Part 2 · Running the business · Chapter 2.9
Registrations and licences
Draft: the wording may change. Tax rules change every year, so check current rates and dates on the official portal before you act.
The idea
A registration is a driving licence for the business. You get it before you start, it covers only what is written on it, and it has an expiry date. Driving on an expired licence is the same as driving without one — and a business trading on a lapsed licence is trading without one.
The licences a stockist usually holds
A stockist of packaged food and household goods in Tamil Nadu will meet most of these:
| Registration | What it covers | Issued by |
|---|---|---|
| PAN of the business | Identity for income tax; needed for almost everything else | Income Tax Department |
| GSTIN | Collecting GST and claiming input credit; lists every place you do business from | GST department, through the GST portal |
| Shop and Establishment registration | The premises as a place of work, and the staff who work there | State labour department |
| Trade licence | Running that trade at that address | The local body: corporation, municipality or panchayat |
| FSSAI registration or licence | Storing and selling food | Food Safety and Standards Authority of India |
| Drug licence | Storing and selling medicines, if you stock them | State drugs control department |
| Udyam registration | Recognition as a micro, small or medium enterprise | Udyam portal |
| TAN | Deducting and depositing TDS (chapter 1.17) | Income Tax Department |
| PF and ESI codes | Once your staff count brings you under them (chapter 2.7) | EPFO, ESIC |
Two of these come in sizes. FSSAI has a basic registration for small businesses and larger licences above certain turnover limits. GST registration becomes compulsory above a turnover limit, and in some cases — such as selling to other states — regardless of size. The limits, fees and conditions are on the FSSAI and GST portals; check them there before you apply or renew.
A drug licence has its own conditions about storage and about who must be in charge of the premises. If medicines are even a small part of your range, ask the state drugs control department what it needs before you stock them.
The licence file
Keep one file — paper or a folder on the computer — with a copy of each licence and one summary page:
| Licence | Number | Address covered | Valid till | Renewal by |
|---|---|---|---|---|
| GSTIN | (on the certificate) | Main shop, Godown 2 | No expiry; keep details current | Accountant |
| FSSAI | (on the licence) | Main shop | (date on the licence) | Owner |
| Trade licence | (on the licence) | Main shop | (date on the licence) | Owner |
Copy the "valid till" dates onto the compliance calendar (chapter 2.8), with a reminder well before each one — renewal applications take time to process. Display the licences the law asks you to display, where an inspector can see them.
A licence covers what is written on it
A licence is tied to a name, an address and a kind of business. Change any of them and the licence may need changing too:
- A new godown must be added to your GSTIN as an additional place of business, and may need FSSAI cover of its own.
- A new product line, such as medicines or a food category you did not sell before, may need a new licence or an amendment.
- A change of owner or partners usually means updating every registration.
Common mistake
Opening a second godown and starting to send goods from it before adding it to the GSTIN. When the van is checked on the road, or an officer visits the godown, the stock is in a place your registration does not cover. The few days saved by not updating the registration are nothing next to the penalty and the days the stock stays held.
Where you'll use this
In Part 3, when a company appoints a stockist, it asks for copies of the GSTIN, FSSAI and, for medicines, the drug licence. Many companies stop billing a stockist whose licence has lapsed — so a missed renewal stops your supply, not just your paperwork.
Check yourself
- Your FSSAI licence expired last week and you have not renewed it. Are you licensed today?
- You rent a second godown. Which registration must be updated before goods move from it?
- Where should every licence's expiry date also be written?
Answers
- No. An expired licence is the same as no licence. Renew before the expiry date.
- The GSTIN, by adding the godown as an additional place of business — and check whether FSSAI needs to cover it.
- On the compliance calendar (chapter 2.8), with a reminder well before the date.