tour operators rules and regulations in india

• Law Firm Marketing: A Complete Guide
• Features and benefits of the best CLAT coaching institute in Jaipur
• Why Hire a Lawyer After a Car Accident?
• 5 Business Laws Every Startup Entrepreneur Should Know
• How Much Do Insolvency Practitioners Charge?

SOCIAL LAWS TODAY is the Largest Legal Blog integrating tremendous knowledge and information amongst the entire legal fraternity and revolutionising Legal Services.

• Community Guidelines
• Country Ambassadors
• Editorial Advisory Board
• Privacy Policy
• Publish Article/Guest Post
• Terms and Conditions
• Advertise with us

Laws Regulating Travel & Tourism Services

• by Social Laws Today
• March 3, 2023
• 8 minutes read

Ankita Lode , a 3rd-year Law Student at Yeshwant Law College, Wardha has written this Article “Laws regulating Travel and Tourism Services in India”

Table of Contents

Introduction

India is a country that boasts a diverse range of cultural heritage and tourist attractions. Tourism is a crucial contributor to the Indian economy, and to ensure the safety and comfort of tourists, the Indian government has implemented various laws and regulations for the travel and tour services sector.

The Ministry of Tourism, Government of India, oversees the development and regulation of tourism in the country and has put in place regulations to ensure tourists have a smooth and enjoyable experience during their visit.

The Travel Agents Association of India (TAAI) is the primary organization representing travel agents in India, and it also collaborates closely with the Ministry of Tourism to promote tourism and safeguard the interests of tourists.

This article will discuss the laws and regulations governing travel and tour services in India.

Who provides travel and tour services?

Travel and tour services can be provided by a variety of entities, including:

• Travel Agencies: Private retailers or government services that sell travel and tourism-related services on behalf of lodging or travel suppliers.
• Tour Operators: Companies that specialize in offering packaged tours, which may include transportation, accommodations, and activities.
• Airlines: Airlines provide air travel services to various destinations worldwide.
• Hotels and Resorts: Accommodations services are provided by hotels and resorts that offer a range of amenities, from budget to luxury.
• Car Rental Companies: Companies that offer rental services for cars, trucks, and other vehicles.
• Cruise Lines: Companies that offer cruise ship services that travel to various destinations worldwide.
• Public Transportation Companies: Companies that offer services like buses, trains, and subways for local or regional travel.
• Travel Insurance Providers: Companies that offer various types of insurance to protect travellers from unexpected events like trip cancellations or medical emergencies.
• Destination Management Companies (DMCs): Companies that offer destination-specific services, such as local tours, guides, and activities.
• Online Travel Agencies (OTAs): Websites that offer a range of travel services, including flights, hotels, rental cars, and vacation packages.

Who governs these travel agencies?

Although there is no central legislation governing tourism services, the primary law that governs the travel and tourism industry in India is the Tourism Act, of 2002. This law was enacted to promote tourism in the country and to regulate and maintain the standard of services provided by the industry.

The Act establishes the Ministry of Tourism and provides for the constitution of the Tourism Advisory Board, which advises the government on matters related to the promotion and development of tourism.

In addition to the Tourism Act, there are several other laws and regulations that govern travel and tour services in India, including the Indian Contract Act, of 1872, which governs contracts between customers and travel service providers; the Consumer Protection Act, of 1986, which provides protection to consumers against unfair trade practices; and the Foreign Exchange Management Act, 1999, which regulates foreign exchange transactions related to travel and tourism.

Furthermore, the government of India has introduced various policies and schemes to promote tourism in the country, including the Swadesh Darshan scheme, which aims to develop and promote tourist circuits in the country, and the e-Visa scheme, which simplifies the visa application process for foreign tourists. Let’s take a look at some of the laws that regulate travel and tour services in India.

Currently, How travel and tourism services in India are regulated ?- Laws

• The Ministry of Tourism
• Indian Tourism Development Corporation (ITDC) Act, 1968
• Tourist Traffic (Regulation and Control) Act, 1978
• Air Transport Corporation Act, 1953
• The Consumer Protection Act

1.      The Ministry of Tourism

The Ministry of Tourism, Government of India, is responsible for the development and regulation of tourism in the country. The ministry formulates policies and programs for the promotion of tourism, and it also lays down guidelines and standards for the provision of tourist services. The ministry works in close coordination with various other government bodies and tourism-related organizations, such as the Travel Agents Association of India (TAAI) and the Indian Association of Tour Operators (IATO), to ensure the safety and comfort of tourists.

The National Tourism Policy, which was developed in 2002 for the growth and promotion of the tourism industry, also includes fundamental guidelines for preserving the interests of travellers and travel organizations. These principles include government-led, private-sector, and community welfare-focused initiatives (ii) sustainability, and (iii) designating a portion of the State Police to serve as the Tourist Police. As a result, the Ministry of Tourism has taken the following actions to protect the interests of travellers and travel businesses:

• The adoption of a code of behaviour for honourable and safe travel.
• The State Governments received funding from the central government to establish Tourism Facilitation and Security Organizations (TFSO) on a trial basis.
• In September 2014, guidelines on tourist safety and security were released for state governments and union territories, along with travel advice.
• The creation of a voluntary system for approving hotel projects and categorizing operational hotels under the Star System in light of their appropriateness for visitors from abroad.
• Development of an optional system for accrediting travel agencies, tour operators, and adventurers.

The ministry has also put in place various laws, regulations, and guidelines, including the Tourism Policy, of 2015, and the National Tourism Policy, of 2020, to promote tourism and safeguard the interests of tourists.

2.      Indian Tourism Development Corporation (ITDC) Act, 1968

The Indian Tourism Development Corporation (ITDC) Act, 1968, established the Indian Tourism Development Corporation (ITDC), which is a public sector undertaking responsible for promoting tourism in the country and for also providing tourist facilities and services.

The act provides for the constitution of a board of directors for the ITDC, which is responsible for the management of its affairs. The board is headed by a chairman appointed by the central government, and it includes representatives from various sectors, including tourism, finance, and also administration. The ITDC has several subsidiaries that provide a wide range of services to tourists, including hotel and restaurant services, transport services, and travel services. The ITDC also operates several hotels and resorts in various parts of the country.

The act empowers the ITDC to undertake various activities for the promotion of tourism in India, including the development of tourist infrastructure, the provision of tourist services, and also the conduct of research and surveys related to tourism.

3.      Tourist Traffic (Regulation and Control) Act, 1978

The Tourist Traffic (Regulation and Control) Act, of 1978, regulates the entry and exit of tourists into and out of India. Moreover, the Act provides for the registration of tour operators and travel agents and lays down the conditions for their registration.

Under the act, tour operators and travel agents are required to maintain records of their activities and submit regular reports to the central government. The act also empowers the central government to revoke the registration of any tour operator or travel agent who violates the provisions of the act.

The act provides for the establishment of a Tourist Police Organization, which is responsible for ensuring the safety and security of tourists in India. The Tourist Police Organization is also responsible for the enforcement of the provisions of the act.

The act also lays down the conditions for the entry and exit of tourists into and out of India. Tourists are required to obtain the necessary visas and travel documents before entering India, and they must comply with the conditions of their visas.

4.      Air Transport Corporation Act, 1953

The Air Transport Corporation Act, of 1953, established the Air India Corporation as a public sector undertaking responsible for providing air transport services in India and abroad. The act provides for the appointment of a board of directors for the Air India Corporation, which is responsible for the management of its affairs. The board is headed by a chairman appointed by the central government, and it also includes representatives from various sectors, including aviation, finance, and administration.

The Air India Corporation operates several domestic and international flights and provides a wide range of services to air passengers, including airport facilities, in-flight services, and baggage handling services.

The act empowers the central government to regulate air transport services and to make rules and regulations for the safe and efficient operation of air transport services.

5.  The Consumer Protection Act

In addition to the aforementioned, under the provisions of the Consumer Protection Act, a customer can file a complaint against any faulty goods or faulty services, including tourism services, in any Consumer Court, based on geographical and financial jurisdiction.

In conclusion, India has put in place various laws and regulations to govern the travel and tour services sector to ensure the safety and convenience of tourists. These laws include the Indian Tourism Development Corporation (ITDC) Act, the Tourist Traffic (Regulation and Control) Act, the Air Transport Corporation Act, and the Motor Vehicles Act.

These laws empower government bodies and various tourism-related organizations to provide a wide range of services to tourists, including hotel and restaurant services, transport services, and also travel services.

Moreover, the Ministry of Tourism works in close coordination with these organizations to promote tourism in the country and lay down guidelines and standards for the provision of tourist services.

These laws are essential in providing tourists with a safe and enjoyable experience and are crucial to the continued growth and development of the tourism industry in India.

• Law for Safeguarding the Rights of Tourists (pib.gov.in)
• https://www.thehindu.com/business/tourism-to-contribute-512-bn-to-indias-gdp-by-2028-says-taai- chief/article66468359.ece

Disclaimer: This Article is part of our  Monthly article writing competition . You can also Participate

Share This Post:

Introduction to human rights & its objectives, search and seizure under income tax.

• by: Motor Vehicles(Amendment) Act 2019 - All About it -
• 10 months ago (Edit)

[…] To know about the Laws regulating Travel & Tourism Services In India: Click Here […]

Leave feedback about this Cancel Reply

• Quality 5 4 3 2 1
• Price 5 4 3 2 1
• Service 5 4 3 2 1

Related Post

Custom as a source of International law

Precedents as a source of law

Major Authorities under the Companies Act 2013

Preamble of the constitution of india: a critical analysis.

APPOINTMENT OF JUDGES TO HIGH COURTS AND SUPREME COURT:

Article 324 to 329A: Elections under Constitution

Laws Regulating Travel and Tour Services in India

The main laws and rules governing travel and tour services in india will be discussed in this article., the 2002 tourism act, the 2016 rules for air transport (licensing of air travel agents), the 1989 indian railways act, the 1988 motor vehicles act, the 2019 consumer protection act,, the foreign exchange management act of 1999, the 2017 gst (goods and services tax) act, law article in india, please drop your comments, you may like.

Relationship Between Banker...

Addressing the Impact of Do...

Legality of Judge Shopping ...

Take Cognizance Of Offence

The Role of Trauma-Informed...

Quo Warranto and Public Acc...

Legal question & answers, lawyers in india - search by city.

Law Articles

How to file for mutual divorce in delhi.

How To File For Mutual Divorce In Delhi Mutual Consent Divorce is the Simplest Way to Obtain a D...

Increased Age For Girls Marriage

It is hoped that the Prohibition of Child Marriage (Amendment) Bill, 2021, which intends to inc...

Facade of Social Media

One may very easily get absorbed in the lives of others as one scrolls through a Facebook news ...

Section 482 CrPc - Quashing Of FIR: Guid...

The Inherent power under Section 482 in The Code Of Criminal Procedure, 1973 (37th Chapter of t...

The Uniform Civil Code (UCC) in India: A...

The Uniform Civil Code (UCC) is a concept that proposes the unification of personal laws across...

Role Of Artificial Intelligence In Legal...

Artificial intelligence (AI) is revolutionizing various sectors of the economy, and the legal i...

File caveat In Supreme Court Instantly

Laws regulating: Travel and Tour Services in India

This article on ‘ Laws regulating Travel and Tour Services in India ‘ was written by Pramod Sanap, an intern at Legal Upanishad.

