Licencing & Registrations -Trade License

Do you know what is Trade License ?

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It is a License issued by the Local authority to run the listed business by the trader within the jurisdiction of the local body. 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.

How it will applicable to you ?

 

In the last forty years, trade license has been introduced in the country and is being regulated through municipal corporation acts by the state governments. This helps in ensuring that no one is severally affected by nuisance and health hazard of any trade or business.

It has been made necessary by the government to carry out any particular business or trade in a particular area and to ensure that no one is carrying out any unethical business practices. This license creates a harmony in the society that every business is following relevant rules, guidelines and obeying the safety measures. This license was made obligatory to make sure that the government can regulate various trade activities in the country. The core objective of issuing a this is to control the locations by restricting the people from executing certain types of businesses from their home location to maintain the business environment and locality environment.

Do you require any documents ?

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

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1. Application in the prescribed Form

2. If the applicant is any Firm, LLP or a Company, their PAN Card, along with the incorporation certificate.

3. In the case of an individual applicant, his/her Aadhaar Card is mandatory.

4. Latest Municipality Property Tax Payment Receipt.

5. Lease documents or consent letter from the owner of the property.

6. NOC from your immediate neighbor

7. A certified layout plan of your trade building showing the business, working or washing or resting areas

8. Katha extracts

9. Katha certificate

10. Sanction plan

11. Occupancy certificate (OC)

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Are there any penalties ?

 

There are various other provisions, rules, and regulations that are required to be followed by the registered person. In case of failure to comply with the registration requirements of trade license and commencing any trade activity before the issuance of this license, the person in the default will be liable to pay prescribed penalty. Furthermore, legal action can also be taken against the defaulter.

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For your information

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1. The Trade license issued by the municipal authority is exclusively for the Trade or business.

2. Rules and regulations in relation to the issuance of a trade license varies from state to state

3. The fee structure for the issuance of the license differs based on the nature of the business

4. A business granted with this license will enjoy a greater goodwill than an unregistered entity and subsequently attracts more customers and investors.

5. This also ensures ethical business practice is performed by the traders as they have to follow safety measures and guidelines.

6. If a person doesn’t apply for the license or before the grant of the license as required under law and commences any trade or business activity than the relevant government (authority) can impose fines and penalty as per their rules and regulation. The failure to comply with pre-requisites of the trade license can also result in the closure of a business.

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How do you approach R2B?

 

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