HOTEL & RESTAURANT ASSOCIATION APPEALS TO CONSUMER AFFAIRS DEPARTMENT TO WITHDRAW ITS NEW SERVICE CHARGE NOTIFICATION

Hotel & Restaurant Association Appeals To Consumer Affairs Department To Withdraw Its New Service Charge Notification

Maintains Service Charge As NEITHER Unfair Trade Practice NOR Illegal

Mumbai: In the wake of a statement issued by the Department of Consumer Affairs on Jan 02, 2017 implying Service Charge billed by restaurants are optional, the Hotel and Restaurant Association of Western India (HRAWI) has come out with a clarification to all industry stakeholders. In a letter to the Department of Consumer Affairs, the Federation of Hotel and Restaurant Associations of India (FHRAI) the apex body of hotels and restaurants, has appealed for withdrawal of the advisory as it has been creating chaos and disruption in the smooth functioning of restaurants across the country.

The association has clarified that there is nothing illegal about levying the fee and has citied judgments by the National Consumer Disputes Redressal Commission, New Delhi which is the highest consumer forum of the country as well as by the Hon’ble Supreme Court, which have upheld the legitimacy of this practice.

“Service Charge like any other charge is a proposal from the restaurant or an establishment to potential customers. It is for the customers to decide whether they wish to patronise the said restaurant or not,” says Mr Dilip Datwani, President, HRAWI. “A restaurant or hotel may just as easily absorb the said service charge into the remaining charges being collected by it from the consumer (by simply including it in the prices on the menu). Service charge is considered a beneficial payment since it is meant for the benefit of the staff of the establishment. So, some establishments make a conscious choice to adopt a beneficial policy towards its staff members by assuring them a minimum tip which is a percentage of the rest of the charges.”

The association has pointed out to cases in which the practice of levying a Service Charge has been upheld by the law. In one of the cases, the National Consumer Disputes Redressal Commission, New Delhi in Nitin Mittal vs. Pind Baluchi, (2012) NCDRC 444 the Association has been advised that such a practice is not an “unfair trade practice” within the Consumer Protection Act. In another case, the Hon’ble Supreme Court too has specifically acknowledged the practice of including “service charge” in the bill by hoteliers and other cases in lower courts which too have recognized the practice.

“Service charge is the amount paid to the staff of the restaurant or other similar establishments. An establishment may choose to include this amount in the bill itself and the percentage may vary from 5 per cent to 15 per cent of the value billed. This is a common and accepted practice in India as well as several other countries. Service Charge is not a government levy, and is not to be confused with VAT or Service Tax. We regret that the department came out with such an advisory which is misleading and has built a wrong notion about hotels and restaurants amongst their customers,” says Mr Pradeep Shetty, Hon’ Secretary, HRAWI & Chairman of legal matters subcommittee, FHRAI & HRAWI. “While consumer rights are paramount, the rights of individual establishments should not be impinged upon,” he adds.

“Generally patrons do not pay tips once they see they have been charged for service. The Service Charges are justly distributed amongst not only the stewards, but to everyone from the chefs to the dishwashing helper. The rationale behind putting it in the bill as a separate charge is also to clearly disclose to the customer that a specified portion of the amount paid by them is being given to the staff of the establishment that has been serving the customer,” concludes Mr Datwani.

About Hotel & Restaurant Association Western India (HRAWI)

The Hotel and Restaurant Association (Western India) is a 66 years old Association of Hotels and Restaurants in Western India. Its members include smaller Hotels up to 5-Star Deluxe categories. The bulk of its members like any growth economy are made up of budget hotels. HRAWI covers Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union Territories of Daman, Diu & Silvassa, and is considered to be the voice of the Hotel Industry. The association is part of the national body of Federation of the Hotels & Restaurants Associations of India (FHRAI), located in New Delhi, which was originally founded in Mumbai in 1950 by the late Mr. J.R.D. Tata.

For more information about the association please visit: www.hrawi.com

SELLING AT MRP NOT APPLICABLE FOR HOTELS & RESTAURANTS

Hotel Body Issues Clarification To ‘Purported’ Minister’s Remark 

Mumbai: The Hotel and Restaurant Association of Western India (HRAWI), in a bid to remove any ambiguity over selling water, aerated drinks and similar commodities above the Maximum Retail Price (MRP), has issued a circular to its members clarifying that hotels and restaurants could continue to sell the same above the MRP. However, it also advised not to sell water bottles or such commodities carrying MRP over the counter at all, and if they do, must be sold at MRP.

The HRAWI is a member association in the western region of the Federation of Hotel and Restaurant Associations of India (FHRAI), the apex body of hotels and restaurants in the country. It issued the circular in response to queries posed by members after a section of the media quoting Consumer Affairs Minister Ram Vilas Paswan carried a news item that selling water and aerated drinks above MRP could attract fine and a jail term. Some news items had also wrongly stated that Hotel Association’s cases have been dismissed in High Court and Supreme Court.

“Running the story without appropriate verification has caused confusion and misunderstanding between hoteliers and their patrons. As per the present law, there is no such legal repercussion that can prosecute a hotel or restaurant for the sale of either packaged drinking water or aerated drinks or any such commodity above the MRP while being served in the premises i.e, inside Hotels and Restaurants. So we have advised our members that they can continue selling at suitable rates as the MRP law applies to retailers only,” says Mr Pradeep Shetty, Hon Secy, HRAWI & Chairman - Legal Matters sub-committee, FHRAI & HRAWI.

