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Red Tape May Eat Away at 24x 7 Restaurant Plan


New Delhi: Stopping at your favourite restaurant to grab a bite in the wee hours may still not be possible unless multiple and contradicting state-level laws are changed, operators said, citing the fine print in a bill approved by the Cabinet allowing shops and eateries to open all day and night. While officials at fine dining outlets, bars and quick service chains said the move would bring in a much-needed boost to a sector that has been reeling with single-digit growth due to lower consumer spending and multiple layers of taxation, they conceded that the multiplicity of local restrictions could cut short plans to operate 24x 7.

“The ultimate decision to adopt or modify the law lies with the respective states and each one has a different policy or act,” said Rahul Singh, chief executive of Beer Café, which operates 35 stores across 10 cities. “A lot needs to be done to ensure this turns into a reality and that may be a challenge. A restaurant serving liquor, or even other-wise, needs multiple licenses to The Centre’s operate.”

The Model Shops and Establishments (Regulation of Employment and Conditions of Service) Bill, which the Cabinet approved on Wednesday, provides for freedom to operate 365 days in a year and flexible opening and closing times. The bill will now be sent to the states and Union Territories so that they can adopt the draft as it is or modify its provisions as per their requirements.

The problem is that every state has its own laws and every law has its own politics,” said Zorawar Kalra, promoter of Masala Library and Farzi Cafe. The decision will “benefit multiple stake-holders including consumers, restaurant companies and the government, besides immediate access to extra jobs. We do hope things work out,” he said.

All restaurants need an ‘eating house licence’ given by local police licensing departments covered under registration regulations, which clearly state that restaurants can’t be kept open between 1 am and 5 am. This will have to be changed.

Each state has an excise and taxation department that covers restaurants with a licence to serve liquor. However, the excise rules specify that liquor can’t be served between 1 am and 11 am. There’s also a health trade licence that will have to be issued by the local municipal authority to operate 24 hours a day.

Gaurav Goenka, managing director of Mumbai-based diversi-fied hospitality and real estate entity Mirah Group, which owns United Sports Bar and Grill, Cafe Mangii, Falafel and Khandani Rajdhani, said: “There is a fine print which has to be examined. State authorities will have to work in tandem to make this work and that could be the challenge.

There will be teething troubles. though in the long run we expect that things will be smooth.” Consumer demand in the restaurant sector has eased over the past five-six quarters and approval for easing restrictions on shops and eateries is expected to fuel consumption significantly. Shopping malls are expected to benefit if shops stay open 24*7 since revenue from rentals as well as common area maintenance charges will escalate.

Source: Economic Times

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