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Shop & Establishment

The Shop and Establishment Act in India is notified by the state and may slightly differ from state to state. However, as per the Act, all shops and commercial establishments operating within each state are covered by the respective Shop & Establishments Act. Shops are defined as premises where goods are sold either by Trade or retail or wholesale or where services are provided to customers and include an office, a store-room, godown, warehouse or workhouse, or workplace. Establishments are defined as a shop, a commercial establishment in which commercial activities are doing, residential hotel, restaurant, eating-house, theatre, or other places of public amusement or entertainment. Further, establishments as defined by the shop& establishment Act and may also include such other establishments as defined by the Government by notification in the Official Gazette. However, factories are not covered by the shops & establishments Act and are covered in the Factories Act, 1948.

Following are the benefit of the shops and establishment act.

Legal Entity Proof-Shop registration provides legal entity proof which gives you the right for doing the business.

Business Bank Account- On the basis of shop Act registration, you can effortlessly open a business bank account.

Government Benefits- If you obtain the shop act registration, then you can easily avail yourself of the government benefits.

Lifetime Certification- Shop Act registration also gives you the lifetime valid certificate, so it is not required for renewal, and renewal cost is nil, and it’s just a one-time cost for the same.

DISADVANTAGE

  • Distance: As the departmental stores are normally located in the central places, people living at a distance cannot receive the advantage of the departmental stores.
  • High Cost of Operation: The cost of doing business is very high in the case of departmental stores as they have to pay huge rents, salaries to staff and spend much on various facilities provided to the customers002E
  • Higher Prices: Due to the high costs of operation and establishment, the prices of commodities in departmental stores are comparatively very high. And poor people are not afforded the advantage of a departmental stores, only the wealthy people can afford to take advantage of the departmental stores.

As an owner of a shop or establishment, you are must require to get the same registered under the Shops and Establishment Act. Here are the specific rules:

Submit an application in the prescribed form and prescribe fees to the  Inspector within 30 days of starting any work in your shop/establishment. The application is to be submitted along with the prescribed fees and also should contain all the following information:

  1.  name as the employer and the name of a manager, if any;
  2. The postal address of your establishment;
  3. The name of the establishment;
  4. Such other content as may be prescribed.

Upon receiving the application for registration and the fees, the Inspector shall confirm the accuracy and correctness of the application. Once suitably satisfied, he shall enter the all details in the Register of Establishments and issue a registration of the certificate of your establishment to you. The certificate will be valid for a period of 5 years and has to be renewed thereafter.

It is very important that the registration certificate has to be prominently exhibited at your establishment

following are the documents required

  • Shop or Establishment photograph at the entrance with Name Board in vernacular language
  • , MOA & AOA of Company / LLP Agreement of the Company or LLP, Certificate of incorporation
  •  PAN card copy
  • List of all Directors or Partners and their ID & Address proof
  • Copy of Board Resolution or Consent of partner
  • Proof of address of Company/LLP/Partnership/Proprietorship
  • All essential details of all the employees if any.
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All about Shop & Establishments

Shop & Establishments

One of the important regulations to which most businesses in India are subject is the Shop and Establishment Act, approve by every state in India. The Act is designed to regulate the payment of wages, working hours, leave, holidays, terms of service, and other work conditions of people employed in the shop and commercial establishments.

Establishments included in this Act are commercial establishments, residential hotels, restaurants, eating houses, theaters, or other places of a public amusement park or entertainment public place. In addition, other establishments that the State Government may, by notification in the Official Gazette, declare to be an establishment for the purposes of this Act would then classify as establishments.

Shop means any premises:

 

    • Where goods are sold, either by retail or wholesale,
    • Where services are provided to the customers.
    • It includes offices, a store-room, godown, warehouse, or workplace, whether in the same premises or otherwise, used in connection with such trade/ business but does not include factory.

 

Basic

INR 1,500/-

One Time Fee

  • GST Registration
  • Shop & Estb. Registration
  • Bank A/c.

Service Provide Within 7 Days

Standard

INR 11,999/-

One Time Fee

  • GST Registration
  • Shop & Establishment Registration
  • MSME Registration
  • Trade Mark Registration
  • Logo Design
  • Opening Bank A/c.

Service Provide Within 15 Days

Premium

INR 11,999/-

Yearly Fee

  • Yearly GST Compliances
  • Income Tax Return

Services Provided Before the Due Date

Frequently Asked Questions

Major steps involved in getting this certificate are as follows-

  1. Application for shop and labor certificate is needed to be submitted within 30 days of commencement of business.
  2. The application can be made offline as well as online. For offline mode, you need to visit the labor department of the state or it can be done online by making an application on the website of the labor department of the concerned state. For example to make an application for a shop and labor certificate in Delhi.
  3. Submit the application to the chief labor inspector of the state online or offline. Relevant documents also needed to submit along with the application for verification.

Following documents need to be submitted along with the application –

  • Photograph of the shop/ establishment’s entrance with the Name Board in the local language.
  • In the case of a limited company or LLP, the following documents need to be submitted for the firm – Certificate of Incorporation, Memorandum of Association (MOA), and Articles of Association (AOA)/ LLP (Limited Liability Partnership) agreement.
  • Copy of the PAN card of the firm.
  • Proof of identity of owner like Voter ID, Aadhar Card, Driving license. Document of partners and directors would be required in case of partnership firm and limited company/LLP.
  • Address proof shop/establishment like utility bills, sale deed, lease deed along with NOC of the owner in case, the premise is rented.
  • Copy of partners’ consent of Board resolution
  • List of partners/ directors along with their Identity and Address proof
  • Details of existing workers like duration, wage rate, etc.

Application form for shop and establishment certificate would contain details like-

  • Name of the establishment
  • Address of establishment
  • Full name of the employer
  • Category of establishment
  • Nature of business
  • Name of the manager
  • Date of commencement
  • Employee details

You need to keep the following points in mind –

  • The certificate should be displayed at a prominent place within the shop.
  • It should be renewed well before the expiration date.
  • Any change or updating should be notified to the chief labor inspector
  • Any person who indulges in behavior prohibited by this act would be liable to punishment under the law.

The following record should be maintained –

  • Working hours.
  • Rest period
  • Leave taken
  • Leave with wages
  • Fines
  • Salary