FHRAI had filed a Writ Petition before the Delhi High Court challenging the notices issued under the then prevailing law namely the Standards of Weights and Measures Act for serving water above MRP.  The Ld. Single Judge of the Delhi High Court by judgment dated 5.3.2007 in W.P. No 6517 of 2003 allowed the writ petition filed by FHRAI holding inter alia that, “… charging prices for mineral water in excess of MRP printed on the packaging, during the service of customers in hotels and restaurants does not violate any of the provisions of the SWM Act as this does not constitute a sale or transfer of these commodities by the hotelier or restaurateur to its customers. The customer does not enter a hotel or a restaurant to make a simple purchase of these commodities. It may well be that a client would order nothing beyond a bottle of water or a beverage, but his direct purpose in doing so would clearly travel to enjoying the ambience available therein and incidentally to the ordering of any article for consumption…”

“Thereafter, two other Courts ( Kerala and Delhi HC ) have also held non-applicability of MRP to items sold in hotels and restaurants. It is regrettable that wrong information continues to circulate even on matters like these. Nobody comes to a hotel or a restaurant to purchase goods or commodities; they come to our establishments to enjoy service and ambience. As hoteliers, our primary focus is on providing memorable experiences,” concludes Mr. Dilip Datwani, President, HRAWI.

About Hotel & Restaurant Association Western India (HRAWI)

The Hotel and Restaurant Association (Western India) is a 66 years old Association of Hotels and Restaurants in Western India. Its members include smaller Hotels up to 5-Star Deluxe categories. The bulk of its members like any growth economy are made up of budget hotels. HRAWI covers Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union Territories of Daman, Diu & Silvassa, and is considered to be the voice of the Hotel Industry. The association is part of the national body of Federation of the Hotels & Restaurants Associations of India (FHRAI), located in New Delhi, which was originally founded in Mumbai in 1950 by the late Mr. J.R.D. Tata.

For more information about the association please visit: www.hrawi.com

FHRAI’S 51ST ANNUAL CONVENTION CONCLUDES WITH MUCH FANFARE, RECOMMENDATIONS & RESOLUTIONS FOR THE PROGRESS OF HOSPITALITY & TOURISM

Indore To Become A Beehive For Investment In The Hospitality Sector

Indore: The three day annual convention hosted by one the largest hotel and restaurant associations of the world – Federation of Hotel & Restaurant Associations of India (FHRAI) concluded today at the Amber Convention Centre. The concluding day also hosted an awards ceremony that conferred prestigious recognitions in various categories to hoteliers, restaurateurs, and several others that contribute to the hospitality sector.

The day witnessed a marked rise in participation in the business sessions from various stakeholders of the sector on Charting New Classification Standards, Maximizing Food & Beverage Revenue using Technology, Industry Challenges Concerning OTAs and Accessible India Campaign followed by an Open House and Convention Resolutions.

Deliberations on various serious issues that include GST, liquor policy for hospitality sector, FSSAI act, and investment opportunities were some of the key highlights of the Brand India convention. The Government acknowledged that tourism and hotels can bring economic prosperity and create employment, and has invited investors in the state assuring its full support.

“We thank the government authorities, hoteliers, visitors and the media for their support in our endeavor of building Brand India and in promoting it. We are very optimistic that the Governments will give due attention to our requests and sort ways for the betterment of the hospitality sector which is one of the key contributors in India’s growing economy. We are hopeful that there is speedy implementation of our recommendations before we meet for our next annual convention,” says Mr Bharat Malkani, President, FHRAI.

About Federation of Hotel & Restaurant Associations of India (FHRAI):

The Federation of Hotel & Restaurant Associations of India (FHRAI) is the apex body of the Indian Hospitality industry.  Founded in 1955, the association has diligently built on its rich legacy and is today privileged to serve as the leading voice of our industry and plays a seminal role in supporting the growth trajectory of India's hospitality and tourism sector. FHRAI provides a vibrant interface between the industry, government, regulatory bodies, academia, international organizations, civil society and the media.

FHRAI TO LAUNCH FIVE NON COMMERCIAL FOOD TESTING LABS FOR THE HOSPITALITY INDUSTRY ACROSS THE COUNTRY

FHRAI To Launch Five Non Commercial Food Testing Labs For The Hospitality Industry Across The Country

·      To supplement the FSSAI Act

·      To undertake Special Food Safety and Hygiene educational programmes for FBOs

·      To work on a non-commercial basis providing services at 40% to 50 % lower prices

·      To set up more such labs across the nation

Indore: The Federation of Hotel and Restaurant Associations of India (FHRAI) has announced that the association will launch five Food Testing Laboratories in India soon. The announcement was made by the President of the association, Mr. Bharat Malkani on the second day of its 51st annual convention being held at Raddison Blu.

During one of the business sessions on the Status of FSSAI Implementation, Mr Bharat Malkani, President FHRAI said, “with the introduction of Food Safety and Standards Act it has become mandatory for food business operators (FBOs) to test their food products. The number of labs that currently exist are grossly insufficient and will not be able to cope with the sheer volume of service seekers. Our labs will benefit thousands of FBOs from bakery federations, catering associations, food retail traders and mithaiwala associations, among others.”

