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Shop and Establishment Act


Shop and Establishment Act

Shops and Establishments Act, the term establishment means a shop or a commercial establishment. These establishments include commercial spaces, residential hotels, restaurants, theaters, or other places of public amusement or entertainment.

The Commercial Establishment:-

According to the act, a commercial establishment means a premise where any trade, business, profession, or any work-related with it is undertaken. Accordingly, a commercial Establishment could include:
  • a society registered under the Societies Registration Act, 1860
  • registered or unregistered charitable or other trusts
  • journalistic and printing establishments
  • contractors and auditors establishments
  • quarries and mines not governed by the Mines Act, 1952
  • educational or other institutes run for private gain
  • any premises where the business of banking, insurance, stocks and shares, brokerage, or product exchange is undertaken. This does not include a factory registered under the factories act, 1948
  • theaters and cinemas.
  • restaurants and eating houses
  • residential hotels, clubs
  • other places of public amusement or entertainment

The Shop Establishment Act.

Shop means any premises where:
  • goods are sold, either by retail, wholesale, or
  • services are rendered to customers. This could include an office a store-room, warehouse, or workplace, whether on the same premises or otherwise, used in connection with such trade/ business.
A shop however does not include a factory or a commercial establishment.

Top Benefits of Shop and Establishment Act

  • The Right of Doing Business
  • Ease of Opening a current Business account
  • Facilitates and Smooth Inspection
  • Government Benefits
  • Legal Entity Proof
  • Easy Loan Available
  • Time Saving
  • Top Benefits Of Shop And Establishment Act​
    regulation of Act in shop and Establishment

    Regulation of Act

    • Working hours per day and week.
    • Guidelines for spread-over, rest interval, opening and closing hours, closed days, national and religious holidays, overtime work
    • Employment of children, young persons, and women
    • Annual leave, maternity leave, sickness, and casual leave, etc.
    • Employment and termination of service
    • Maintenance of registers and records and display of notices
    • Obligations of employers as well as employees.

    Procedure for licence

    STEP 1: Submit the application within 30 days of commencement of the business, either by visiting the office of the Department of Labour of the State or by visiting the government website of the Department of Labour of the State.

    STEP 2: Submit the application to the Chief Inspector, along with the required documents and government fee. Government fee varies from State to State.

    STEP 3: The Chief Inspector shall register the shop or establishment in the Register of Establishments, on being satisfied with the correctness of the details, and shall issue the registration certificate.

    Documents Required for registering a Shop and Establishment

    Documents Required

    These Documents are required for Shop and Establishment Registration

    • Photograph of the Shop or Establishment at the entrance with Name Board in local language
    • Certificate of Incorporation, MOA & AOA of Company / LLP Agreement of the Company or LLP
    • Copy of PAN card
    • List of Directors or Partners and their ID & Address proof
    • Copy of Board Resolution or Partners Consent
    • Address proof of Company/LLP/Partnership/Proprietorship
    • Details of all the employees if any.

    Frequently Asked Question

    Every Indian state has enacted certain rules and regulations with regard to conditions of work. The objective is to secure uniform benefits for employees working in different establishments, from shops, commercial establishments and residential hotels to restaurants, theatres and other places of public amusement or entertainment.

    “Establishment” means a shop, commercial establishment, residential hotel, restaurant, eating house, theatre, or other place of public amusement or entertainment to which this Act applies and includes such other establishment as the [State] Government may, by notification in the Official Gazette, declare to be an establishment for the purposes of this Act.

    Shops Act Application is mandatory in some cases for businesses, as long as they qualify as an “Establishment” under the Shops and Establishment Act.
    So if you run a business in Maharashtra, you need to obtain Shop Act License under Bombay Shops and Establishments Act, 2018.

    Broadly speaking the premises governed by the Act are shops, commercial establishments, residential hotels, clubs, restaurants, eating houses, theatres and other places of public amusement or entertainment.

    No, unfortunately.
    There are different laws for different regions in the country. So in addition to the Bombay Shops and Establishments Act, 2018 which we looked at earlier, there is the Delhi Shops and Establishments Act, 1954 and the Karnataka Shops and Establishments Act, 1961 among many, many others.
    So before you register, you need to check the applicable law which affects you. In some cases, a single law may apply across States. Many laws created for the erstwhile State of Bombay apply to Gujarat and the Union Territories nearby. While some states like Manipur have their own Shops and Establishments Acts, some North East Indian states share a single law for Shops and Establishments Registration.

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