November 23, 2018

India: Procedure to obtain Trade License


With a view to commence business operations in India, the business entities are required to obtain a valid trade license from the local Government authorities. The trade license authenticates that the corporate entity is carrying out in accordance to the legal provisions of the country complying with adequate standards and best practices.

Legal framework

Trade license is obtained under the Shop and Establishment Act, 1953 and the State Government promulgated the Shop and Establishment Act and Rules. These regulatory guidelines draw out appropriate standards required to be adhered to in order to ensure smooth operations of the business houses.

Trade licenses are issued by the authorised department of a municipal corporation in consultation with other specialised departments like police, fire brigade, health, engineering department having jurisdiction over the business.

Eligible Candidates

The following conditions must be fulfilled to apply for a trade license:

  • Applicant must be of the age of 18 years or above;

  • Applicant must bear no criminal records;

  • Business of the Applicant must be capable of executing legal work.

Documentation needs

Some of the documents required to be submitted along with the filing an application form for trade license, in the prescribed format, are given below:

  • Details regarding the Applicant;

  • For individual Applicant ID Proof. However, where the Applicant is a body incorporate, its certificate of incorporation;

  • Utility Bill of the premises where the business is being carried on;

  • Latest Municipality Tax Payment Receipt;

  • Registration Certificate under Shop and Establishment Act;

  • Lease documents or consent letter from the owner of the property;

  • No Objection Certificate from owner or neighbours;

  • Certified layout plan of trade building showing the business, working or washing or resting areas

Waiting Time

It usually takes 7-10 days to obtain a trade license, subject to the completion and accuracy of the documents provided.

The trade license enables the business entities to begin and operate their operations in accordance with the law of the land.

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