He further added, “To be launched on a non-commercial basis, the labs will not only follow global standards of food safety and hygiene, but will also conduct the tests at forty to fifty percent lower costs than its commercial counterparts.”

Hotel and restaurant Association of Western India (HRAWI), one of FHRAI’s member bodies has already launched one such lab in Vadodara. HRAWI is the first hospitality industry association in the country to establish its own food testing laboratory.

“The FHRAI owned labs will be fully equipped with national and international standards equipment. The labs will be managed by a team of qualified and experienced technologists and would have proficiency to test almost all the Indian culinary samples,” concluded Mr. Malkani.

Today’s convention encompassed several sessions and panel discussions on subjects ranging from New Age Payment options, Emerging Food & Beverage trends, Contemporary trends in hotel architecture, MP Tourism - Investment opportunities, Energy Sustainability in hotels and Status of FSSAI implementation.

About Federation of Hotel & Restaurant Associations of India (FHRAI):

The Federation of Hotel & Restaurant Associations of India (FHRAI) is the apex body of the Indian Hospitality industry.  Founded in 1955, the association has diligently built on its rich legacy and is today privileged to serve as the leading voice of our industry and plays a seminal role in supporting the growth trajectory of India's hospitality and tourism sector. FHRAI provides a vibrant interface between the industry, government, regulatory bodies, academia, international organizations, civil society and the media.

ONE OF THE WORLD’S BIGGEST HOSPITALITY EXTRAVAGANZAS TO KICKOFF TOMORROW AT FHRAI’S 51ST ANNUAL CONVENTION ‘BRAND INDIA’

One Of The World’s Biggest Hospitality Extravaganzas To Kickoff Tomorrow At FHRAI’s 51^st Annual Convention ‘BRAND INDIA’

Several Imminent Govt. Dignitaries To Be Present On The Inaugural Day; 3 Day Convention To Host Series Of Business Sessions, Exhibition & Awards Gala

Indore: The most extravagant hospitality annual conventions and the much awaited 51^st edition of The Federation of Hotel and Restaurant Associations of India (FHRAI) will kickoff tomorrow 22^nd Sept at the Amber Convention Center, 5pm onwards. Themed Brand India with Madhya Pradesh (MP) as the host state, the Convention will have inaugural session addressed by imminent Government dignitaries including Shri Shivraj Singh Chauhan, Hon’ble Chief Minister of MP, Shri Surendra Patwa, State Minister, Tourism and Culture, Govt. of MP, Shri Amitabh Kant, Chairman, Niti Ayog, Smt. Malini Laxman Singh Gaur, Mayor of Indore among others.

The three day convention will host an exhibition featuring the latest products and technologies in hospitality along with a series of business sessions on varied subjects and will conclude on 24^th with a grand awards ceremony. The FHRAI Awards will be conferred by Shri Surendra Patwa, State Minister, Tourism and Culture, Govt. of MP, Shri Digvijay Singh, National General Secretary, Indian National Congress and Shri Vinod Zutshi, Secretary, Minister of Tourism, GoI.

“We are pleased to host the biggest celebration ever of hospitality, in the heart of Incredible India – Indore. We, the hospitality industry are the first glimpse, the first impression to guests who visit India. It’s upon us to represent the best of India with its myriad colors and colorful heritage. This year, under the emblem of Brand India we as a sector are resolved to set new benchmarks in hospitality and tourism. Inspired by the Hon’ Prime Minister’s vision based on the 5 Ts, ‘Talent, Tradition, Tourism, Trade and Technology’ the 51^st Convention will embody these as intrinsic part of the theme,” says Mr. Bharat Malkani, President, FHRAI.

The Convention will encompass several sessions and panel discussions on subjects ranging from New Age Payment Options, MP Tourism - Investment Opportunities, Energy Sustainability in Hotels, Status of FSSAI Implementation, Charting New Classification Standards, and Accessible India Campaign, among others.

The present projection expects 10 million tourists to visit India by the year 2020. This can only be achieved if 180,000 guestrooms are added at an estimated cost of Rs. 200,000 crores to the existing supply of 120,000 guestrooms in all the classified categories from 1-star to 5-star. “This will require for the hotel industry to work inclusively with the Govt. and the convention will serve as a great platform for presenting to the various stakeholders including tourism authorities, policy makers, investors and industry players the ways and means to make their valuable contributions,” says Mr. Kamlesh Barot, Past President, Hotel and Restaurant Association of Western India (HRAWI).

One facet of the convention will draw emphasis on accommodating the increasing tourist arrivals in the country. The hospitality industry plans to take up the challenge to set up the required tourism infrastructure for this and complement the Government’s efforts to make Brand India the beacon of growth in both products and services.

“It’s a delightful moment for the Federation, its members and Indian hospitality industry. The annual convention has evolved as the most important event for hoteliers over the last 51 years. With each edition of this event, it has been FHRAI’s sincere endeavor to not only surpass the high expectations of the members, but also set new benchmarks in terms of innovation, excellence and grandeur. We welcome you all to this event,” concludes Mr. Malkani.

