General Trading License in Kerala
Trade license is a certificate issued by the local government like Panchayat, Municipality and Municipal Corporations permitting to do any form of business at the premises for which it has been issued. This trade license is mandatory for the functioning of every business establishment in Kerala.
The issue of trade license is regulated by ” The Kerala Panchayat Raj Act, 1994”. The Kerala Panchayat Raj (Issue of Licence to Industries, Factories, Trades, Entrepreneurship Activities and Other Services Amendment Rules 2018 ) came into force in 2018 to regulate the Issue of License. before it was “Issue of License to Dangerous and Offensive Trades and Factories Rules 1996”, then by the “The Kerala Investment Promotion and Facilitation (No. 2) Act 2018” the words were changed to ” Issue of License to Industries, Factories, Trade, Entrepreneurship Activities and Other Services Amendment Rules 2018 “
Why trade license?
Trade license is one of a method to manage the trade and to regulate adherence with rule and safety guidelines issued by the government.
It makes sure that the people are not adversely affected by Health Hazard & Nuisance created by the improper carrying of a business establishment.
Any unauthorised running of the business will be marked as an offence which may result in a consequential penalty, following a prosecution.
Licensing Authority
Trade Licenses are issued by the accredited department of a municipal corporation in deliberation with the other departments like health, fire brigade, engineering department having authority over the business.
In Kerala, the Health Department of LSGD (Local Self Government) issues the trade License.
Who needs a Trade License?
Every owner of the business establishment who wishes to start an enterprise or engage in a general trading activity within the local limits of any municipal corporation is required to obtain a trade license.
If a person wants to start more than one business or open branches of the current one, he has to take the license for each additional business.
The failure to capitulate with pre-requisites of the trade license can also result in the closure of a business.
Application for Trade License
There are two phases for the Application of the trade license
- Issue of a new license
- Renewal of existing license
Step by step application process for new trade license
- The applicant has to file an application and submit the required documents through online or in-person to the authorized Secretary or officer at the municipal corporation.
- After the submission, the applicant will receive an acknowledgement receipt from the corporation. If any missing document is found with the application, the concerned officer shall inform the applicant and allow them to submit the missing document within a speculated time given by the officer.
- The application process starts with verification by the health inspector. He inspects the respective area and verifies the conditions whether it fits the relevant rules, standards and safety guidelines. After inspecting the trade premises, a detailed verification report is submitted to the Secretary/Officer. From the details and remarks received from the health inspector, Secretary decides whether to approve or deny the license
- Fee payment:
If the secretary/officer approves your application, the applicant has to make the payment to get the trade license. The fee varies according to the nature of the enterprise.
Either it can be paid online or through the municipal corporation counter.
- In general, the trade license will be issued within 7-10 days after the prescribed fee payment.
Documents Needed for Trade License
- Application in the prescribed form
- Consent letter from the owner of the property
- Property tax payment receipt
- Rent agreement
- Certificate of incorporation, MOA and AOA of the corporate
- ID proof of both the applicant and the owner
- Site Plan Showing the area under the occupation of the applicant committing the neighbourhood of the site.
- Consent Letter / Board Resolution for Authorized Signatory
- NOC is needed if the enterprise is of Industry/ Workshop/ Machinery/ Factory for installing the required equipment for the business
- Report of District Medical Officer of Health, NOC from the Department of Town and Country Planning, NOC from State Pollution Control Board if the enterprise is related to any health care institution.
- Others as requested by the Municipal corporation officials on a case-to-case basis
Renewal of the Existing license
The period of Trade License is Five years and shall be renewed automatically after the payment of Trade License fees. The renewal license fees have to be paid within thirty days from the date of expiry of the license. In case the renewal process is delayed, then it’s going to attract a fine depending upon the principles and regulation of the issuing authority.
Documents required for renewing a license
- Original trade License
- Previous year challans
- Duly paid property tax receipts
The Trade license issued by the municipal corporation is solely for the Trade or business. Various other provisions, rules, and regulations are required to be followed by the registered person. In case of failure to comply with the certification requirements of trade license and initiating any trade activity before the issuance of this license, the person in the default will be liable to pay the prescribed penalty. Moreover, legal action can also be taken against the delinquent.
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