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How to Get a Trade License in India?

IndianMoney.com Research Team | Posted On Saturday, May 04,2019, 05:56 PM

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How to Get a Trade License in India?

 

 

What is a Trade License?

Trade license is an important and compulsory registration, required for conducting a business. The State Government is authorized with the task of issuing trade licenses, granting permission to businesses to carry out their trade. It is a document that ensures the business is carried out in accordance with the relevant rules, safety regulations and standard guidelines. Trade license ensures the business is not using unethical methods or any hazardous materials which can cause health problems to others living in the locality.

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How to Get a Trade License in India?

Why you need a Trade License?

The main objective of the trade license is to control businesses thriving in an area. Trade license is a way to regulate the business activities and check that they do not cause any nuisance or health hazard in the area or locality.

Obtaining a trade license is necessary, as it proves that your business is being carried out under Government vigilance. The trade license ensures people and authorities, that your business is functioning by following the proper rules, regulations and safety measures specified by the government.

Who can issue a Trade license?

In India, the government has authorized the licensing department of the Municipal Corporation, to issue the trade license for departments like industries, health and so on. While some states have made it mandatory to obtain a trade license, in other states it’s optional. The license fee differs across states. Therefore, the issuance of the license varies from state to state and depends mainly on the municipal rules and regulations.

SEE ALSO: Commodity Trading In India

How to Apply for a Trade License?

Applying for a trade license is quite an easy process. To apply for trade license in Karnataka, follow the steps given below:

  • Visit the official site of Bruhat Bengaluru Mahanagara Palike (BBMP)
  • On the home page, click on the “citizen services’ option
  • On the next page, select the “trade license” option
  • You then select the option “online trade license new registration”
  • A page displaying terms and conditions appears
  • Read the terms and conditions and click on the “continue” option to proceed
  • An online trade application form is displayed on the screen
  • Fill all the necessary details in the fields provided
  • After filling out the form with valid and authentic details, click on the “next” option for successful registration.

Categories of Trade License:

Listed below are the various categories of trade license issued by the government:

  • Industries license: industrial trade licenses are issued for small, medium and large industries and manufacturing units.
  • Shop license: Shop license is offered to various businesses like manufacturers of crackers, toys, candles and dhobi shops and barber shops, so that they are able to carry businesses from a particular locality.
  • Food establishment license: This license is required by bakeries, canteens, hotels and restaurants, as well as meat and vegetable shops for permission to carry on their trade.

Eligibility for a Trade License:

  • The applicant must be at least 18 years of age.
  • Applicant must not have a criminal record.
  • The business must be legally permissible.

Documents Required for Trade License:

Listed below are the documents you must submit to the municipal corporation to obtain a trade license:

  • Application form
  • PAN card
  • Incorporation certificate (if applicable)
  • Aadhaar card (in case of an individual applicant)
  • NOC from an immediate neighbour
  • Property tax payment receipt
  • Lease documents/ consent letter from the property owner
  • The certified layout plan of the building where the business is conducted
  • Khata certificate
  • Khata extracts
  • Sanctioned plan
  • Occupancy certificate

How Much Time Does It Take to Process?

The time taken to process the trade license in a metropolitan city is lesser than rural areas. Generally, in metropolitan cities, the application gets processed within 7 to 10 days.

SEE ALSO: History of Foreign Exchange in India

How to Renew a Trade License?

The trade license issued remains valid for only a year. The license must be renewed on an annual basis by applying for application renewal. The application for renewal of trade license must be submitted within 30 days from the date of expiry. In case of any delay in the renewal process, there are chances of incurring a late fee which is 50% of the license fee. There are some documents which must be submitted for renewing the trade license. They are:

  • Original copy of the trade license
  • Previous year’s challan
  • Property tax receipt (updated)

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