Trade License in Mumbai (2026): BMC's Section 394 Licence, Schedule M Fees, Eating Houses, Renewal and the Gumasta Difference

Search for "trade licence Mumbai" and you'll find agents promising one for every shop in the city, at prices from a couple of thousand rupees to fifty thousand. The Brihanmumbai Municipal Corporation's own documents tell a more precise story. BMC licenses trades and storage listed in Schedule M of its Act — food, salons, laundries, workshops, chemists, warehouses, combustible goods and so on — and charges for each by area or quantity. Ordinary shops outside that list deal with the Labour Department's gumasta registration instead. This guide is for owners and accountants in Mumbai, with notes for Pune, Thane and Maharashtra's other cities. It covers who needs the BMC licence, the Schedule M fees, the special route for eating houses, documents, timelines, renewal and penalties. We checked it against BMC's licence pages, fee schedule and circulars in October 2026.

Quick answer

In Mumbai, a trade licence is BMC's licence under section 394 of the Mumbai Municipal Corporation Act, 1888, needed if you keep or carry on anything in Schedule M — eating houses, baking, salons, laundries, tailoring, chemists, workshops, warehouses, combustible goods. Apply at your ward's Citizen Facilitation Centre three months before starting; new licences take seven days per scrutiny level.

• Fees come from Schedule M by trade and area — e.g. eating house ₹980 a year up to 20 sq m

• Plus a security deposit of 25% of the annual fee

• Renew within one month before expiry; up to two years at a time

• Unlicensed and caught? one extra year's fee on top of back fees

• Not the same as gumasta (shops act) registration — see our Maharashtra shop act guide

What the BMC trade licence is

Mumbai's municipal law is the Mumbai Municipal Corporation Act, 1888 (still often called the BMC or MMC Act). Section 394 lists articles that can't be kept, and trades and processes that can't be carried on, in any premises without the commissioner's licence. The detail lives in Schedule M, which BMC's licence fee schedule divides into parts: explosives and dangerous articles in Part I, combustible liquids and other materials above set quantities in Part II, and in Part IV the trades and operations — from baking and bhelpuri preparation to dyeing, flour mills, laundries, eating houses, salons, lodging houses, printing presses, tailoring, vehicle servicing, metalwork and warehousing.

BMC's Licence Department administers these licences. Its RTI manual says licences for trades and storage are granted under the corporation's rules and section 479 of the Act, that unauthorised trading and storage is fined under section 471, and that where unlicensed storage or trade endangers life, goods can be seized after the Fire Brigade gives its remarks. The department also handles shop projections and stall boards under section 313 and sky signs and advertisements under section 328 — separate permissions people sometimes lump in with "the trade licence".

The licence doesn't certify that your building or structure is legal. BMC's 2016 health circular is explicit that an eating house licence is issued from a health and hygiene point of view only, and the licence says so. Building approvals and a fire NOC are separate.

Trade licence vs gumasta licence: which do you need?

Many Mumbai owners call the shops act certificate a "gumasta licence" and assume it is the trade licence. They're different documents from different authorities.

• Gumasta / shops act. Registration or intimation under the Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017, administered by the state Labour Department. Since October 2025, registration is required for establishments with 20 or more workers; smaller ones file an intimation. It's about employees — hours, leave, holidays. See our Maharashtra shop act guide.
• BMC trade licence (section 394). The corporation's control over specific trades and storage that carry fire, health or nuisance risks. It's about the activity and the premises.

So an electronics shop selling packaged goods may need only the shops act registration or intimation. A restaurant, bakery, salon, laundry, tailoring unit or chemist needs both — plus FSSAI for food, a fire NOC where required, enrolment for Maharashtra professional tax, and wages at or above the Maharashtra minimum wages.

BMC's application form even asks for your shops and establishments registration number and whether you hold an explosives licence, a factory permit under section 390, a licence under section 401 or environment clearance, which shows how these approvals fit together.

Schedule M fees: what BMC charges

BMC's published fee schedule sets an annual fee for each Schedule M item by area (for trades) or quantity (for storage), with a maximum per item. Some common trades:

Eating houses climb to ₹2,355 for 50–100 sq m and ₹3,335 for 100–150 sq m, then ₹980 for every further 50 sq m, up to a maximum of ₹47,320 a year. Each licensable item is charged separately even when one consolidated licence is issued, unless it's ancillary to the main trade in the same or adjacent rooms.

