South India Hotels & Restaurants Association
M-1 ‘Prince Centre’
709-710, Anna Salai
Chennai – 600 006
Tel : 044 28297511-12
1
READY RECKONER
(up-dated as of 31st May 2012)
ON
CENTRAL / STATE AGENCIES
SANCTIONS/CLEARANCES REQUIRED
FOR HOTELS IN SOUTH INDIA
Note: This is only a simple easy reference guide based on information received and collated at our end. We recommend
that an independent enquiry is also made by the reader to ascertain the requirements
2
Page Numbers
4&5
ANDHRA PRADESH
6&7
KARNATAKA
8&9
KERALA
10 & 11
TAMIL NADU&PONDICHERY
3
List of Sanctions /Clearances required from Central/State Agencies to set up and
operate a Hotel
ANDHRA PRADESH
Within Municipal Corporations in Andhra Pradesh
I)
At Project stage :
Nature of Approval required
Licensing/Issuing Authority
1.
Sanction of Building Plan.
Municipal Corporation
2.
Clearance of Urban Ceiling Act
State Government
3.
Consent of Additional Floor space
Local City Development Authority
4.
Height clearance of the Hotel
Local Authority/DGCA if it is in
vicinity of airport and in the Line
of approach/take offs of aircrafts
5.
Land and Property Tax
Local body/Municipal Corporation
6.
NOC Fire Department
Local Fire Department
7.
Approval of Water lines and Sewerage
Municipal Corporation/Metro Water
And Sewerage Development Board
8.
Consent of Air/Water pollution
AP Pollution Control Department (both
at project stage and after the hotel has become
functional)
9.
Approval for Garbage disposal & Sewage
Municipal Corporation
10. License for Power, Electrical installation,
Installation of Generator, Laundry equipment
EPDC of Andhra Pradesh
11. Project Approval to get Tax concessions
Ministry of Tourism, Government of
& Star Classification
12. Income Tax PAN and TAN Registration
India.
Income Tax Department/NSDL
4
ANDHRA PRADESH (Contd)
At the time of Opening of the Hotel:
Nature of Approval required
Licensing/Issuing Authority
1. Lodging House/Hotel Trade License
Municipal Corporation e.g. GHMC for
Hyderabad; GVMC for Visakhapatnam
Municipal Corporation e.g. GHMC for
Hyderabad; GVMC for Visakhapatnam
Labour Office
Gazetted Food Inspector
Office of the State Food Safety
Commissioner
Controller of Weights & Measure7.
7.
City Corporation
Commercial Tax Department
Central Excise Department
Commissioner of Police
2. Eating House (Restaurant & Bakery)
3. Registration under Shop & Establishments Act
4. Nomination for Food Handlers License
5. Registration for getting FSSAI License for the
Preparation of Food in Hotels & Restaurants
6. Calibration of Weights & Measures
Operating Beauty Parlour/Saloon
8. VAT Registration/Luxury Tax
9. Service Tax Registration
10. NOC to Run the Hotel/Licence for establishment
For place of public entertainment
11. License to play Music in Hotel rooms, Common
Areas and to obtain license for Special events
12. Registration under PF Act & EPF Act
Public Performance Licence (PPL
Indian Performing Rights Society (IPRS)
Provident Fund Commissioner
13. Registration under ESI Act
14. Minimum wages Act, Bonus Act, Labour Act
Maternity Benefit etc
15. Swimming Pool License
ESI Corporation
State Government Department of
Labour
City Corporation, Commissioner of
Police
16. Air & Water Pollution
17. Bar License (for Hotels)
18. Building Completion Certificate
19. Restricted Money Changer’s license
20. Import License under EPCG
21. Hotel Star Classification
AP Pollution Control Board
State Excise Department
Municipal Corporation
Franchisee from FFMC
DGFT, Ministry of Commerce, GOI
Ministry of Tourism, Govt of India
22. Satellite Channels
Authorised Distributors
5
List of Sanctions /Clearances required from Central/State Agencies to set up and
operate a Hotel
KARNATAKA
Within Municipal Corporations in Karnataka e.g. Bengaluru
I)
At Project stage :
Nature of Approval required
Licensing/Issuing Authority
1. Sanction of Building Plan.
Municipal Corporation e.g.
