All You Need To Know While Starting A Restaurant In India

Last Updated at: Oct 16, 2020
Restaurants and bars started reopening from September 1 in the State of West Bengal with a cap of 50% occupancy because of the COVID-19 pandemic. However, the owners of bars and restaurants have urged the State Government to increase the seating capacity to 75% to meet running expenses. They have said that with the 50% ceiling, it has become difficult to meet staff salary expenses and other operating costs, which have increased to adhere to safety protocols.


If you are planning to start a food business in India, then you require considering some legal aspects. You will have to register your restaurant under a specific type of business. The cost of LLPs is less when compared to the other forms of entities. A license from FSSAI is also essential to ensure the safety of food offered to customers.

Starting a restaurant business is very exciting. But at the same time, there are so many complications involved in this business such as getting the right location, hiring good employees, marketing the business etc.  You also need to make sure that you have all the legal papers and have taken all the required licenses for the business. Even if you miss a single license also you need to face so many legal consequences in the future. To avoid all these troubles it is always better to obtain all the required licenses which are listed below.

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Necessary licenses to start a Restaurant in India

FSSAI (Food Safety and Standards Authority) License

The FSSAI license, which is also known as the Food License is one of the mandatory licenses necessary to open a restaurant and is acquired from the FSSAI (Food Safety and Standard Authority of India). FSSAI license mainly serves as the approval of the authority to the restaurant which ensures the customers that the food of the restaurant confirms the food safety standards. FSSAI license is basically a unique 14 digit registration number which is given to restaurants, manufacturers and traders which should be printed on the food packages. This affirms the customers that they are eating at the right place which followed all the safety food standards.

Liquor License

Liquor license must be obtained if your restaurant serves liquor. This license can be acquired from the local excise commissioner or through the forms which are available in the government websites of that particular state. Possessing this liquor license is very important. If it is found out that you are selling the liquor without this license you will incur the huge penalty. In some cases, your business is shut down permanently.

Apply For FSSAI Registration

Health/Trade License

Health Trade License is created from the concern that public health must be given the utmost importance. This license can be obtained from the local civil authorities like the Municipal Corporation of the particular state or the Health Department.

Eating House License

The Eating House License is given by the Licensing Police Commissioner of that particular city where you are opening the restaurant. The estimated cost to get this license is Rs.300 for the span of three years.

Shop and Establishment Act

To run a restaurant in India you must first register it under the Shops and Establishment Act. The restaurant should be registered within the 30 days of its commencement. This license is based on which city you are operating the restaurant.

GST Registration

GST which came into force from July 1st, 2017, has kept everyone hooked to it with its frequent changes. Both the restaurant business and the government have been in trouble for long. Even then registering in GST is one of the main things that your restaurant must do, which will ensure running of your restaurant seamlessly.

Fire Department

The restaurant’s main motive must be to guard their customers against all things which are injurious, be it food products or dangers such as fire. A No Objection Certificate (NOC) from the fire department of the particular state is a must to run a restaurant.

Lift Clearance

If a lift is installed in your restaurant you need to get permission from the inspector of the electricity department and the labor commissioner of that particular city. This license is given by the Electrical Inspector from the labor commissioner office after verifying the installation of the lift, layout, safety gears etc.

Music License

If your restaurant is playing music then you should obtain a music license from the  Phonographic Performance Limited (PPL). If it is found that your restaurant is playing the music without obtaining a proper license then you will face huge penalties.

Certificate of Environmental Clearance

The restaurant is not only responsible for the health of the customers, but also legally and morally responsible to make sure that its operations are not harming the nature. Therefore, restaurants are required to obtain the Certificate of Environmental Clearance.

Signage License

You need marketing strategies for your product to make sure that your business will gain huge profits. However, if you want to make use of marketing strategies for your restaurant either through word of mouth, pictures, logos, symbols, posters etc. you are required to acquire a legal permission which is the signage license. You can acquire this license from local civil authorities like the Municipal corporations of that particular city.

These are the important licenses which will legally permit you to carry on with your restaurant business in India without getting involved in any kind of legal troubles.

Restaurants are one of the best startup ideas that you can ever think of. However, running an eatery can be equally difficult as it is directly related to the health and safety of consumers. If you manage to fulfill the legal requirements, then your business will strengthen its position and also you will stay away from all penal actions.