Trade License - Delhi

Meaning of Trade License?

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

According to the Delhi Shops & Establishment Act,1954

Delhi shops and establishment act, 1954 issue following conditions on basis of which the Delhi trade license is issued. There is compulsory registration of shops or established under this act within 30 days of commencement of business.

Shops and Establishments Act regulates the following aspects of doing business in India:

• The working hours on a daily and weekly basis.
• Provisions for spread-over, rest interval, opening, and closing hours closed days, national and religious holidays, overtime work.
• Regulation of employment norms for children, young persons, and women.
• Rules and regulations concerning paid leaves.
• Rules and conditions for employment and termination of service.
• Regulations concerning the maintenance of records and registers.
• Obligations of employers as well as employees.
• Precautions against fire, accidents, etc.
• Regulations concerning the display of notices.
• The responsibility of the employer and employee towards each other, the firm, and society.

Why Trade License is required?

The government has made it necessary for one to obtain a trade license to ensure that the person is not carrying out unethical business practices and is following the relevant rules, safety measures, and guidelines. A licensed business protects its owners against certain types of liability. If damage or injury occurs in the business actions or doings, the personal finances would not be at stake in any settlement. The various types of trade licenses offer different levels of protection.

Which business is required Trade License

All commercial establishment that falls under the following categories must obtain trade license:

• An establishment or administrative service in which persons employed or mainly engaged in office work.
• A hotel, restaurant, boarding or eating house, a cafe or any other refreshment house.
• A theatre, cinema, or any other place of public amusement or entertainment.

Who Issue’s Trade license?

Trade License is issued by the licensing department of the municipal corporation in various departments like industries, engineering, health, etc. In Delhi, it is issued by Municipal Corporation of Delhi (MCD).

Different Types or Categories of Trade Licenses

Generally, there are 4 types of trade license which are as follows-

1. Trade /Storage License
2. Health Trade License
3. Veterinary License
4. Other MCD Licenses like Factory license, Hawking license, etc.

Eligibility Criteria to apply for Trade License

Basic requirements that an applicant must possess to apply trade license are as follows-

• The applicant must have crossed the age of 18 years
• The applicant must not have any criminal records
• Business must be legally permissible

Documents required for getting New Trade license:

For obtaining Delhi trade license these are the important document furnished by the applicant at the time of submitting the application for trade license-

1. Address proof and identity proof of the individual.
2. Certificate of the incorporation, AOA, and MOA of the company.
3. Affidavit.
4. Cancelled cheque and the bank statement.
5. Legal occupancy document proof of the establishment or allotment letter of the government agency.
6. Document proof for the establishment of trade.
7. Lease deed of the constitution.
8. Documentary proof for non- existence of unauthorized construction.
9. No objection certificate from the land-owning agency.

Time Period of Processing of Documents

Generally, it takes 7-10 days-time to process the application of Trade licenses in metro cities. However, in other small cities or rural areas, it can take a longer period of time.

Do we require to Renewal Trade License every year?

Yes, trade licenses need to be renewed every year or when the validity of a trade license expires. Usually, trade licenses in India are renewed between 1st January to 31st March every year. Usually, the validity of the trade license issued by the municipal authority is for a period of one year and is 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 regulations of the issuing authority.

Following are the documents that need to be submitted for renewal of the license–

1. Address proof and identity proof of the individual.
2. Original license copy.
3. Old G-8 receipt.
4. Application for renewal of the license.

Documents required for getting Duplicate Trade license

1. First information report (FIR)
2. Indemnity bond

Fees for Application of Trade License/Renewal of Trade License:

Procedure for Application of Trade License:

1. Go to the online portal of MCD (Municipal corporation of Delhi) i.e. https://mcdonline.nic.in/.
2. Select your region i.e. north, south, or east DMC.

3. Then click on ‘Online services’.

4. On the home page, there is a visibility of “Trade or Storage “Tab” click on it.

5. Now, you can click on “Application of new licenses” where can be directed to the new trade license application page.

6. Then, the application has to be completed with all required information and then click on the submit button.
7. After that upload the required documents and submit the same.
8. Once this process is completed, the uploaded documents are verified by the ULB officials.
9. After the successful submission of the application, a unique application number will be generated.
10. After that, the applicant will be notified through SMS on their mobile number regarding making the requisite payment.
11. At the time of payment, you have to fill the following details-

• Ubl name
• Collection date
• Collection center
• Payment date
• Bank details
• The final step is to make payment by clicking on the “make payment” tab.

After that acknowledgment receipt is generated.