Bruhat Bangalore Mahanagar Palike
2. Clearance of Urban Ceiling Act
State Government
3. Consent of Additional Floor space
4. Height clearance of the Hotel
Corporation/Bangalore Mahanagar Palike
Local Authority/DGCA if it is in the vicinity of
airport and in the Line of approach/take offs of
aircrafts
5. Land and Property Tax
`
Local body/Municipal Corporation
6. NOC Fire Department
Local Fire Department
7. Approval of Water lines and Sewerage
Corporation (Bangalore – BWSSB)
8. Consent of Air/Water pollution (Hotels Green category) Pollution Control Department (both at project
stage and after the hotel has become functional)
9. Approval for Garbage disposal & Sewage
Corporation
10. License for Power, Electrical installation,
Installation of Generator, Laundry equipment
11. Approval for installing Cold storage
Karnataka State Electricity Board
12. Sanction of LPG, furnace etc
Ministry of Petroleum, Govt of India and Gas
Authority (Indian Oil Corporation)
Ministry of Tourism, Government of
India.
Local Body
13. Project Approval to get Tax concessions
KARNATAKA (Contd)
6
II) At the time of Opening of the Hotel:
Nature of Approval required
Licensing/Issuing Authority
1.
2.
3.
4.
Lodging House Trade License
Eating House (Restaurant & Bakery)
Nomination for Food Handlers License
Registration for getting FSSAI License for the
Preparation of Food in Hotels & Restaurants
5. Registration under Shop & Establishments Act
Municipal Corporation (Health Dept)
Municipal Corporation (Health Dept)
Gazetted Food Inspector
Office of the State Food Safety
Commissioner
Labour Office
6. Nomination under Prevention of Food
Adulteration Act / Food Handlers License
7. Operating Beauty Parlour/Saloon
8. Calibration of Weights & Measures
9. VAT Registration/Luxury Tax
City Corporation
City Corporation
Controller of Weights & Measure
Commercial Tax Department
10. Service Tax Registration
Central Excise Department
11. NOC to Run the Hotel/Licence for establishment
Commissioner of Police
for place of public entertainment
12. License to play Music in Hotel rooms, Common
Public Performance Licence (PPL)
Areas and to obtain license for Special events
Indian Performing Rights Society (IPRS)
13. Registration under PF Act & EPF Act
Provident Fund Commissioner
14. Minimum wages Act, Bonus Act, and Labour Act
State Government – Dept of Labour
Maternity Benefit etc
15. Fire License
Karnataka Fire & Emergency services
16. Air & Water Pollution (Hotels under Green category) Karnataka Pollution Control Board
17. Bar Licence
State Excise Department
18. Building Completion Certificate
Municipal Corporation
19. Restricted Money Changer’s license
Franchisee from FFMC
20. Import License under EPCG
DGFT, Govt of India
21. Hotel Classification
Ministry of Tourism, Govt of India
List of Sanctions /Clearances required from Central/State Agencies to set up and
operate a Hotel
7
KERALA
Within Municipal Corporations, Municipalities and Panchayat in Kerala
I)
At Project stage:
Nature of Approval required
Licensing/Issuing Authority
(1) Sanction of Building Plan.
Panchayat/Municipalities/ Corporation
(2) Clearance of Urban Ceiling Act
State Government
(3) Consent of Additional Floor space
Not Permitted- State Govt. will not
entertain application for the relaxation
of the statutory norms.
(4) Height clearance of the Hotel
DGCA, and for Cochin by the Indian
Navy as the Air space is controlled by
the Naval Authorities.
(5) Land and Property Tax
Panchayat/Municipalities/ Corporation
(6) NOC Fire Department
Local Fire Department or from their HQ
at Thiruvananthapuram.