About Federation of Hotel & Restaurant Associations of India (FHRAI):

The Federation of Hotel & Restaurant Associations of India (FHRAI) is the apex body of the Indian Hospitality industry.  Founded in 1955, the association has diligently built on its rich legacy and is today privileged to serve as the leading voice of our industry and plays a seminal role in supporting the growth trajectory of India's hospitality and tourism sector. FHRAI provides a vibrant interface between the industry, government, regulatory bodies, academia, international organizations, civil society and the media.

About Hotel & Restaurant Association Western India (HRAWI):

The Hotel and Restaurant Association (Western India) is a 66 years old Association of Hotels and Restaurants in Western India. Its members include smaller Hotels up to 5-Star Deluxe categories. The bulk of its members like any growth economy are made up of budget hotels. HRAWI covers Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union Territories of Daman, Diu & Silvassa, and is considered to be the voice of the Hotel Industry. The association is part of the national body of Federation of the Hotels & Restaurants Associations of India (FHRAI), located in New Delhi, which was originally founded in Mumbai in 1950 by the late Mr. J.R.D. Tata.

INDORE TO PLAY HOST TO FHRAI’S 51ST ANNUAL CONVENTION

Indore To Play Host To FHRAI’s 51^st Annual Convention; To Showcase One Of The Biggest Ever Hospitality Extravaganzas

Shri Shivraj Singh Chauhan, Chief Minister, Madhya Pradesh; Dr. Mahesh Sharma, Union Minister of State For Tourism & Culture; Smt. Sumitra Mahajan, Hon’ble Speaker, Lok Sabha; Shri Amitabh Kant, Chairman, Niti Ayog; Among Others To Address The Inaugural Session In One Of The World’s Largest Congregation Of Hoteliers

Indore: The Federation of Hotel and Restaurant Associations of India (FHRAI), the 3^rd largest hotel and restaurant association in the world, will pivot its 51^st Annual Convention on ‘Brand India’. The convention will be held between 22^nd September and 24^th September, 2016 at Indore, MP.

“I am delighted to know that Indore is hosting the 51^st FHRAI convention,” said Shri Shivraj Singh Chauhan, Chief Minister of Madhya Pradesh in a written message to FHRAI. The Governor of Madhya Pradesh, Shri Ram Naresh Yadav, also expressed his pleasure and conveyed his welcome to the delegates and wished success to the convention. “This event will serve as an opportune platform to bring together key stakeholders for insightful deliberations on innovative strategies which can support the buoyant growth trajectory of India’s tourism sector,” wrote Dr. Mahesh Sharma, Union Minister of State, Tourism & Culture.

Inspired by the Hon’ Prime Minister’s vision based on the 5 Ts, ‘Talent, Tradition, Tourism, Trade and Technology’ the 51^st Convention will embody these as intrinsic part of the theme. One facet of the convention will draw emphasis on accommodating the increasing tourist arrivals in the country. The hospitality industry plans to take up the challenge to set up the required tourism infrastructure for this and complement the Government’s efforts to make Brand India the beacon of growth in both products and services.

“It’s a delightful moment for the Federation, our members and Indian hospitality industry. The annual convention has evolved as the most important event for an hotelier over the last 51 years. Our impetus this year will be ‘Brand India’ which will focus on the country’s diverse tourism portfolio that includes adventure, wellness, sports, MICE, eco-tourism, film, rural and religious tourism among others. The convention in Indore will be the single largest platform for hundreds of entrepreneurs to explore business opportunities, exchange ideas and strengthen business ties,” says Mr. Bharat Malkani, President, FHRAI.

The three-day convention will encompass several sessions and panel discussions on subjects ranging from Innovative ways of Financing Hotels & Restaurants, Trends in Interior Design, Maximizing Food & Beverage Revenue using Technology and Deployment of Mobile Wallets & Digital Marketing.

About Federation of Hotel & Restaurant Associations of India (FHRAI):

The Federation of Hotel & Restaurant Associations of India (FHRAI) is the apex body of the Indian Hospitality industry.  Founded in 1955, the association has diligently built on its rich legacy and is today privileged to serve as the leading voice of our industry and plays a seminal role in supporting the growth trajectory of India's hospitality and tourism sector. FHRAI provides a vibrant interface between the industry, government, regulatory bodies, academia, international organizations, civil society and the media.

About Hotel & Restaurant Association Western India (HRAWI):

The Hotel and Restaurant Association (Western India) is a 66 years old Association of Hotels and Restaurants in Western India. Its members include smaller Hotels up to 5-Star Deluxe categories. The bulk of its members like any growth economy are made up of budget hotels. HRAWI covers Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union Territories of Daman, Diu & Silvassa, and is considered to be the voice of the Hotel Industry. The association is part of the national body of Federation of the Hotels & Restaurants Associations of India (FHRAI), located in New Delhi, which was originally founded in Mumbai in 1950 by the late Mr. J.R.D. Tata.