Introduction

In this article, we will be discussing the laws which regulate travel and tour services in India. As we now understand it, the tourism business has a variety of sectors, destinations, visitors, and challenges. Visitors from all over the world flock to India to see its numerous beauties which are recognized as their tourist destinations. The good news is that applying for a tourist visa is rather straightforward. The unending list of legal criteria to satisfy is the bad news. The confusing nature of the Indian court system doesn’t help either.

Although tourism is not explicitly listed anywhere in India, it is included in the Union, Concurrent, and State lists. The union list includes topics like immigration regulations, aviation, historic sites and monuments, shipping, and highways; the concurrent list includes topics like wild animal and bird protection, forests, and so forth; and the state list includes topics like a domestic pilgrimage, theatres, and so forth. Many pieces of legislation have surfaced in relation to these challenges over time.

Laws Regulating the Travel and Tour Industry

The root of many tourism-related problems is the lack of any established norms controlling trade. Everyone would be able to determine if the services offered are acceptable after service quality standards have been set and are continuously modified in response to market needs.

What is Agency?

Perhaps no industry uses the term “agency” more than the tourism sector. However, the phrase is frequently misused and used to depict connections that the law would not actually regard to be those of an agency.

An agent is an individual who has been given permission to act on behalf of another person (the “principal”) in a way that has the potential to influence how the principal and a third party interact. In the travel business, the term “travel agent,” whether used online or in person, is very loosely defined and frequently used to refer to arrangements that go beyond the definition of an “agency.”

Is it necessary to register yourself as Travel Agent?

Although not required, registering as a travel agency recognized by the Government of India is beneficial and gives the travel agency recognition. The system for the recognition of travel agencies (TAs) aims to improve the level of service and quality in the travel and tourist sector. A travel agent must meet a few standards, including those relating to money invested, the number of personnel employed, the maintenance of minimum office space, and other conditions, in order to be recognized by the Government of India.

Furthermore, in order to become a Travel Agent recognized by the Government of India, an application must be submitted to the Ministry of Tourism in the manner specified.

In India, there are many laws that are either directly or indirectly related to tourism. Here are a few examples:

The Indian Forest Act, the Wildlife Protection Act, the Forest Conservation Act, the Air Prevention and Control of Pollution Act, the Environment Act, the National Environment Tribunal Act, the Coastal Zone Regulations, and other environmental laws are examples of those that are related to the environment.

For lodging, see The Sarais Act, the Department of Tourism’s regulations for classifying hotels, etc. For monuments, see The Ancient Monuments Act, the Archaeological Survey of India’s regulations, the Ministry of Culture’s guidelines, etc. The Indian Penal Code, the Consumer Protection Act, the Prevention of Food Adulteration Act, and other laws protect tourists’ health and safety.

Similarly, to this, there are several laws, rules, and regulations that govern the transportation sector. These rules and laws, though, differ between states. State-by-state variations include the taxation of tourist coaches, their permission charge, etc.

Ethical Practices:

The travel business has become increasingly specialized, and the typical traveler relies on a knowledgeable travel agent to provide sensible advice. The principals who designate travel companies to serve them rely on these approved agents to uphold the highest standards of ethical behaviour and salesmanship. Travel agents must follow procedural fairness and ethical principles due to the rising number of them and the scope of their services. TAAI has also been acknowledged as the voice of the Indian travel and tourism sector and stands for everything that is dynamic, professional, and ethical in our country’s travel-related activities.

It is also important to note that the travel agency cannot use unfair and unjust practices against the consumer even though there is a lack of regulation regarding the tour and travel industry still the consumer law would protect the consumer against such unfair and unjust practices of the travel agency.

The requirements must be met: the agency’s capital must be at a minimum of Rs. 3.00 lakh. Along with audited banking statements, a declaration from the Chartered Accountant outlining the agency’s capital investment is needed.

The organization must be authorized by the International Air Transport Association (IATA) or be a General or Passenger Sales agent for a carrier that has been so authorized. The organization was required for it to have been in existence for a minimum of a year prior to applying. The company’s office must be organized, maintained, and tidy in India. The workplace should be at least 100 square feet in regions greater than 1000 meters above sea level.

As we now understand it, the tourism business has a variety of sectors, destinations, visitors, and challenges. Visitors from all over the world flock to India to see its numerous beauties which are recognized as tourist destinations. There is a lack of regulation regarding the tour and travel industry in India despite this many other laws such as Consumer protection and others in a sense try to regulate the industry.

The government of India does provide for the registration of travel agents but it is not necessary even though when one registers for this there is a need for such a person to maintain certain standards related to the industry.

References:

• Code of Ethics; available at: https://www.travelagentsofindia.com/code-ethics.php , (last visited on 14 February 2023).
• What is the law of travel agency and what do you need to know?; available at: https://www.lexology.com/library/detail.aspx?g=4ba97b84-e349-40b7-b413-d714b778b75d , (last visited on 14 February 2023).
• How To Become A Licensed Travel Agent In India?; available at: https://vakilsearch.com/blog/licensed-travel-agent-in-india/ , (last visited on 14 February 2023).

Join Our Community

• Salamat Raho: HumanKind
• Volunteer Programs

Top Stories

• Discover Home Sweet Home: Unveiling the 13 Best Places to Live in Illinois for 2024
• 06 Best Places to Live in Rancho Cucamonga, CA
• Countries Where You Can Pay Via UPI

Stay Connected

Everything you need to know about india’s travel and tourism laws, introduction  .

India is a storied, age-old country with a vibrant past, history, and traditions. It is not surprising that there are more visitors coming to India every day because the country’s aesthetic worth and scenic beauty have become a significant part of its identity.

Often, blissfully pleasant travel is accompanied with a lack of familiarity with local laws. On the other hand, the Indian judicial system is cumbersome and ineffective. It’s not worthwhile to interfere with what was supposed to be a leisurely and delightful journey. 

More on Travel Laws

https://nomadlawyer.org/category/travel-laws/

Travel and Tourism 

The travel and tourist industry includes a broad range of business activities, including travel, lodging, entertainment, food service, and retail sales. This well-established sector of the American economy contributes 2.9% of the nation’s GDP and directly employs 5.7 million people. Even though employment and real output in the travel and tourism sector have increased recently, they have not fully recovered from the recession of 2007–2009. In light of this, Congress will think about renewing or extending the Travel Promotion Act of 2009, which started a national advertising and marketing campaign to entice foreign visitors to visit the US. The international travel and tourism sector expanded to become a substantial source of income for many nations in the years following World War II. The WTTC estimates that more than 100 million jobs were directly supported by international travel and tourism in 2012, and that number is projected to increase to 125 million by 2023. There is a fierce international competition for tourism. The main tourist destinations in the globe in 1980 were Europe and North America, which accounted for more than 80% of the global market.

Numerous studies on the specific subject of tourist activities have been conducted over the past few decades, with a focus on the internal dynamics of tourism. Though it is still in its early stages, legal scientific research is being done on the nature of tourism control. The daily operations of their business as well as the legal aspects of hospitality and tourism management as a whole must be understood by managers of companies in the hospitality and tourism industries.

The Need of Tourism Laws

The main objective of tourism law, which is supported by the United Nations World Tourism Organization, is to establish a legal framework for the proper use, development, and management of tourist activities (UNWTO). Basically, the legislation’s presence will contribute to the protection of natural resources as well as the preservation of cultural traditions, among other social, political, and economic advantages. In addition, passengers and other parties involved may gain from fundamental legal protection through open procedures. Popular nations in the industry are currently fighting to monitor and put into place realistic laws to preserve tourism activities and secure benefits obtained from them. Tourism law is a distinct area of law that combines fundamental legal principles with regulations specific to the tourism and hospitality sectors.

According to American legal policy, the purpose of travel laws is to offer a framework for the proper development and management of tourist activities. State, federal, and international laws are blended together to create the tourist laws that control various aspects and activities of the industry. For instance, travel legislation may cover anything from employment to community health standards for the hospitality industry. The main objective of tourism legislation is to provide a fair and equitable environment for tourists and travel agencies. For instance, when it comes to the goods and services offered, as well as situations where regulations are in place to ensure restaurants serve safe food and have safe premises, tourist legislation is put into action.

The Travel Law 

While international law of travel refers to the rules, procedures, agreements, and treaties that regulate international travel, the law of travel or travel law refers to the regulations that govern both corporate and individual behavior in the travel sector. Since it may be necessary to file a claim in a foreign country, travel law is a rather specialized area of law that may be particularly fascinating. It deals with a variety of issues, including international accident lawsuits, contractual recovery procedures against foreign suppliers, package travel rules, and compliance with international and national legislation. The goal, according to the online Lawrina.com website, is to advance legal doctrines including public law, tort law, trust law, employment law, and contract law while also directing international travel law. International travel law offers a complete set of regulations for the travel sector by including contract law, employment law, tourist and hospitality standards, antitrust limits, regulatory and agency compliance, and understanding of specific international accords and treaties.

Tourism Laws in India 

Fortunately, whether you are a foreign visitor or just passing through, Indian law is clear on the bulk of tourist rules. They are all the same, including:

In India, women have the option to decline being driven to the police station by a male officer. According to the Code of Criminal Procedure, they might also refuse to go to the police station between the hours of 6 and 6 o’clock (CrPC). It is not necessary to personally visit the police station in order to make a complaint. She may easily submit a complaint by mail or e-mail after finding the address of the neighborhood police station online. Women can also email the National Commission of Women at [email protected] with their complaints.

The Indian Penal Code (IPC) offers a lot of room for interpretation when it comes to the rules regarding open displays of affection. Even holding hands in public is frowned upon in other places, where it is acceptable to embrace or make out. Examining the environment is a smart move before starting any such endeavor.

According to Section 268 of the Indian Penal Code , a “public nuisance” is any unlawful act that results in a common damage, danger, or annoyance to the public or to individuals in general. According to this definition, loud music and noises, public drunkenness, property damage, and nudity are all examples of “public nuisances.”

Despite how alluring it may appear, it is illegal to photograph or video a number of tourist attractions, temples, government areas, and the like. Put your binoculars away in crowded areas like railway stations and airports. 

Various states in India have different laws regarding the consumption of alcohol. Alcohol may not be consumed on days that have political or religious importance or in the run-up to an election.

Alcohol is not allowed in several states, like Gujarat and Bihar, during the entire year. A permission may be necessary for this. Transporting alcohol across states is usually forbidden as a result of the variations in state alcohol laws. The use of drugs is officially forbidden across the nation, and those who do so risk fines or jail terms of six months to 10 years.

Any antiques that are bought or moved between places need to be registered with the local police and come with a picture.

There are typically three rules that must be observed when foreigners visit India: The Foreigners Registration Act of 1939 and the Passport (Entry into India) Act of 1920 Moreover, the 1946 Foreigners Act.

While mastery of these actions is not necessary, some formalities must be observed:

Every foreigner must register at the Foreigner Regional Registration Office after 14 days, unless his visa stipulates otherwise (or 24 hours in the case of a tourist from Pakistan). This is possible right there in the airport. Less than 180 day stays by foreign tourists are exempt from registration.

