Overview of Shop and Establishment License

Most businesses in India, including shops, restaurants, cafes, and other commercial establishments, are regulated under the provisions of the Shop and Establishment Act. This Act ensures a structured work environment and safeguards the rights of workers. It is mandatory for businesses to register under this Act, though specific rules and regulations may vary from state to state. The primary objective is to establish fair working conditions, regulate wages, holidays, and protect employee rights.

What is Covered Under the Shop and Establishment Act?

As per the Act, an establishment includes:

• Shops
• Commercial establishments
• Residential hotels
• Restaurants and eating houses
• Theatres and public entertainment venues
• Any other establishments as notified by the State Government in the official gazette

A shop refers to any place where goods are sold or services are rendered to customers. It also includes:

• Store-rooms
• Go-downs
• Warehouses
• Workplaces (excluding factories and public entertainment venues)

Who Needs a Shop and Establishment License?

The license is required for:

• Businesses
• Trades
• Professions registered under the Shop and Establishment Act

Eligibility to Obtain a Shop and Establishment License in India

The following establishments must obtain a Shop and Establishment License:

• Wholesalers and retailers
• Service centres
• Warehouses, storerooms, and go-downs
• Hotels
• Restaurants and eateries
• Entertainment houses, amusement parks, theatres, and other places of public amusement
• Any other workplaces as notified by the State Government

Benefits of Obtaining a Shop and Establishment License

• Legal Recognition – Provides official recognition to the establishment/shop.
• Acts as Business Proof – Serves as proof for further business registrations in India.
• Facilitates Bank Account Opening – Required for opening a bank account in the establishment/shop's name.
• Supports Raising Investments – Helps in securing loans or venture capital for business expansion.
• Access to Government Benefits – Enables entrepreneurs to avail government schemes and incentives.
• Saves Time – The online registration process makes it quick and hassle-free.

Documents Required for Obtaining the Shop and Establishment License

The following documents are necessary to apply for a Shop and Establishment License:

• Identity Proof – Aadhaar Card, PAN Card, Voter ID, or Driving License of the employer.
• Photograph – Passport-size photograph of the employer.
• Bank Documents – Affidavit, Cancelled Cheque, and Bank Statement.
• Establishment Photograph – A photo of the shop/establishment with the employer.
• Property Documents – Rent Agreement (if rented) or Ownership Proof.
• Utility Bill – Electricity or Water Bill of the premises.

Additional Documents Based on Business Entity Type:

• Trust – List of trustees.
• Company – Certificate of Incorporation, MOA, and AOA.
• Co-operative Society – List of members and chairman.
• Partnership Firm – Partnership Deed with partner details and share percentage.
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Registration Procedure for Shop and Establishment License

Physical Registration Process

• Apply to the Chief Inspector within 30 days of business commencement.
• Submit a prescribed form with details such as:
  • Name of the employer
  • Name and address of the establishment
  • Number of employees
  • Establishment category
• After review, the license is issued and must be displayed on the premises.
• The license requires timely renewal as per regulations.
• If the business closes, notify the Chief Inspector 15 days prior in writing for cancellation.

Online Registration Process

1. Visit the State Labour Department Website – Create a user ID and password.
2. Fill in Required Details:
   • Name of the establishment/shop
   • Employer’s details
   • Employee details
   • Registered address with NOC or Rent Agreement (if applicable)
   • PAN details of the employer

Penalties Under the Shop and Establishment Act

All establishments covered under the Act must obtain a Shop and Establishment License and comply with the prescribed rules and regulations.

Failure to register or comply with the provisions of the Act results in penalties. The penalty amount varies from state to state based on the respective state government’s regulations.

Aspects Regulated Under the Shop and Establishment Act

The Shop and Establishment Act governs various aspects to ensure a fair and safe working environment in shops and establishments across India.

Key Aspects Regulated:

• Maximum Working Hours – Defines the maximum number of working hours for employees.
• Meal and Rest Breaks – Specifies time duration allotted for meals and rest.
• Child Labour Prohibition – Regulates laws to prevent child labour in factories and establishments.
• Women Employment – Ensures guidelines for the employment of women.
• Weekly Holidays – Mandates the number of compulsory weekly holidays for employees.
• Establishment Off Days – Regulates the closure days of shops and establishments.
• Opening & Closing Hours – Specifies the permissible working hours for establishments.
• Wages for Holidays – Ensures employees receive wages for designated holidays.
• Accident Coverage – Defines policies for accident coverage in workplaces.
• Fire Safety Measures – Ensures preventive measures against fire hazards.
• Ventilation & Lighting – Mandates proper ventilation and lighting for workers.
• Hygiene Standards – Ensures clean and hygienic working conditions.
• Payment Regulations – Defines conditions and timings for wage payments.
• Deductions on Payments – Regulates lawful deductions from salaries.
• Leave Policy – Defines rules regarding leaves and entitlements.
• Dismissal Regulations – Outlines conditions for employee termination.
• Record Keeping – Mandates proper record-keeping of employee details.

For more details, visit the state government portal of your respective location.

Fastzeal Procedure for Obtaining a Shop and Establishment License

1. Purchase a Plan for Expert Assistance – Choose a suitable plan to receive expert guidance.
2. Submit Queries – Share your concerns and queries regarding the Shop and Establishment License.
3. Provide Required Documents – Submit the necessary documents to the Fastzeal expert for verification.
4. Application Preparation & Screening – Experts prepare the application and ensure all admissibility criteria are met.
5. Completion of Procedural Formalities – Fulfill all required legal and procedural actions for obtaining the license.
6. Receive Your License – Get the approved Shop and Establishment License delivered to your doorstep.