One need to get trade license as it is mandatory in law. It is very similar to driving license. If one is caught driving a car without any license he will be penalized for the same. Similarly if one is conducting a business without any trade license that person’s business would be considered illegal and he might have to pay heavy penalty depending upon the nature and duration of the business. The government has made it necessary for one to get trade license to ensure that one is not carrying out unethical business practices and is following relevant rules, safety measures and guidelines. The requirement for trade license was made compulsory to ensure that the government can regulate various trade activities in the country.
Businesses for which Trade License is Necessary
Trade licenses are necessary for three kinds of business. These types are as follows-
All the eating establishments like hotels, restaurants, canteen, food stall, bakeries, sale of vegetables, meat, provisions store, etc.
Trades which use motives like manufacturing industries, factories, power looms, flour mills, cyber café, etc.
Offensive and dangerous trades like barber shop, dhobi shop, timber wood, sale of fire wood, candle manufacturer, cracker manufacturer, etc.
These three types of trade have covered almost all the business and service activities. Thus, for every legal business or service activity, one needs to obtain trade license.
Rules and Regulation under the Act
Trade license is obtained under Shop and Establishment Act. The Acts regulates following rules and working conditions-
The Act specifies the permissible working hours per day and per week.
Along with fixed working hour the act also specifies the rest intervals, opening and closing hours, holidays, overtime policies, closed days, spread over of work, etc.
The Act also specifies the regulation for the employment of young people and women.
It also specifies the rules and regulations for paid leaves like maternity leave, sick leave, etc.
It also regulates the conditions for employment and termination.
It states the requirement of maintaining registers and records and necessity of displaying notices.
It also specifies the obligation and responsibility of employers and employee towards each other, to the firm and to the society.
General Procedure
The process of obtaining, maintaining or terminating the trade license is very simple. However the procedure varies from state to state. Following is the general procedure to which few more formalities needs to be added depending upon the state rules.
Commencement of Business:
To get a Trade license registration online one needs to file an application along with fees details and needs to send to an Inspector (Chief Inspector of Shops or any other Inspector under the Act) for inspection. The details should also include:
Name of the business or service center, owner, managers, if any;
Address along with pin code of the Business or Service Center, where posts can be mailed;
Any other specifics as may be recommended.
The certificate of registration will be issued once the Inspector has verified the statements. He will register the establishment in the ‘Register of Establishments’. After receiving the certificate one needs to conspicuously display the certificate at the establishment and have to be cautious about the renewal policy.
Amendment to Certificate
Any amendment or change that has to be made in the certificate should be communicated to the official within 15 days of the occurring of the change. The Inspector would issue a new certificate with the change afterward.
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