Shop and Establishment

What is Shop and Establishment registration?

Shop and Establishment Act is enacted by every state in India. The act aims to regulate conditions of work and to provide statutory obligations for the employers and the rights of the employees in an unorganized sector of employment and other establishments in their jurisdiction.

The act also regulates the work and employment conditions in the unorganized sector. Therefore this act aims to ensure maximum advantages for the employees working in different categories of establishments such as shops, commercial establishments, residential hotels, restaurants, eating houses, and other places of public amusement or entertainment.

Any business involved in the trade of goods and services to customers out of a commercial office is required to apply for the Shop and Establishment license. The license is required even a business entity is located at home. It is required to obtain the license within 30 days of commencement of the business.

The offices under the Central and State Governments are exempted from the provisions of the act. The public utility services, establishments for the treatment or care of the sick or mentally unfit, establishments of Food Corporation of India, offices of legal practitioners employing more than 3employees are also exempted from the provisions of the Shop and Establishment Act.

Shop and Establishments Act Regulations

  • Working hours per day and week.
  • Guidelines for rest interval, closed days, opening and closing hours, overtime work, national and religious holidays.
  • Guidelines for wages for holidays.
  • Rules for the employment of children, young persons, and women.
  • Rules for annual leave, sick leave, maternity leave, and casual leave, etc.
  • Rules for employment and termination of service.
  • Maintenance of registers and records and display notices.
  • Obligations of employers as well as employees.
  • Rules for deductions from wages.
  • Dismissal of the employees.
  • Cleanliness of the working conditions.
  • Regulations on lightning and ventilation.
  • Precautions against fire.
  • Precautions against accidents.

Forms under the Shop and Establishment Act?

The forms under the Shops and Establishment act vary from state to state.

Form I: It is the prescribed format of the statement.

Form III: This is the application form for the renewal of the Shop and Establishment license.

Form VI: This is the application form for the issue of a duplicate certificate.

Form VII: This is the prescribed format for the notice of change.

Form IX: This is the prescribed format for the certificate of age.

Form XIV: This is the prescribed format for the letter of authorization.

Form X: This is the register of fines.

Form IX: This is the register of deductions for the damage or loss.

Form XII: This is the register of advances of wage.

Form XXII: This is the register of employment.

Form XXIII: This is the register of wages.

Form XXV: This is the register of leave.

Form XXVI: This is the letter of appointment.

Form XXVII: This is the prescribed format for the return for March or June or September or December.

Information required to be furnished for Shop and Establishment registration

  • Name of the firm.
  • Name and details of the owner (employer) and the employees at the time of incorporation of the business.
  • Address of the firm.
  • Telephone number.
  • Email address.
  • Date of commencement of business.
  • Name of the manager if applicable.
  • Nature of the establishment.
  • The number of employees in the establishment.
  • Days of the holiday.

Documents required for Shop and Establishment Registration

The requirements of documents for registering for Shop and Establishment License varies from state to state. The following are the list of general documents required for registration.

  • Identity proofs such as Aadhar card or PAN card.
  • A passport size photograph of the owner of the shop or establishment.
  • A photo of the shop or establishments with the employer in the photograph.
  • Rent agreement for rented apartments.
  • Utility bills such as the electricity or water bill of the working premises.
  • A list of the number of trustees. (Applicable for a trust)
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  • Memorandum of Association (MOA).
  • The number of members and chairman in the c-operative societies.
  • Address proof of the shop or establishment.
  • Partnership deed containing all the vital information such as the name of the company, share a percentage of partners, and the signature of the respective partner.
  • A copy of the RBI permission.
  • Certificate of Incorporation as per the Companies Act, 2013.
  • A permit for transportation from the Regional Transport Office (RTO).
  • FSSAI license for food businesses.
  • Food and drug license.
  • Copy of the collect or permission.
  • A Non Objection Certificate (NOC) by the respective police department for a cybercafé.
  • Excise license.
  • Share broker certificate by Securities and Exchange Board of India.

Procedure for applying for Shop and Establishment Registration

  • Apply in the prescribed format to the concerned competent authority within 30 days of the commencement of the business.
  • Furnish the required information.
  • Pay the prescribed government fees.
  • Submit the required documents.
  • After the submission of the application, it will be verified by the authorities for its correctness.
  • The authorities can demand further information or documents if required.
  • Once the authorities are satisfied the details of the shops or establishments will be registered in the register of establishments.
  • After entering the details of the shop or establishment, the license will be granted.
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What if you violate the law?

  • A person who fails to maintain any records or register under this act or willfully refuses, or without lawful excuse neglects to furnish such information or return or willfully furnishes, or causes to be furnished any information or return which he knows to be false, or refuses to answer any question necessary for obtaining any information required to be furnished under this act will be liable to a punishment with a fine not less than Rs.1500 which may extend to Rs.7500.
  • A person who willfully obstructs an inspector in the discharge of his duties under the act or refuses or willfully neglects to afford an inspector any reasonable facility for making any entry, inspection, supervision, examination or inquiry by or under this act in relation to any railway, factory or industrial or other establishments, or willfully refuses to produce on the order of an inspector any register or any other document kept in pursuance of this act, will be liable to a punishment with a fine not less than Rs.1500 which may extend to Rs.7500.
  • If any person who has been violated the law punishable under this act is again guilty of an offense involving contravention of the same provision, he is liable to a punishment on a subsequent conviction with imprisonment for a term which is not less than one month which may extend to six months and a fine which is not be less than Rs.3750 which may extend to Rs.22500.
  • The person who fails or intentionally neglects to pay the wages of any employed person by the date fixed by the authority in this behalf, without prejudice to any other action that may be taken against him, will be punishable with an additional fine which may extend to Rs.750 for each day for which such failure or neglect continues.

Conclusion

Being the owner of a shop or an establishment in India, one must possess a Shop and Establishment License. It is required for them to strictly follow the rules and regulations of the act. Failing to comply with these leads to punishable offenses under the act.

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