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Trade License in India

Trade licenses are provided to check on the business to see if they act according to the requirements of the law.
  • We file the application form on your behalf to get the Trade License.
  • We monitor and track the status of the application on behalf of the client.

Overview of Trade License

A trade license is simply a license or a certificate required for a business or individual to carry out operations. Usually, this license is provided by the respective state government for a particular municipal limit. This license will allow the applicant to open a business in a particular region. The applicant will have to ensure that the business is carried out as per the requirements of the license.

This license doesn’t allow the applicant to run any other business than the one which it is issued for. Apart from this, the license does not allow the individual to secure the property or any form of legal entitlement of the property where the business is carried on.

Types of Business that Require a Trade License

Food Business 

Food business will include any establishment which deals with food. This will also include an establishment that caters food and serves food. The following businesses would require trade licenses to operate:

  • Hotels, Restaurants, Canteens
  • Malls, Theaters and Clubs
  • Bakeries, Confectionery Shops and Snack Shops
  • Dairy needs store, Retailers, and any other premises which serve food

Trade and Other Related Services Business 

Any trade or profession which includes services for individuals would also require securing a specific form of license. The following trades require to secure this license:

  • Barber Shops and Salons
  • Cyber Cafes and Internet Parlors
  • Small Manufacturing Units
  • Medium Manufacturing Units
  • Small Scale Industries

Manufacturing Industries

Any form of industries which is involved in manufacturing products would also require this license. The following industries would require this license:

  • Medium Based Manufacturing Industries
  • Large Manufacturing Units and Industries 

Classification of Trade Licenses

Based on the amount of risk posed by the business, licenses are classified into the following:

  • Low Risk Based License

This form of license would involve any form of business that does not have a high risk. Usually, restaurants and other forms of eateries consider this license.

  • Medium Risk Based License

This type of license would be usually issued to establishments such as small scale industries and medium-sized industries.

  • High Risk Based License

This type of license is usually issued to industries and large scale establishments. Usually, this form of establishments would have higher risk of dealing with different form of materials and substances. Normally, on these premises, the standards of monitoring would be higher when compared to low and medium risk license.

Procedue for applying for a Trade License

Depending on where the applicant is located, the following requirements have to be complied with:

  • The applicant has to either apply online or offline for the trade license certification. For the online method, the applicant has to make an application and attach the prescribed documents. For the offline method (in-person) the applicant has to take all the documents to the relevant authority. With this, the applicant has to fill in the application form with the respective details for the license.
  • As per the requirement of the applicant, different states would have different processes to make an application for the license. However, the government has brought out initiatives to make systems in every state electronic.
  • The applicant has to go to the prescribed webpage to file the online trade license.
  • After this, the applicant will get a pop-up notification related to the terms and conditions which have to be adhered for the trade license.
  • The applicant has to click on the accept button for the terms and conditions.
  • Next step in the process would include the applicant to fill in necessary information and details regarding the trade license.
  • The online system for license registration has a specific mode where authentication of documents can be carried out electronically. The applicant has to perform these and submit relevant documents.
  • Once this process is carried out, the applicant will get a confirmation for successful registration of the trade license.
  • The applicant will get the confirmation regarding the same, and the applicant will receive the license within eight to eleven working days.
  • Usually, the process of receiving the trade license is faster in Metropolitan Cities when compared to rural areas.

Documents Required for Trade License:

  • Application for the License.
  • If the applicant is a corporate entity, then PAN card along with the respective company formation documents must be submitted.
  • For an individual applicant, documents such as Aadhaar Card is compulsory.
  • Property Tax Documents for the Property.
  • Lease agreement should be provided. Copies of the lease agreement.
  • Any form of Khata Extracts and Certificates.
  • Occupancy Documents.
  • No Objection Certificate from Neighbor in Case the business is located in a residential area.
  • Sanction Documents.