According to Section 14 of the Registration of Foreigners Act, a foreign person must identify himself or herself, state their nationality, provide their identification papers, such as passports and ID cards, and sign a form at the hotel or guesthouse where they are staying. Within 24 hours of the aforementioned arrival, the hotel or guest home administration must contact the police.

In order to stay at a hotel, visa holders must also retain copies of Forms C and F from the Registration of Foreigners Act. These may be downloaded from the internet or obtained from the Foreigners Registration Office.

Foreign nationalists must acquire a permit from the appropriate government in order to access areas that have been classified as protected or restricted. A convincing reason for needing to visit the designated areas must be submitted with the request for such authorization, which must be filed at least eight weeks in advance.

Foreign visitors are required to keep their passports on them at all times. They must have an international driver’s license if they decide to drive while travelling, as well as a two-wheeler license and a Helmet. 

Foreign nationalists must be at a specified location, like Goa’s Nude Beach, to engage in public nudity.

For any cash, banknotes, or traveler’s checks worth more than $1,000 USD or its equivalent, the Currency Declaration Form must be completed. This currency may only be converted into Indian rupees at banks and other authorized money exchangers.

There are two check-in desks at the airport where travelers may check in. The Green Channel is open to those without dutiable articles or unaccompanied luggage, whereas the Red Channel is required for everyone else. If a passenger is found in the Green Channel with dutiable or prohibited items, he may be fined or prosecuted in addition to having the goods seized.

Visitors from nations with an active case of yellow fever must possess a Yellow Fever Vaccination Certificate that complies with international health standards before entering the nation.

Although these regulations were put in place to provide visitors a perfect experience, I think the government and the relevant authorities should do more. Because not all tourists are completely aware of their rights and obligations, there should be a tourist hotline number.

The government should discourage tourist organizations that are not recognized by the government to prevent them from defrauding naïve visitors.

Along with offering a stress-free vacation, these actions and others will also actively encourage travel to the nation.

Conclusion 

Rules and regulations are closely related to both tourism and hospitality. It contributes to ensuring a decent and equal workplace for both industry workers and tourists. Because business owners must understand it as well in order to avoid a lawsuit or penalties.

Contributed by Sanal Pillai

Edited by Imtiaz Ullah

Leave a Reply

Your email address will not be published. Required fields are marked *

Recent Posts

• 5 Years Multiple Entry Tourist Visa by Dubai
• How to Renew Passport Online in India

Sign in to your account

Username or Email Address

Remember Me

Most Searched

• Birth Certificate
• Driving Licence

Guidelines for approved inbound tour operators

Guidelines for recognition or renewal or extension as an approved Inbound Tour Operator (ITO) are given by Ministry of Tourism. Details related to fees, conditions to be filled and centres to apply for recognition, renewal and extension as inbound tour operator are given. Access downloadable application form and list of documents required for recognition or renewal or extension as an approved Inbound Tour Operator (ITO) is also available.

Related Links

Information about indian tourism development corporation.

The Indian Tourism Development Corporation ( ITDC) came into existence in October 1966 and has been the prime mover in the progressive development, promotion and expansion of tourism in the country. Users can find detailed information on the mission and objectives of the Corporation.

State wise list of domestic tour operators by Ministry of Tourism

Find information on domestic tour operators in various states by Ministry of Tourism. Users can find details such as agency name, contact person’s name, office address, phone and fax numbers, email id etc. Provision to search operators information by selecting state and city name is also available.

Guidelines and Application Proforma for Recognition or Renewal or Extension as an Approved Tourist Transport Operator

Get guidelines and application proforma for recognition or renewal or extension as an approved tourist transport operator provided by the Ministry of Tourism. Users can download the form and use it further. Instructions on how to fill the form are also available.

Guidelines and Proforma for Application for Recognition or Renewal or Extension as an Approved Travel Agent or Travel Agency

Access to guidelines and proforma for application for recognition or renewal or extension as an approved travel agent or travel agency provided by the Ministry of Tourism is given. Instructions on how to fill the form are available. Users can download the form and use it further.

List of tourist transport operators by Ministry of Tourism

Find list of tourist transport operators in different states approved by Ministry of Tourism. Contact person’s name, office address, phone and fax numbers, email address etc of every approved operator are available. Users can search operators’ details by selecting the name of the state and city.

Guidelines for Domestic Tour Operator

Guidelines for grant of guide licence to regional level tourist guides, guidelines for travel agents, guidelines for tourist transport operator, guidelines for adventure tour operator, approval of hotels at project stage and classification and reclassification of hotels.

Information about voluntary scheme for classification of operational hotels by Ministry of Tourism is given. Details related to conditions for approval of hotels at project level, classification or re-classification of operational hotels, guidelines for bar licence and sewage treatment plant, etc. are available. Users can also access downloadable forms.

Scheme of Financial Assistance to Institutes of Hotel Management & Catering Technology & Applied Nutrition and Food Craft Institutes

Scheme of capacity building for service providers.

The Ministry of Tourism has introduced Scheme of Capacity Building for Service Providers to provide training to tourism service providers. You can find information related to this scheme, its objectives, funding, beneficiaries etc. Information on how to apply, where to apply, concerned authority and officials is also available.

Application for Proposal Submission for Central Financial Assistance for Information Technology Initiatives

This application form is for proposal submission for central financial assistance for Information Technology (IT) initiatives. The application form is provided by Ministry of Tourism. You can find details of documents to be attached with this form.

Guidelines and Application Proforma for Approval of Convention Centre

You can find the guidelines and application proforma for approval of convention centre provided by the Ministry of Tourism. Users can download and fill the form according to their requirement. Format of acceptance of regulatory conditions for approval of convention centre project and condition to be fulfilled after the convention centre or hotel becomes functional is also available.

Tour Operator – Legal Compliances

In this article, we will take a look at the various compliances involved in the business of tourism in India.

India has always been a major attraction to tourists. But the evolution of the industry has surged into the mainstream in recent years in India. Therefore, there are so many people who are finding employment in the tourism sector. According to the United Nations World Tourism Organization (UNWTO), the tourism sector provides 6-7 percent of the world’s total jobs directly and even more indirectly through the multiplier effect. The tourism sector in India is estimated at $117.7 billion in the year 2011 and is estimated to increase to $418.9 billion by the year 2024. So, there are so many opportunities for the new entrepreneurs who are starting their career in the tourism sector as tour operators.

Type of Business Entity

Tour operators these days have many preferences of business entities to choose from and the business strategy for the endeavor would play a significant role in finding the right fit. Most of the tour operators choose to have a Private Limited Company as it is one of the extensively used and acknowledged forms of business in India contributing a lot of benefits.

A private limited company is undeniably the best for entrepreneurs who have ideas to offer online services and rapidly gauge up their business by using the power of the internet. Business entities like Limited Liability Partnership (LLP) or One Person Company (OPC) would be best for entrepreneurs who have plans to build their business steadily without any hurry.

GST Registration

The services provided by a tour operator are taxable under GST. So, the tour operators are required to acquire a GST registration. However small-scale tour operators need not pay GST if the cumulative turnover of taxable services does not exceed Rs.20 lakhs in the financial year. It is mandatory for businesses to register for GST, with a turnover of more than Rs. 20 lakhs (Rs.10 lakhs for northeastern states) annually.

GST Registration can be done online by registering your business on the official GST portal and then scan and upload all the required documents.

Government Approved Tour Operators

Though registration as a Government of India approved Tour Operator is not necessary, it is valuable and provides acknowledgment for the tour operator. The main ambition and objective of the scheme for recognition of tour operators are to reassure quality standards and services in the tourism sector. To become a tour operator recognized by the Government of India, the tour operator must fulfill certain prerequisites on the capital invested, number of employees, maintenance of minimum office space and other requirements. Further, an application must be made to the tourism ministry in the prescribed format to become a Government of India approved Tour Operator.

IATA Operator

The International Air Transport Association (IATA) is the trade association representing major air traffic in the world. IATA offers wide-ranging training and professional development services for tour operators, and IATA authorization is a very important seal of approval acknowledged worldwide. Therefore, it is essential for a tour operator to consider becoming IATA members and enjoy access to a wide range of benefits.

The government regulates only those industries that bear something of a strategic advantage either from the point of view of the economy or from the point of view of global optics. When it comes to the tourism industry, it is strategic in both ways. There are several parts of India, such as Goa, Kerala and Rajasthan that earn a major chunk of their revenues only from tourism. At the same time, it gives India the image of being an ancient civilization which is keeping abreast with the changing times.

Besides, the current government is spending a good amount of its budget on various tourism related leverages such as building the tallest statue in the world. So without a doubt, investment in the tourism sector is bound to pay rich dividends in the long run. If you have any other queries with regards to regulatory or legal matters, get in touch with us and we will ensure that you receive the best guidance from our team of expert professionals for your requirements.

Also, Read:

• Types of Business Models in the Hotel Industry
• Details That Can Be Rectified In GST Registration
• Web Application Business Ideas

A Checklist for Annual Company Compliance

Introduction  The Public Limited Enterprises in India are needed to prepare the greatest number of annual compliances each year if…

5 Reasons Why Compliance is Important for Businesses Today

Introduction Its crucial for bussiness to know the Importance of Compliance.  Compliance refers to adhering to the laws, regulations, and…

Essential Tax and Compliance Management Tasks

People might think running a business is a ‘cakewalk’. Only you, as an entrepreneur, would know the amount of hard…

What Are the 4 Phases of the Compliance Process?

Compliance is a critical aspect of any organisation’s operations, ensuring adherence to legal and regulatory requirements. The compliance process involves…

Understanding G-Secs and How to Invest in Them for Business?

G-secs refer to government securities or, in other words, loans or capital issued by the government. The biggest advantage associated…

Startups to Continue Receiving a Tax Holiday

Businesses of all sizes and types have been having a tough year courtesy of the coronavirus pandemic. The Indian government…

How the Rupee Depreciation is Enticing NRIs in Real Estate?

