An Easy Guide to Get a Trade License in India


Trade license is an essential document for every business and it is mandatory for every establishment to acquire a license from the License Department before production, transfer or storage of any products or service.
Source:siliguritimes
Trade License is a permit issued by the municipal corporation to permit a selective trade at a specific address. It is a very time-consuming process and also little costly because when you set up a business, you need various types of licenses, based on the type of business you own, and other factors like employees count and the functionalities of your service. The licenses ensure that the business is carried on as per relevant rules and safety guidelines.

What is the necessity of a trade license

Business registration is different from obtaining a Trade License. Trade license is a governmental permission to start a business.  Here, we have articulated how to get a trade license. A method of trade regulation to make sure to comply with rules and safety guidelines issued by a government in public interest against any hazard or inconvenience if caused by any business.

In short, a trade license is to ensure that nobody is following unethical business practices and is following guidelines, rules and safety measures.

How to get a trade license

To obtain a trade license is quite simple but the procedures vary from one state to another. The applicant has to submit an application to a concerned authority in Municipal Corporation. It takes about 7 to 10 days for the application to be processed in metro cities. In rest of the smaller cities and rural areas, it could take a longer time. After the license being issued, you have to periodically renew to make sure that the business is run as per the local laws.

It’s mandatory in some states to apply for trade license, 3 months before commencement of a business.

Procedure to get a Trade license in gist:

  • Fill out the form obtained from the municipality to get a trade license.
  • Submit the form along with documents necessary.
  • The concerned authority will issue the trade license after duly confirming all the documents and the application presented.

What are the categories for which you need a trade license

  • Type A for trades dealing with consumable items and eateries.
  • Type B for trades that deal with locomotive power for functioning in industries, flour mills, workshops, etc.
  • Type C for trades with dangerous activities. 
Eligibility     
  • Minimum age of 18 years
  • No criminal records
  • Business capable to execute legal work
Points to remember
  1. Apply for trade license before starting a business.
  2. To renew, you must apply within 30 working days before the expiry.
  3. Once the license issued and it has to be maintained on annual basis.
Documents required for licensing
  • Documents of service or business center and the owner (Rent agreement, Utility Bill, Fire department NOC)
  • If the premise is managed by another person, besides the owner then his/her ID and Address proof is required.
  • Business or service center address and other necessary documents might be required.
  • Tax receipt from Municipality Corporation.
  • Bank statement or canceled cheque of the business
  • Company's Pan card.

How important is a trade license

A licensed business is associated with prestige and stability and is attractive to the investors and customers.

A licensed business is a kind of protection for the owner against all kind of liabilities. If there is any damage or loss, the business actions and the personal finances won't be at stake in any kind of settlement.

A licensed also provides you with access to some groups who would otherwise be unable to join or participate in a person operates in his/her personal name. Companies with better business methodologies, investment groups, and business-oriented organizations might not allow any access to information if the company is not involved in any trade.

It has been made mandatory by the government for every business to obtain a trade license to make sure that no unethical practices are being carried out and all guidelines and safety measures are being followed.

Summary:
To make an effort to discourage any illegal activity and make sure right execution of business without harming people's interest and your surrounding environment, the Government made it mandatory for every business to obtain Trade License and complying for the same will benefit you in several ways, as mentioned in this blog.
Location: Kolkata, West Bengal, India

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