Engagement
Shops and Establishment registration in Karnataka
Last reviewed 08 November 2026
Shops and Establishment registration and compliance after the 2026 amendment.
In short
Shops and commercial establishments in Karnataka register under the Karnataka Shops and Commercial Establishments Act, 1961. Since the Amendment Act, 2026 came into force on 4 September 2026, a registration once issued stays valid until the business closes or stops (section 4(5)), applications and fees are made electronically, and an establishment with ten or more workers already registered under the OSH Code, 2020 is covered by a new exemption in section 3(1)(k).
Overview
The Karnataka Shops and Commercial Establishments Act, 1961 governs registration, working conditions and records for shops and commercial establishments in the state. The Karnataka Shops and Commercial Establishments (Amendment) Act, 2026 (Karnataka Act No. 38 of 2026) received the Governor's assent on 3 September 2026, was published in the Karnataka Gazette on 4 September 2026 and came into force at once. Registration is applied for online on the Labour Department's e-Karmika portal.
What changed on 4 September 2026
| Change | Provision |
|---|---|
| Registration once issued is valid until the closure or cessation of the business | Provision: Section 4(5), substituted; section 4(6) omitted |
| Application, fees and certificate through electronic or digital mode | Provision: Section 4(1), (2) and (4) |
| New exemption for establishments employing ten or more workers that are already registered under the OSH Code, 2020 | Provision: Section 3(1)(k) |
| No separate registration for godowns or storage within 100 metres of the principal establishment | Provision: Proviso to section 3(1)(k) |
| Notices to the Inspector through electronic or digital mode | Provision: Section 6 |
| Service certificate to an employee within seven days of the employee's application | Provision: New section 6-B |
| Employer may not retain an employee's original educational, experience or other certificates | Provision: New section 6-C |
Section 4(4) was amended only to require electronic payment and was not omitted. For a certificate issued before the amendment, confirm on e-Karmika that no renewal is asked for.
Penalties, compounding and appeal
- Section 4(8): imprisonment of not less than six months and a fine of up to ₹5,000 are replaced by a fine of up to ₹50,000.
- Section 30: fines raised from ₹1,000 and ₹2,000 to ₹3,000 and ₹5,000, and from ₹250 to ₹2,000; contraventions of sections 24 and 25 attract a fine of not less than ₹10,000.
- Compounding (section 33-A): the jurisdictional Labour Officer may compound an offence on payment of 50% of the prescribed fine for a first offence and 75% for a second or later one. An offence of the same nature committed more than twice in a year cannot be compounded, and no penalty is imposed without a hearing.
- Appeal (section 33-B): within 30 days of the order, after depositing the fine, to an officer not below the rank of Assistant Labour Commissioner; disposed of within 60 days.
Key Deliverables
- Checking whether the establishment registers or falls within the new OSH Code exemption
- Registration application on e-Karmika, with the supporting documents
- Updating particulars and notices to the Inspector electronically
- Employer compliance under the new sections 6-B and 6-C
- Compounding applications and appeals under sections 33-A and 33-B
Documents & E-Forms
- e-Karmika registration
When to Engage
When a new office, shop or branch opens in Karnataka, or when a notice is received from the Labour Department.
Typical turnaround: Scoped in the engagement letter.
Frequently Asked
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