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Trade License

Trade License is a license that permits the businessperson to setup a trade in a particular area. Every businessperson must obtain a trade license. Hurry up! Get your trade license with Corpbiz by availing of the exclusive offers right away!

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Overview of Trade License

Trade License is a certificate through which an entity is permitted or allowed to open the business and commence a particular trade in a particular area. Through Trade License, State Government regulates the operation of the specific business from a particular locality. It regulates and ensures there is no harm to the living or the health of citizens through activities carried out in the course of trade.

Trade License is issued with standards, safety guidelines, and relevant laws to ensure how business is being done and to protect the community within the state. Trade License is monitored and issued by the State Government for regulating trade and business within the city.

Business entities not adhering to the rules of trade license can face a heavy penalty in the due course of trade. Therefore, business owners must apply for trade license to the specific state authority without subsequent delay. Trade license registration is time consuming and an expensive process which is discussed henceforth.

What are the Categories of Trade License?

Following are three categories under which a trade license is issued:

  • Industrial License

    This license is applied by a business engaged in manufacturing industries operating in small, medium, and large scale.

  • Shop License

    This license is issued to a business involved in carrying out dangerous and offensive activities such as cracker manufacturer, candle manufacturer, firewood shop, etc.

  • Food & Shop Establishment License

    This license is obtained by the business engaged in food businesses such as restaurants, hotels, canteen, food stall, etc.

Trade License

What are the Benefits of Registering Trade license?

Trade license permits the traders to carry out the business within the specific locality issued by municipal authority. Trade License plays a crucial role in keeping a check on the business activities and whether the businesses are following the rules and regulation or not.

What are the Benefits of Registering Trade license?
  • Enhances Customer’s Confidence

    It ensures that the customers shall not adversely be affected by the health issues due to improper trade of business.

  • Increase Goodwill and Brand Value

    It maintains the higher goodwill in the market.

  • Increase Customer Base

    Registration of Trade License attracts more and more customer base and investor organizations.

  • Adherence of Rules and Regulations

    It is to ascertain the authority as well as the customers that the working practices are being carried out reasonably by following the prescribed rules and regulations.

  • Restrictions on certain Commercial Activities

    It regulate the business by putting restrictions on certain commercial activities.

  • Proper Monitoring of Business Activities

    Trade license helps monitoring the responsibilities of a trader in connection with the business.

  • Legal Support

    An entrepreneur holding the trade license certifies that no unethical or illegal activity is being conducted.

Checklist of Eligibility Criteria to obtain Trade License in India

Below mentioned are the eligibility criteria to obtain trade license:

  • Applicant must be of age 18 years or more,
  • No criminal record of the applicant,
  • Legally permitted Business,
  • Business should be operated in the permissible area such as Commercial (Local and Notified both)
  • Residential area with small shops of maximum area 20 square meter on the ground floor.

What Documents are Required for Trade license?

Below-mentioned documents need to be attached with an application for Trade license, which are as follows:-

  • Form 353 duly filed,
  • Id proof of the applicant (Aadhaar Card).
  • Address proof of the Applicant.
  • Latest Municipality Property Tax Payment Receipt
  • Rent /Lease agreement, in case of rental premise,
  • A layout of the premise if the entrepreneur is dealing with dangerous and hazardous goods.
  • Cancelled cheque.
  • NOC from your immediate neighbor
  • Certificate of incorporation is required if the applicant is a company.
  • PAN of the entity
  • Certificate of Occupation
  • Sanction plan: Layout plan of your trade building showing the business, working or washing or resting areas

What is the Registration Procedure to get the Trade License?

Obtaining a trade license is a simple process, it can be obtained online and offline. However, official websites for applying online can vary as per the state; to apply online; the applicant is required to follow the required steps to get the trade license-

  • Filing the Simple Questionnaire

    You need to submit a simple questionnaire along with the requisite documents.

  • Application to the Respective Authority

    Registering the trade license with the requisite documents and details should be adhered, in which following details must be added:-

    • Trade license details

    • Applicant name and address

    • Business name and address

    • Type of licenses already issued.

  • Submission of Requisite Documents

    An applicant shall submit the requisite documents to the respective authority. Once the form is submitted along with the necessary documents, the applicant needs to submit the applicable fees for registration. The fee structure for the issuance of the license differs based on the nature of the business

  • Issuance of License

    After completion of the registration process, the applicant will get the transaction number on its registered mobile number for future reference. Once the authority grants the license, the same shall be sent to the applicant through courier. It takes approx. 12 working days to register the trade license.