FHRAI ANNOUNCES BRAND INDIA AS THEME OF ITS 51ST ANNUAL CONVENTION

FHRAI Announces BRAND INDIA As Theme Of Its 51^st Annual Convention; Indore To Play Host; To Showcase One Of The Biggest Ever Hospitality Extravaganzas

Shri Shivraj Singh Chauhan, Chief Minister, Madhya Pradesh; Dr. Mahesh Sharma, Union Minister of State For Tourism & Culture; Smt. Sumitra Mahajan, Hon’ble Speaker, Lok Sabha; Shri Amitabh Kant, Chairman, Niti Ayog; Among Others To Address The Inaugural Session In One Of The World’s Largest Congregation Of Hoteliers

Mumbai: The Federation of Hotel and Restaurant Associations of India (FHRAI), the 3^rd largest hotel and restaurant association in the world, will pivot its 51^st Annual Convention on ‘Brand India’. In a prelude held in Mumbai, the association revealed its objectives and announced that the convention will be held between 22^nd September and 24^th September, 2016 at Indore, MP.

“The Convention will encompass several sessions and panel discussions on subjects ranging from Innovative ways of Financing Hotels & Restaurants, Trends in Interior Design, Maximizing Food & Beverage Revenue using Technology and Deployment of Mobile Wallets & Digital Marketing. The discussion forums will provide an excellent opportunity for the participants to engage with key policy makers, business people from allied industries and inspirational entrepreneurs,” says Mr. Bharat Malkani, President, FHRAI.

Inspired by the Hon’ Prime Minister’s vision based on the 5 Ts, ‘Talent, Tradition, Tourism, Trade and Technology’ the 51^st Convention will embody these as intrinsic part of the theme. One facet of the convention will draw emphasis on accommodating the increasing tourist arrivals in the country. The hospitality industry plans to take up the challenge to set up the required tourism infrastructure for this and complement the Government’s efforts to make Brand India the beacon of growth in both products and services.

The present projection expects 10 million tourists to visit India by the year 2020. This can only be achieved if 180,000 guestrooms are added at an estimated cost of Rs. 200,000 crores to the existing supply of 120,000 guestrooms in all the classified categories from 1-star to 5-star. “This will require for the hotel industry to work inclusively with the Govt. and the convention will serve as a great platform for presenting to the various stakeholders including tourism authorities, policy makers, investors and industry players the ways and means to make their valuable contributions,” says Mr. Kamlesh Barot, Past President, Hotel and Restaurant Association of Western India (HRAWI).

Besides the inaugural session, business sessions, networking sessions and entertainment programmes, the 3-day convention will concurrently run an exhibition featuring the latest products and technologies in hospitality. The concluding day will also feature a conferring of FHRAI Awards – the most prestigious hospitality awards in India. The award ceremony will be participated by Shri Surendra Patwa, State Minister, Tourism and Culture, Government of Madhya Pradesh, Shri Digvijay Singh, National General Secretary, Indian National Congress and Shri Vinod Zutshi, Secretary, Ministry of Tourism, Government of India, among others

“I am delighted to know that Indore is hosting the 51st FHRAI convention,” said Shri Shivraj Singh Chauhan, Chief Minister of Madhya Pradesh in a written message to FHRAI. The Governor of Madhya Pradesh, Shri Ram Naresh Yadav, also expressed his pleasure and conveyed his welcome to the delegates and wished success to the convention. “This event will serve as an opportune platform to bring together key stakeholders for insightful deliberations on innovative strategies which can support the buoyant growth trajectory of India’s tourism sector,” wrote Dr. Mahesh Sharma, Union Minister of State, Tourism & Culture.

“It’s a delightful moment for the Federation, our members and Indian hospitality industry. The annual convention has evolved as the most important event for an hotelier over the last 51 years. Our impetus this year will be ‘Brand India’ which will focus on the country’s diverse tourism portfolio that includes adventure, wellness, sports, MICE, eco-tourism, film, rural and religious tourism among others. The convention in Indore will be the single largest platform for hundreds of entrepreneurs to explore business opportunities, exchange ideas and strengthen business ties,” concludes Mr Malkani.

HOTEL INDUSTRY SCEPTICAL ABOUT GOVERNMENT’S HOMESTAY PLANS TO PROMOTE TOURISM

Hotel Industry Skeptical About Government’s Home-stay Plans To Promote Tourism

Mumbai: The Hotel and Restaurant Association of Western India (HRAWI) has raised concerns over the Government’s plan to open up home-stays as a way to bridge the acute deficiency of hotel rooms in the country for promoting tourism. The proposal which may allow anyone to offer stays at their homes will have no Government intervention and not attract any kind of taxation or commercial tariffs. The hotel industry is skeptical about the outcome of such a plan as it could backfire with no assurance of guest safety and would have consequences that affect employment and tax revenues.

“In a country like India where tourism is at a nascent stage promotion of home-stays at the expense of organised hospitality could spell doom. The primary problem with home-stays is that there are no standardization or categorizations. There have been multiple cases of exaggerated promises, misrepresentations, disagreements and conflicts with guests, hygiene issues and intimidation among others. Because home-stays are unregulated, there are no redressal systems in place,” says Mr. Bharat Malkani, President, HRAWI & Federation of Hotels and Restaurants Association of India (FHRAI). “Hotels are required by law to send details of foreign guests to the police station by submission of a C Form. This is a security requirement from the Ministry of Home Affairs. Home-stays are not required to be compliant and the industry fears that this will become the de facto accommodation for those foreigners that seek anonymity from the Police,” he adds.

HRAWI also questioned the relevance of subjecting hotels to administrative clearances, liquor permits and other licenses while home stays providing the very same services are exempted. Homestays, functioning just like hotels do, are prevalent even today in a lot of states. However, they are unorganized and are presently limited in numbers. With the Government’s new shift in policy focusing on homestays, the dynamics are expected to change.

