Find out everything you need to know about renewing a Trade License.

What is a trade license?

A type of document known as a trade license gives you permission to do business-related activities. It does not grant the right to own land or the authority to do anything other than business. This license is issued by the municipality in conjunction with other offices like the state government’s healthcare, building, and estate departments.

Because of this, every business needs to get this license from the Licensing Division before starting any business-related manufacturing, trading, or storage activities. The form must be completed and submitted to the corporation’s commissioner 30 days before business operations begin. When applying for this license, the company is required to submit all required documentation.

Why a Trade License?

Why is it necessary to obtain a trade license before starting a business? Before we move on, you need to know the answer to this important question. The government had imposed restrictions on certain kinds of businesses forty years earlier. After consulting businesses, the government began issuing trade licenses. This kind of license is currently used by businesses to perform a specific trade and business-related activity. These permits will only be issued to individuals for the purpose of permitting them to engage in particular business activities within a particular geographical area. The state government must issue a license in order for businesses in a given state to be able to operate throughout the state.

A particular municipality or state government must issue this license as a requirement. Companies are allowed to do certain things in a certain area. Additionally, these licenses are provided to ascertain whether the business is operating in accordance with the law.

Who Can Grant a Trade License?

In some cases, the state government and the licensing department of the municipality corporation grant the trading license in various industries like manufacturing, construction, healthcare, and so on. The license is granted by the Indian government to stabilize business activity throughout the country. It grants authority to conduct any trade or business based on the location of the industry on records. The rules and regulations of the local municipal authorities determine how the license is given out, which varies by state.

Food Business: Different Types of Trade Licences Food Business: Any business that deals with food falls under the food industry. Hotels and catering centers, for example, are examples of establishments that prepare and serve meals. The following businesses will require trade licenses to operate:

Bakeries, confectioneries, and snack stores Bakeries, confectioneries, and snack stores Dairy shops, merchants, and any other establishments that provide food Trade and Other Related Services Business Any trade or occupation that entails providing care to clients would also need to acquire a specific type of license. Cafeterias, hotels, and eateries Shopping malls, movie theaters, and nightclubs The company requires a license for the following trading activities.

Computer stores, parlors, barbershops, miniature production units, units of intermediate manufacturing, and small-scale manufacturing are all examples of manufacturing industries that require this license.

Trade licenses are divided into the following three categories based on the degree of risk associated with the company: Production industries with a moderate base Companies and large manufacturing facilities

Low Risk-Based Licence This kind of license would be good for any business or industry that doesn’t have a lot of risks. Hotels and other types of restaurants frequently think about applying for this license.

Medium Risk-Based Licence This kind of license is usually given to businesses, like small and medium-sized businesses.

Business and large-scale organizations typically receive this kind of high-risk-based license. The likelihood of working with various chemicals and toxins is typically higher in this kind of establishment. In most cases, the levels of surveillance on these businesses would be higher than on licenses of a lower or middle level.

Eligibility to Apply for a Trade License

Before a candidate can be considered for this license, they need to meet the following requirements:

  • The person or candidate had to be a major. This suggests that the candidate must be older than 18.
  • The individual should not have any arrests or a criminal history on their record.
  • There must not have been any laws broken by the person’s organization.

Documents Needed to Apply for a Trade License

  • Licence Application Form
  • If the applicant is a business, they will need to submit their PAN card and any necessary paperwork for the company’s incorporation.
  • Individual applicants are required to provide important documents like their Aadhaar card.
  • documentation regarding the taxation of the property.
  • If there is a rental contract, it must be created. The application must be accompanied by copies of the lease.
  • Documents of Residence If the company is located in a residential neighborhood, you must obtain a letter from the neighborhood authorities saying that they will not object.

Click here to know more about: Who needs trade license in India?

Procedure for Applying for a Trade License

Based on the applicant’s location, the following requirements must be met in order to apply for this license:

  • The candidate must request the certificate of their trade license in person or online. The candidate must submit an application and upload the required documents in order to use the online facility. The applicant must present all required documents to the appropriate authorities for the offline option. The candidate must use this to complete the application form with the information required to apply for this license.
  • Different states will have different procedures for submitting a license application, each of which will be tailored to the requirements of the candidate.
  • The candidate must visit the state’s website for the state in which they wish to operate their business in order to submit an application for an electronic trading license.
  • After that, a pop-up message with information about the terms and conditions that each applicant must agree to in order to obtain a trading license will be sent to the candidates.
  • The candidate must click the accept icon to accept the terms and conditions.
  • The applicant may then complete the relevant information regarding the trade license.
  • The option to verify documentation electronically is available on the online platform for licensing registration. The candidate must carry out these responsibilities and provide the required documentation.
  • The candidate will receive a notification stating that they have successfully completed the trade license registration process after completing this step.
  • A notification will be sent to the candidate’s registered email address, and the license will be delivered to the individual within nine to eleven business days.
  • When it comes to rural areas, big cities typically have a quicker process for obtaining a trade license.

Renewal of a Trade License

The license can be renewed if the following conditions are met:

Each financial year, these licenses are typically renewed between January 1 and March 31.

The validity of this license is one year.

The applicant must apply within Indian territory to obtain a trade license.

The application must be submitted 30 days prior to the expiration of the previous certificate.

When renewing a trade certificate, all necessary documents must be presented to the appropriate authorities.


The Indian government takes the precautionary measure of issuing a trade license in order to shield the general public from the annoyance and health risks that a business or trader may pose. Heavy fines and penalties may be assessed if the authorities discover a violation of the rules. We sincerely hope that the information in this article has provided you with a clear understanding of how to obtain a trade license.

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