Trade License

Complete Guide About Trade License

A trade license is a document/certificate that gives the permission to the applicant (person seeking to open a business) to commence a particular trade or business in a particular area/location. However, the license does not allow the holder to any other trade or business than for it is issued. Furthermore, this license does not pass on any kind of property ownership to the holder of the license.

Trade License is the primary requirement if you want to start a particular business in a specific municipal locality. A Company gets penalized for carrying out commercial activities without a valid License. Such License was introduced to safeguard the interest of the citizens belonging to different areas of Indian states. The Municipal Corporation of every state monitors the trade businesses of each locality. Thus, it ensures that any Company do not carry out illicit trade which could result in a health hazard to the public. This document will provide a comprehensive guide to obtain Trade License.

What role does trade play in economic growth?

Trade holds vital importance in ending global poverty. Countries that trade on an international level tends to grow at a faster pace by improving productivity and generating higher income. Open trading also benefits lower-income households by rendering more affordable goods & services to consumers. Trade helps to drive economic growth by integrating with the world economy. Thus, it eradicates poverty.

Considering the importance of trade, the Municipal Corporation of a particular area grants a permit which enables a person to start his/her business in that area. Besides, it’s an efficient way to supervise and regulate business from a specific locality.

The central objective of this regulation is to certify that the trade being carried out is in accordance with the standard rules and safety guidelines. The State Governments has laid down the provisions to regulate the trade within a city. However, the License is issued by the Municipal Corporation of that place where a business is situated.

In case, the business owner seeks to start the business in other states, then he/she must procure the Trade License for that particular location as well.

Eligibility criteria :

Though guidelines for Trade License vary for various cities and states, yet there are some common criteria which are given below:

  • The applicant cannot be a minor which means he/she has to be of 18 years or above;
  • Applicant must not have any criminal record against him/her;
  • The business trading operations which the applicant shall undertake must be legally permissible.

Documents required for attaining Trade License :

The applicant needs to submit the following documents along with the Application to the Municipal Corporation:

  • Identity proof of the applicant such as Aadhaar card, PAN card etc;
  • Address proof of the applicant like Passport, Driving License;
  • PAN card of the Establishment that applies to LLPs/ Companies/Firms;
  • (MOA) Memorandum of Association and (AOA) Articles of Association of the Company;
  • Bank Statement and a cancelled cheque;
  • Income Tax Return and Property Tax Receipt;
  • Affidavit;
  • Documentary proof of the Business or Trade Establishment;
  • Consent Letter from the property owner or Lease documents;
  • Proof of the business’s premise such as the Electricity Bill, Sales Deed and Water Bill;
  • No-Objection Certificate (NOC) from the premise owner;Other documents, as required

Online process to apply for Trade License :

The procedure differs for every state and there are diverse online portals which govern them. Therefore, it is better to take expert assistance like Swarit Advisors. It is a legal firm that can ease the legal procedure of commencing trade in any state of your choice. An applicant needs to undertake the steps mentioned below:

  • Fill an Enquiry Form available on the website of Swarit Advisors;
  • One of the Legal members will then connect with you over a call;
  • You need to precisely explain the nature of  the business and the trade which you want to pursue;
  • Their team of Lawyers will then draft, prepare all your documents and provide you with the same for the confirmation; 
  • After making all the modifications, the team will send your document and Trade Application to the concerned department of Municipal Corporation.
  • Post verification, if the department feels satisfied with the provided information, it will finally grant Trade Certificate.

Note- This License is valid for one year and must be renewed on a periodical basis. Also, the Renewal Application has to be filed at least 30 days from the expiry of the License.


Anyone who wants to start his/her business in the dream locality, the first step is to take the legal permit from its Municipal Corporation. The fee structure for the issuance of Trade License depends upon the nature of a business. A Trade licensee relishes a greater goodwill than an unregistered Establishment, subsequently drives more prospectus customers & investors.

Check Out  related  blog :  Documents Required for Obtaining a Trade License in India



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