Business License in India

What is a Business License?

Certain business activities require government seal to operate, in order to maintain compliance with the legal requirements and safety standards. A business license in India is like a permission by the Central/State/Municipal authorities to carry out certain commercial operations. Such business licenses aim at promoting accountability, transparency and consumer protection. The laws usually restrict operations or even impose certain penalties in the absence of such business licenses or permits. This in turn makes it crucial for businesses to comply with licensing requirements to avoid any repercussions. 

What are the licenses required to start a business in India?

When you first give a thought to start a business, all you think about is how to run the business and gain profits. Business licenses are the last thing in mind, and can turn out to be an overwhelming task. That’s why we have jotted down the various types of business licenses and permits required for specific operations. 

List of Business License in India

• Business Registration - Having an identity for a business is crucial to decide the future course of action for the founders. Company Formation or LLP Registration is the legal requirements which businesses need to take care of at the very beginning. 

• GST Registration - Goods and Service Taxes have reshared the economic picture since they came into existence in 2017. It is important for businesses to get GST Registration done to avoid any tax dilemma. 

• Trade License - For businesses operating in a commercial property, it is crucial to get their trade licenses. Business license for trade are usually issued by the Municipal Corporations/ Local Authorities. 

• FSSAI License - For business operators in the food industry, obtaining a business license from the Food Safety and Standards Authority of India is unavoidable. There are certain requirements in the products and packaging which such licensed businesses need to take care of. 

• MSME/Udyam Registration - Business license and benefits are helpful for establishing and growing for those entities who have undergone Udyam Registration or as a Micro, Small & Medium Enterprise. The government is supporting entrepreneurs and small businesses. 

• State Pollution Control Board License - There are certain environmental standards and regulations which the businesses need to comply with. The business license in India is necessary to be obtained from the Pollution Control Board of States/Union territories for specific category of business operations. 

• Shops and Establishments License - For running a retail business in India, the proprietors/business owners need to obtain a business license under the Shops and Establishments. 

• Drug License - The drug here concerns the medicinal drugs which requires businesses to have specific educational qualifications by those running the entities. Business licenses for Chemists or Druggists ensure that experts are there while releasing against any kind of medicinal prescriptions. 

• Import-Export Code - For businesses involved in export or import of goods or services, it is mandatory for them to obtain an Import-Export Code. It serves as a key business identification number issued under the governance of the Directorate general of Foreign Trade.

• Fire Department License - For a business entity involving a space or goods/services prone to fire risks, the business license from Fire Department of the State or Local Authorities is a must. 

• Air/Water Pollution Permit - For business operations involving use of natural resources, for the purpose of manufacturing or releasing any material into air or water, obtaining requisite permits from departments of Air and Water Pollution is required. 

• Other Permits and Business Licenses - There are business licenses in India which need to be obtained by entities operating in specific industries. For example, a Financial institution needs to be registered with SEBI - Stock Exchange Board of India.