Trade License is one of the most important documents which permit an applicant who want to start a business in a specific locality. This license is regulated by the Municipal Corporation Act by the respected state government and issued after consulting with different departments such as fire, health, etc. This license ensures that all the businesses follow all the guidelines, rules and regulations described by the state government and the guideline & regulations vary from state to state. With the help of this license, an applicant can start or operate its business in a commercial area without any fear of being closed. Scroll down to check more information regarding Trade License.
Different Categories of Trade License in India
Three different categories come under this license in India; you can check the same from below:
Shop License: This license is for offensive trades like barber shops, fireworks manufacturer, firewood sales, etc.
Industries License: This license is for small, medium, and large scale of manufacturers.
Food and establishment license: This is for all the hotels, restaurants, canteen, pubs, veg & non-veg sales, bakeries, and all the food & beverage related industry.
Why do we need a Trade License in India?
Trade License is controlled through the Municipal Corporation Act by the State Government in India. This license ensures that no one will get affected by any trouble and health hazard of any business or trade. It is mandatory to carry out the business in a specific area and to ensure that no one will carry any wrong business or trade practices. Every business in India holding this license should follow all the guidelines, safety measure, and rules & regulations prescribed by the state government. The main objective of this license is to control the locations by restricting the people certain types of business from their home location to maintain the business and locality environment.
What is the importance of Trade Certificate in India?
Following are some importance of license in India:
With this license, you can monitors the business operating in a specific location.
It makes sure that there is no harm to the health of the general public due to the inappropriate conduct of business.
It also ensures that all the rules & regulation and guidelines followed by the business.
It governs the business by putting boundaries on some commercial activities.
It monitors the entrepreneur’s responsibilities.
The holder of this license ensures that there is no illegal activities or trade is conducted in the business.
What is the eligibility criterion for Trade License in India?
Following is the eligibility criteria to obtain a trade certificate license in India:
The age of the applicant must be 18 years or above.
No criminal records of the applicant.
Business must be lawfully permitted under the laws and constitutional provisions.
This license is permitted to the only permissible area such as commercial, local commercial, and notified commercial.
The maximum area should be 20 square meters on the ground for the residential area with small shops.
What are the essential documents required for Trade License in India?
Following is the list of vital documents required at the time of obtaining the license in India and the documents required depends on the type of business:
Application in a proper format.
Submit MOA (Memorandum of Association) and AOA (Article of Association) in case of a company or a firm.
Submit PAN card and Incorporation Certificate if the applicant is an LLP, firm or a Company.
Submit the latest Municipality property tax payment receipt.
Submit Aadhar card of the applicant.
Submit Lease documents from the owner of the property.
No Objection Certificate (NOC) from your instant neighbour.
Katha certificate.
Sanction Plan.
Occupancy Certificate.
Katha extracts.
Submit a certified plan layout of trade building showing the working area, resting & washing area, and business.
What is the process to get a Trade License in India?
You can obtain a license online and offline. The official websites for apply online for the license vary from state to state. To obtain the license online follow the steps as mentioned below:
First, the applicant must apply to the licensing authority of a specific municipal where the business is located.
The applicant must submit the application which contains the following information:
1. Details of trade certificate license.
2. Name and address of the applicant.
3. Name and address of the business.
4. Types of licenses already issued.
Once the applicant submits the application form along with the essential documents, then the applicant needs to submit the prescribed fees.
Once the registration process is over, the applicant will receive a transaction number on its registered mobile number for further reference in the future.
Note:
The processing of an application for the license will take around 7-10 working days in some major cities, and it takes longer times in small cities.
The validity of the License in India is for one year.
Renewal of Trade License
It is mandatory to renew the license every year. The license can be renewed in between 1st Jan to 31st March. Apply for the renewal within 30 days from the date of expiry of trade license.
For the renewal of a license, the applicant must submit the following documents along with the application:
1. Submit an original copy of the Trade License Certificate.
2. Submit previous year challans.
3. Submit the latest or updates property tax paid receipt.
Conclusion
The Government of India takes a big step by introducing this license which safeguards the public or people from the health hazards and any nuisance which cause a trade or business in India. If anybody violates its rules and regulations, then they will be penalized.