1. Documents required for trading in domestic marketSESSION 10LEGAL ENVIRONMENT OF BUSINESS1

2. Retail is one of Indias fastest-growing economicsectors because the working population is increasingand the buying power of the people is alsoincreasing. Starting a retail business requires certaindocumentation that needs to be in place in order toadhere to the national and local law.2 3. Documents/laws/acts related to trading in domestic marketRegister the companys nameTax account no. (TAX)PANRegistration ActIndian stamp actEasement act 18823 4. Documents/laws/acts related to trading in domestic marketShop and establishment actThe Trade & Merchandise Marks Act, 1999Laws relating to EmploymentContract Labour (Regulation and Abolition) Act, 1970Inter-State Migrant Workmen (Regulation ofEmployment and Conditions of Service) Act, 1979Minimum Wages Act, 1948 4 5. Documents/laws/acts related to trading in domestic marketPayment of Bonus Act, 1965Payment of Gratuity Act, 1972Payment of Wages Act, 1936Workmens Compensation Act, 1923Industrial Dispute Act, 1947Environment (Protection) Act, 19865 6. Register the Companys Name Reserve the companys name with the Registrarof Companies. ID proof, PAN Card, Address Proof is neededalong with the application form + registrationfee to get the certificate of incorporation thatlegally approves the name of your business. 6 7. Tax Account Number(TAN) Obtain a TAN from an authorized agent approved bythe National Securities Depository Limited. TAN is required of anyone responsible for collectingtax. The applicationformisavailable atwww.incometaxindia.gov.in and www.tin-nsdl.com7 8. Permanent Account Number Application for PAN s.b. submitted to anauthorized franchise approved by the NationalSecurities Depository or the Unit Trust of IndiaInvestors Services PAN is essential for tax purposes Mandatory while opening a business account orwhile applying for a loan 8 9. Registration Act Objective : to ensure information about all landrelated so that correct land records could bemaintained. Also used for recording of transactions relating toother immovable property provides for registration of supporting documentswhich give these documents more authenticity Registering authorities are present in all the districts 9 10. Indian Stamp Act 1899 Original purpose was to raise revenue to Govt. However, today stamped document is considered muchmore authentic and reliable than an un-stamped document Instruments chargeable to duty under the Stamp Act whichare not duly stamped are inadmissible in a court of law andhave no evidentiary value. a penalty of up to 10 times the original stamp value has tobe paid to rectify them10 11. The Easement Act 1882 governed by the Easements Act, 1882 the right of easement is derived from the ownership ofproperty It means a right which the owner or occupier of landpossesses for the beneficial enjoyment of that land andwhich permits him to do or to prevent something frombeing done in respect of certain other land not his own. 11 12. The Easement Act 1882 an easement may be acquired by the owner ofimmovable property, i.e. the dominant owner, or onhis behalf by the person in possession of the property. Such a right may also arise out of necessity or by virtueof a local custom.12 13. Shops and Establishment Act retail stores are governed by various Shops andEstablishments Acts as applicable in the states These acts regulate the conditions of work andemployment in shops and generally prescribe obligationsin respect of inter alia registration, opening and closing hours, daily and weekly working hours, holidays, leave, health and safety measures wages for overtime work13 14. The Trade & Merchandise Marks Act, 1999 TRIPS defines Trademarks as any sign, or any combination of signs that can distinguish the goods and services of one organization from the other organization. TRIPS provides for initial registration and each renewal for a term of ten years The Trade and Merchandise Act 1999 is compatible with TRIPS and harmonizes it with international systems and practices 14*Trade Related Intellectual Property Rights 15. Laws relating to Employment A retail organization is governed by the provisions ofthe Employees Provident Funds Act, 1952. this act mandates periodic contributions to theEmployeesProvident FundSchemeand theEmployees Pension Scheme as applicable The firm also has to make contributions under theEmployees State Insurance Act, 1948 15 16. Employees Provident Funds Act, 1952 applicable to any estt. employing 20 or more persons provides for compulsory Provident Fund for thebenefit of employees in factories and other estts. Employers contribution to be deposited to the EPF is aspecified %age of the employees salary employees contribution = employers contribution16 17. Employees State Insurance Act, 1948 Provides for benefits to employees in case ofsickness, maternity, employment injury, etc. Every estt. must register within the specified timeand in the specified manner All employees in the estt. to which this act appliesshall be insured 17 18. Employees State Insurance Act, 1948 The contribution payable= employers +employees @ decided by the Central Governmentand payable to the ESIC Contribution has to be made for all employees,whether directly or indirectly employed by the firm18 19. Contract Labour (Regulation and Abolition) Act, 1970 This legislation applies to every estt./contractor inwhich 20 or more workmen are employed or wereemployed in the past 12 months as contract labour Registration of an estt. is mandatory through anapplication to the registering authority19 20. Contract Labour (Regulation and Abolition) Act, 1970 Employer/each contractor in relation to eachemployer have to obtain a license from Govt.licensing officers to execute any work throughcontract labour The license may impose conditions as to work,fixation of wages and other essential amenities inrespect of contract labour 20 21. Contract Labour (Regulation