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An Overview Of PSARA License Registration In India

Private security industries have become very popular in India. With an increase in concerns about crime and terrorism, Private security services are increasing. These industries provide security services to people. People can hire private security as an alternate option to the police. To regulate these activities, the government has enacted The Private Security Agencies (Regulation) Act, 2005, which is enforced by the Department of Internal Security of the Ministry of Home Affairs, Government of India. A security agency must obtain a Licence from the State Controlling Authority Concerned before the commencement of the business since it is a pre-requisite to start any security agency in India. The PSARA License is valid for five years from the date of issuance of the license. The application for renewal of the Psara license has to be filed 45 days before the license expiry. Once the license expires, renewal is required

Eligibility criteria for PSARA License

  • Entities or persons eligible: Any person or entity is eligible to make an application to obtain a PSARA License. However, the Act has provided an indicative list as to who can apply:
    1. Private limited companies
    2. Limited liability partnership
    3. Sole Proprietorship Firm
    4. Partnership Firm
  • Should not be in contravention of National interest: An applicant will not be granted the PSARA License if it is found to have links with any entity working in contravention to the National Security of India, or is banned under any law to protect the national interests of the country.
  • Name of the business: Any private security agency trying to obtain a license should have a name ending with " Security services" or any term related to that.
  • The object of the business: The MOA of the business must include a clause specifically stating that " Such company/business provides security services" or any term related to that.
  • MOU with the Training institute: The applicant shall enter into an MOU with a training institute or an organization as approved by the state controlling authority for imparting training to the security guards.
  • Basic qualifications of the applicant: To obtain a PSARA License, the applicant must be a citizen of India and shall be above the age of 18 years and have basic education.
  • Strong finance: The applicant should have a good financial record, since, sometimes the registering authority might ask for income tax records.
  • Clear record of the applicant: The applicant shall have a clear record with no criminal record or involvement in activities against national interests. An applicant will be rejected by the controlling authority if such records are found.
PSARA License

Pre- requisites for PSARA License

Pre- requisites for PSARA License
  1. Allotment of PAN card
  2. Registration with the service tax department
  3. Provident fund registration
  4. Shops and Commercial establishments license
  5. Registration under Contractual Labour Act
  6. Employees State Insurance Registration

Documents required for PSARA License

Following are the important documents required by an applicant to obtain a PSARA License:

Document by company

  • PAN Card
  • MOA
  • AOA
  • Certificate of incorporation
  • LLP Agreement/ Partnership Deed ( in case of LLP/Partnership Firm)

Director's documents

  • Passport Size Photograph
  • Director's PAN Card
  • Aadhar Card
  • Address Proof
  • Police verification certificate
  • Educational document of directors

Other Documents

  • Proof of office of the company
  • Proof of ownership of such company
  • MoU with the training institute
  • GST Certificate ( if any)

Steps for obtaining PSARA License

Steps for obtaining PSARA License

Correct documentation

One of the most important steps to obtain a PSARA License is to get the correct documents ready. This will make the entire process very convenient for applicants as well as the registering authority.

MOU with the Training institute

After the documentation, the applicant has to enter into an MOU with a State recognized training institute for training purposes.

Filing of Application

The applicant for obtaining a PSARA License has to be filed before the State's controller authority of the state in which such a company has to operate.

Verification by Police Station

After an application is filed, the applicant must get an antecedent verification by a local police station with jurisdiction over the address of the applicant. There are certain things to be considered for verification at the police station such as a Certificate of no prior conviction of the applicant to be given by the police station. Police record of the applicant, Details of earlier business of security, if any.

Issuance of PSARA

After verification by the registering authority, it issues a license to the applicant.

Pricing of PSARA License

There are three main areas where cost can be incurred which are:

  1. Government fee: For every license, a certain fee has to be paid as a government fee. It can be either paid via net banking or debit/ credit card. The following table gives a better idea of how the fee is calculated:
  2. Category Cost
    For 1 district in a state Rs 5,000
    For 2 -5 districts in a state Rs 10,000
    For the whole state Rs 25,000
  3. Professional and other costs: For obtaining a PSARA License, companies usually take the help of professionals, and thus, certain costs are incurred in payment for the services. In addition, the process of PSARA License involves visitation of government departments, police stations and thus the cost is incurred in these things as well.
  4. Training Costs: In addition to the government and the professional few, a private security agency has to incur training costs. Investment in a training institution is done for better and quality training to its officers and also an MOU is signed between the applicant and the training institute where such costs are involved.

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Frequently Asked Questions

Private Security Agencies Regulation Act, 2005 is the regulating act for private security agencies in India.

It is very important, in fact, mandatory for every private security agency to obtain a PSARA license.

The validity of the PSARA License varies from state to state. It is 5 years in most of the states, but, in states like Uttarakhand, Chattisgarh, the validity is for one year.
Yes, it is required to get the license renewal once it expires.
No, it is not at all necessary for the applicants to be ex-servicemen or army men. Anyone can apply for such a license.
PSARA License is state-specific, i.e. the agency has to obtain a separate license for every state it operates in.
Although the governing act is passed by the Indian Parliament, the rules and regulations are subject to the states. Thus, the procedure might vary across the states.
Yes, it is allowed as per the rules of the PSARA Act, 2005. An FDI can be made up to 49% in a Company or business.
Yes, prior approval of the FDI investment is required.
Yes, for obtaining a license, a No objection from the police station is required.

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