Shop and Establishment Act Registration

Every shop or commercial establishments must apply for and obtain the Shop and Establishment Certificate to continue their business in India. The Shop and Establishment Certificate is issued under the Shop and Establishment Act of the particular state where the shop or establishment is located.

Shop and Establishment Act

The Shop and Establishment Act regulates the shops and commercial establishments operating within the state. Every state has its own Shop and Establishment Act (“Act”). However, the general provisions of the Act are the same in all states. The Labour Department of the respective states implements the Shop and Establishment Act. 

Shop and Establishment Act Applicability

The Shop and Establishment Act applies to all shops and commercial establishments defined under the Act.

Shops are generally defined under the Act as the premises where the selling of goods take place either by retail or wholesale or where services are rendered to customers. It includes offices, godowns, storerooms and warehouses used in connection with the trade or business. 

Commercial establishments are generally defined as a commercial, banking, trading or insurance establishment or administrative service in which persons are employed for office work. It includes a hotel, boarding or eating house, restaurant, cafe, theatre, or other public entertainment or amusement places. However, factories and industries are not covered by the Act and are regulated by the Factories Act, 1948 and Industries (Development and Regulation) Act 1951.

Regulations Under The Shop and Establishment Act

The Act, among other things, regulates the following matters:

• Hours of work, annual leave, weekly holidays.
• Payment of wages and compensation.
• Prohibition of employment of children.
• Prohibition of employing women and young persons in the night shift.
• Enforcement and Inspection.
• Interval for rest.
• Opening and closing hours.
• Record keeping by the employers.
• Dismissal provisions.

Shop and Establishment Certificate

The shops and commercial establishments covered under the Act must mandatorily apply for registration under the respective state Act. They should register itself under the Act within 30 days of commencement of business and obtain a Shop and Establishment Registration Certificate or Shop License (“Certificate”) under the Act. 

The persons who need to apply for the Shop and Establishment Certificate are as follows:

• Proprietors or owners of shops and establishments, including the people working and maintaining a business from home 
• Proprietors who run a business from home without having any physical store or premises 
• Proprietors of e-commerce business or online business, or online stores and establishment 

The Shop and Establishment Certificate as a basic registration/license for the business. This Certificate is produced for obtaining many other business licenses and registrations. It serves as proof of the incorporation of commercial establishment or shops. It is also useful when the proprietor of the business wants to obtain a loan or create a current bank account for the business. Most banks will ask for this Certificate for opening a current bank account.

Process For Obtaining Shop and Establishment Registration

The procedure for obtaining the Shop and Establishment Registration Certificate differs from state to state. It can be obtained online or offline. 

For obtaining the registration certificate online, the proprietor or owner of the shop or business can follow the below process:

• Log into the respective State Labour Department website. 
• Fill the application form for the registration under the Shop and Establishment Act.
• Upload the documents and pay the prescribed fees. The prescribed fees differ from state to state. 
• Once the registration form is approved, the registration certificate will be issued online to the proprietor or owner of the business.

For obtaining the registration certificate offline, follow the below process:

• Fill out the application form for the registration under the Shop and Establishment Act.
• Submitted the application to the Chief Inspector of the concerned area along with the prescribed fees. 
• The Chief Inspector will issue the registration certificate to the owner or proprietor after being satisfied with the correctness of the application. 

The registration application form contains the details relating to the name of the employer and establishment, address and category of the establishment, number of employees and other relevant details as required.  

Documents Required For Shop And Establishment Registration 

The documents required for obtaining the shop and establishment registration certificate is:

• Shop or Business establishment address proof.
• ID proof of the proprietor.
• PAN Card of the proprietor.
• Details of the employees.
• Payment challan.
• Additional business licenses necessary for starting the business, if any.

Validity of Shop And Establishment Registration 

The validity and fees of the Shop and Establishment Certificate differs from state to state. Some states provide the Certificate valid for a lifetime, while other states provide the Certificate valid for one to five years. The registration application needs to be renewed before the expiry of the period of registration. 

Shop and Establishment Registration is a mandatory license required for operating shops and commercial establishments in India. It a mandatory compliance to be followed by shops and establishments. The Shop And Establishment Act varies from state to state and ensures labour protection.