Each state in India has its own rules and restrictions when it comes to the Shops and Establishments Act. Every member of the workforce, paid or unpaid, is covered by these laws, as are employees of the employer’s family.
In this way, the state government is empowered to exempt establishments from certain sections or entire laws, permanently or temporarily. Bombay Shops and Establishments Act Section 5 grants the same right, giving the state government of Maharashtra the authority to extend the scope of the Act to include/add new establishments, and then entrusting such establishments to abide by all the laws and regulations applicable to them.
Section 5 of the Bombay Shop Act:
State governments can expand the Act’s scope as they see fit by including establishments or classes of establishments that previously weren’t covered by it. Section 5 of the act states in its first subsection:
As per the second subsection, any establishment, class of establishment, person, or class of employees that is subjected to this Act shall be deemed subject to this Act if the government passes such an official declaration under subsection (1). Upon declaration, all or any of the provisions of this Act, including any adaptations or modifications made thereto, shall apply to such establishments, classes of establishments, or class of employees.
The general objective of the Shops and Establishments Act:
- Organization of the unorganized sector.
- Small businesses should be required to register.
- Regulation of unorganized sector employees’ wages, working hours, and labour rights.
- Make child labor illegal.
- Women employees should be given special benefits.
Benefits of the Shops and Establishments License:
- Banks make it easier for businesses to open current accounts so they won’t mess up business transactions with personal accounts.
- State and local governments conduct hassle-free inspections. Due diligence and auditing requirements are reduced under the Shops Act.
- By protecting employees’ rights and ensuring their welfare, the Act provides a positive working environment by discouraging unethical practices and ensuring their health and financial security.
- Provides better exposure to a segment of consumers who haven’t been catered to and strengthens the entity’s roots by giving it a legal status.
Shops Act License in Bombay:
Among Maharashtrians, a shop license is called a Gumatsa. All sole proprietorships, partnerships, limited liability partnerships, and private limited companies are required to obtain a Gumatsa.
If your establishment has between 0 and 9 employees, your Gumasta license is valid for life. Each time the Shops Act needs to be renewed, it is valid for one to three years for employees more than nine.
The process for applying for a Maharashtra Shop Act license online is as follows:
- In order to access the online portal, you must log in first
- Depending on what kind of establishment/business initiative is being registered, you select the registration procedure as an individual or organization
- The organization’s name and proprietor’s information should be filled in.
- Documents must be uploaded
- The signature should be uploaded
- Don’t forget to pay the fees.
In Maharashtra, shops with 0-9 employees are required to obtain a Shops Act license at a cost of *1500/-. If you have more than 10 employees, your charges will be different.
Documents Required: Shop and Establishment Act 1948
- Aadhar cards for proprietors, directors, or partners
- A person who is applying must provide an email address and mobile phone number
- Information about the individual
- Private limited companies need to include electric bills, rent agreements, MOA, AOA, and CINs. If you are a partner in a firm, you will also need a partnership agreement
- The name of the shop should be on the picture.