Bed and Breakfast facility registered with MTDC requires BMC licence: Bombay High Court

The Bombay High Court on Tuesday held that mere registration of a Bed and Breakfast lodging facility with Maharashtra Tourism Development Corporation (MTDC) does not exempt the owner from obtaining a license from the Brihanmumbai Municipal Corporation (BMC) [Harmesh Singh Chadha @ Jimmy vs Municipal Corporation of Greater Mumbai and Ors.]..Justice Bharati Dangre said that under Section 394 of the Mumbai Municipal Corporation (MMC) Act, certain activities including 'lodging' are restricted unless a license for the same is granted by the Commissioner."Section 394 of the MMC Act impose a restriction upon certain activities to be carried out within its limits of the Corporation except on the licence granted by the Commissioner and this include carrying of any trade upon any premises which is specified in part IV of Schedule M or any process or operation connected with any such trade and Part IV of Schedule ‘M’ cover an activity of ‘lodging’," the Court held.It, therefore, concluded that registration being granted by the MTDC to run a bed and breakfast facility does not amount to grant of license."No doubt, Bread and Breakfast establishment has been granted registration under the MTDC, but it is no licence by the MTDC to carry on such an activity," she declared.Even while a Bed and Breakfast service in only certain rooms of a residential house is not a totally commercial endeavour, the establishment must nevertheless seek a licence to operate, the Court underscored..By way of backgroud, Harmesh Chadha, a resident of Juhu in Mumbai had let out some rooms of his residential property as bed and breakfast lodging facilities under an MTDC scheme. In January 2022, BMC officers conducted an inspection and Chadha was issued a warning to discontinue the trade and was also issued a seizure action notice under Section 394 of the MMC Act..Chadha challenged this seizure order in court. He claimed that the BMC had no locus as the MTDC had approved the establishment, and that it was not a "trade establishment," but rather a "homestay" to promote tourism. He drew the Court's attention to the fact that he and his family lived in the same home, and that only the ground floor rooms were let out. According to Chadha, the BMC acted on a malafide complaint filed by a local resident. He prayed that the BMC inspection report and seizure action be held bad in law.The BMC justified its notice to terminate the bed and breakfast by claiming that Section 394 of the Act required a civic licence for such operation..The Court, after scrutiny of the rules and regulations of the MTDC, held that Bed and Breakfast facilities established under the MTDC scheme are in fact covered under Section 394 of MMC."Such an establishment will necessarily have to obtain the fire safety permit as well as the permission from the FSSAI, since food is being offered to the tourist at such an establishment. Prima facie, the licence which is required to be obtained u/s.394 in order to operate a trading or activity upon the premises cannot be said to be exempted, merely on registration of the facility with MTDC," the Court said.It, therefore, upheld BMC's seizure order and dismissed Chadha's petition.[Read Judgment]