The shops and establishments and other entities like trusts, hotels etc. in Maharashtra are governed by the Maharashtra Shops and Establishment (Regulation of Employment and Conditions of Service) Act, 2017. The Act not only lays down the procedure for applying for a license to run these establishments but also directs the shop owners to follow the stipulated procedure when they intend to cancel the license.
Sometimes closing a door can be as important and exciting as opening one. So is the case with business operations. While registering a shop opens a door of opportunities, sometimes the owner might want to shut it down if the situation and circumstances demand to do so. However, irrespective of whether a shop is registered or kept operational or not, or even if it is shut down, there are a couple of legal requirements to be adhered to.
The article aims to highlight the procedures to be followed to close a shop and establishment in the state of Maharashtra. It is of utmost importance that the licensed owner of the shop follows the stipulated protocols.
The Shop and Establishment Act in India
The Shops and Establishment Act of 1954 was put forward to regulate the payment of wages, the number of hours put into work by the employees, and their terms of service. The Act aims to administer the general working conditions of employees working in various shops and commercial organisations within India.
Furthermore, a license is required to run, manage and maintain a commercial establishment in India, which is provided under the Act. It may be interesting to pay attention to the fact that the Act provides regulations for opening and establishing shops and closing them down.
Maharashtra Shops and Establishment (Regulation of Employment and Conditions of Service) Act, 2017, mandates the registration of the shops and establishments within Maharashtra. Therefore, individuals who intend to open shops within Mumbai, Pune, or other Maharashtra areas should procure the license. The Act, however, also includes societies, charitable trusts, educational institutes, and all entities run with a motive of profit within its purview.
Employers must apply for the license by applying the prescribed form, required documents, and fees. Previously the registration was required to be done in person with the Chief Inspector of the respective jurisdiction. Still, it is being done online through the official website of Maharashtra’s labour department within 60 days of commencing the business.
Entities that Fall under Shops and Establishments Act, 1954
- Retail shops
- Wholesale shops
- Service sector establishments
- Store-rooms/ godowns/warehouses
- Any place of work
- Residential hotels
- Cafes and eating houses
- Places of public amusement/entertainment.
Procedure for Registration under The Shop and Establishment Act
- The applicant has to go to the official website and click Create Employer User Profile
- The user is navigated to the page where details pertaining to the establishment are to be entered
- The user is required to register the mobile number with the website and verify it using OTP for registration
- Details such as Name of the Entity, Type of Constitution, Applicant’s Full Name, Applicant’s PAN, etc are to be entered
- The email id is to be entered and the same has to be verified using the OTP that is sent to the email entered previously
- Once the user profile is created, the applicant is required to log in to the website with the credentials thus registered
- From the home page, head to the section for New Registration of Shops and Establishment
- The Registration Form A is to be filled and then submitted
- The status of the application can be tracked using the unique application number that is provided to the applicant
- The supporting documents are to be uploaded after that.
- The applicant is required to select the Go to the Payment option
- A suitable payment method is to be selected, and the payment should be made
- The status of the application will now be reflected as ‘Under Scrutiny’
- The status has to be checked periodically to know whether the application has been accepted or rejected
- If the application should get rejected, the applicant has to reach out to the Maharashtra labour department to understand and rectify the errors and should reapply after that
- Once the approval is obtained, the certificate can be downloaded and printed out.
Documents to be Furnished for Obtaining the License Under the Act
- An annexure that delineates the details pertaining to the premises of the shop or the establishment
- Annexure-A, which is the self-declaration of the applicant (75KB to 100KB)
- Annexure B, attestation for the self-declaration of the applicant (75KB to 100KB)
- Annexure C, Undertaking of the applicant (75KB to 100KB)
- Proof of business registration, like Memorandum of Association, Articles of Association, partnership deed, registration certificate, etc.,
- Applicant’s signature (9KB to 15KB)
- Identity Proof of the applicant (Copy of driving license, passport, AADHAR card, etc.)
- Photo Copy of fee receipt which the applicant had remitted earlier (75KB to 100KB).
A sample application with the details filled out can be availed for reference by clicking the help option given in the portal.
Procedure for Cancellation
The following procedure has to be followed when the applicant wishes to cancel the registration under the Maharashtra Shops and Establishment (Regulation of Employment and Conditions of Service) Act, 2017.
- While applying for cancellation of the shop and establishment license, the applicant should use the prescribed form of the application available on the website
- The applicant must take due care to fill the application with the correct details
- The application regarding cancellation of the shop license must be made within 10 days of closing the establishment
- While applying for cancellation, the applicant must make sure that the right shop and establishment license registration number is mentioned
- The applicant must exercise due care to check if the establishment’s name, address, and payment details have been mentioned.
Checklist for Cancelling the License Under the Maharashtra Shops and Establishment (Regulation of Employment and Conditions of Service) Act, 2017
- Has the application form been filled out?
- Are all the details provided updated and relevant?
- Is the license registration number mentioned on the application?
- Has the reason for the cancellation of the license been mentioned?
- Have the supporting documents been attached?
- Has the cancellation of the license been supported with valid reasons?
- Whether a copy of the receipt that shows that all dues are settled has been attached?
- Verifying A Shop and Establishment Licence
- Purpose of Shop and Establishment Act in India
- What Is the Bombay Shop and Establishment Act?