In this article, Jagriti Bharti of Amity Law School, Lucknow discusses the kinds of Raids a Restaurant or Eatery can expect.

With the globalisation of the whole country, India’s food trade system has also been globalised. It has initiated a transnational system for food production. India is passing through a strategic development phase when it comes to food and beverages. Indian food industry not only with its own home brands but also with the foreign brands is being taken to great heights of development. Indian food and beverage market are growing steadily having a fairly sophisticated market with enough restaurants in big cities of India like Delhi, Mumbai, Bengaluru, Chennai etc. Food franchise like KFC, Pizza Hut, McDonald’s, Starbucks Coffee, Dunkin’ Donuts, Domino’s Pizza, Subway, Costa Coffee, Burger King is among some of the famous foreign food franchise who has tightened their position in Indian food industry through their outlets in various cities of the country.

Active and fast pace lifestyle of the people has given a path to the development of the restaurant and eateries across the country. Thought they fulfil the purpose of serving hungry Indians who are willing to pay them their price, there are lots of eateries and restaurants who are not up to the mark in sanitation, hygiene and food quality. Their compromise in quality and hygiene can have a disastrous effect on the health of the consumers of their food. Several laws are made for these restaurants and eateries for maintenance of hygiene level and food quality but least of them is followed leading the government to take a step forward towards securing the safety of the public. And this step is the “surprise checks” (also known as “raids”) and audits of the hotels, restaurants, eateries to check their level of hygiene and food quality and ensure their public health.

“Week long raids in the Secunderabad Cantonment has exposed the unpalatable underbelly of the restaurant industry operating in the city. The exercise has now prompted a sea change in the Cantonment hotels management policy. The sanitation wing of the Cantonment board seized 6 installations including a sweetshop and a bakery. Officials found that all the kitchens had employees living in them and the kitchen repleted with the toilet. The surprise check was conducted after receiving complaints and will be continued until the food outlets will comply with hygiene norms^[1].”

Above stated incident was just an example of a “raid.” There are much more which have been either conducted or yet to be conducted wherever the restaurant staff and administration lay back from their duty. The safety and quality of the food served in the restaurants and eateries are governed under FSSAI (The Food Safety and Standards Authority of India) Act. It operates under the Health ministry and is required to regulate and monitor the manufacture, processing, distribution, sale, and import of food as to ensure the safety of food. The FSSAI has become really active after the “Maggi issue”. They are conducting a lot of surprise audits and raids frequently in various hotels and restaurants to keep the restaurants and food businesses of their toes and deliver what is expected “quality”.

The provisions of FSSAI Act under which raids can be conducted of restaurants and eateries are:

1. Running Food Business Without License and Registration

As per Section 31 of the Food Safety and Standards Act, 2006, no person can commence or carry food business without a license. Whosoever carries food business without obtaining required licence will be liable to imprisonment for a term which may extend to 6 months and also a fine which may extend to five lakh rupees (Section 63).

Running food business (including restaurants and eateries) without a proper licence is illegal and this may attract raids from the food authority in order to find out whether the specific food business is legal or illegal. Restaurants will be required to show licence of their business whose inability to produce will attract the said punishment. [Getting FSSAI license for the restaurants].

NOTE: For a restaurant to sell liquor on its premises, it needs to get licensed from the State Excise Commissioner without which selling liquor is illegal. That restaurant can be raided and can even order for its closure.

2. Selling food, not of nature, substance or quality demanded

Raid can be conducted in any restaurant or eatery if they sell food to the purchaser which is,

• Not in compliance with the provision of the FSSAI Act or,
• Regulations made under this Act or,
• Nature or substance or quality demanded by the purchaser’

And the concerned person will be liable to a penalty not exceeding five lakh rupees^[2]. Noncompliance of this Section by any person who, if, covered under Section 31 (2) will be liable to a penalty not exceeding 25,000 rupees.

Case: This case is of Delhi’s eateries serving low-quality food. It was informed to the Delhi High Court by the FSSAI that various food samples collected from three different popular eateries in the capital have been found unsafe for consumption. They were:

• KFC at Scindia House in Connaught Place: Sample collected was ‘Rizo Rice’ which contained artificial colour.
• Sagar Ratna restaurant in Guru Teg Bahadur Nagar: Rice sample collected for testing was found to be unsafe.
• Bikanerwala restaurant at ITL Tower in Netaji Subhash Place: Samples of fruit and vegetable chutney was found to be contaminated with artificial colours.