How current are these rates? The schedule BMC publishes labels its fee column as a 75% increase over the rates proposed in 2005, and doesn't carry a date. BMC's application form tells applicants to check the portal for the schedule, and the demand you receive after approval is what you pay. Treat the table as BMC's published schedule and confirm the figure on your demand.

Extras on top of the fee.

• A scrutiny fee is paid when you submit a new application; the schedule fee is paid after approval.
• A security deposit of 25% of the annual fee, forfeited if you break the licence conditions. Warehousing, transport and clearing businesses pay a flat ₹3,000 instead.
• Pay within 10 days of the demand notice; you can still pay within 20 days with a composition of 25% of the fee.
• Educational institutions and hospitals pay 50% of the scheduled fee.

Worked example. A café in Andheri uses 35 sq m for seating and kitchen. Under Schedule M it's an eating house in the 20–50 sq m slab: ₹1,435 a year, plus a security deposit of 25% (about ₹359) and the scrutiny fee at application. If it also bakes on site in a separate room, baking is charged separately. The licence fee is small next to FSSAI, the fire NOC and fit-out costs, so the real budgeting issue is time: the Fire Brigade and Health remarks are what take weeks.

How to apply

New section 394 licence in Mumbai

1. 1

   Check Schedule M and the premises

   Confirm which Schedule M items your business involves and the area of each. The licensed area includes any authorised mezzanine, loft or basement used for the trade.

2. 2

   Get the Chief Fire Officer's NOC

   BMC's form asks you to bring the Chief Fire Officer's NOC at the time of application. Apply for it first.

3. 3

   Fill the section 394 form

   Download the form in English, Marathi or Hindi from BMC's trade licence page. Give the firm's status and partners or directors with PAN, the trades and their areas or quantities, premises type, shops act number and any other licences held.

   BMC trade licence services
4. 4

   Submit at the ward Citizen Facilitation Centre

   Submit with attested documents and the scrutiny fee at the CFC of the ward where the premises is. BMC's page says the online application is coming and CFCs accept applications meanwhile.

5. 5

   Two levels of scrutiny

   The Senior Inspector (Licence) is the approving authority. Each scrutiny level should take seven days per scrutiny level, with remarks from Fire Brigade, Health or other departments as needed.

6. 6

   Pay the schedule fee and display the licence

   Pay the demand within 10 days. Display the licence and its special conditions at the premises, and put up a board outside showing the trade, licence number and the person in charge.

Apply early. BMC asks that applications reach it three months before you intend to start, because the Licence Department relies on advice from the Fire Brigade, Health, Engineering and Estates departments. An application isn't a licence, and the rules warn that starting in anticipation of one exposes you to legal action.

Fees run from the start date. The schedule charges fees from the date of application or the date the trade was detected, whichever is earlier — or from the actual start date if that's earlier still. Backdating your start doesn't save money.

Eating houses and lodging houses: the health route

Restaurants, cafés, caterers and lodging houses follow the procedure in BMC Public Health Department circular HO/44380/C of 1 March 2016. The ward's Medical Officer of Health examines the proposal and sends it with remarks to the zonal Deputy Executive Health Officer, who forwards it to the Assistant Commissioner of the ward to decide. If the proposal is rejected, the reasons must be written down and sent to you within a month of the application.

The circular also sets general conditions every licensee accepts: the fee is non-refundable; a licence paid by cheque is valid only once the cheque clears; you must keep the licence and any requirement letters on the premises; you must tell the health officer in writing at least a month before any change in the licensed particulars; you must keep fire-fighting equipment working; and you or a representative must be available at the premises when BMC officers call.

Documents

Documents for a BMC section 394 licence

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• Identity proof (any one): PAN, Aadhaar, passport, driving licence or voter ID
• Proof of possession (any one): rent receipt, commercial photopass, registered leave and licence agreement, lease deed, PR card, allotment letter, society maintenance receipt or electricity bill
• Business entity proof if applicable: partnership deed, memorandum of association, certificate of incorporation, trust or society certificate
• Shops and establishments registration certificate or intimation
• No Objection Certificate from the Chief Fire Officer
• Copies of other licences held: explosives, factory permit (s.390), s.401 licence, environment clearance
• For renewal: original licence, identity proof and the application

Share Print

Two details trip up Mumbai applicants. First, the form asks whether the premises is in a slum area and whether you hold a commercial photopass — keep that paperwork handy if it applies. Second, the "licensed premises" is only the rooms and areas written on the licence. Using an unlisted loft, mezzanine or godown for the trade counts as trading without a licence there.