(7) Approval of Water lines and Sewage
Panchayat/Municipalities/ Corporation
(8) Consent of Air/Water pollution
Kerala State Pollution Control Board
(both at project stage and after the
hotel has become functional)
(9) Approval for Garbage disposal & Sewage
Panchayat/Municipalities/ Corporation
(10) License for Power, Electrical installation,
Kerala State Electricity Board
Installation of Generator, Laundry equipment
(11) Approval for installing Cold storage
Panchayat/Municipalities/ Corporation
(12) Sanction of LPG, furnace etc
Ministry of Petroleum, Govt of India
and Gas Authority (IOC) State fire
Departments Clearance is mandatory
from the Safety point of view.
(13) Project Approval to get Tax concessions
Ministry of Tourism, Government of
India
KERALA (CONTD)
8
II)
At the time of Opening of the Hotel:
Nature of Approval required
Licensing/Issuing Authority
(1) Lodging House License
(2) Restaurant License
(3) License for Manufacture & Sale of
Eatables (MPFA)
Panchayat/Municipalities/ Corporation
Panchayat/Municipalities/ Corporation
Panchayat/Municipalities/ Corporation
(4) Registration for getting License for the
Preparation of Food in Hotels & Restaurants
(5) Registration under Shop & Establishments Act
Office of the Food Safety
Commissioner
Labour Office under the State Govt.
(6) Nomination under Prevention of Food
Adulteration Act / Food Handlers License
(7) Operating Beauty Parlour/Saloon
(8) Calibration of Weights & Measures
(9) VAT Registration/Luxury Tax
(10) License to play Music in Hotel rooms, Common
Areas and to obtain license for Special events
(11) Registration under PF Act & EPF Act
(12) Minimum wages Act, Bonus Act, Labour Act
Maternity Benefit etc
(13) Air & Water Pollution
(14) Liquor License (For Hotels)
(15) Building Completion Certificate
(16) Restricted Money Changer’s license
(17) Import License under EPCG
(18) Hotel / Restaurant Classification
9
Director of Health Services, Govt. of Kerala
Panchayat/Municipalities/ Corporation
Controller of Weights & Measure, Govt. of Kerala
State Sales Tax Department
Public Performance Licence (PPL)
Indian Performing Rights Society (IPRS)
& Local Police clearance for using Mike.
Provident Fund Commissioner
State Government Department of
Labour
Kerala Pollution Control Board
Kerala State Excise Department
Panchayat/Municipalities/ Corporation
Reserve Bank of India
Director General of Foreign Trade Ministry of
Commerce, Govt of India
Ministry of Tourism, Govt of India
List of Sanctions /Clearances required from Central/State Agencies to set up and
operate a Hotel
TAMIL NADU
Within Municipal Corporations in Tamil Nadu e.g. Chennai, Coimbatore & Madurai I) At
Project stage:
Nature of Approval required
Licensing/Issuing Authority
(1) Sanction of Building Plan.
Municipal Corporation/CMDA
(2) Clearance of Urban Ceiling Act
State Government
(3) Consent of Additional Floor space
CMDA (in case of Chennai)
(4) Height clearance of the Hotel
Local Authority/DGCA if it is in the
vicinity of airport and in the
Line of approach/take offs of aircrafts
(5) Land and Property Tax
Local body/Municipal Corporation
(6) NOC Fire Department
Local Fire Department
(7) Approval of Water lines and Sewerage
Corporation/CMWSSB (for Chennai)
(8) Consent of Air/Water pollution
(10) Approval for Garbage disposal & Sewage
Pollution Control Department (both at project
stage and after the hotel has become functional)
Corporation
(10)License for Power, Electrical installation,
Installation of Generator, Laundry equipment
(11)Approval for installing Cold storage
Electricity Board i.e. TNEB
Local Body
(12)Sanction of LPG, furnace etc
Ministry of Petroleum, Govt of India and Gas
Authority (Indian Oil Corporation)
Ministry of Tourism, Government of
India.
