Trade License in Mumbai

Trade license is a document that authorizes a resident to pursue a trade or business in a particular premise. It is issued in consultation with other specialized departments like fire brigade; health; engineering; estate; and the likes of it, so as to ensure that the citizens aren’t affected by health hazards and nuisance caused by the improper conduct of trade. The License Department of the Municipal Corporation of Greater Mumbai is vested with the administrative powers pertaining to trade license in India’s financial capital. In this article, we look at the procedure for obtaining a trade license in Mumbai.

Need for the Document

Trade license, which is regulated by the different state governments, is issued to certify that the business in question is being conducted in accordance with the relevant rules, standards and safety guidelines, thereby ensuring that the residents are not affected by health hazards, and the nuisance brought forth by the improper and illegal conduct of trade. Any business or trade pursued without obtaining the same could be slapped with penalties and/or prosecution of the highest order.

Designated Custodians

Trade license applies to every trader engaged in a general trading activity within the periphery of any municipal corporation. The class of trade license varies from one state to another, the likes of which are determined by the nature of the business pursued.

Whom to Contact?

Trade licenses are disseminated to the residents by the authorized department of a municipal corporation in consultation with other specialized departments like fire brigade; health; engineering; estate; and the likes of it having jurisdiction over the business.

Premise of Operation

It is now implicit that trade license is issued to facilitate the performance of a trade or business in a particular premise, which could be a commercial; local commercial; notified commercial; mixed land use or residential area. Regulations convey that the concerned establishment must be constructed in a square foot which is less than 20 meters.

Documents Required

The following documents must be furnished by the applicants of a trade license:

Proof of possession of the establishment; which could be in the form of a rent receipt, society maintenance receipt, registered purchase agreement, leave license agreement, indemnity bond (on a stamp paper of Rs. 500). The document must be supported by relevant proofs such as electricity bills, telephone bills, etc.
Proof of authenticity of premises.
Proof of fire safety measures. It could be in the form of an NOC from CFO (other than codified requirement), Fire (Codified), in accordance with Appendix A and Appendix B. These documents (any of these would suffice) should be supported by an undertaking from the party confirming their compliance with the stated requirements.
Other licenses, the likes of which could be Bombay Shops and Establishment; License u/s 394 of the Mumbai Corporation Act, 1888 or a permit u/s 90 of the Mumbai Corporation Act, 1888.
No Objection Certificate (NOC) from the Commissioner of Police.
List of ancillary commodities.
PAN Card of the establishment (for companies, LLP’s or firms).
Canceled Cheque leaf of the establishment.
Bank statement of the establishment.
Certificate of Incorporation.
Memorandum of Association.
Articles of Association.
Partnership Deed (for Partnership firms and LLP’s).
Colored photograph of the applicant.
Pan Card of the applicant.
Proof of identity of the Directors and Partners of the entity, in addition to the proof of identity and address.
Front-faced photograph of the entity (in a way that depicts the goods traded in the premises).
Site/key plan of the locality of the establishment earmarking the neighborhood of the site.

How to Apply?

The applicant of a trade license is required to visit the Citizen Facilitation Centre (CFC), located nearest to the proposed business establishment, and submit the completed application form after obtaining it from the same venue. The application must be supported by the required documents and fee.

The Response of the Centre

After the application is received by CFC, the same is forwarded to the License Department. The application is then assigned and processed by the Department Head of the License Department at the concerned Ward. The Certificate is issued to the applicant after inspection of the site and approval of the application by the relevant authorities. The certificate is usually issued within a week of filing it, though incompletion or errors in the application could force a delay.

Renewal of License

The applicant may renew his/her license by the same procedure as above, i.e., filing an application to the CFC. The following documents must be submitted along with the application form:

Original License.
Proof of Identity.

Denial of License

Denial of trade license prohibits the very functioning of the business, though appeals can be made to the standing committee against the rejected application by delivering the denial letter.