How To Start A Clinic

How to start a clinic  –

The healthcare industry has a market size of 6.5 Lakh CRORES, one of the largest industries in India, which is growing with a 22.9%  annual growth rate. Prosperity, longevity, population, and medical rising are important drivers behind the growth of the medical industry. Through the powerful network of hospitals and health infrastructure, the availability of medical facilities in Tier2 cities, cities, and villages was minimized in large cities.

Therefore, an unused health requirement of more than 70% of the population located in the rural area in India has a huge amount of health requirements. Healthcare Clinic is an important channel that ensures the majority of technical assistance between Tier2 or Tier 3 cities and rural areas population. A health clinic with minimal investment in infrastructure and equipment is a great small business for doctors and Medical Practitioners.

Business Entity 

It is best for a company to be incorporated as a legal entity so that it provides limited liability protection to its founder and can be easily transferred to another person in the future. In such cases, we recommend establishing a health clinic as a limited liability partnership (LLP). One or more partners of the LLP may be Medical practitioners to provide the necessary services, but investors or other stakeholders are part of the LLP in roles other than healthcare. May continue. Limited liability companies are recommended for investments in large clinics and equipment larger than Rs.25 lakhs. Ownership is desirable for very small clinics with annual sales of less than 10 lakhs.

Trademark For Clinics

For clinics with their own brand name, you can get a trademark registration for the same brand name to create intangible assets and build goodwill over the long term. In today’s economy, many healthcare chains are successfully established through branding and expansion. Therefore, you need to protect your investment in brands and intellectual property from the beginning. 

Drug License


If your clinic /hospital has an affiliated pharmacy, or if you want to dispense medicines to your patients from the clinic /hospital, you will need the following: 

  • A drug retail license is obtained from a drug administrator under the Drugs and Cosmetics Act of 1940. 

  • If the clinic /hospital uses or sells narcotics in the form of injections, tablets, or bandages, special permission must be obtained from the district collector.

Service Tax Registration 

 The following types of medical services are not taxed under the service tax system: 

 • The service provider must not be a hospital, nursing home, or multi-specialist clinic; 

 • Services are provided by an independent doctor or hospital resident’s doctor

 • Precautionary measures provided to the insured. 

 • Payments made by the person for the medical services received. 

Other healthcare providers, including clinics that do not meet the above requirements, are required to obtain a service tax registration if they exceed Rs. 9 lakhs It is subject to paying service tax.

The Other Important License Required is:

  • Regulations Building Permit and Licenses (From the Municipality)
  • No objection certificate from the Chief Fire Officer “License under Bio-Medical Management and Handling Rules, 1998.
  • No objection certificate under Pollution Control Act.
  • Narcotics and Psychotropic substances Act, 1985
  • Vehicle Registration Certificates (For all hospital vehicles.)
  • Atomic energy regulatory body approvals (For the structural facility of radiology dept, TLD badges, etc)
  • Boilers Act, 1923(If applicable)
  • MTP Act, 1971 (MTP stands for Medical termination of pregnancy. To be displayed in the Gynaec and Obs department)
  • License for the Blood Bank (To be displayed in the Blood Bank)
  • Transplantation of Human Organs Act 1994(If applicable)
  • PNDT Act, 1996 (PNDT stands for Prenatal diagnostics test. To be displayed in the Radiology department that this is followed. )
  • Dentist Regulations, 1976
  • Drugs & Cosmetics Act, 1940
  • Electricity Act, 1998
  • ESI Act, 1948 (For contract employees)
  • Environment Protection Act, 1986
  • Fatal Accidents Act 1855
  • Guardians and Wards Act, 1890
  • Indian Lunacy Act, 1912 (Applicable only if a Psychiatry dept is there in the hospital)
  • Indian Nursing Council Act 1947 (Whether nurses are registered with NCI).
  • Also one must check whether pharmacists are registered with the Pharmacy Council of India.)
  • Insecticides Act, 1968
  • Lepers Act Maternity Benefit Act, 1961
  • Minimum wages act, 1948 (For contract employees)
  • Pharmacy Act, 1948
  • SC and ST Act, 1989
  • Protection of Human Rights Act, 1993
  • Registration of Births and Deaths Act, 1969
  • Urban Land Act, 1976
  • Right to Information Act 2005