SHOP AND ESTABLISHMENT REGISTRATION

Shop and Establishment Registration

Having a shop and establishment registration eliminates unethical business practices like defamation, revealing customer data, abusive practices in competition, and helps in promoting growth.

Why register Shop and Establishment Registration

Registration for shop and establishment allows you to take advantage of many benefits given to the owner and/or to the registered shop.

The state governor (SG) issues the shop and establishment registration certificate license to every shop owner under the shop and establishment act. For availing the perks it is mandatory that every shop and establishment registers for the same.

It is important that any shop/commercial establishment that commences operation must apply to the chief inspector for the license within a prescribed time. The process contains a form for application and the following are the fields mentioned in the form:

  1. Name of the employer
  2. Name of the employee
  3. Name of the shop/establishment
  4. Category of the shop/establishment
  5. Address of the shop/establishment

Post the application form filling and successful registration, the shop owner gets legal entity proof. This legal proof gives shop owners the right to do a business. It is basically proof of the existence of the business.

A registered shop/establishment is more reliable and trustworthy as compared to a business that is not registered under the shop and establishment registration act.

Benefit of having Shop and Establishment Registration

  • Establish trust among investors and/or customers: Any investor before entering into any business relationship with an organization checks the authenticity of that particular organization. Besides that, an investor or a customer also identifies whether the owner’s investment is secure or not. A registered shop and establishment are more famous among the people.
  • Protect the rights of employer and employee: It ensures peace of mind for the employer and employee of the organization. Other than that, it improves transparency between the employees. This leads to building trust. An employee within the organization can enjoy their rights and they are also eligible for good wages and many other perks.
  • Encourage growth: The business owner grows its legal status and receives many unexpected benefits and perks in the long run. This act improves the efficiency and effectiveness of business and increases the work exposure of the business owners.
  • Smooth opening of a current business account: By giving the license of shop and establishment, the business owner can easily open his/her business current account in any bank and also avail business offers which are provided by the banks under different schemes of Startup establishment, MSME, and many more.
  • Government perks: If a shop is registered under the shop and establishments act as a registered shop, then the government has several schemes to provide benefits to such small businesses and shop owners.
  •  Easy inspection: Many times inspections of shops and establishments are done by the local municipality and/or by some officer of the state government to examine the functioning of the business and/or the shop. In such cases, if the shop and establishment are registered, the process becomes easier and better.
  • Strengthen the position of the entity: A registered shop improves the goodwill among the consumer in the market and builds a strong trust with the end-users. A business owner achieves a respectful position in the market and also gets secured from any illegal allegation.
  • Saving of time: The process is time-saving and comes with a one-time investment. As everything in India is going digital, there is little to no manual work. It is very easy to get the registration done online.
  • One time expenditure: Once the registration is done and completed, in future, there are no additional charges or costs incurred. The payment for registration is made only one time and by doing that you can avail the shop and establishment registration certificate.

About Shop and Establishment Registration

The shop and establishment act regulates the working hours, holidays, wages, and terms & conditions of the work.

Every state has its shop and establishment act and only the general provisions are similar for all.

This act is generally regulated by the labour department of the states but there is a minor difference between the procedure of one state to another state.

Definition of a shop: A shop is a premise where goods are sold and/or bought. It is a place where the services are given to the consumers or end-users. Factories are excluded from the definition of a shop.

Definition of an establishment: As per the relevant act, the establishment includes a shop or a commercial establishment that comprises the following:

  1. Business complexes
  2. Cinema hall and other places of entertainment
  3. Cafeterias

Commercial establishment means an establishment where the business, trade, or profession is initiated. It includes those establishments which are declared by the government as commercial establishment. Any premises which are occupied for a commercial purpose is a commercial establishment. It includes public refreshments, complex, office areas but the office of a legal practitioner comes out of the ambit of commercial establishment.

Requirement for Shop and Establishment Registration

This act is applicable all over India.

If you are an owner of any establishment/shop, it is necessary to register your shop and establishment within 30 days of opening the shop/establishment.

A registered shop avails many benefits. The time limit for registration varies from state to state and many businesses in India are regulated by this act only.

Procedure to apply

Online:

  1. Business owners need to login to the respective state labour department website
  2. The owner has to fill the application form
  3. He/She has to upload all the documents and have to pay the required fees. The applicable registration fees are different for different states.
  4. After the prescribed time, the registration form gets approved.
  5. Once the form gets approved, the license is issued to the business owner.

Offline:

  1. A business owner has to submit the application form to the chief inspector of his/her area with the fees.
  2. The chief inspector checks the accuracy, relevancy, and correctness of the application.
  3. Post the due diligence, the chief inspector issues the license to the business owner.

The license is valid for 1 year only but some states issue lifetime licenses to their business owners.

Documents Required:

To register for the shop and establishment registration, the following are the documents required:

  • PAN card of the owner as an ID proof
  • Address proof of the shop and/or establishment
  • Challan of the fees paid for registration
  • ID proof of the owner (Aadhar card)
  • Employee details
  • Photograph of business owners and his/her shop/establishment
  • Electricity bill
  • Certificate of incorporation (COI), Memorandum of Association (MOA), Article of Association (AOA) of company, LLP agreement, if required.
  • List of all directors/partners and their ID proofs and address proofs, if required
  • Board of resolution copy and/or consent of partners, if required.

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