Kerala reduces penalty by 30 times for delay in renewal of trade license in municipalities

Change in penalty due to delay in license renewal
Previously, a penalty of 25 percent of the annual wage was imposed for every 10 days of delay, and an additional 25 percent penalty was applied for every 15 days of delay thereafter. Even for shorter delay periods, fines were 10 to 20 times the actual wage.

However, according to the new rule, even if the license renewal period is postponed for one year, only 20 percent of the annual fee can be charged as a penalty. For delays exceeding one year, a penalty of 25 percent of the annual wage will be imposed for each subsequent year.

The amendment has been implemented under Section 11(4) of the Kerala Municipal Act. For example, if the license fee is Rs 1,000, after a delay of one year, a penalty of Rs 200 will now suffice compared to the previous rate where the penalty alone could exceed Rs 6,000. This means a 30-fold reduction in penalties.

However, the new rules stipulate that renewal applications must be made at least 30 days before the license expires.

Minister MB Rajesh stated that the change has been made in response to long-standing demands from trade and commerce organisations, adding that the process of renewing licenses through K-Smart has been simplified.

Gram Panchayats did not have unscientific fee structures.