and Abolition) Act, 1970 The Act provides for the welfare of the workers byimposing obligations on the employer to providefor canteens, rest rooms, washing facilities etc. Non-adherence to this this act is punishable withimprisonment or with fine 21 22. Inter-State Migrant Workmen (Regulation ofEmployment and Conditions of Service) Act, 1979 regulates the employment of inter-state migrantworkmen and provides for their conditions ofservice applicable to every estt./contractor employing 5 ormore inter-state migrant workmen currently orhave employed in the past 12 months The estt. has to apply for the registration of theestt. in the prescribed manner and time22 23. Inter-State Migrant Workmen (Regulation ofEmployment and Conditions of Service) Act, 1979 The contractor has to obtain the license from thelicensing officer appointed by the Central/StateGovt. The license is valid only for a specified period andrequires to be renewed at its expiry The Act levies some duties on the principalemployer and the contractor 23 24. Inter-State Migrant Workmen (Regulation ofEmployment and Conditions of Service) Act, 1979 principal employer provides for the displacementallowance and journey allowance contractor provides for adequate wages, medicalfacilities and other benefits 24 25. Minimum Wages Act, 1948 applicable to any person who employs 1 or moreperson in any scheduled employment The employment can be direct or indirect AIM of this act is to prevent exploitation of labourand to provide sustenance and maintenance ofthe worker and his family 25 26. Payment of Bonus Act, 1965 Objective : distribution of profits earned by theestt. among the workmen applicable to every estt. in which 20 or morepersons are employed on any day during anaccounting year An employer is bound to pay every employee aminimum bonus of 8.33% of the salary or wageearned by the employee. 26 27. Payment of Gratuity Act, 1972 applicable to any estt. in which 10 or moreemployees are employed or were employed onany day in the preceding 12 months An employee should be in uninterrupted service(as per conditions laid down in the Act) in order tobe paid gratuity 27 28. Payment of Gratuity Act, 1972 Gratuity shall be payable after the completion of 5years of continuous service upon the terminationof his employment on superannuation orretirement or resignation in case of death of an employee it is payable to thenominee of the employee 28 29. Payment of Wages Act, 1936 everyemployee has a right to receiveremuneration for the services provided by him applies to persons employed in any estt. eitherdirectly or indirectly AIM : to ensure that the wages are paid by theemployers within the prescribed time limit w/o anyunauthorized deductions29 30. Workmens Compensation Act, 1923 Provides for protection from hardship faced byworkmen due to accidents, death or occupationaldiseases Provides for assistance to the family members ofthe workmen An employer has to pay compensation for thepersonal injury caused to a workman by accident,death, etc. arising out of and in the course of hisemployment30 31. Workmens Compensation Act, 1923 A contractor for construction of building is alsomade liable for the personal injuries of hisworkmen amount of compensation depends on the natureand extent of the injury31 32. Industrial Dispute Act, 1947 Objective : to investigate and settle disputesbetween the employer and the workmen It is applicable to any industry wherein systematicactivity is being carried on by cooperation betweenan employer and his workmen (direct/indirect) Arbiters WorksCommittee,BoardsofConciliation, Courts of Inquiry, Labour Courts andNational Tribunals32 33. Environment (Protection) Act, 1986 Provides for standards for emission or dischargeof environmental pollutants from various sources restricts areas in which operations or processescannot be carried out or shall be carried outsubject to certain safeguards 33 34. Info gathered from a store ownerin Patna, BiharThe documents required for trading indomestic market:1.CST2.BIHAR VAT3.LABOUR CERTIFICATE34 35. STEP 1 Any shop has to apply for sales tax registration withthat sales tax office in whose circle that shop falls in Patna has 6 circles implying 6 offices Both CST and Bihar VAT registration(5%) is done atthe same Sales Tax Office CST and LST has to be paid before 15th of next monthelse there is a penalty of 1.5% per month on theunpaid amount of tax 35 36. Returns.. Quarterly RETURNS have to be filed by 31st of nextmonth. The return includes the details of the goodsbought as well as goods sold during the quarter also includes the details of the CST and LST (BiharVAT) paid during the previous quarter36 37. Docs required while applying for sales tax no. a) 2 Identity proof PAN Card, Drivers Licence,Voter ID, etc. b) Address proof of the commercial propertyfrom where store shall operate If property is self owned, attach the propertypapers If property is rented, attach the copy of rentagreement 37 38. Docs required while applying for sales tax no. c) Municipality receipt to be submitted whetherthe shop is self owned or rented d) Bank statement of the Current A/C held e) In case of CST, 2 such guarantors are requiredwho belong to the same circle/city and whohave been paying their taxes since at least 6months 38 39. Road Permit & C Form For inter-state purchase, CST licence is a must. If we buy from local distributor, then CST is not required. When we place an order to a brand AND its the case ofinter-state purchase, we send them the road permit (formD-IX). (Separate road permit is required for each order)39 40. Road Permit & C Form At the end of the quarter, we have to send the Cform to the brand. (The C form is issued by theSales Tax Office upon verification of the CST and LSTpaid during the previous quarter against the goodsbought and sold during the previous quarter) Against the C form, a CST of 2% has to be paid. In absence of C form, a CST of 5% has to be paid.40 41. 41