Hospitality Laws in India

The hospitality sector encompasses a wide variety of sub-industries, the most prominent
of which are hotels and restaurants, as well as event organising, amusement parks, and
cruise lines. The hotel sector is worth several billions of dollars and is largely dependent
on the amount of spare time and money that people have available to spend on
themselves. A hospitality establishment, such as a restaurant, hotel, or even an
amusement park, is made up of several different groups within it. These groups include
facility maintenance, direct operations (such as servers, housekeepers, porters, kitchen
workers, bartenders, and so on), management, marketing, and human resources. The
hospitality business in India is one of the most important growth drivers within the
services sector. This crown in our services industry, though it is booming, yet has many
thorns to wear despite being a key source of foreign direct investment (FDI) and one of
the main providers of employment within India. The hospitality industry is a large
subsection within the service industry and is comprised of four main areas: Food &
beverage, travel & tourism, lodging, and recreation. In India hospitality sector is regulated
under two arms which majorly comprises of the following:
1. Statutory Authorities regulating Hospitality Sector

a) Authorities Regulating Hotel Industry: The Hotel and Restaurant Division of the
Union Ministry of Tourism is responsible for granting approvals to the online
applications made for project level approval and also for the hotels under
construction. Further other hotel associations manage the hotel industry which
includes:
- The Federation of Hotels and Restaurants Association of India
- The Hotel and Restaurant Association of Eastern India
- The Hotel and Restaurant Association of Norther India
- The Southern India Hotel and Restaurant Association
- The Hotels and Restaurant Association (Western India)
- Hotel Association of India
- Hotel and Restaurant Approval and Classification Committee (HRACC)
b) Authority Regulating Food and Beverage under hospitality sector: The Food Safety
and Standards Authority of India (FSSAI), under the Government of India's Ministry of
Health and Family Welfare (MoHFW), is the nodal regulatory authority on all food and
beverages matters in India.

2. Laws Regulating Hospitality Sector in India

- The legislation for the construction and commissioning of hotels, restaurants,

guest houses, and other establishments is the first head. This legislation
includes the Foreign Exchange Management Act, the industrial licencing
policies, land laws, and various development control orders issued by the
central and state governments.
- Legislation governing the operation, maintenance, and administration of
businesses, as well as food and sanitary regulations, may be found under the
second topic. In addition to that, it regulates matters pertaining to insurance,
fire safety, and weights and measures. A liquor licence, a dance licence, a
lodging house licence, an eating house licence, police permits, a licence under
the Shops and Establishment Act, or a licence under the Food and Drug
Administration Act are among the different licences that are awarded
annually.
- Rules involving taxation, employment, and other types of contractual
connections may be found under the third category. This covers laws
pertaining to income tax, service tax, spending tax, excise duty, luxury tax,
and entertainment tax, in addition to legislation pertaining to employment
problems like as the Apprentice Act, the ESI Act, and other similar statutes.

In general, the following laws applies to some or the other areas under hospitality sector:

i. Prevention of Food Adulteration Act: The act regulates the sale of substandard
food and protects the interest of the consumers by eliminating fraudulent
practices.
ii. Food Safety and Standards Act: The law regulates the manufacture, storage,
distribution, sale and import of food articles.
iii. The state specific shops and establishment statutes: The legislations can be made
by state government to provide statutory obligation and rights to employees and
employers in the unorganised sector of employment i.e., shops and establishment.
iv. Tax laws: This regulates a wide variety of laws which majorly includes Income
Tax, Service Tax, Luxury Tax etc.

v. Employees State Insurance Act: The hotel unit has to be registered as per the ESI Act
under section 1 (5) where the unit employs more than 20 or more persons.
vi. Building Completion Certificate (CC): This document indicates that the structure
was constructed according to the authorised plan and the regulations that were
imposed by the development authority. It also indicates that the building has been
completed. This certification document details everything pertaining to the
project, including the building materials, the building plan, and other relevant
details. The certificate in question was granted by the authority in charge of local
development.
vii. Under the Water Act and the Air Act with the SPCB: The State Pollution Control
Board of every state requires hotels to obtain the "Consent to Establish" (CTE)
and the "Consent to Operate" (CTO) in accordance with the "Air Act, 1981" and
the "Water Act, 1974"[1] before the hotels begin their construction activities and
start their business operations. This is a mandate that the hotels must comply with.