The Indian currency has depreciated as much as 5.2% against the US dollar in 2022 so far. The rupee’s depreciation…

Subscribe to our newsletter blogs

Private Limited Company Registration Private Limited Company with Indian and Foreign Shareholders One Person Company Registration Limited Liability Partnership (LLP) Registration Partnership Firm Registration Subisdary Company Registration Subsidiary of an Indian Company in India Public Limited Company Registration Section 8 (Not-for-Profit) Company Registration Trust Registration Society Registration USA Company Incorporation Register a NBFC Company in India NIDHI Company Registration Producer Company Registration Digital Signature Certificate (DSC) Tax Deduction Account Number (TAN) Trademark Registration - India Trademark Renewal International Trademark Application Trademark Ownership Transfer Respond to a Trademark Objection File a Trademark Opposition Judgments Vakil GPT Libra Winding Up of Company roDTEP Private Company into OPC Patent Search Apply for a Provisional Patent Apply for a Patent Changes in IEC Changes in GST LUT Application ITR for LLP Business Ideas Business Loans NGO Registration Change the Objectives of Your Company Sole Proprietorship Scope of Work and Deliverables Agreement Service Level Agreement Business Compliance PIL Web Ecommerce Development Hallmark Registration Caveat Petition OSP License GDPR APEDA Registration Money Recovery Vendor Termination RBI Compounding Application Patent Infringement Labour Law Non Compete Agreement Relinquishment Deed Spice Board Registration Convert Private to Public Limited Company Posh Compliance Trademark Assignment Restitution Of Conjugal Rights Company Name Search Corporate tax e-FIR Property Documents Verification Trademark Infringement Well Known Trademarks Copyright Infringement Intellectual Property Employment Agreement Income tax Notice Financial Agreement Trademark Search NRI Legal Services Professional Tax for Employees Professional Tax for Directors ESI Registration PF Registration ESI Filing PF Filing Cancellation of GST Professional Tax Registration DIPP Certification Basic Food License State Food License Central Food License Fundraising PF and ESI Filings PF and ESI Registration Professional Tax Filing Shops and Establishment Act Registration Importer Exporter Code Registration SSI / MSME Registration Trade License Registration Copyright Registration Change in trademark application Trademark Withdrawal Payroll Services Goods & Service Tax (GST) Registration Trademark Watch ISO Registration Hearing Labour Welfare Fund Registration USA Company Compliances NGO Compliance Non-Disclosure Agreement Memorandum of Understanding (MoU) Get Advice from a Lawyer Get a Detailed Legal Opinion from an Expert Commercial Rental / Lease Agreement Leave and License Agreement Prepare a Power of Attorney Agreement Review Shareholders' Agreement Term Sheet Review a Term Sheet given by an Investor Share Purchase Agreement Terms of Service and Privacy Policy Terms of Service Privacy Policy Get Basic Legal Advice Get Basic Legal Opinion Get an Advanced Legal Opinion Get Expert Legal Opinion Legal Agreement Legal Notice Disclaimer Draft a Consumer Complaint Founders Agreement Franchise Agreement Vendor Agreement Master Service Agreement Joint Venture Agreement Freelancer Agreement Consultancy Agreement Profit Sharing Agreement Cheque Bounce Notice Freelancer / Contractor's Agreement Loan Agreement Terms of Service and Privacy Policy Website Terms of Service and Privacy Policy App Terms of Service and Privacy Policy - Web & App Probate of Will Divorce Consultation Property Registration Property Consultancy - opinion Management of a Trust Management of a Society Dissolution of Partnership Firm Accounting and Book Keeping GST Filings TDS Filings File Annual Returns for your Private Limited Company Get help from a Company Secretary for your Private Limited Company Get help from a Company Secretary for your Limited Liability Partnership Change your Company Name Change the Objectives of Your Company Appointment of a Director Removal/Resignation of a Director Change the Official Address of Private Company Close your Private Limited Company Convert your Partnership into a Private Limited company Convert your Sole Proprietorship into a Private Limited Company Convert your Private Limited Company into an LLP Convert your Private Limited Company into a Public Limited Company Income tax returns - Propreitorship Firm Financial Projections for Bank Loan Investor Pitch Deck CA/CS certification Increase in Authorized Capital of your Company Change the Objectives of Your LLP Change your LLP Name Adding a Designated Partner Change the Official Address of Your LLP Increase in Contribution to your LLP Change LLP Agreement Close your Limited Liability Partnership Convert your Sole Proprietorship into an LLP Compliance - Section 8 Close down your Not-for-Profit (Section 8) Company Get Share Certificates for your Company Replacement of a Director Change in the Designation of Director Adding a Partner in LLP Replacement of Designated Partner Resignation of Designated Partner Resignation of Partner Change Name of your LLP Close your Partnership firm Close your Proprietorship firm Close your Public Limited Company Convert your LLP into a Private Limited Company Convert your Partnership into an LLP Convert your Sole Proprietorship into a Partnership Audit your Company Valuation of Business Convert your Private Limited Company into an One Person Company Transfer of Shares Change in Authorized Capital of your Company Employee Stock Options (ESOP) Issue of New Shares (To existing promoters) RBI & SECRETARIAL COMPLIANCES FOR FOREIGN INVESTMENT ISSUE OF NEW SHARES IN YOUR COMPANY (TO OTHER THAN EXISTING PROMOTERS) Employment Agreement with ESOP Due Diligence of Company Convert your One Person Company into a Private Limited Company DIR-3 KYC Filing Issue of Convertible Debentures (CCD) Permanent Account Number (PAN) Religion change Gender Change Apply for Name Change - Minor Name Change Application FSSAI Marriage Certificate Mutual Divorce Court Marriage Public Notice - Gazette Notification Make a Will Residential Rental Agreement Gift Deed File your Income Tax Returns - Salaried Individual Logo design Free GST Registration Internal Start a Branch Office in India Get a Section 80 G Tax Exemption Trademark Search ISI Registration Apply for Birth Certificate Employment Contract without ESOP Sale Deed CA Advisory Service Apply for Succession Certificate Legal notice for recovery of dues Apply for legal heir certificate Apply for Psara License RERA complaints Main Service Startup India Registration Integrated Accounting + GST Talk to a CA Talk to a Lawyer Talk to a CS FCRA Registration FCRA Renewal Change in Member or Nominee of OPC Change in Particulars of Director Creation or Modification of Charge Satisfaction of Charge Conversion of Dormant Company to Active Company Conversion of Loan into Equity Shares Change the Official Address of Your Business (from one state to another state ) Get Support on Opening Current Bank Account Design registration Legal Metrology NGO Deed Drafting File an Opposition for Brand Infringement Darpan Registration Cessation of Partner or Designated Partner SEBI IA Registration Surrender of DIN/DPIN Foreign Liabilities and Assets (FLA) Return Change the Official Address of Your LLP (From One State to Another State) Change the Official Address of Your Company (Outside the City) CSR-1 Registration Service

Bengaluru - Bangalore Chennai Cochin Coimbatore Delhi Gurugram - Gurgaon Hyderabad Kolkata Mumbai Noida Thiruvananthapuram Vijayawada Visakhapatnam Addanki Adilabad Agartala Agra Ahmedabad Aizawl Ajmer Akola Alappuzha Aligarh Allahabad Alwar Amaravati Ambala Amritsar Anand Anantapur Andaman Aurangabad Aurangabad-Bihar Azamgarh Badaun Badlapur Bagaha Bagalkot Bahadurgarh Baltora Baraut Bardhaman Bareilly Bathinda Begusarai Belgaum Bellary Berhampur Bhadrak Bhadreswar Bhagalpur Bharuch Bhavnagar Bhayandar Bhilai Bhilwara Bhiwandi Bhiwani Bhopal Bhubaneswar Bidar Bijapur Bikaner Bilaspur Bina Etawa Birati Birbhum Bishalgarh Botlagudur Budaun Budgam Buldhana Bundi Cachar Calicut Chandauli Chandigarh Chandigarh-Punjab Chhapur Chhatarpur Chhindwara chidambaram Chitradurga Chittoor Chittorgarh Churu Cooch Behar Cuddalore Cuttack Dahod Daman Darbhanga Dehradun Deoghar Dera Bassi Dewas Dhaka Dhanbad Darbhanga Dharmapuri Dharmanagar Dharwad Dhule Dimapur Dindigul Dispur Dombivli Dumarkunda Dungri Durgapur Dwarka Eluru Erode Faridabad Firozabad Firozpur Gandhidham Gandhinagar Gangtok Ganjam Gannavaram Ghaziabad Gonda Gorakhpur Greater Noida Gulbarga Guntur Gunupur Guwahati Gwalior Haldwani Hansi Hanumangarh Haridwar Hisar Hoshiarpur Hosur Howrah Hubli Idukki Imphal Indore Itanagar Jabalpur Jagdalpur Jaipur Jalandhar Jalgaon Jalgaon Jamod Jamalpur Jammu Jamnagar Jamshedpur Jamui Jaunpur Jhansi Jind Jodhpur Jorhat Kadapa Kakinada Kalahandi Kalimpong Kalyan Kangra Kankroli Kannur Kanpur Kanyakumari Kapurthala Karad Karaikal Karaikudi Karimnagar Karjat Karnal Karur kasganj Kashipur Katihar Katni Kavaratti Khamgaon Khammam Kharagpur Khordha Kochi Kohima Kolhapur Kollam Koppal Kota Kottayam Kozhikode Krishnagiri Kullu Kumbakonam Kurnool Kurukshetra Lalitpur Latur Loharu Lucknow Ludhiana Madhubani Madikeri Madurai Mainpuri Malappuram Malda Mandi Mandsaur Mangalore Mapusa Margao Marthandam Mathura Meerut Midnapore Mirzapur Mohali Mone Moradabad Morbi Morena Muktsar Mundra Muzaffarnagar Muzaffarpur Mysore Nabarangpur Nadiad Nagapattinam Nagaur Nagercoil Nagpur Nainital Nalanda Namakkal Nanded Nandigama Nashik Navi Mumbai Navsari Nellore Nilgiris Nizamabad Ongole Ooty Other Cities Palakkad Palampur Palgadh Pali Panaji Panchkula Panipat Paradip Pathanamthitta Pathankot Patiala Patna Pilani Port Blair Pratapgarh Puducherry Pune Raichur Raigarh Raipur Rajahmundry Rajapalayam Rajkot Ramanathapuram Ramgarh Ranchi Raniganj Ratlam Rewa Rohtak Roorkee Rourkela Rupnagar Saharanpur Salem Sangli Sangrur Satara Secunderabad Shillong Shimla Shimoga shirdi Sikar Siliguri Silvassa Singrauli Sirmaur Sirmur Sitamarhi Sitapur Sivaganga Sivakasi Siwan Solan Solapur Sonipat sonla Sri Ganganagar Srinagar Surat Talbehat Tezpur Thalassery Thane Thanjavur Theni Thoothukudi Thrissur Tiruchirappalli Tirunelveli Tirupati Tirupur Tiruvannamalai Tumkur Udaipur Udupi Ujjain Una Uppala Uttarpara Vadodara Vapi Varanasi Vasai Vellore Vidisha Vill Damla Viluppuram Vinukonda Virar Virudhunagar Warangal Washim Yamuna Nagar Yelahanka Zirakpur Select City*

Email Enter valid email addres

You'll be redirected to payment page to reserve a callback from our expert

Maharashtra Tour Organisers' Association

Registration no. - f16477(mumbai) | [email protected].

Maharashtra Tour Organisers' Association (MTOA) is the oldest Travel association in Maharashtra celebrating 50th Year and it aims to bring all Tour operators registered in Maharashtra together and work closely with each other for growing together and also mutual benefits to its fellow Members. MTOA coordinates with State Tourism Boards and National Tourism Boards for better promotion of tourism in Maharashtra, India and Globally, thereby ensuring proper information is communicated to tour operators about the rules and regulations of Central Govt., State Govt., Railways, Airlines, Transport Department, Various Permits / Licenses, Consulate's and various other travel related details. MTOA Organizes Domestic & International FAM tours and various other travel related events to enhance knowledge and fellowship amongst its members. Benefits of taking MTOA Membership is that you have to pay Life Membership Fee of INR 10,000/- and INR 1500/- as Annual Activity Charges every year (1st April to 31st March)(as per rules and regulations).

Committee Members

Vishvajeet Patil

Mob : +91 9320767601

Vice President

Mob : +91 9987445511

Rajan Parekh

Gen. secretary.

Mob : +91 9321257289

Rajesh Vira

Mob : +91 9702363344

Datta Bhalerao

Jt.secretary.

Mob : +91 9689038880

Tushar Sanas

Mob : +91 8454874444

Chetan Dunakhe

Committee member.