Renewal, changes and transfer

Keeping a BMC trade licence valid

Within one month before expiry

Renew at the CFC with the original licence, ID and application — issued on submission

At renewal

Option to renew for up to two years if the trade isn't hazardous

After expiry

Treated as unlicensed; renewal at the authority's discretion with composition fees

Change of area, quantity, owner or premises

Supplementary licence, amalgamation or transfer — apply before the change

The rules make renewal your responsibility: BMC won't send a reminder, and posting a cheque isn't enough — the licence counts as renewed only once the renewal endorsement is made. Renew within one month before expiry. If you're late, renewal is at the licensing authority's discretion and composition fees are added, rising with the number of quarters you're late, up to the full annual fee. The RTI manual confirms licences are renewed yearly, or for two years if you choose.

Increasing area or quantity. If you expand after the licence is issued, BMC issues a supplementary licence for the extra area or quantity for the rest of the year and merges the two at the next renewal. If you're already paying the maximum fee for an item, no extra fee is charged.

Transfers. A licence can't simply pass to a new owner. A verified change of hands or premises can be transferred for a transfer fee, but until it is, the new owner is trading without a licence. BMC lists separate services for change in constitution, duplicate licences, cancellation and restoration.

Shorter periods. If you need a licence for less than a year, fees are charged by quarter: 25% for one quarter, 50% for two, 75% for three and the full fee beyond that.

Penalties and enforcement

Fines and prosecution. Trading or storing without a licence is prosecuted under section 471 of the Act. If storage or trade without a licence endangers life, goods can be seized after Fire Brigade remarks, and BMC also uses section 516AA with police help against unauthorised storage of inflammable or hazardous chemicals.

The extra year's fee. If BMC finds an unlicensed licensable trade and later decides to license it, the schedule adds one extra year's fee on top of all fees due since the trade began. For a 35 sq m eating house that has run unlicensed for two years, that's three years' fees at the eating house rate rather than one — plus the security deposit.

If BMC finds an unlicensed Schedule M trade

Step 1

Inspection or complaint

trade detected

Step 2

Prosecution / seizure

s.471; goods if life at risk

Step 3

Apply and pay

fees from start date

Step 4

Plus one extra year's fee

Schedule M rule IV(d)

Step 5

Licence + 25% deposit

Breach of conditions. Not displaying the licence and its special conditions, not putting up the board outside, or not labelling licensable articles is a breach of licence conditions and can lead to forfeiture of the security deposit and action against the licensee. A licence fee once paid is never refunded, even if the licence is cancelled.

Signboards, projections and hawking: separate permissions

Three other Licence Department permissions often get mixed up with the trade licence. Projections — stall boards, showcases, awnings, rolling shutters and doors that project over a municipal road or footpath — are controlled under section 313 of the Act and need their own permission, granted to shop owners who show documentary proof of the shop premises and renewed every year.

Advertisements and sky signs, including illuminated shop signs and hoardings, need permission under sections 328 and 328A under BMC's advertisement policy guidelines. New rooftop and terrace hoardings aren't allowed, and permissions aren't granted or renewed without a structural stability certificate.

Hawking is a different system altogether. BMC stopped issuing new hawker licences after a Supreme Court order of 30 July 2004; street vending is now handled through the Town Vending Committee chaired by the municipal commissioner and ward vending committees. A section 394 licence doesn't let you trade from the footpath outside your shop.

Outside Mumbai: Pune, Thane and other cities

Mumbai's section 394 system is specific to BMC. Pune, Pimpri-Chinchwad, Thane, Nagpur, Nashik and Maharashtra's other municipal corporations license trades under the Maharashtra Municipal Corporations Act, 1949 (formerly the Bombay Provincial Municipal Corporations Act) and their own bye-laws, fee schedules and online portals, and municipal councils under the Maharashtra Municipal Councils Act. The principle is the same — a licence for listed hazardous or nuisance trades, separate from shops act registration — but the lists, fees and timelines differ, so check your corporation's licence page before you budget.

Common mistakes and how to fix them

Treating the gumasta certificate as a trade licence. If your business is in Schedule M, you need both.