(13) Project Approval to get Tax concessions
TAMIL NADU (Contd)
10
II)
At the time of Opening of the Hotel:
Nature of Approval required
Licensing/Issuing Authority
(1) Lodging House License
(2) Eating House (Restaurant & Bakery)
(3) License for Manufacture & Sale of
Eatables (MPFA)
(4) Gradation of Restaurant
(5) Registration for getting FSSAI License for the
Preparation of Food in Hotels & Restaurants
(6) Registration under Shop & Establishments Act
(7) Nomination under Prevention of Food
Adulteration Act / Food Handlers License
(8) Operating Beauty Parlour/Saloon
(9) Calibration of Weights & Measures
(10) VAT Registration/Luxury Tax
(11) Service Tax Registration
(12) License to keep Public Amusement PRL/Lodging
(13) License to play Music in Hotel rooms, Common
Areas and to obtain license for Special events
(14) Registration under PF Act & EPF Act
(15) Minimum wages Act, Bonus Act, Labour Act
Maternity Benefit etc
(16) Swimming Pool License
Police
(17) Air & Water Pollution
(18) Liquor, FL 3 License (For Hotels)
(19) Building Completion Certificate
(20) Restricted Money Changer’s license
(21) Import License under EPCG
Revenue Department
Corporation Health Officer
Corporation Health Officer
(22) Hotel Classification
11
Corporation Health Officer
Office of the State Food Safety
Commissioner
Labour Office
City Corporation
City Corporation
Controller of Weights & Measure
Commercial Tax Department
Central Excise Department
Commissioner of Police
Public Performance Licence (PPL)
Indian Performing Rights Society (IPRS)
Provident Fund Commissioner
State Government Department of
Labour
City Corporation, Commissioner of
Tamil Nadu Pollution Control Board
State Prohibition & Excise Department
CMDA – for Chennai.
Reserve Bank of India
Director General of Foreign Trade Ministry of
Commerce, Govt of India
Ministry of Tourism, Govt of India
HOTELS IN SOUTHERN STATES
MANDATORY REQUIREMENTS, BAR LICENCES
& TAXES
Index
Page Nos
 Government Norms (State wise)
... 13
 Requirements for Bar Licence
... 14 & 15
 Luxury Tax/ VAT rates applicable
... 16 & 17
12
13
REQUIREMENTS FOR BAR LICENCE
FOR HOTELS IN SOUTHERN STATES
(As on 31.05.2012)
1. Andhra Pradesh
A)
B)
C)
D)
E)
Liquor Bar licenses are given to 3 Star & above Hotels
Annual Bar Licence Fees
Rs 18 Lakhs
Additional Fees for Serving Liquor for 24 hrs: 4 star & above hotels will be permitted to serve
liquor around the clock by paying an additional fee of Rs 6 Lakhs.
License is valid for the entire hotel.
Approved Restaurants are given Beer & Wine licenses.
2. Karnataka
A) No Classification is required for getting Bar License
B) Annual
(i)
(ii)
(iii)
C)
Bar Licence Fees :
For Hotels
For Stand Alone Restaurants
For Beer & Wine Parlours
Rs 3 Lakhs
Rs 3.80 Lakhs
Rs 0.50 Lakhs
(The above fee includes the standard annual fees plus certain percentage of annual consumption and KDIFC
charges for a typical 5 Star deluxe hotel.)
Liquor can be served anywhere in the hotel.
3. Kerala
A)
B)
C)
D)
E)
Annual Bar Licence Fees:
(i)
For the Entire Hotel
(ii)
For Wine/Beer Parlour
Rs 24 Lakhs
Rs 5 Lakhs
Till 31.03.2012 only 3 Star and above hotels were permitted a Bar license.
For issuing new Bar Licences there is a condition that the distance between two Bars should be
Three Kilometres in Panchayat area and one Kilometre in Municipality / Corporation area. Also
the norm for 3 star hotels is that there should be a distance of 150 meters between the Bar and
a Religious place of Worship/School and similarly for 4 star Hotels the distance between the
above places should be a minimum of 50 meters
With effect from 1st April 2012 onwards, newly constructed hotels that require Bar licences should
have 4 Star and above Classification status. The distance for issuing Bar Licence for four star
hotels has been increased to 200 Metres.
It is proposed that from financial year 2013-2014 onwards bar licenses will be given only to 5
star hotels with a minimum of 25 rooms. Also, it will be required that the distance between two
bars should be a minimum of 1 Kilometre.
