What is the registration process under Shop and Establishment Act?

Last Updated at: Apr 30, 2020
Shop and establishment

The Shop and Establishment Act regulates conditions of work, lists rights of employees in the unorganized sector, and provides a list of obligations for every employer. However, this is best suited for shops all across India, every benefit making foundations, lodgings, bistros, eating circles and joints, eateries, cinemas and for all public places of entertainment.

What are the Shops and Establishments Act?

Shops and establishments act deal with several operations that follows the shops, restaurants, theatres or the commercial establishments in the country. However, the word ‘Establishment’ means a shop or commercial foundation. Many entertainment resources are also covered under this Act. When registering for the shop and establishment act in the case of SSI or MSME businesses in the unorganized sector, it serves as a proof for the existence of the business.

The shop and establishment act is used for various reasons. And let us see a few among them:
  • National holidays
  • Over-time work
  • Hours of work
  • Interval for rest and meals
  • Prohibition of employment of children
  • Terms & conditions
  • Employment of young person/women
  • Opening and closing hours
  • Close days
  • Conditions on providing the wages
  • Weekly holidays
  • Wages for holidays
  • Time of payment
  • Deductions from wages
  • Leave policy
  • Dismissal
  • Lighting and ventilation
  • Precautions against fire
  • Accidents
  • Record keeping
    And so on.

register for shop and establishment act

Registration process:

Each state follows a separate shop and establishment regulations. The fee might vary, the process, the amount of time to deliver the certificate, the inspector in-charge, and so on will vary depending on each state.

  • Almost within 30 days from the date of commencement of any business, the employer of the shop/commercial establishment should send an application to the inspector in-charge.
  • The application should be in the agreed form. Moreover, the employer should submit it along with the prescribed fees.
The application form should contain the following details:
        • Name of the employer
        • Name of the establishment
        • Address of the establishment
        • The category which it belongs to
        • Number of employees working
        • The date on which the establishment started work
  • The Labour Department of each State produces the shop and establishment act process and the registration takes place.
  • The local district labor officers normally take charge as the inspector in-charge under this act. However, they are the ones who will grant the shop and establishment registration certificate.
  • The fee for the whole process varies on how many workers are on employment in that particular organization/business.
  • The inspector in-charge will review the application, once the occupier applies. If the application has all the necessary details and if the details satisfy the inspector in-charge, then the registration of the shop and establishment will be successful and the occupier will get a registration certificate.
  • Prominently, the registration certificate must be displayed at the establishment and also remember to renew the license periodically.
  • However, the employer has to notify the inspector in-charge if there is a plan to close down the business.
  • In case if the employer is sure to close, then the employer has to submit writing within 15 days of closing. The inspector will then cancel the registration provided under the Shops and Establishment Act. Therefore, they will remove its name from the register.
  • However, make sure to intimate any changes of information to the inspector within 15 days from the date on which such changes take place if you have missed telling at the time of registration. After all verification, the inspector in-charge will make necessary changes and will issue a fresh registration certificate if required.

Documents Required for registering a Shop Establishment license

Documents required:

Here is a list of common documents:

  • Identity Proof
  • Commercial Address Proof
  • Other licenses required to start a business
  • PAN Card
  • Fee Payment Challan

Indeed it depends on the type of establishment/business and the state where you are applying for registration, it may be necessary for you to submit some additional documents to the inspector for getting the certificate.

Records to be maintained under Shop & Establishment Registration:

Under the Shop and Establishment Act, every business has to seek approval from the Department of Labour and keep up-to-date registers regarding details of employment, fines, deductions and advances, salary, and holidays. However, the requirements may vary from state to state. Files related to annual holidays and the number of employees need to be submitted to the office of the Municipal Corporation annually further no Regular return needs to be filed under this Act.

In conclusion, the Shops & Establishments Act is enforced by the state legislature and the registration is mandatory for every establishment. Vakilsearch provides you the complete details on how to register for the Act and successfully get the certificate from the inspector.

Also, download the PDF format to know more about Shop & Establishment.

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