Mob : +91 9819097902

Devendra Gandre

Mob : +91 9220874847

Kishore Savardekar

Mob : +91 9322670404

Contact Us Maharashtra Tour Organisers' Association

Vishvajeet patil president.

Raja Rani Paryatan Bhavan, Sweet Home, L. J. Road, Mahim, Mumbai - 400016. Mob: +91 9320767601

Rajan Parekh Secretary

11B, Dhan Mansion Avantikabai Gokhale Road, Opera House, Mumbai - 400004. Mob: +91 9321257289

Rajesh Vira Treasurer

B-12/8, B D D, G. K. Road, Behind Hindmata Cinema, Nr Apna Bazar, Dadar East, Mumbai 400 014. Mob: +91 9702363344

• Rules and Regulations
• Privacy Policy

© Copyright 2020 Maharashtra Tour Organisers Association. All Rights Reserved.

Notifications

1. Release of Foreign Exchange by Authorised Dealers

1.1 For release of foreign exchange to persons resident in India for various current account transactions, Authorised Dealer banks are to be guided by the Rules made by the Government of India under Section 5 of the Foreign Exchange Management Act, 1999 which are detailed in the Foreign Exchange Management (Current Account Transactions) Rules, 2000 (hereinafter referred to as the Rules) notified by the Government of India vide Notification No. G.S.R.381 (E) dated May 3, 2000, ( Annex-1 ) as amended from time to time. In terms of the said Rules, drawal of foreign exchange for certain categories of transactions listed in Schedule I is expressly prohibited. Exchange facilities for transactions included in Schedule II to the Rules may be permitted by the Authorised Dealer banks provided the applicant has secured the approval from the Ministry/Department of the Government of India as specified therein. In respect of transactions included in Schedule III to the Rules, prior approval of the Reserve Bank would be required for remittance exceeding the specified limits. The release of foreign exchange up to the threshold ceilings specified in Schedule III stands delegated to the Authorised Dealer banks. All applications for release of foreign exchange exceeding the limits as prescribed in Schedule III to the Rules should be referred to the Regional Office concerned of the Foreign Exchange Department of the Reserve Bank, under whose jurisdiction the applicant is functioning / residing.

1.2 “Drawal” of foreign exchange also includes use of International Credit Cards (ICC), International Debit Cards (IDC), ATM cards, etc. “Currency”, interalia, includes ICC, IDC and ATM Cards. Accordingly, all Rules, Regulations made and Direction issued under the Act apply to the use of ICC, IDC and ATM Cards.

1.3 Release of foreign exchange is not admissible for travel to and transaction with residents of Nepal and Bhutan.

1.4 Prohibition:

Remittances in any form towards participation in lottery schemes are prohibited under the Foreign Exchange Management Act, 1999. Further, these restrictions are also applicable to remittances for participation in lottery like schemes existing under different names like money circulation scheme or remittances for the purpose of securing prize money/awards, etc.

1.5 Fraudulent offers:

There is a spate of fictitious offers of cheap funds in recent times from fraudsters through letters, e-mails, mobile phones, SMS, etc. Communications on fake letterheads of the Reserve Bank and purportedly signed by its top executives / senior officials are also being sent to targeted people. Many residents have been victims of such offers and lost huge money in the process. The Reserve Bank has alerted the public on several occasions about such fictitious schemes/ offers, through the print and the electronic media.

Fraudsters are seeking money from gullible people, under different heads, such as processing fees/ transaction fees/tax clearance charges/conversion charges, clearing fees, etc. The victims of the fraud have also been persuaded to deposit the amount in accounts with banks in India, and such amounts have been withdrawn immediately. Multiple accounts are being opened in the name of individuals or proprietary concerns, at different bank branches for collecting the transaction charges, etc. AD Category - I banks must, therefore, exercise due caution and to be extra vigilant while opening or allowing transactions in such accounts. Any person resident in India collecting and effecting / remitting such payments directly /indirectly outside India would make himself/ herself liable to be proceeded against with, for contravention of the Foreign Exchange Management Act, 1999, besides being liable for violation of regulations relating to Know Your Customer (KYC) norms / Anti Money Laundering (AML) standards. The Reserve Bank of India does not maintain any account in the name of individuals / companies / trusts in India to hold funds for disbursal.

2. Release of Foreign Exchange by Authorised Dealer Category II

In order to provide adequate foreign exchange facilities and efficient customer service, the Reserve Bank has decided to grant licenses to certain entities by authorising them as Authorised Dealer – Category II to undertake a range of non-trade current account transactions. Accordingly, Authorised Dealer – Category II are authorised to release / remit foreign exchange for the following non-trade current account transactions:

Private visits,

Remittance by tour operators / travel agents to overseas agents / principals / hotels,

Business travel,

Fee for participation in global conferences and specialized training,

Remittance for participation in international events / competitions (towards training, sponsorship and prize money),

Film shooting,

Medical treatment abroad,

Disbursement of crew wages,

Overseas education,

Remittance under educational tie up arrangements with universities abroad,

Remittance towards fees for examinations held in India and abroad and additional score sheets for GRE, TOEFL, etc.

Employment and processing, assessment fees for overseas job applications,

Emigration and emigration consultancy fees,

Skills / credential assessment fees for intending migrants,

Processing fees for registration of documents as required by the Portuguese / other Governments,

Registration / subscription / membership fees to International Organisations.

3. Remittance facilities for resident individuals:

Remittances for current account transactions (viz. private visit; gift/donation; going abroad on employment; emigration; maintenance of close relatives abroad; business trip; medical treatment abroad; studies abroad) available to resident individuals under Para 1 of Schedule III to Foreign Exchange Management (Current Account Transactions) Amendment Rules, 2015 dated May 26, 2015 are subsumed under the Liberalised Remittance Scheme (LRS) of USD 2,50,000 per Financial Year (FY) with effect from May 26, 2015 [Instructions on LRS are available on Master Direction on Liberalised Remittance Scheme dated January 1, 2016]. Release of foreign exchange exceeding USD 2,50,000, requires prior permission from the Reserve Bank of India.

3.1 Travel:

3.1.1 Out of the overall foreign exchange (USD 250,000 per financial year) being sold to a traveller, exchange in the form of foreign currency notes and coins may be sold up to the limit indicated below:

Travellers proceeding to countries other than Iraq, Libya, Islamic Republic of Iran, Russian Federation and other Republics of Commonwealth of Independent States - not exceeding USD 3000 per visit or its equivalent.

Travellers proceeding to Iraq or Libya - not exceeding USD 5000 per visit or its equivalent.

Travellers proceeding to Islamic Republic of Iran, Russian Federation and other Republics of Commonwealth of Independent States - full exchange may be released.

Travellers proceeding for Haj/Umrah pilgrimage- full amount of entitlement in cash or up to the cash limit as specified by the Haj Committee of India, may be released.

3.1.2 Authorised Dealers may remit foreign exchange up to a reasonable limit, at the request of a traveller towards his hotel accommodation, tour arrangements, etc., in the countries proposed to be visited by him. Further, all tour related expenses including cost of rail/road/water transportation charges outside India and remittances relating towards cost of Euro Rail; passes/tickets, etc. for Indian travellers, and overseas hotel/flight charges have been subsumed under the new enhanced LRS limit of USD 250,000.

3.1.3 Period of surrender of foreign exchange

(i) In case the foreign exchange purchased for a specific purpose is not utilized for that purpose, it could be utilized for any other eligible purpose for which drawal of foreign exchange is permitted under the relevant Rules / Regulation.

(ii) General permission is available to any resident individual to surrender received / realised / unspent / unused foreign exchange to an Authorised Person within a period of 180 days from the date of receipt / realisation / purchase / acquisition / date of return of the traveller, as the case may be.

Note: Where a person approaches an Authorised Person for surrender of unspent/ unutilized foreign exchange after the prescribed period of 180 days, Authorised Person should not refuse to purchase the foreign exchange merely on the ground that the prescribed period has expired.

(iii) The liberalised uniform time limit of 180 days is applicable only to resident individuals and in areas other than export of goods and services. In all other cases, the regulations / directions on surrender requirement shall remain unchanged. ( Notification No. FEMA 9/2000-RB dated May 3, 2000 , as amended from time to time).

3.1.4 Unspent foreign exchange

A returning traveller is permitted to retain with him, foreign currency, travellers’ cheques and currency notes up to an aggregate amount of USD 2000 and foreign coins without any ceiling beyond 180 days. Foreign exchange so retained, can be utilized by the traveller for his subsequent visit abroad.

3.2 Remittance of salary

A person who is resident but not permanently resident in India and

a. is a citizen of a foreign State other than Pakistan; or

b. is a citizen of India, who is on deputation to the office or branch of a foreign company or subsidiary or joint venture in India of such foreign company, may make remittance up to his net salary (after deduction of taxes, contribution to provident fund and other deductions).

Explanation: For the purpose of this item, a person resident in India on account of his employment or deputation of a specified duration (irrespective of length thereof) or for a specific job or assignments, the duration of which does not exceed three years, is a resident but not permanently resident.

3.3. Meeting of medical expenses of NRI close relatives by resident individuals

Where the medical expenses in respect of NRI close relative (relative as defined in 1 Section 2 (77) of the Companies Act, 2013 ) are paid by a resident individual, such a payment being in the nature of a resident to resident transaction may be covered under the term “services related thereto” under Regulation 2(i) of Notification No. FEMA 16 /2000- RB dated May 3, 2000 .

3.4. International Credit Cards/International Debit Cards/Store value cards etc. by Authorised Dealers in India:

3.4.1. International Credit Cards (ICC)

The restrictions contained in Rule 5 of the Foreign Exchange Management (Current Account Transactions) Rules, 2000 will not be applicable for use of International Credit Cards (ICCs) by residents for making payment towards expenses, while on a visit outside India.

Residents can use ICCs on internet for any purpose for which exchange can be purchased from an Authorised Dealer in India, e.g. for import of books, purchase of downloadable software or import of any other item permissible under Foreign Trade Policy (FTP).

ICCs cannot be used on internet or otherwise for purchase of prohibited items, like lottery tickets, banned or proscribed magazines, participation in sweepstakes, payment for call-back services, etc., since no drawal of foreign exchange is permitted for such items/activities.

There is no aggregate monetary ceiling separately prescribed for use of ICCs through internet.

Resident individuals maintaining foreign currency accounts with an Authorised Dealer in India or a bank abroad, as permissible under extant Foreign Exchange Regulations, are free to obtain ICCs issued by overseas banks and other reputed agencies. The charges incurred against the card either in India or abroad, can be met out of funds held in such foreign currency account/s of the card holder or through remittances, if any, from India only through a bank where the card holder has a current or savings account. The remittance for this purpose should also be made directly to the card issuing agency abroad, and not to a third party. The applicable limit will be the credit limit fixed by the card issuing banks. There is no monetary ceiling fixed by the Reserve Bank for remittances, if any, under this facility.

Use of ICC for payment in foreign exchange in Nepal and Bhutan is not permitted.

ADs may issue ICCs to NRIs/PIOs, without prior approval of the Reserve Bank, subject to the condition that charges on the use of ICCs should be settled by the concerned NRIs/PIOs only out of inward remittances or balances held in their Non-Resident External (NRE) Accounts/ Foreign Currency Non-Resident (FCNR) Accounts.

