A trade license is a legal document granting authorization to a person or party to start a business operation that is local municipal is issued by.A trade organization requires a business license from regulators, be it municipal or state government. It does not allow for ownership of the property or any other activity. The municipal corporation authorizes license department and allots licenses in consultation with other specific consultative departments like health, engineering, Estate and others of the same type. In most states, the application for grant or renewal of license will be made to a commissioner in the corporation. The application must be made within 30 days of starting to operate a business. On applying with the required information and documents the concerned officer will ensure that the business is suitable for the purpose used, there is no possibility of danger or nuisance for any person around and issue the license. Trade license would normally be issued within a period of 7-15 days on submission of application.
Type of Trade License
There are three type of trade license that a company or individual can apply for based on the type of trade or business that is carried out.
Dangerous and offensive trade likes a sale of firewood, cracker manufacturer, candle manufacturer, barber shop, dhobi shop etc.
Small, medium and large scale manufacturing factories.
Food establishment license
Restaurant, hotels, food stall, canteen, the sale meat vegetables, bakeries etc.
Eligibility for getting a trade license
- Person must crossed minimum age (18 year)
- Person must not have any criminal record.
- Business must be capable of executing legal work.
List of required Documents
- Address proof and identity proof.
- Certificate of incorporation, MOA and AOA of the company.
- Cancellation cheque and bank statement.
- Legal occupancy documents proof of the establishment/ unit or allotment letter of the government agency.
- Documentary proof of establishment of trade.
- Lease deed of the constitution.
- Documentary proof regarding the non-existence of unauthorized construction.
- NOC from the land owning agency.
Trade license has to be obtained within 7-10 days in metropolitan cities, if documents are not filled according to the rules, it will take time as in 35-40 working days. It has to be obtained within 30 days of commencement of business in other small cities and rural areas.
Trade license renewal
Statically, trade license in India are renewed in between January 1st to March 31st. the validity of a license issued by the municipal authority is for a period of one year and required to be renewed every year.
The application for renewal of the license is to be made within thirty days from the date of its expiry. In case the renewal process is delayed, then it may attract fine depending upon the rules and regulation of the issuing authority.
Following are the documents that need to be submitted for renewal of the license-
- Original copy of the trade license.
- Previous year challan
- Up to date property tax paid receipt.
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