How to Get a Shop Act License: Step-by-Step Guide
5 min read | about 2 months ago
How to Obtain a Shop Act License for Your Business
Businesses in India are required to comply with the provisions of the Shop & Establishment Act. It is implemented by every Indian State and covers several operational aspects including leave policies, working hours, and employee service terms. Regulated by the Labor Department, this license is a must for commercial enterprises in the country. Let us learn more about it below.
Shop Act License Meaning & Importance
The Shop & Establishment Act is regulated by the Department of Labor and governs several activities of new businesses. You should register under the Act when setting up any venture like an office, retail or wholesale store, theater, hotel, restaurant, godown, or showroom. Government regulations usually vary throughout States, although they usually cover all commercial enterprises, with the exception of factories and production units.
The Act’s main importance lies in how it regulates various critical factors like the working conditions and hours along with holidays, wages, and maternity leave. It builds the foundation for fairer treatment of workers, while preventing their exploitation or misuse. The Act also goes a long way towards improving the overall working environment for professionals.
If you’re setting up a business, how can you apply for the license? Here’s a guide to the same below.
Shop License Act Application Process
Here is a guide to applying for the Shop Act License.
Visit the Official State Website
Go to the official Labor Department website of your State and create your password and User ID.
Create Your Profile
You can then create your profile by providing details like the name of the establishment/enterprise, employee and employer details, PAN card, registered address, etc.
Complete Form A and Submit Details
The next step is completing the Form A (Form F - Intimation for fewer than 10 employees) for the Shop and Establishment Registration. You can then choose the district and State, before submitting the details.
Upload Documents and Pay the Registration Fees
You can then attach all necessary documents for the Shop Act license after completing the form and then make the payment by clicking on the Fees button.
Keep Tracking the Application Status
Once the application is submitted, keep tracking its status periodically under the under-scrutiny option. The authorities will verify your documents and then issue the certificate accordingly.
Documents Needed for the Application
Here are the documents that you’ll need to apply for the Shop Act license.
- Identity Proof of the employer (PAN card, voter ID, driving license, or Aadhar card)
- Proof of Address of employer
- Copy of license / registration under any other law from any authority
- Photograph of the shop/establishment in which signboard is visible
- Annexure A & B Self Declaration
- Identity verification documents viz., MOA, COI, List of Directors/Trustees
- Nature of Business verification
Renewals, Fees & License Types
You have to renew the license annually without fail. It can be done online through the State Government website. You have to initiate the renewal at least 15 days before the expiry of your license. Make sure you keep your passport-sized photographs, PAN card, rent/lease agreement, employee count, name of establishment, and updated registers handy. Upon the payment of the renewal fee, the updated license will arrive within a week’s time in most cases.
The Form A license mentioned above is for new enterprises. However, Form B is for existing businesses, while Form C is for those in particular categories like entertainment, food, medicines, etc. The fees usually range between Rs. 100 to Rs. 5,000, depending on the State policies and the size of the business.
Conclusion
The Shop Act License is indispensable for every business or commercial enterprise. Follow the steps mentioned above to register and obtain your license while starting a new venture. At the same time, you should proactively renew your license every year to avoid future hassles. Once you get the license, it will ensure proper legal recognition for your establishment, while also working as a proof of business for further registrations, if required. You can use it as a crucial document for opening your current account or raising funds for your establishment. The license may also help you access various Government subsidies or benefits at different operational stages.
In case you wish to open a current account and avail diverse business banking services, consider Unity Small Finance Bank. It offers several benefits like lockers, unlimited free intra-bank transfers, low minimum monthly average balance, and unlimited electronic transfers.
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