Shop And Establishment Act - How To Apply Online?

What is a shop? A shop is defined as a building/property established for the sole purpose of selling goods or services. A shop may have only one person working which is the owner himself or he can hire any number of employees as per his requirements, provided he follows a set of rules and regulations.

What is an establishment? A commercial establishment refers to a financial unit or banking sector that produces or sells goods and services from a specific location. Establishment may be restaurants, coffee shops, residential hotels, movie theatres, amusement parks, financial institutions and so on.  

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What is ‘shop and establishment act’? Shop and Establishment Act came into force to regulate the payment of wages, working hours, terms of service and other work related conditions of employees in shops and commercial establishments. Any shop/commercial establishment in India must register under the act within 30 days of establishment. Each state has different rules and regulations for registration under the act and requires approval from the department of labor. The department must issue a certificate of registration upon application and this must be displayed at the shop. The registration should be renewed periodically as per the act.

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Shop And Establishment Act

Karnataka Shops and Establishment Act:

This act came into force in 1962. All the shops in Karnataka must mandatorily register under the act. An application must be submitted to the inspector in charge of your region. After submitting the application, the inspector would initiate the verification and would issue a registration certificate. This registration would be valid for a certain period and needs periodic renewal. The application could be rejected for incomplete information or for furnishing wrong information. If the owner of the establishment wishes to close, then he must notify the inspector within 15 days of closing and the inspector would verify and cancel the registration.

There are certain establishments that are exempted from registration under the act and are mentioned below;

• Offices of central government, state government and local authorities
• Healthcare centers for mentally challenged and handicapped
• Establishments of legal and medical practitioners in which less than 3 persons are employed
• Bank branches

How To Apply Online Shops and Establishment Act?

Each state in India has its own set of rules and regulations for the registration. Below mentioned are the detailed steps that must be followed to register your shop/establishment under the Karnataka Shops and Establishment Act:

• Log on to https://labouronline.kar.nic/in  for online registration
• Click on ‘new registration’ to generate user ID and password
• Fill the application form and submit the form to your regional circle officer
• Pay the registration fee. The registration fee would depend on the number of employees in the establishment

Registration Fee
No. of Employees	Fees (Rs.)
No Employees	250/-
1 to 9 Employees	500/-
10 to 19 Employees	3000/-
20 to 49 Employees	8000/-
50 to 99 Employees	15000/-
100 to 250 Employees	30000/-
251 to 500 Employees	35000/-
501 to 1000 Employees	45000/-
1000 Above Employees	50000/-

• Attach the following documents with the application form 1) Name of the establishment 2) Details of the employer and employees 3) Full postal address of the establishment 4) Legal documents of the property 5) PAN card of the establishment/owner
• Submit the physical copy of the application to the regional labor inspector

The regional labor inspector would issue the registration certificate upon verification. This certificate is to be displayed at your premises at all times. This certificate could be renewed using the same user ID and password that was generated at the time of registration.

Advantages of registering under the Shop and Establishments Act

There are certain benefits of registering under the act which are mentioned below;

• You can open a current account
• It helps to get loans from nationalized banks and NBFCs to expand the business
• Tax benefits
• It helps in getting power and other exemptions from the state government.

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