Under-declaring area. The fee and the licensed premises depend on the area you declare. Lofts and mezzanines used for the trade must be included.

Starting before the licence. Fees are charged from the start date anyway, and an unlicensed start adds an extra year's fee. Apply three months ahead.

Forgetting the fire NOC. The section 394 form expects the Chief Fire Officer's NOC at application. Start that process first.

Relying on a renewal reminder. There isn't one. Diary the expiry date and renew within the month before.

Official links

• BMC — Trade Licence u/s 394Forms, checklists, timelines and services
• BMC — Schedule M fee schedule and rulesFee slabs, deposit, renewal and transfer rules
• BMC — Section 394 application form (English)Application and document list
• BMC Health Department circular (eating houses)2016 procedure and general conditions

What to do next

Check whether your business appears in Schedule M, measure the area each licensable activity uses, and start the Chief Fire Officer's NOC. Then file the section 394 application at your ward CFC three months before opening, alongside your shops act registration or intimation, FSSAI for food and Udyam registration. Use our startup cost calculator to budget the licence fee, deposit and other approvals for your first year.

This is general information, not legal or tax advice — confirm on the official source or with a professional.

Frequently asked questions

Do I need a trade licence for a shop in Mumbai?

Only if your business stores or carries on something listed in Schedule M of the Mumbai Municipal Corporation Act — such as an eating house, bakery, laundry, salon, tailoring shop, chemist, flour mill, workshop, warehouse or larger quantities of combustible goods. A shop selling only goods outside Schedule M needs shops act registration or intimation, but not a BMC section 394 licence.

What is the trade licence fee in Mumbai?

BMC charges an annual fee from Schedule M based on the trade and the area or quantity. An eating house pays ₹980 up to 20 sq m and ₹1,435 for 20–50 sq m; a salon or laundry pays ₹475 for the smallest slab. A security deposit of 25% of the annual fee is added. Confirm current rates on BMC's portal.

Is a gumasta licence the same as a BMC trade licence?

No. The gumasta licence is registration under the Maharashtra Shops and Establishments Act, 2017, handled by the state Labour Department and required for 20 or more workers. The BMC trade licence under section 394 is the corporation's control over hazardous or regulated trades and storage. A restaurant usually needs both, plus FSSAI and a fire NOC.

How long does a BMC trade licence take?

BMC's service page gives seven days per scrutiny level for new licences, which go through two scrutiny levels, while renewals and duplicates are issued on the spot when a valid application and fee are submitted. BMC asks for new applications three months before you start, because Fire Brigade and Health remarks are needed.

How do I renew my BMC trade licence?

Renew within one month before expiry, with the original licence, an identity proof and the application, at the ward's Citizen Facilitation Centre or online where available. You can renew for up to two years at a time unless the trade is hazardous. Late renewals attract composition fees on top of the annual fee.

What happens if I run a licensable trade in Mumbai without a licence?

BMC can prosecute under section 471 of the Act and, where the storage or trade endangers life, seize goods after the Fire Brigade's remarks. If it later grants you a licence, the Schedule M rules add one extra year's fee on top of the fees due from the date you started.

Sources & verification

Figures on this page were checked against the sources below when it was last reviewed on 13 October 2026. Each rate and limit is stored once with its own official source and review date, and official update channels are monitored daily so changes are picked up. How we verify

1. 1.Trade Licence u/s 394 — services, approving authority, processing duration and fees — Brihanmumbai Municipal Corporation · accessed 13 October 2026
2. 2.Schedule of licence fees and rules appended to Schedule 'M' (section 394) — Brihanmumbai Municipal Corporation · accessed 13 October 2026
3. 3.Licence Department — RTI manual — Brihanmumbai Municipal Corporation · accessed 13 October 2026
4. 4.Application form for licence under section 394 (English) — Brihanmumbai Municipal Corporation · accessed 13 October 2026
5. 5.Circular HO/44380/C dated 1 March 2016 — revised licence procedure and conditions u/s 394 (eating houses) — BMC Public Health Department · accessed 13 October 2026
6. 6.Trade Licence Renewal u/s 394 — checklist — Brihanmumbai Municipal Corporation · accessed 13 October 2026
7. 7.Trade Licence in Mumbai (2026): BMC Section 394, Gumasta and What You Actually Need — CalcGuru (independent guide) · accessed 13 October 2026