Trade License


What is a Trade License?

A trade license is a document/certificate that gives the permission to the applicant (person seeking to open a business) to commence a particular trade or business in a particular area/location. However, the license does not allow the holder to any other trade or business than for it is issued. Furthermore, this license does not pass on any kind of property ownership to the holder of the license.

There a few different kinds of trade licenses:

  • Industries license: Small, medium and large scale manufacturing factories
  • Shop license: Dangerous and Offensive trades like a sale of firewood, cracker manufacturer, candle manufacturer, barber shop, dhobi shop etc.
  • Food establishment license: Restaurants, hotels, food stall, canteen, the sale of meat & vegetables, bakeries etc.

Why should I apply for a Trade License?

  • A Licensed business will enjoy greater goodwill and will attract the customers and investors than an unregistered entity.
  • It protects the owners against certain types of liability
  • Companies having better business practice attract various investment groups and other business organizations
  • In order to do ethical business, practice the person can apply for obtaining Trade License Registration which ensures the safety measures and guidelines
  • If a person does not get Trade license as required under law and starts any business than a government can impose a fine and penalty on such person. It can also result in the closure of such a business.

How to apply for a Trade License?

Once the type of trade license is finalized, the Form 353 has to be duly filled with all the required details. All the above-mentioned documents have to be submitted to the ward office of the area’s local municipality.After the application is filed, if more information is needed the authorities may demand for addition details. If all the details are found satisfactory, the trade license will be issued. The validity of the trade license is one year and it takes about 2-3 weeks to procure one. It will be sent through courier.NON COMPLIANCETrade license is the mandatory license for every business. Hence, if any business owner fails to get one before starting a business, he or she is liable to pay a fine or may face legal repercussions.

Proofs required for a trade license

In order to apply for a trade license, the applicant is required to make an application and submit the same to the concerned Municipal Corporation along with all the necessary documents.

There are different documents that required to be provided depending on the type of business intended to carry on.

  • Application in the prescribed Form
  • If the applicant is any Firm, LLP or a Company, their PAN Card, along with the incorporation certificate.
  • In the case of an individual applicant, his/her Aadhaar Card is mandatory.
  • Latest Municipality Property Tax Payment Receipt.
  • Lease documents or consent letter from the owner of the property.
  • NOC from your immediate neighbor
  • A certified layout plan of your trade building showing the business, working or washing or resting areas
  • Katha extracts
  • Katha certificate
  • Sanction plan
  • Occupancy certificate (OC)