3. Selling food that contains external or inappropriate matter

Section 54 of the FSSAI Act states that any person who sells, stores, distributes or imports food which contains inappropriate or extraneous matter shall be liable to a penalty which may extend to one lakh rupees. Raids can be conducted by the concerned authority if complaint registered against any eateries or restaurant regarding this matter.

Case: There was a case of Mother Diary in which media agencies reported that he detergent and frozen fat was found by the Kolkata based Central Laboratory during re-tests of milk samples collected by the district Food and Drug Administration.

4. Keeping the kitchen dirty and unhygienic

Any restaurant owner who keeps the manufacturing area of food or process any article of food in an unhygienic or unsanitary condition will be liable to a penalty which may extend to one lakh rupees (Section 56) and this noncompliance of the owner can also raids to be conducted.

Case: The authorities warned Central Province Club of Nagpur of cancellation of their food licence due to faults like an extremely unhygienic kitchen, no pest control, unclean water tank etc. found during an inspection by the Food safety officer and which was not permissible under the FSSAI Act. [FSSAI guidelines to be followed by all the restaurants].

5. Accidents including consumer’s injury or death

According to Section 59, if any restaurant owner found guilty of selling any food item which caused either death or injury to the consumer then he will be liable a penalty of rupees five lakh in case of death and rupees 3 lakh in case of injury occurred to the consumer. If this has happened in any restaurant then the owner of the concerned restaurant may face the wrath of the food safety officials during raids.

There are also some other laws under which raids can be conducted in the restaurant and eateries

1. Income Tax Act, 1961

Section 14 of the Income Tax Act provides 5 heads of income i.e. Salaries, income from house property, profits and gains of business and profession, capital gains and income from other sources. If a person’s income falls in any of these heads, he will be liable to pay income tax as per the provisions of this Act. Owning and operating a restaurant, hotel, eatery or other food business is a kind of business and hence the restaurant owner has to pay the income tax on the income he has earned in the previous year from his business under the head “Profits and gains from business and profession” evading which will make him liable to face penal consequences.

Despite the laws made under the Act, people tend to evade payment of tax by not disclosing their income and assets. But the government had a smart solution to this. It launched “Income Declaration Scheme” in 2016 in order to combat the problem of tax evasion. Under this scheme every person has to declare their income and wealth to the government till 30 September 2016 failing which he will face search and seizures from the Income Tax officials.

Case: The Income Tax department has left no stone unturned in a bid to make “IDS” a success. It conducted around 100 raids in eateries in Ahmedabad, New Delhi and Kolkata. In Mumbai alone, around 50 restaurants and eateries were raided and were asked to declare their income under Income Declaration Scheme. Small businesses and roadside eateries also had to face raids from the IT officers.^[3]

2. Prevention of Food Adulteration Act, 1954

Under Section 7 of the Act, no restaurant can sell food which is,

• Adulterated^[4]
• Misbranded
• In noncompliance of the conditions mentioned in the license for selling that food
• For the time being prohibited by the Food (Health) Authority in the interest of public health.
• In contravention of the Act or the rules made under this.

Violation of Section 7 may lead the restaurant owner to face search and seizure conducted by the Food inspector under Section 10 of the Act. A food inspector may enter the places of manufacture and storage of food items of a restaurant or eatery under question and conduct raid. He may collect food samples and send it to food analyst for analysis.

CONCLUSION

Owning a business like a restaurant or an eatery needs a bundle of licences from different Acts of State as well as Central and has to abide by the provisions and rules mentioned therein, violation or noncompliance of which can really trouble their business through penalties and raids conducted by the food authorities who can even pass an order of its closure. So, before starting a food business, one needs to be very alert and careful about the laws related to it.

^[1]http://www.thehindu.com/news/cities/Hyderabad/Unpalatable-underbelly-of-restaurant-industry/article16084834.ece [19 July, 2017 at 12:15 PM]

^[2] Section 50 of FSSAI Act, 2006

^[3]http://economictimes.indiatimes.com/news/economy/policy/income-tax-department-raids-roadside-eateries-small-businesses-to-make-declaration-scheme-a-success/articleshow/54454245.cms [19 July, 05:25 PM]

^[4] Section 2 (ia) of Prevention of Food Adulteration Act, 1954