3.4.2. International Debit Cards (IDC)

Banks authorised to deal in foreign exchange may issue International Debit Cards (IDCs) which can be used by a resident for drawing cash or making payment to a merchant establishment overseas during his visit abroad. IDCs can be used only for permissible current account transactions and the limits as mentioned in the Schedules to the Rules, as amended from time to time, are equally applicable to payments made through use of these cards.

The IDCs cannot be used on internet for purchase of prohibited items like lottery tickets, banned or proscribed magazines, participation in sweepstakes, payment for call-back services, etc., i.e. for such items/activities for which drawal of foreign exchange is not permitted.

3.4.3. Use of credit / debit cards for payments for airline tickets

In certain cases where the payment for the tickets are made by the residents using credit /debit card, Card Companies have been providing arrangements to the foreign airlines operating in India to select the country and currency of their choice, in respect of transactions arising from the sale of the air tickets in India in Indian Rupees (INR). In such transactions, the overseas bank as the acquiring bank receives the funds from card issuing company in its Vostro account maintained with an Authorised Dealer bank in India or in its foreign currency account maintained abroad and makes the payment in foreign currency overseas to the foreign airline. This practice adopted by foreign airlines is not in conformity with the extant provisions of the Foreign Exchange Management Act, 1999. AD Category- I banks may, therefore, advise the foreign airlines to discontinue the practice of using overseas banks for settlement of INR transactions on account of sale of air tickets in India.

3.4.4. Store Value Cards/ Charge Cards/ Smart Cards, etc.

Authorised Dealer banks may issue Store Value Card/ Charge Card/ Smart Card to residents traveling on private/business visit abroad which are used for making payments at overseas merchant establishments and also for drawing cash from ATM terminals. No prior permission from the Reserve Bank is required for issue of such cards. However, the use of such cards is limited to permissible current account transactions and subject to the prescribed limits under the FEM (CAT) Rules, 2000, as amended from time to time.

3.4.5. Redemption of unutilized balance on prepaid travel cards:

Resident Indians who purchase their travel cards, are permitted refund of the unutilized foreign exchange balance only after 10 days from the date of last transaction and accordingly, this condition is stated in the “user guide”. Since these cards are expected to act as substitutes for cash/ Travellers Cheques, the facilities available to the user will have to be similar. Accordingly, all such Authorised Persons shall redeem the unutilized balance outstanding in the cards immediately upon request by the resident Indians to whom the cards are issued subject to retention of:

Amounts that are authorized and remain unclaimed/ not settled by the acquirers as of the date of redemption till the completion of the respective settlement cycle;

A small balance not exceeding US$ 100, for meeting any pipeline transactions till the completion of the respective settlement cycle; and

Transaction fees / service tax payable in India in Rupees.

For the amount that are authorized but unclaimed/ not settled by the acquirer, the issuer of such cards can hold such amounts until such transactions are processed/ settled by the acquirers within the prescribed settlement timeframe.

4. Remittance facilities for others:

4.1. Gift/donation

General permission is available to persons other than individuals to remit towards donations up-to one per cent of their foreign exchange earnings during the previous three financial years or USD 5,000,000, whichever is less, for (a) creation of Chairs in reputed educational institutes, (b) contribution to funds (not being an investment fund) promoted by educational institutes; and (c) contribution to a technical institution or body or association in the field of activity of the donor Company. Any additional remittance in excess of the same shall require prior approval of the Reserve Bank of India. Applications for remittances for purposes other than those specified above may be forwarded to the Chief General Manager, Reserve Bank of India, Central Office, Foreign Exchange Department, Foreign Investments Division (EPD), Central Office Building, Mumbai-400 001, together with (a) details of their foreign exchange earnings during the last 3 years, (b) brief background of the company’s activities, (c) purpose of the donation and (d) likely benefits to the corporate. 2

4.2. Commission to agents abroad for sale of residential flats or commercial plots in India

Remittances by persons other than individuals shall require prior approval of the Reserve Bank of India if commission per transaction to agents abroad for sale of residential flats or commercial plots in India exceeds USD 25,000 or five percent of the inward remittance whichever is more.

4.3. Remittances towards consultancy services

Remittances by persons other than individuals shall require prior approval of the Reserve Bank of India if remittances exceed USD 10,000,000 per project for any consultancy services in respect of infrastructure projects and USD 1,000,000 per project, for other consultancy services procured from outside India.

Explanation:—For the purposes of this sub-paragraph, the expression “infrastructure’ shall mean as defined in explanation to para 1(iv)(A)(a) of Schedule I of FEMA Notification 3/2000-RB, dated the May 3, 2000 , as amended from time to time.

4.4. Remittances towards re-imbursement of pre-incorporation expenses

Remittances by persons other than individuals shall require prior approval of the Reserve Bank of India for remittances exceeding five per cent of investment brought into India or USD 100,000 whichever is higher, by an entity in India by way of reimbursement of pre-incorporation expenses.

4.5. Payment of fees in foreign currency - Embassy affiliated educational institutions

Authorised Dealers may sell foreign exchange towards payment of fees to schools/educational institutions under the administrative control of foreign embassies.

4.6. Remittance towards payments of collected subscription to overseas TV media company

Authorised dealers may allow cable operators or collection agents in India of overseas TV media companies, to remit subscription collected from subscribers in India/advertisement charges collected from the advertisers who are eligible to advertise on overseas TV channels without any prior permission from the Reserve Bank.

4.7. Bids in foreign currency for projects to be executed in India

Persons resident in India are permitted to incur liability in foreign exchange and to make or to receive payments in foreign exchange, in respect of global bids where the Central Government has authorised such projects to be executed in India. In such cases, authorised dealers may sell foreign exchange to the concerned resident Indian company which has been awarded the contract.

4.8. Sale of overseas telephone cards

Authorised Dealers may allow agents in India of the overseas organisations issuing pre-paid telephone cards to remit the sale proceeds of such cards, net of their commission, to the issuers of the telephone cards.

4.9. Liberalization of foreign technical collaboration agreements

AD Category-I banks may permit drawal of foreign exchange by persons for payment of royalty and lump-sum payment under technical collaboration agreements without the approval of Ministry of Commerce and Industry, Government of India.

4.10. Drawal of foreign exchange for remittance for purchase of trademark or franchise in India

AD Category-I banks may permit drawal of foreign exchange by person for purchase of trademark or franchise in India without approval of the Reserve Bank.

4.11. Remittances for making tour arrangements by agents

4.11.1. Authorised Dealers may effect remittances at the request of agents in India who have tie-up arrangements with hotels/ agents, etc., abroad for providing hotel accommodation or making other tour arrangements for travel from India, provided the Authorised Dealer is satisfied that the remittance is being made out of the foreign exchange purchased by the traveller concerned from an Authorised Person (including exchange drawn for private travel abroad) in accordance with the Rules, Regulations and Direction in force.

4.11.2. Authorised Dealer may open foreign currency accounts in the name of agents in India who have tie up arrangements with hotels/ agents, etc., abroad for providing hotel accommodation or making other tour arrangements for travellers from India provided:-

i) the credits to the account are by way of depositing

collections made in foreign exchange from travellers; and

refunds received from outside India on account of cancellation of bookings / tour arrangements, etc., and

ii) the debits in foreign exchange are for making payments towards hotel accommodation, tour arrangements, etc., outside India.

4.11.3. Authorised Dealer may allow tour operators to remit the cost of rail/ road/ water/transportation charges outside India without any prior approval from the Reserve Bank, net of commission/ mark up due to the agent. The sale of passes/ ticket in India can be made either against the payment in Indian Rupees or in foreign exchange released for visits abroad.

4.11.4. In respect of consolidated tours arranged by travel agents in India for foreign tourists visiting India and neighbouring countries like Nepal, Bangladesh, Sri Lanka, etc., against advance payments/ reimbursement through an Authorised Dealer, part of the foreign exchange received in India against such consolidated tour arrangement, may require to be remitted from India to these neighbouring countries for services rendered by travel agents and hoteliers in these countries. Authorised Dealer may allow such remittances after verifying that the amount being remitted to the neighbouring countries (inclusive of remittances, if any, already made against the tour) does not exceed the amount actually remitted to India and the country of residence of the beneficiary is not Pakistan.

5. Issue of Guarantee – Import of service

5.1. AD Category-I banks are permitted to issue guarantee for amount not exceeding USD 500,000 or its equivalent in favour of a non-resident service provider, on behalf of a resident customer who is a service importer, provided:

The AD Category-I bank is satisfied about the bonafides of the transaction.

The AD Category-I bank ensures submission of documentary evidence for import of services in the normal course.

The guarantee is to secure a direct contractual liability arising out of a contract between a resident and a non-resident.

5.2. In the case of a Public Sector Company or a Department/ Undertaking of the Government of India/ State Governments, approval from the Ministry of Finance, Government of India for issue of guarantee for an amount exceeding USD 100,000 (USD One hundred thousand) or its equivalent would be required.

6. Operational instructions to Authorised Persons

6.1. Reserve Bank will not prescribe the documents which should be verified by the Authorised Persons while permitting remittances for various transactions, particularly of current account.

6.2. In terms of the provisions contained in sub-section 5 of section 10 of the Act, before undertaking any transaction in foreign exchange on behalf of any person, an Authorised Dealer is required to obtain a declaration and such other information from the person (applicant) on whose behalf the transaction is being undertaken that will reasonably satisfy him that the transaction is not designed to contravene or evade the provisions of the Act or any of the Rules or Regulations made or Notifications or directions or orders issued under the Act. Authorised Dealers should preserve the information / documents obtained by them from the applicant before undertaking the transactions for verification by the Reserve Bank. The onus of furnishing the correct details in the application, will remain with the applicant who has certified the details relating to the purpose of such remittance.

6.3. In case the person on whose behalf the transaction is being undertaken refuses or does not give satisfactory compliance of the requirements of an authorised person, he shall refuse in writing to undertake the transactions and shall, if he has reasons to believe that any contravention / evasion is contemplated by the person, report the matter to the Reserve Bank.

6.4. For payments other than imports and remittances covering intermediary trade transactions, applicant needs to fill up Form A2 (Annex 2). The Form A2 should be retained for a period of one year by the Authorised Persons, together with the related documents, for the purpose of verification by their Internal Auditors.

6.5. For effecting current account remittances not exceeding USD 25,000 Authorised Dealers need only a simple letter from the applicant containing the basic information, viz., names and the addresses of the applicant and the beneficiary, amount to be remitted and the purpose of remittance. However, this is subject to the condition that the payment is made by a cheque drawn on the applicant's bank account or by a Demand Draft. AD banks shall prepare dummy A-2 so as to enable them to provide purpose of remittance for statistical inputs for Balance of Payment.

7. Income- tax clearance

Reserve Bank of India will not issue any instructions under the FEMA, regarding the procedure to be followed in respect of deduction of tax at source while allowing remittances to the non-residents. It shall be mandatory on the part of Authorised Dealers to comply with the requirement of the tax laws, as applicable.