14
However, in the following Ten Tourist centres – Bekal; Vythiri; Allapuzha; Kumarakom; Fort
Kochi; Kumily; Munnar; Varkala;Kovalam; Ashtamudi (Kollam) - bar License will continue to be
issued to hotels with 3 Star Status and having twenty rooms. In these areas, the new condition
regarding distance between bars will also not be applicable.
F)
Effective 01/04/2012, the Working Hours of Bars will be as follows: i) Panchayat and Municipality
Area – 8 AM to 11 PM and ii) Corporation area – 9 am to 12 midnight.
G)
Restaurants in Kerala, approved by Ministry of Tourism, Government of India and Kerala
Government can have bar licenses.
4. Tamil Nadu
A)
B)
D)
From 2001 onwards, bar licenses are given to only Classified Hotels.
In the case of 4 & 5 star hotels that are approved in the Project stage by the Ministry of Tourism,
Government of India, and at the time of commencing operations have applied for Classification,
they can with the discretionary powers of the Commissioner of Prohibition & Excise, Government
of Tamilnadu, receive a temporary Bar License on the explicit condition that they will obtain the
classification of the hotel within 3 months of commencement of operations.
Liquor is permitted to be served only in the bar and not in public places. However, temporary
licence can be obtained for Banquets.
Bar licenses are not given to Stand-alone Restaurants.
E)
License fees for getting FL 3 license (For Hotels) are given below:
C)
Star category
Application fee
Processing Fee
License fee
Deposit
5 Star/Deluxe
Rs1000
Rs 5000
Rs 8 Lakhs
Rs 1 Lakh
4 star
Rs1000
Rs 5000
Rs 6 Lakhs
Rs 1 Lakh
3 star
Rs1000
Rs 5000
Rs 4 Lakhs
Rs 1 Lakh
2 star
Rs1000
Rs 5000
Rs 3 Lakhs
Rs 1 Lakh
1star
Rs1000
Rs 5000
Rs 2 Lakhs
Rs 1 Lakh
Note:

For each additional Bar at the hotel, the applicable fees will be additional and the same as above.

3 star & above Hotels can have a Beer License by paying Rs 80,000/-
15
Details of Luxury Tax and VAT Applicable to Hotel Industry in Southern States (as
of 1st April 2012)
State
Andhra
Pradesh
Karnataka
Luxury Tax (in percentage)
On Room
Rate
On
Published
tariff
Up-to 600
per room
Nil
Rs.600&
above
5%
On Room
Rate
On actual
tariff
Up-to
2000per
room and
above
Rs.1000 to
2000
12%
Rs. 500/- to
Rs.1000/-
4%
Up-to
Rs.499/-
Nil
8%
VAT on F & B
VAT on Liquor
a) VAT Exemption for
Turnover up-to Rs 5
lacs
Presently in
abeyance
b) Restaurants in 3
Star Hotels/ Stand
alone Restaurants
above Rs 1.50 crores
Turnover - VAT 14.5%
c) Restaurants in
below 3 star
hotels
/stand alone
restaurants in below
Rs, 1.50 crores turnover
– VAT5 %
a)
VAT on
Non stat
Hotels/Rest
aurants
having
compoundin
g facilities –
4%
b)
VAT on Star
Hotels/Stan
d alone
Restaurants
-12.5%
16
Kerala
Tamil Nadu
Puducherry
On Room
Rate
On
actual
tariff
Up-to 400per
room
Nil
Rs.400 and
above Nonairconditioned
rooms
Rs.400/- and
above aircon rooms
7.5%
VAT on food 13.5%
General Sales
tax on Liquor
10%
On
published
tariff
Star Hotels and
approved
Restaurants -14.5%
Above Rs.
1000
12.5%
Ordinary Hotels
/Restaurants with
compounding
facility -5%
VAT on
serving
liquor in the
Bar as 2nd
sale -14.5%
Rs.500 to
1000
10%
Rs. 200/to
Rs.500/-
5%
Up-to
Rs.199/-
Nil
On Room
Rate
1.5%
Not applicable
Food & Beverage 10%
17
Not
applicable