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Legal Requirements to run Paying Guest Accommodation in India

One of the most important parts of setting up, however, is the legal permits that are required before the hostel may be set up. Hostels require various types of permits as may be prescribed by the local law, and require registration. These include a number of permits, including

  1. a trade license for carrying on the business of the hostel,
  2. a No-objection certificate from the local municipal corporation, the municipality, or the local panchayat, as the appropriate body may be.
  3. The local police station must also be informed of the hostel being brought up, and its location as well.

A trade license has become important in various parts of the country for the reason that in many places, they are thought to be a commercial establishment. The Bruhat Bangalore Mahanagara Palike (BBMP), through a resolution in 2013, made registration, and a trade license compulsory in order to operate a hostel.[2] Similar rules apply to most other areas.

Further, in order for the hostel to come up, the nearest self-governing body such as the municipal corporation, municipality or panchayat must be informed. Interested applicant may apply to the relevant corporation, and after due examination of all papers and the premises, a No-objection certificate may be provided.

The police station also requires a formal notice to be sent to it, detailing the location, name and other details of the proposed hostel, before it may legally be open. These are required as in many places; the police station is required to provide a station-specific list of hostels, prompted by a huge increase in the number of hostels that have recently opened in places of tourist interest.

Further, another requirement is that hostels be registered under the Sarai Act,1867. Any hostel not registered under the Sarai Act are liable to be closed down upon opening for business. All hostel owners are required to file the trade licenses that they have received from the concerned public body as proof of their work, along with some other permits and requirements registered below, and they will be registered accordingly.

Further, there are a number of miscellaneous permits that must be obtained. All hostels must have obtained a fire safety clearance, that may be obtained from the local fire department, clearance for the emergency services department, and a No-Objection certificate from the Pollution Control Board  and for the electricity supply, they must also have received clearance from the electricity board. These may be obtained via application to either the fire department, emergency services department, the or the electricity board or corporation that is nearest to the hostel in question. In many cases, an affidavit requiring the hostel owner to state that they have taken adequate measure for water, sanitation, lighting and security are also required. Upon production of these details, a hostel owner will be registered under the Sarai Act,1867, thereby making the hostel’s establishment a legal establishment under the Act.

[1] http://www.hostelsclub.com/en/magazine/change-life-opening-a-hostel-in-india

[2] http://www.thehindu.com/news/cities/bangalore/trade-licence-a-must-for-pg-hostels/article5405758.ece


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