Foreign Exchange Management (Current Account Transactions) Rules, 2000 Notification No. G.S.R.381 (E) dated May 3, 2000 (as amended from time to time)

In exercise of the powers conferred by Section 5 and sub-section (1) and clause (a) of sub-section (2) of Section 46 of the Foreign Exchange Management Act, 1999, and in consultation with the Reserve Bank, the Central Government having considered it necessary in the public interest, makes the following rules, namely:--

1. Short title and commencement.--- (1) These rules may be called the Foreign Exchange Management (Current Account Transactions) Rules, 2000;

(2) They shall come into effect on the 1st day of June 2000.

2. Definitions---In these rules, unless the context otherwise requires:

(a) “Act” means the Foreign Exchange Management Act, 1999 (42 of 1999);

(b) “Drawal” means drawal of foreign exchange from an authorised person and includes opening of Letter of Credit or use of International Credit Card or International Debit Card or ATM Card or any other thing by whatever name called which has the effect of creating foreign exchange liability;

(c) “Schedule” means a schedule appended to these rules;

(d) The words and expressions not defined in these rules but defined in the Act shall have the same meanings respectively assigned to them in the Act.

3. Prohibition on drawal of Foreign Exchange--- Drawal of foreign exchange by any person for the following purpose is prohibited, namely:

a. a transaction specified in the Schedule I ; or

b. a travel to Nepal and/or Bhutan; or

c. a transaction with a person resident in Nepal or Bhutan.

Provided that the prohibition in clause (c) may be exempted by RBI subject to such terms and conditions as it may consider necessary to stipulate by special or general order.

4. Prior approval of Government of India ---No person shall draw foreign exchange for a transaction included in the Schedule II without prior approval of the Government of India;

Provided that this Rule shall not apply where the payment is made out of funds held in Resident Foreign Currency (RFC) Account of the remitter.

5. Prior approval of Reserve Bank

Every drawal of foreign exchange for transactions included in Schedule III shall be governed as provided therein.

6. (1) Nothing contained in Rule 4 or Rule 5 shall apply to drawal made out of funds held in Exchange Earners’ Foreign Currency (EEFC) account of the remitter.

(2) Notwithstanding anything contained in sub-rule (1), restrictions imposed under rule 4 or rule 5 shall continue to apply where the drawal of foreign exchange from the Exchange Earners Foreign Currency (EEFC) Account is for the purpose specified in items 10 and 11 of Schedule II , or item 3, 4, 11, 16 & 17 of Schedule III as the case may be.

7. Use of International Credit Card while outside India

Nothing contained in Rule 5 shall apply to the use of International Credit Card for making payment by a person towards meeting expenses while such person is on a visit outside India.

Transactions which are Prohibited (see Rule 3)

1. Remittance out of lottery winnings.

2. Remittance of income from racing/riding etc. or any other hobby.

3. Remittance for purchase of lottery tickets, banned /proscribed magazines, football pools, sweepstakes, etc.

4. Payment of commission on exports made towards equity investment in Joint Ventures / Wholly Owned Subsidiaries abroad of Indian companies.

5. Remittance of dividend by any company to which the requirement of dividend balancing is applicable.

6. Payment of commission on exports under Rupee State Credit Route, except commission up to 10% of invoice value of exports of tea and tobacco.

7. Payment related to "Call Back Services" of telephones.

8. Remittance of interest income on funds held in Non-Resident Special Rupee (Account) Scheme.

Schedule II

Transactions which require prior approval of the Central Government (see Rule 4)

SCHEDULE III (See rule 5)

Notified by GOI Notification No. G.S.R 426(E) dated May 26, 2015

Facilities for individuals—

1. Individuals can avail of foreign exchange facility for the following purposes within the limit of USD 2,50,000 only. Any additional remittance in excess of the said limit for the following purposes shall require prior approval of the Reserve Bank of India.

Private visits to any country (except Nepal and Bhutan).

Gift or donation.

Going abroad for employment.

Emigration.

Maintenance of close relatives abroad.

Travel for business, or attending a conference or specialised training or for meeting expenses for meeting medical expenses, or check-up abroad, or for accompanying as attendant to a patient going abroad for medical treatment/ check-up.

Expenses in connection with medical treatment abroad.

Studies abroad.

Any other current account transaction

Provided that for the purposes mentioned at item numbers (iv), (vii) and (viii), the individual may avail of exchange facility for an amount in excess of the limit prescribed under the Liberalised Remittance Scheme as provided in regulation 4 to FEMA Notification 1/2000-RB, dated the 3rd May, 2000 (here in after referred to as the said Liberalised Remittance Scheme) if it is so required by a country of emigration, medical institute offering treatment or the university, respectively:

Provided further that if an individual remits any amount under the said Liberalised Remittance Scheme in a financial year, then the applicable limit for such individual would be reduced from USD 250,000 (US Dollars Two Hundred and Fifty Thousand Only) by the amount so remitted:

provided also that for a person who is resident but not permanently resident in India and –

is a citizen of a foreign State other than Pakistan; or

is a citizen of India, who is on deputation to the office or branch of a foreign company or subsidiary or joint venture in India of such foreign company,

may make remittance up to his net salary (after deduction of taxes, contribution to provident fund and other deductions).

Explanation: For the purpose of this item, a person resident in India on account of his employment or deputation of a specified duration (irrespective of length thereof) or for a specific job or assignments, the duration of which does not exceed three years, is a resident but not permanently resident:

provided also that a person other than an individual may also avail of foreign exchange facility, mutatis mutandis, within the limit prescribed under the said Liberalised Remittance Scheme for the purposes mentioned herein above.

Facilities for persons other than individual -

2. The following remittances by persons other than individuals shall require prior approval of the Reserve Bank of India.

(i) Donations exceeding one per cent. of their foreign exchange earnings during the previous three financial years or USD 5,000,000, whichever is less, for-

creation of Chairs in reputed educational institutes,

contribution to funds (not being an investment fund) promoted by educational institutes; and

contribution to a technical institution or body or association in the field of activity of the donor Company.

(ii) Commission, per transaction, to agents abroad for sale of residential flats or commercial plots in India exceeding USD 25,000 or five percent of the inward remittance whichever is more.

(iii) Remittances exceeding USD 10,000,000 per project for any consultancy services in respect of infrastructure projects and USD 1,000,000 per project, for other consultancy services procured from outside India.

Explanation:—For the purposes of this sub-paragraph, the expression “infrastructure’ shall mean as defined in explanation to para 1(iv)(A)(a) of Schedule I of FEMA Notification 3/2000-RB, dated the May 3, 2000 .

(iv) Remittances exceeding five per cent of investment brought into India or USD 100,000 whichever is higher, by an entity in India by way of reimbursement of pre-incorporation expenses.”

3. Procedure

The procedure for drawal or remit of any foreign exchange under this schedule shall be the same as applicable for remitting any amount under the said Liberalised Remittance Scheme.

Note: The principal rules were published in Part II, Section 3, Sub-section (i) of Gazette of India, Extraordinary, vide G.S.R. 381(E), dated the 3rd May, 2000.

1 “Section 6 of the Companies Act, 1956” replaced with “Section 2(77) of the Companies Act, 2013”.

2 Omitted as a corrigendum

3 Inserted vide AP (Dir Series) Circular 50 dated February 11, 2016

Rules & Regulations​

India has a set of rules and regulations that apply to its citizens, residents, and visitors. Here are some of the key rules and regulations    in India:

• Traffic Rules: In India, traffic rules are enforced by the police, and it’s mandatory to wear a helmet while riding a two-wheeler or fastening the seatbelt while driving. Vehicles must follow the speed limits, traffic signals, and stop at red lights.
• Smoking Ban : Smoking is banned in public places in India, including hotels, restaurants, and bars. Violators of the smoking ban can face fines or imprisonment.
• Alcohol Consumption: The legal drinking age in India is 21 years. Alcohol consumption is prohibited in some parts of the country, especially in certain religious places.
• Safety and Security: Visitors are advised to take necessary precautions to ensure their safety and security in India. It’s important to avoid isolated places, not to travel alone at night, and be aware of scams and frauds.
• Cultural Sensitivities: India is a diverse country with different cultures and customs. Visitors are advised to respect the cultural sensitivities and dress modestly in religious places.
• Wildlife Protection: India has strict rules for the protection of its wildlife. It’s illegal to hunt or trade wildlife and its products. Visitors are advised to follow the guidelines while visiting national parks and wildlife reserves.
• Drug Abuse: The use of drugs is strictly prohibited in India, and violators can face severe penalties, including imprisonment.
• Internet and Social Media : The use of the internet and social media is regulated in India, and it’s important to be mindful of the content posted or shared online.
• Legal System : India has a common law legal system, and visitors are advised to be aware of the laws and regulations while staying in the country. Violators of the laws can face legal action and penalties.
• Environmental Protection: India has laws and regulations for the protection of the environment, including the prevention of pollution and the conservation of natural resources. Visitors are advised to follow the guidelines and avoid littering or damaging the environment.
• Currency Regulations : There are restrictions on the amount of Indian currency that can be brought into or taken out of the country. Visitors are advised to check the guidelines and declare any currency above the permissible limit at customs.
• Photography Restrictions: Photography is prohibited in certain areas, including military installations and some religious places. Visitors are advised to follow the guidelines and seek permission before taking photographs.
• Social Etiquette: India has its own social etiquette, including greetings, gestures, and customs. Visitors are advised to be respectful and mindful of the local customs and traditions.
• Foreign Exchange Regulations : Visitors are required to exchange foreign currency only at authorized exchange counters, banks, or moneychangers. It’s important to keep the exchange receipts for future transactions.
• Health Regulations: India has health regulations for visitors, including mandatory vaccinations and health screenings in certain cases. Visitors are advised to consult their healthcare provider before traveling to India and follow the guidelines for a safe and healthy stay.
• Cyber security: India has laws and regulations for cyber security, including the protection of personal data and the prevention of cybercrime. Visitors are advised to follow the guidelines and take necessary precautions while using the internet and other digital platforms.
• Legal Drinking Age: The legal drinking age in India varies by state, and visitors are advised to check the guidelines and follow the laws related to alcohol consumption.
• Dress Code: India has a diverse culture, and visitors are advised to dress modestly, especially in religious places. It’s important to cover the head and wear appropriate clothing while visiting temples, mosques, or other religious places.
• Public Behavior: India has rules and regulations for public behavior, including the prevention of public nuisance and disturbance. Visitors are advised to follow the guidelines and avoid any behavior that may offend or disturb the public.
• Visa Regulations: India has different types of visas for visitors, including tourist, business, and student visas. Visitors are advised to check the visa regulations and requirements and follow the guidelines for a hassle-free stay in India.
• Traffic Rules: India has strict traffic rules and regulations, including the use of helmets and seat belts while driving. Visitors are advised to follow the guidelines and avoid reckless driving to ensure their safety and the safety of others on the road.
• Animal Protection: India has laws and regulations for the protection of animals, including the prevention of animal cruelty and the conservation of wildlife. Visitors are advised to follow the guidelines and avoid any activities that may harm animals or disturb their natural habitats.
• Caste System: India has a complex social structure with a caste system that defines social hierarchy and relations. Visitors are advised to be respectful and mindful of the local customs and traditions related to caste, and avoid any behavior or comments that may offend or discriminate based on caste.
• Smoking Regulations: India has smoking regulations that prohibit smoking in public places and workplaces. Visitors are advised to follow the guidelines and avoid smoking in public areas to ensure a healthy and safe environment.
• Child Protection: India has laws and regulations for the protection of children, including the prevention of child labor and the promotion of education and welfare. Visitors are advised to be aware of the guidelines and report any incidents of child abuse or exploitation.