“The hospitality industry without home-stays in Maharashtra today can generate almost Rs. 600 crores per extra night that a foreign tourist stays back to the Government as foreign exchange earnings, besides being the highest employment generator. Almost all tourist towns across the world have grown on the back of strong hospitality infrastructure and not home-stays, which are brought in only as a stop gap emergency measure, as Delhi did during the Asian games, due to the three year gestation period to add new hotel rooms. The solution to growth of tourism in India is freeing the hospitality sector from red tapism and following a pragmatic taxation policy,” says Mr. Kamlesh Barot, past President, HRAWI.

“If the home-stays concept does go into execution then hotels that are presently operating with the highest taxation applicable in addition to paying for utilities such as water and electricity at commercial rates are bound to be doomed. Tourism cannot afford to run or prosper without hotels and the Government will have to consider an alternate plan that can either allow hotels to operate with the same relaxations as would be given to homestays or vice versa,” concludes Mr. Malkani.

About Hotel & Restaurant Association Western India (HRAWI)

The Hotel and Restaurant Association (Western India) is a 66 years old Association of Hotels and Restaurants in Western India. Its members include smaller Hotels up to 5-Star Deluxe categories. The bulk of its members like any growth economy are made up of budget hotels. With around 1300 members across Western India, HRAWI covers Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union Territories of Daman, Diu & Silvassa, and is considered to be the voice of the Hotel Industry. The association is part of the national body of Federation of the Hotels & Restaurants Associations of India (FHRAI), located in New Delhi, which was originally founded in Mumbai in 1950 by the late Mr. J.R.D. Tata.

FHRAI SUBMITS PRE-BUDGET MEMORANDUM TO MOT AND MOF

Hotel Industry Hopes For Tangible Resolutions In FY 2016 – 17

Mumbai: Ahead of the Budget, the Federation of Hotel and Restaurant Associations of India (FHRAI) has appealed to the government to rationalize taxes and amend certain policies for aligning the tourism sector with the rest of the world and give boost to the hospitality industry. In the pre-budget memorandum submitted to the Ministry of Tourism (MOT) and Ministry of Finance (MoF), the association has outlined in details the critical taxations and policy initiatives and recommendations that would provide the hotel industry the much needed stimulus.

Some of the key recommendations on taxation include the impact of GST on Tourism Arrivals, availing of Export Promotion Capital Goods Scheme (EPCG) and Service Exports from India Scheme (SEIS) without a Classification mandate, Issuance of Tax-free ‘Hospitality Infrastructure Bonds’.

"The hospitality industry has been at the receiving end for last few years but with the Government’s focus on tourism development things may be turning around for hospitality too. High decibel events and initiatives organised by respective States for promoting tourism and hospitality are indicators of commitment towards these sectors and we feel positive about the future. However, besides campaigns and promotions, the ministries will also have to revisit and remodel some of the prevailing tax structures, laws and policies to bring it at par with competing tourism economies of the world,” says Mr. Bharat Malkani, President, FHRAI & Hotel and Restaurant Association of Western India (HRAWI).

“For instance, our neighbouring south-east Asian countries like Thailand and Malaysia have a GST of 7 and 6 per cent respectively. In contrast, GST applicable for hotels in India amounts to a whopping 25 to 30 per cent. Our industry is competing with a difference of roughly 20 per cent while matching with all global the service amenities and requirements. Also, we hope that the government considers granting infrastructure status to hotels with a project cost of INR 25 crore as against the present INR 250 crore,” he adds.

On policy initiatives, FHRAI has suggested increasing the threshold limit of INR 25,000 to INR 1,00,000 for payments to hotels and restaurants against bills raised and to allow bank loans up to INR 10 crores per unit or borrower extended to hotels and restaurants and be reckoned as 'priority sector lending' within the RBI guidelines.

"Small and Medium Enterprises (SMEs) are a vital catalyst for employment generation, skill development and innovation in the hospitality sector. It is imperative to facilitate timely and adequate flow of credit for their sustainable growth and expansion. For the purpose of inclusion under the priority lending norms, the categorization of SMEs in the hospitality industry should be delinked from the restrictive criteria stipulated by the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 and instead be based on liberal, industry specific and globally accepted parameters such as number of employees, annual turnover and such quantifiable parameters. A broad spectrum of institutional mechanisms should be made accessible by which the hospitality industry, including our small and medium enterprises, can access lower cost long-term finance,” concludes Mr. Kamlesh Barot, past-President, FHRAI & HRAWI.

HRAWI APPEALS FOR RATIONALIZATION OF IRRELEVANT LAWS SO THAT RELEVANT ONES CAN BE ENFORCED EFFICIENTLY

HRAWI Appeals For Rationalization of Irrelevant Laws So That Relevant Ones Can Be Enforced Efficiently

•  27% Of Existing Licenses Formulated Before 1950;
• Sand Buckets in Hotels Mandatory But Modern Fire Fighting Technology Does Not Count
• "Licence for Chimney under Smoke Nuisance Act" created in 1912 still in force
• Trivia: “The Eating House Licence” formulated in 1876 is the oldest license

In the wake of the fire disaster at a Kurla eatery in Mumbai, HRAWI, expressing its sympathy, has appealed to the Government to scrap all irrelevant laws so that both the enforcers and the hotels could concentrate on total compliance on all relevant laws and procedures. The industry has complained that it is reeling under a barrage of archaic laws that are unfeasible to comply with and are totally irrelevant.

