents are inspected and verified an acknowledgment is sent to the applicant and on completion of the registration process, a final certificate is issued.
Shop License V/s Trade License
- Trade license is required to be obtained for carrying out any particular trade or business whereas the shop license under Shop and establishment Act is required to be obtained for such particular shop or establishment as a business with state Government.
- Trade license is the proof of not doing any unethical work on such establishment whereas the shop license can be obtained by the small trader or owners for commercial activities.
- Trade license is basically required for an establishment like restaurant, hotels and manufacture industries, etc. while Shop license is required for every shop or business who providing any goods or services.
- The Trade license is required for establishments in the commercial areas whereas the shop license is for commercial as well as for residential premises also.
Applicability of Trade License
Trade license is required for commercial establishments that are doing business or providing any services like restaurant and manufacturing industries etc. Trade license is also required to obtain in order to ensure that the activity of the business is not adversely affected to our nations or the people of India.
List of State and Union Territory License:
Following license is issued under different states:-
| State/UTC
|
Name of License |
| DELHI | TRADE/ STORAGE LICENSE |
| HARYANA | HARYANA TRADE LICENSE |
| MAHARASHTRA | GUMASTA LICENSE |
| SIKKIM | SIKKIM TRADE LICENSE |
| JHARKHAND | MUNICIPAL TRADE LICENSE |
| MANIPUR | MANIPUR TRADE LICENSE |
| TRIPURA | TRIPURA TRADE LICENSE |
| TELANGANA | TELANGANA TRADE LICENSE |
| JAMMU AND KASHMIR | J & K TRADE LICENSE |
| MIZORAM | MIZORAM TRADE LICENSE |
| TAMIL NADU | TAMIL NADU TRADE LICENSE |
| WEST BENGAL | WB LICENSE |
| ANDHRA PRADESH | AP TRADE LICENSE |
| HIMACHAL PRADESH | HP TRADE LICENSE |
| KERALA | KERALA TRADE LICENSE |
| GOA | TRADE ESTABLISHMENT/ BUSINESS ESTABLISHMENT LICENSE |
| MADHYA PRADESH | TRADE/COMMERCIAL LICENSE |
| ODISHA | ODISHA TRADE LICENSE |
| ASSAM | ASSAM TRADE LICENSE |
| BIHAR | BIHAR TRADE LICENSE |
| CHHATTISGARH | CHATTISGARH TRADE LICENSE |
| GUJRAT | GUJRAT TRADE LICENSE |
| KARNATAKA | VYAPAR TRADE LICENSE |
| PUNJAB | TRADE LICENSE PUNJAB |
| MANIPUR | MANIPUR TRADE LICENSE |
| NAGALAND | NAGALAND TRADE LICENSE |
| ARUNACHAL PRADESH | AP TRADE LICENSE |
| RAJASTHAN | RAJASTHAN TRADE LICENSE |
| UTTRAKHAND | UTTRAKHAND TRADE LICENSE |
| ANDAMAN & NICOBAR ISLAND
|
A & N LICENSE |
| LAKSHADWEEP
|
LAKSHADWEEP TRADE LICENSE |
| LADAKH
|
LADAKH TRADE LICENSE |
| DAMAN AND DIU | DAMAN TRADE LICENSE
|
| PUDUCHERRY
|
PUDUCHERRY TRADE LICENSE
|
| CHANDIGARH
|
CHANDIGARH TRADE LICENSE |
Therefore, every business operating in a commercial or residential area the license is must to be applied within 30 days of starting of business. Every time before applying for trade or the shop license the applicability on the entity, nature of business carried on, jurisdiction must be checked as per relevant state laws. Each such license can be modified, canceled on the submission of documents in a prescribed application.
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