Want to sell food online in India? Legal requirements you need to know

Want to sell food online in India? Legal requirements you need to know

Legal & Compliance

Sanjukta Chakraborty

Sanjukta Chakraborty

24 Jul 2019, 12:30 — 5 min read

India’s immense cultural diversity has given birth to equally diverse food. Good food is at the heart and soul of people in India and more and more people these days prefer ordering food from the comfort of their home or office. Online food companies are booming and if exact statistics were to be given, the online food delivery industry is growing at 150% year-on-year with an estimated Gross Merchandise Value (GMV) of US$ 300 million last noted in 2016.

If you too are in the food business and want to start selling online, you need to comply with the following regulations in India:

1. Register with FSSAI

The Food Safety and Standards Authority of India (FSSAI) enlists certain food safety measures and standards that food business operators (FBO) need to follow in order to start selling their food online. The FSSAI ensures that the food products are checked for quality and adulteration before they reach the consumers.

  • Why do you need a FSSAI registration? - Any FBO involved in manufacturing, processing and selling of food products must obtain the FSSAI registration. If the FBO is micro or small it only requires to register itself with FSSAI. Obtaining registration or license depends upon the annual turnover of the FBO.
  • Requirements for FSSAI registration- As mentioned earlier, all small-scale food business requires this license. The following businesses are covered under this category:
    • Any FBO with an annual turnover of not more than INR 12 lakhs
    • Small retailers dealing in food products
    • A person who manufactures and sells from by himself and from his home
    • Food sale is done by the temporary stall holder
    • Any individual who distributes food in any religious or social gathering except a caterer
    • Small-scale or cottage industries dealing in the food business
    • How can you obtain the FSSAI registration? -  You can start by filing up forms as per the size of your annual turnover which is as follows:
  • Below INR 12 lakhs – Registration FORM A
  • Between INR 12 – 20 lakhs – State License FORM B
  • Above INR 20 lakhs -Central License FORM B

The application acceptance/rejection is notified within seven days of applying for the same.

Also read: Vendor Agreement: Why is it important?


2. VAT registration

VAT stands for Value Added Tax and is charged by the Central Government on the sale of goods and services. It is charged and paid by the producers of the goods and services but is levied on consumers who purchase them.

The TIN number or the VAT registration number is mandatory for sale of goods and products. It is an 11 digit number and is recognised throughout the country. The first two characters represent the state code and the next nine characters can vary in different states. A VAT registration ensures authenticity of the business.

3. GST registration

All food companies looking to start an online food delivery website or sell their food online must have registered for GST. There are two models under which food companies are allowed to operate, cook & deliver and pick & deliver namely. The impact of GST varies for both. For further information, click here.

Also read: Top 5 reasons you need an ISO 9001 certification

4. Health Trade License

Food business directly impacts the health of the people and hence it is mandatory to procure a Health Trade License. It is issued by the municipal corporation of India under Delhi Municipal Corporation Act.

You can easily apply for the license at the respective Zonal Citizen’s Service Bureaus (CSB) or on website of the state’s Municipal Corporation.

5. Shops and establishments registration

As an FBO, you also need to register under the shops and establishments registration of your state. You just need to fill in the form and provide basic details about your business.

Whether it is a packed food business or a restaurant, it is imperative that you do a thorough research of the market before stepping in. Factors like licenses, warehousing, retailing, delivery and transportation should be kept in mind.

Also read:  Company non-operational? Reduce your compliance burden

Image  courtesy: shutterstock.com

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Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views, official policy or position of GlobalLinker.

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Sanjukta Chakraborty

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