“For instance, many hotels that have invested heavily in modern fire fighting technology are still required to keep a sand bucket. A sand bucket cannot douse most fires, but if a hotel or a restaurant does not maintain a sand bucket, it can get booked for non-compliance of safety norms. Or take the case of whitewashing a restaurant kitchen, almost all hotel kitchens are tiled, but we still have to provide a certification of white washing,” says Bharat Malkani, President, FHRAI.

The hotel industry today needs a whopping 134 licenses and permissions to operate in Mumbai. A large number of the licenses were formulated when the British ruled India. If the 89 year old “Entertainment Licence on Festival Occasions” was framed by the Britishers for controlling a subject nation, “Licence for Chimney under Smoke Nuisance Act” created in 1912 when food was cooked in firewood is completely irrelevant today. The oldest license is “The Eating House Licence” formulated in 1876. Nineteen of the seventy key licences were formulated before 1950.

“Hoteliers in Mumbai have a tradition of adhering to maximum compliance. If there were any shortcomings, they were mostly minor oversights like being unable to produce a license on time or practical challenges in adhering to outdated laws. But we can assure our patrons that there wasn’t a single case of violation that had a potential to impact their safety or health. Hoteliers are as serious about safety as anyone else. The owners spend more than 16 hours a day in their restaurants and consequently are at a bigger risk than anyone else. When it comes to health and safety norms, we are very careful,” says Mr. Kamlesh Barot, past President HRAWI.

“We want to operate in a system where there are rational licenses, zero ambiguity of laws and clearly defined check list and guidelines provided by enforcing authorities. We wish for a system that works on the principle of accountability and clarity of laws. The Chief Minister’s recent decision to reduce the number of operating licenses to 25 is a step in positive direction. We are hoping that the laws will be rationalized at the earliest,” concludes Mr. Malkani.

About Hotel & Restaurant Association Western India (HRAWI)

The Hotel and Restaurant Association (Western India) is a 65 years old Association of Hotels and Restaurants in Western India. Its members include smaller Hotels up to 5-Star Deluxe categories. The bulk of its members like any growth economy are made up of budget hotels. With around 1300 members across Western India, HRAWI covers Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union Territories of Daman, Diu & Silvassa, and is considered to be the voice of the Hotel Industry. The association is part of the national body of Federation of the Hotels & Restaurants Associations of India (FHRAI), located in New Delhi, which was originally founded in Mumbai in 1950 by the late Mr. J.R.D. Tata.

HRAWI WELCOMES TRAI’S DECISION, HIKE OF 15 – 20 % AVERTED

No Additional Charge To Watch TV In Hotels & Restaurants

Mumbai: The Telecom Regulatory Authority of India (TRAI) through a circular has ruled against differential cable TV rates levied at hotels and restaurants.  Declaring it should be at par with domestic charges, it maintained that additional cost of watching TV would be applicable only if charged separately or if charges are being levied for entry. The Hotel and Restaurant Association of Western India (HRAWI) along with the apex body Federation of Hotel and Restaurant Associations of India (FHRAI) had been agitating for regulated tariff for Hotel Industry since 2004 and had submitted its detailed comments to the consultation paper. The HRAWI has welcomed the decision which has averted an approximate 15-20 per cent increase in room tariffs and restaurant bills.

Bharat Malkani,
President, HRAWI

“We had been contesting against differential tariffs for over a decade and our efforts have paid off. It has been declared a necessity for the benefit of customers and not a luxury,” says Mr. Bharat Malkani, President, HRAWI. “The channels and broadcasters wanted commercial establishments to pay additional charges than what was paid by domestic subscribers. Although in cases where any establishment exploits TV broadcasting by charging additionally to its patrons, will then be required to pay at commercial tariffs,” he adds.

The Federation of Hotel and Restaurant Associations of India (FHRAI) submitted that in 2006, the Supreme Court had held that television is a mere amenity in hotel rooms just like fans and air-conditioners and had submitted its detailed comments to the consultation paper. It had represented at the Open House Discussion and submitted to the authority that hotels and restaurants be treated at par with Domestic subscribers, as TV signal is a part of other amenity provided free of charge by hotels to their guests.

The FHRAI also stated that channels do not subsidize ordinary subscribers like it happens in electricity or water to demand higher tariff for commercial subscribers. “We had argued that members do not charge separately for watching TV programs in restaurants , it’s a mere amenity and customers today demand TV sets for information or to watch their favourite sport while enjoying their drink or food. Besides even the tourism departments have mandated installing TVs in hotels for a better tourist experience. Commercial tariff for cable TV would have meant that customers would have to pay additional by way of higher food or beverage cost,” says Mr. Pradeep Shetty, Chairman - Legal Matters sub-committee, FHRAI and HRAWI.