Note- Once the type of trade license is finalized, form 353 is duly filled with all the requisite Information and are submitted to the Municipal Ward Office.

What are the Penalties Applicable in case of Violation?

If an entrepreneur or entity starts a business without obtaining a Trade License, the government imposes penal provisions in the form of fees and penalties on such entities.

Furthermore, it also results in the cessation of the business. In a nutshell, if the entity/entrepreneur starts the business and fails to comply with the rules and regulations set by the respective authority, the said entity/entrepreneur will be liable for the penalty as prescribed by the government/authority.

  • If an entity infringes the condition of license or grounds nuisance in the neighborhood/surrounding then the license may be cancelled/revoked;
  • The establishment committing a breach of the terms of the license or applicable laws shall make it liable to pay prescribed penalty;
  • A fine of 50% of the license fees is levied in case of any delay in the trade license renewal process.
  • An appropriate legal action can also be taken against the defaulting entity.

What is the Trade License Renewal in India?

Trade License is issued with one year of validity by municipal authority and is required to be renewed every year before the date of its expiry. Generally, the license is renewed from 1st January to 31st March of every year. The renewal application is made thirty days before its expiry with the following documents attached:

  • Original copy of trade license issued,
  • Challan copies of the previous year
  • The property tax paid up to the date of the renewal application,

CorpBiz Procedure for Trade License

Kindly utilize the steps given above to integrate legally and securely a Trade License and get the benefits in the form of better-quality sales and satisfied clients. Our CorpBiz experts will be at your disposal for assisting you with guidance concerning Trade License and its compliance for the smooth functioning of your Trade in India. CorpBiz professionals will assist you in planning seamlessly at the least cost, confirming the successful conclusion of the process.

It is advisable that an attorney with “Trade Licensing experience” must be appointed to overwhelm many of the potential pitfalls that creep around within Trade License and to understand the requirement in detail. The elementary information would be mandatory from your end to start the process. The Attorney will begin working on your request once all the information is provided, and the payment is received.

Why CorpBiz?

CorpBiz is one of the platforms which coordinate to fulfill all your legal and financial requirements and connect you to consistent professionals. Yes, our clients are pleased with our legal service! Because of our focus on simplifying legal requirements, they have consistently regarded us highly and providing regular updates.

Our clients can also track at all times the progress on our platform. If you have any questions about the Trade License process, our experienced representatives are just a phone call away. CorpBiz will ensure that your communication with professionals is charming and seamless.

  • Purchase a Plan for Expert Assistance
  • Add queries regarding Trade License
  • Provide Documents to CorpBiz Expert
  • Prepare application for Trade License+ complete all admissibility criteria for preliminary screening
  • Complete Procedural actions
  • Trade License, at your Door step. Start Trading!

Frequently Asked Questions

Trade License is a state-specific application and procedure varies as per state. Some state has made it compulsory to get a trade license while some state has made it an optional choice for business.

Depending upon the state, rules relating to fees also vary as per the state such as few states are charging a monthly fee while others charge as a particular percentage of their total turnover.

Generally, the processing time is different for different states. In general, it takes 7-10 days to process in metro cities, and the time is taken in small cities, or rural areas is quite longer than in urban cities.

  • If an entity infringes the condition of license or grounds nuisance in the neighborhood/surrounding then the license may be cancelled/revoked;
  • The establishment committing a breach of the terms of the license or applicable laws shall make it liable to pay prescribed penalty;
  • A fine of 50% of the license fees is levied in case of any delay in the trade license renewal process.
  • An appropriate legal action can also be taken against the defaulting entity.

A trade license is valid for a period of 1 year. Every trader needs a trade license and are required to comply with the rules and regulations.

Trade license is required to be renewed every year. The trade license is renewed between 1st of January to March 31st. The application for renewal is to be made within 30 days from the date of its expiry.

  1. Shop License
  2. Industrial License
  3. Food establishment License

If for any reason an applicant is denied a Trade License, an applicant can submit a petition to the Standing Committee with a copy of denial letter.

Yes, a Trade License is required in whatever line of business you are in. Any business that exchanges goods or services for money, has to obtain the trade license. Before starting the restaurant business, you require a Food Establishment license.

Yes, it is mandatory to renew the trade license.

Why Corpbiz

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