Mandi Licence in India: Who Needs One, What It Costs, and How Renewal Works

Short answer: anyone trading notified agricultural produce inside a regulated market area needs a licence from that market committee. It is issued by the state, not centrally, so the fee ranges from ₹60 a year for a commission agent in Haryana to ₹10,000 on Telangana's own application form. Most states run an annual cycle with renewal due 30 days before expiry. The licence fee is a separate thing from market fee — do not confuse the two.

The licence is not the market fee

This is the single most common mix-up, and it costs people money at audit. Two different payments exist:

• The licence fee buys you permission to trade in a notified market area. It is usually a flat annual amount, often with a refundable security deposit.
• Market fee (mandi shulk) is an ad valorem levy on the value of produce you actually trade, collected per transaction.

They are notified separately, paid separately, and must sit in separate ledger heads, because a Market Committee audit looks at them separately. For the levy side, see our state-by-state market fee and cess guide.

Who needs a licence

Once a market committee is constituted for an area, trading notified produce there without a licence is an offence under the state Act. Assam states it plainly: under Section 13(2) of the Assam Agricultural Produce Market Act 1972, no person may carry on business as a trader, commission agent, broker, weighman, measurer, surveyor or warehouseman in a market area without a licence (ASAMB).

Note the breadth of that list. It is not only the arhtiya. In most states the weighman and the broker hold their own licences on their own forms, which is why a mandi that looks like one business is often five or six separate licences.

What it costs, by state

Treat this as a starting point for verification, not an authority. Licence fees are set by notification and revised without much publicity. Every figure below carries its source; where we could not confirm a current figure from an official source, the row says so rather than guessing.

The spread is the point. A commission agent licence costs ₹60 a year in Haryana and ₹10,000 on Telangana's form — a difference of more than 160 times for the same trade. Any advice that quotes "the mandi licence fee" as a single national number is wrong before it starts.

Validity and renewal — where people get caught

Most states run an annual cycle, and the renewal window is tighter than people assume. Haryana is the clearest documented example and a useful model for what to expect:

• Apply 30 days before expiry. Under rule 21 the renewal application goes to the E.O. cum Secretary of the market committee before the 30-day window ahead of expiry.
• A 30-day grace period exists, running to 30 April each year.
• After that, a penalty. The competent authority may renew within a further 30 days, to 30 May, on payment of a penalty equal to the annual fee.

Source: HSAMB. Assam likewise requires renewal to be applied for at least 30 days before expiry, on Form F for traders and commission agents and Form G for brokers, weighmen, measurers, surveyors and warehousemen (ASAMB).

Delhi licences run to the financial year and expire on 31 March; a lapsed licence can be suspended or cancelled under Rule 36 of the General Rules. If your state ties the licence to the financial year, the renewal task belongs in your March calendar, not your April one.

How the application actually runs

The shape is similar across states even where the forms differ:

1. Get the correct form from your market committee. Assam uses Form A for traders and commission agents and Form D for brokers, weighmen, measurers, surveyors and warehousemen — both in duplicate. Telangana uses Form 5-C for commission agents. Delhi issues Form A from the market committee office or the state board.
2. File it through the market committee for your market area, not directly with the state board. In Assam the application is addressed to the Chairman of the Board but routed through the market committee.
3. Pay the fee and lodge the security deposit. Haryana requires the deposit to be placed with a post office or nationalised bank, not handed over in cash at the office.
4. Expect verification, and possibly an inspection of your shop premises before the licence issues.
5. Clear your dues first. Telangana requires a no-dues certificate from the market committee secretary covering market fees and other arrears. Outstanding market fee will block a licence renewal in several states.

Does a unified licence cover the whole state?

Sometimes, and you have to check rather than assume. The 2020 state ordinances in Gujarat, Himachal Pradesh, Karnataka, Madhya Pradesh and Tamil Nadu introduced a unified single licence, usable in any principal market yard, sub-market yard, private market yard or e-trading platform in that state, with the fee still payable to the APMCs (PRS Legislative Research).

Those ordinances were subsequently reviewed and amended in several states, so whether a unified licence is available to you today depends on what your state's current Act says, not on what the 2020 ordinance said. Ask your Market Committee directly, and get the answer with a rule reference.

What to ask your Market Committee

Five questions that save a return trip:

1. Which form applies to my category, and do you need it in duplicate?
2. What is the current notified licence fee and security deposit for my category — and under which notification?
3. What is my expiry date, and what is the last date to renew without penalty?
4. Does my licence cover other market yards in this state, or only this one?
5. Do I need a no-dues certificate before renewal, and who issues it?

Get the notification number for the fee. It is the only way to know whether the figure you were quoted is current, and it is what you produce if the amount is later disputed.

Keeping the records the Samiti will ask for

A licence is not a one-time formality — it comes with a reporting obligation. Haryana licensees file returns on the M form under the PAPM (G) Rules 1962. Most states require something equivalent: a record of produce handled, market fee collected and deposited, and party-wise transaction detail.

The practical consequence is that your books need to produce a market-fee figure per period that reconciles to what you deposited. MandiGrow keeps market fee, development cess, arhat and labour charges as separate effective-dated heads per commodity group, so the number you report is the number the system computed on the day of sale rather than a figure reconstructed afterwards. You can work through the arithmetic on our mandi fee calculator.

Related guides in this series

• Mandi market fee & cess by state — the levy side, which is what the licence lets you collect.
• UP mandi licence for traders — the vyapari licence, the e-Mandi portal, and the Unified Licence question in Uttar Pradesh.
• MP mandi licence — the ₹500 trading licence, the ₹100 Form A-1 route most traders miss, and the ₹2,00,000 multi-market licence.
• Punjab mandi licence — why Rule 17 and Section 10 give different fees, Form A versus Form AA, and the Pakistan-Punjab search trap.
• How APMC mandi fee is calculated — line by line.
• How an APMC mandi works — the background, if you are new to the trade.

Corrections

Licence fees and renewal rules change by notification, and we would rather be corrected than cited wrongly. If a figure above is out of date for your state, email support@mandigrow.com with the notification reference and we will update this page and note the revision date.