About Hotel & Restaurant Association Western India (HRAWI)

The Hotel and Restaurant Association (Western India) is a 65 years old Association of Hotels and Restaurants in Western India. Its members include smaller Hotels up to 5-Star Deluxe categories. The bulk of its members like any growth economy are made up of budget hotels. With around 1300 members across Western India, HRAWI covers Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union Territories of Daman, Diu & Silvassa, and is considered to be the voice of the Hotel Industry. The association is part of the national body of Federation of the Hotels & Restaurants Associations of India (FHRAI), located in New Delhi, which was originally founded in Mumbai in 1950 by the late Mr. J.R.D. Tata.

HRAWI WORKS IN CONJUNCTION WITH MTDC AND GOVERNMENT OF MAHARASHTRA FOR EASE OF BUSINESS

HRAWI Maps Investor Friendly Policies To Attract “Gen-Next” Entrepreneurs

Mumbai: Hotel & Restaurant Association of India Western India (HRAWI), the apex body of Hotels and Restaurants in Western India in conjunction with Maharashtra Tourism Development Corporation (MTDC) and Government of Maharashtra (GoM) has been advocating new business strategies with a goal to give boost to the hospitality industry.  HRAWI has shown optimism and believes that implementation of the new policy will encourage the growth of hotel/hospitality infrastructure in the country.

India ranked 140/189 in 2013 and 142/189 in 2014 on Ease-of-doing-business index where 1 is the most business-friendly regulation country as per data released by The World Bank. Sixty five percent of India’s population is under thirty years of age. It is, therefore, imperative to have investor friendly ease-of-business policies to attract “Gen-next” entrepreneurs to this sector. HRAWI, along with MTDC and GoM through Accenture, has identified Single Window Clearance as the key solution in the Ease-of-Business strategy paper.

“High taxation and unreasonable levies are the reason why more entrants are not looking at this industry with a keen investment opportunity. Moreover, local and smaller entrepreneurs are shying away due to high investment and low Rate of Interest. We need to look at this in a rational way with an attitude to give boost to an industry capable of singularly taking tourism to new heights and earning formidable revenues in foreign exchange,” says Mr. Bharat Malkani, President, HRAWI

At present, there are around 112 clearances (70 project and 42 operational) required from various ministries/ departments from the GoM to set up a hotel. Recognizing that multiplicity and the delay in obtaining clearances from various ministries/ departments/ agencies is hampering the growth of the hospitality sector, it has recommended streamlining the current outdated systems and launch a transparent online “Single Window Monitoring Mechanism” for expeditious implementation of hotel & restaurant projects.

An online single window clearance shopping cart will increase room inventory for the State and reduce room tariffs besides reducing waste of time and increase efficiency. A foreigner staying one extra night will increase forex revenue to Maharashtra Government at INR 599 crores per night.

“With the implementation of the proposal, MTDC will become the nodal agency to which restaurants and hotels will apply for new licenses and renewals. It will act as a single window that will in turn fetch all licenses from the relevant departments on the Board and have the investors pick them up from the same window. It will also ensure that the permits are granted within a set time frame. The presentations made by Accenture include topics as curbing the number of licenses, permits, NOCs and registrations from 112 to 20 for opening new establishment as well as renewing existing licenses, appraisals for special tourist zones that would remain open round the clock and abolishment of archaic drinking permit rules among other. If sanctioned and implemented at the earliest, the proposal holds capacity to boost tourism and bring India on the International map as one of the most preferred tourist destinations,” says Mr. Kamlesh Barot, past President, HRAWI.

Hotel & Restaurant Association of Western India (HRAWI) is the apex body of Hotels and Restaurants in Western India. One of the strongest four pillars of Federation of Hotel and Restaurant Associations of India (FHRAI), since 2010 it is a nominee in the core committee of Maharashtra Tourism Development Corporation (MTDC).

About Hotel & Restaurant Association Western India (HRAWI)

The Hotel and Restaurant Association (Western India) is a 65 years old Association of Hotels and Restaurants, representing majority of Hotels and Restaurants across Western India, which covers Maharashtra, Gujarat, Madhya Pradesh, Chhattisgarh, Goa and the Union Territories of Daman, Diu & Silvassa and is more or less considered to be the voice of the Hotel Industry / Fraternity. The four Regional Associations form a part of the “Federation of Hotel & Restaurant Associations of India” (FHRAI) at the center in New Delhi, which is our parent body. The Association is part of the national body of the “Federation of Hotel & Restaurant Associations of India”, which was originally founded in Mumbai in 1950, by the late Mr. J.R. D. Tata.

Editor’s Note: Federation of Hotel and Restaurant Associations of India (FHRAI) was instrumental in initiating a first-ever move that was advised by the Committee of All India Secretaries, that got approved by the Union Cabinet of Ministers also, to set up the Hospitality Development & Promotion Board (HDPB) under Ministry of Tourism in 2011. Secretary (Tourism), Government of India is the Chairman of the Board with ADG as the convener and members include Secretaries of UD, Environment, Culture, Civil Aviation, Finance, Home, BMC, Delhi Development Authority and two non-official members being the FHRAI etc. The Chief Secretary of the State Government would be Chairman of the HDP Board at the State level. The Board was to be setup by each of the States, which has formally setup by Manipur, Mizoram and Maharashtra. The main functions of the Board would be to ensure timely accrual of approval / clearance/NOC by the multiple agencies and facilitate the implementation of hotel projects. It also monitors and facilitates the clearance of hotel projects in a time bound manner apart from reviewing hotel project policies to encourage the growth of hotel/hospitality infrastructure in the country.