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Required Guidelines for Hotel Business

calendar13 Aug, 2020
timeReading Time: 4 Minutes
Hotel-Business-Guidelines

Several licenses and registrations are required for starting and operating a hotel business in India. Many of the grants and registrations must be obtained before beginning the hotel and renewed though the hotel is functioning.  Additionally, most licenses require the hotel to meet specific rules or criteria for maintaining validity. Therefore, Entrepreneurs in the hotel industry must be aware of these licenses and registration – to operate a hotel business effortlessly.

A lot of the necessary license depend on the kind of hotel, star rating, amenities, and the location of the hotel. Further, the rules and regulations to obtain a license for the hotel industry differ according to the states.

Read our article:What is The Difference Between The FSSAI License and FSSAI Registration?

List of Hotel Business License That Are Essential

A list of licenses and registrations are essential to obtain for beginning a hotel business in India. Many of the hotel business license and registrations shall get before the commencement of business. This license also requires renewal after a certain period.  Similarly, most of the licenses ask the hotel to follow a specific set of rules or criteria for retaining validity. Hence, it becomes a priority for Start-ups in this field to get themselves beware of these lists of hotel business licenses. To run the business smoothly.

Hotel Business License

Building Permit

The National Building Code of India was organized by the Bureau of Indian Standards(BIS) to unite the building guidelines throughout the country.  The National Building Code is accepted by all Governmental Department, Municipal Bodies and other Construction Works. As per the National Building Code, no individual should carry out any expansion, erect, re-erect or make modifications or crush any building or cause the same to be done deprived of first obtaining a separate permit for each such development or building from the concerned Authority. Consequently, all hotels should have a proper building license as per the relevant Town Planning Act or Development Act or Municipal Act[1] or any other appropriate rulings for plan, building layouts, water supply, sewerage, drainage, electricity supply, etc.

Fire Safety Permit

A fire safety permit or certificate is essential for the Fire Department for operating a hotel business. A fire safety documentation is typically provided if the building has registered proper fire anticipation and fire safety measures as required under the relevant fire safety rules and guidelines.

License from the police department

Hotels are public spaces that are monitored closely by the Police Department. Therefore, all hotels must maintain a good log of all Guests who have remained at the hotel, follow relevant guidelines, and continue a valid license from the Police Department. Police license for hotels typically falls under the power of license of Places of Public Entertainment held by Police.

Trade License or Health Trade License

A health trade license is typically required from the local Health Department for restaurants and hotels. The Municipal Corporation regularly issues health trade licenses. The health trade license is important for businesses that have a direct effect on public health. Agreement with the proper hygiene and safety norms, which are essential for public health, is a precondition for the issuance of a health trade license.

Business Registration

It is recommended that a hotel be set up an artificial legal entity like a company. By functioning a company under an artificial legal being, the responsibility of the promoters regarding the business can be limited, and the business as a going apprehension would be easily transferable to any other person.

ESI Registration

ESI is an autonomous establishment under the Ministry of Labour and Employment, Government of India. ESI (Employee’s State Insurance) registration is mandatory in India for Businesses that employ ten or more workers. To continue the compliance with the ESI Regulations, the employer must contribute 4.75% of the wages for all employees earning INR 15,000 or less toward ESI employer dues. The employee is required to provide 1.75% of their payments as ESI dues.

EPF Registration

An (Employee Provident Fund) EPF Registration is required for any establishment that employs more than twenty persons in India. The EPF Board manages a contributing provident fund, pension system, and an insurance system for the workforce involved in the organized sector in India.

Bar License

If the hotel functions a bar or serves alcohol in the restaurants, a Bar license would be required from the relevant authorities. Bar license is usually provided by departments working under the State Government of India. Hence, the prerequisite for bar license varies from state to state in the country.

FSSAI License

An FSSAI license under the Food Safety and Standard Act is essential for operating a restaurant in India. The FSSAI license is usually provided for one year and is renewal at the end of each year. The local FSSAI office manages an FSSAI license for restaurants. FSSAI license for cafeterias does not fall under the view of the Central Government of India.

GST Registration

The taxpayer under GST is any person who brings on any commercial activity at any place in India. Who is listed or required to be registered under the GST Law. Any person who engages in economic activity including trade and commerce is treated as taxable person.

Conclusion

Many of the hotel business licenses and registrations shall obtain permits before the commencement of business. This license also requires renewal after a certain period.  Also, most of the licenses ask the hotel to follow a particular set of rules or criteria for retaining validity. Hence, it becomes a priority for Start-ups in this field to get themselves beware of these lists of hotel business licenses. To run the business smoothly.

Read our article:Who needs FSSAI Registration? Is FSSAI Registration Mandatory?

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