It’s important to note that the rules and regulations in India can change from time to time, and visitors are advised to stay informed and follow the guidelines while staying in the country.  It’s important to note that these rules and regulations are not exhaustive, and visitors are advised to research and stay informed about the laws and guidelines in India. It’s also recommended to respect the local culture and customs and seek assistance from the authorities or local residents in case of any questions or concerns.

Take notes as you read a judgment using our Virtual Legal Assistant and get email alerts whenever a new judgment matches your query ( Query Alert Service ). Try out our Premium Member services -- Free for one month .

Delhi High Court

Indian association of tour operators vs union of india & anr. on 31 august, 2017, author: s. muralidhar, bench: s.muralidhar , prathiba m. singh.

Dr. S. Muralidhar, J.:

Introduction

1. This writ petition by the Indian Association of Tour Operators, seeks a declaration that Rule 6A of the Service Tax Rules, 1994 ('ST Rules'), concerning 'Export of services' is ultra vires the Finance Act 1994 ('FA').

The validity of Section 94 2 (f) of the FA is also challenged on the ground that it gives unguided and uncontrolled power to the central government to frame rules regarding 'provisions for determining export of taxable WP (C) 5267 of 2013 Page 1 of 26 services'.

2. The members of the Petitioner, who are Indian tour operators, are inter alia engaged in the business of arranging tours for foreign tourists visiting India as well as her neighbouring countries. They state that they enter into contracts with the foreign clients either directly or through foreign tour operators. Such contracts/bookings are generally made through phone calls or emails. The bookings are confirmed generally in writing by stating the cost and other terms and conditions. They make all arrangements for the foreign tourist including hotel accommodation, transport by all modes such as rail, tourist buses, monuments visits including entrance tickets, entertainment, food and restaurant bookings etc. Members of the Petitioner organize package tours which include a bouquet of services. It is stated that the foreign tourists/foreign tour operators make the entire payment for the package tour in convertible foreign exchange through bank transfer, or bank draft or credit card payment etc.

3. Sample copies of the invoices issued by the Indian tour operators to the foreign tourists for the period prior to 1st July 2012 and thereafter have been placed on record. Prior to insertion of Section 6A of the ST Rules with effect from 1st July 2012 tour operator services provided to foreign tourists was treated as 'Export of services' and exempted from the levy of service. The invoices raised after 1st July 2012 reveal that service tax @ 3.09% is charged on the cost of services provided by the Indian tour operators to foreign tourists.

4. At the outset, a caveat requires to be entered. With the introduction of the WP (C) 5267 of 2013 Page 2 of 26 Goods and Service Tax regime with effect from 1st July 2017, the provisions of the earlier FA and the rules thereunder stand repealed. We are in the present petition concerned with the legal position as it existed prior to 1st July 2017. In other words, the present petition is concerned with the question of payment of service tax by the Indian tour operators in respect of the services provided by them to foreign tourists during the period between 1st July 2012 and 1st July 2017.

Position prior to 1st July 2012

5. Service tax was introduced for the first time by the FA with effect from 1st July 1994. The relevant provisions concerning service tax were set out in Chapter V of the FA. Section 64 (1) of the FA stated that Chapter V would apply to the whole of India except Jammu and Kashmir. Section 64 (3) provided that it would apply to 'taxable services provided on or after the commencement of this Chapter".

6. Section 65 (105) of the FA defined 'taxable service' to mean "any service provided or to be provided" to a whole range of persons as mentioned in clauses (a) to (zzzzw). Clause (n) of Section 65 (105) of the FA, which is relevant for the present petition, stated that the provision of service to any person "by a tour operator in relation to a tour" would be a taxable service. Section 66 of the FA provided for the 'charge of service tax." Again, relevant for the present petition is the fact that Section 66 provided inter alia that service tax at the rate of 12% of the value of the taxable service referred to in Section 65 (105) (n) of the FA shall be levied and "collected in such manner as may be prescribed."

7. Section 93 (1) of the FA empowered the central government to exempt generally, or subject to such conditions as may be specified, a taxable service of any specified description from the whole or part of the service tax leviable thereon. Section 93 (2) permitted the central government to grant exemption from payment of service tax by a special order in each case under circumstances of exceptional nature.

8. The rule making power of the central government is provided in Section

94. Section 94 (1) states that the central government may make rules for carrying out the provisions of Chapter V of the FA which pertained to service tax. Section 94 (2) permits the central government to make rules on matters specified therein "without prejudice to the generality of " the power under Section 94 (1) . Section 94 (2) (f) permits the central government to make rules 'for determining export of taxable services'.

9. On the strength of Sections 93 and 94 (2) (f) of the FA, the central government issued the Export of Services Rules 2005 ('ESR 2005'). Rule 3 (1) (ii) ESR 2005 inter alia stated that "export of taxable services shall in relation to taxable services specified in sub-clause (n) of clause (105) of Section 65 of the Act, be provision of such services as are performed outside India". The proviso thereto stated that where such taxable service is partly performed outside India, "it shall be treated as performed outside India."

10. Rule 3 (2) of ESR 2005 initially stated that the provision of any taxable service specified in Rule 3 (1) shall be treated as export of service when the following conditions are satisfied, viz.:

(a) such service is delivered outside India and used outside India; and

(b) payment for such service provided outside India is received by the service provider in convertible foreign exchange.

11. The Explanation to the Rule 3 (2) stated: "for the purposes of this rule 'India' includes the installations, structures and vessels in the continental shelf of India and the exclusive economic zone of India."

12. Rule 3 (2) of ESR 2005 underwent changes first in 2007 and then again in 2010. As a result of these amendments, Rule 3 (2) ESR read thus:

"3 (2) The provision of any taxable service specified in sub-rule (1) shall be treated as export of service when the following conditions are satisfied, namely:

(a) (omitted)

(b) payment for such service is received by the service provider in convertible foreign exchange.

13. The Explanation to Rule 3 (2) too underwent a change and read thus after the 2010 amendment: "For the purposes of this rule 'India' includes the installations, structures and vessels in the continental shelf of India and the exclusive economic zone of India, for the purposes of prospecting or extraction or production of mineral, oil and natural gas supply thereof."

14. Rule 4 of the ESR 2005 stated: "Any service, which is taxable under clause (105) of Section 65 of the Act, may be exported without payment of WP (C) 5267 of 2013 Page 5 of 26 service tax."

15. The resultant position, prior to 1st July 2012, as far as export of tour operator services was that even if a part thereof was performed outside India and the remaining in India, it would still be treated as having been performed outside India and thereby be construed as an export of service. Such export of tour operator service was not exigible to service tax. This position continued till 1st July 2012.

Position after 1st July 2012

16. Significant changes were introduced in Chapter V of the FA with effect from 1st July 2012 by the Finance Act, 2012 . Section 65 was omitted and substituted by Section 65 B titled 'Interpretations'. Section 65 B (51) of the FA defined the expression 'taxable service' to mean any service on which service tax is leviable under Section 66B. Section 66B is the charging provision.

17. Section 66 B of the FA, inserted by the FA 2012 with effect from 1st July 2012, provided that: "there shall be levied a tax (hereinafter referred to as the service tax) at the rate of twelve per cent on the value of all services, other than those services specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be prescribed." Prior to its omission by way FA 2013, with effect from 1st May 2013, there was an Explanation to Section 66B which stated that "for the removal of doubts, it is hereby clarified that the references to the provisions of Section 66 in Chapter V of the Finance Act, 1994 or any other Act, for the purpose of levy and collection of service tax, WP (C) 5267 of 2013 Page 6 of 26 shall be construed as references to the provisions of Section 66B." This entire Explanation has now been inserted as a separate provision, Section 66 BA.

18. A plain reading of the charging provision, Section 66 B of the FA, brings out the following facets:

(i) Service tax is leviable on the value of all services "other than those services specified in the negative list." The negative list of services are set out in Section 66D of the FA, inserted again with effect from 1st July 2012.

Tour operator services is not part of the negative list.

(ii) Such service should be "provided or agreed to be provided" by one person to another and collected in such manner as may be prescribed.

(iii) Such service should be provided or agreed to be provided in the "taxable territory". The expression 'taxable territory' has been defined under Section 65B (52) to mean "the territory to which the provisions of this Chapter apply." Section 64 (1) of the FA states that Chapter V "extends to the whole of India except the State of Jammu and Kashmir."

19. A collective reading of Section 66B read with Section 64 (1) and Section 65B (52) makes it plain that service tax is leviable only on services provided or agreed to be provided in the 'taxable territory' i.e. the whole of India except Jammu and Kashmir. Such service alone is 'taxable service' which is defined under Section 65 B (51) to mean that "any service on which service tax is leviable under Section 66B." The net result is that services rendered WP (C) 5267 of 2013 Page 7 of 26 outside the taxable territory of India would not be a 'taxable service' for the purposes of the FA. This is of utmost significance since the entire Chapter V applies, in terms of Section 64 (3) of the FA only to "taxable services provided on or after the commencement of this Chapter."

Rule making powers

20. The rule-making power of the central government is contained in Section 94 of the FA. Section 94 (1) talks of the general power of making rules to carry out the provisions of Chapter V of the FA. Section 94 (2) is a specific power and is without prejudice to the generality of the power under Section 94 (2) (f) permits the central government to make rules for "determining export of taxable services." In other words, while such rules can describe what would constitute 'export of taxable services' they cannot possibly determine the taxability of such export of services.

21. Another provision of the FA which grants the central government a rule making power for a specific purpose is Section 66 C of the FA which too was inserted by the FA 2012. It empowers the central government to make rules for determining the place of provision of service. It states that the central government may "having regard to the nature and description of various services, by rules made in this regard, determine the place where such services are provided or deemed to have been provided or agreed to be provided or deemed to have been agreed to be provided." The expression 'such services' in the above provision has to necessarily refer only to 'taxable services." This is because in terms of Section 64 (3) of the FA Chapter V, in which Section 66 C is located, applies only to 'taxable WP (C) 5267 of 2013 Page 8 of 26 services'.

22. In terms of Section 66C of the FA, the central government had made Place of Provision of Services Rules 2012 ('PPSR 2012'). Under Rule 3 of PPSR 2012, it is stated that "the place of provision of a service shall be the location of the recipient of service." The proviso thereto states that in case of services "other than online information and database access or retrieval services" where the location of the service receiver is not available in the ordinary course of business, the place of provision shall be the location of the provider of service. PPSR 2012 envisages the provision of service relating to the immovable property, events, and also performance based services. Rule 7 talks of place of services provided at more than one location. All these provisions talk of services in the taxable territory. They do not seek to describe export of services.

Analysis of Rule 6A

23. It in the above background that Rule 6A of the ST Rules, inserted with effect from 1st July 2012, requires to be examined. Rule 6A reads as under:

"6A Export of services -

(1) The provision of any service provided or agreed to be provided shall be treated as export of service when -

(a) the provider of service is located in the taxable territory

(b) the recipient of service is locate outside India

(c) the service is not a service specified in the Section 66D of the Act,

(d) the place of provision of the service is outside India WP (C) 5267 of 2013 Page 9 of 26

(e) the payment for such service has been received by the provider of service in convertible foreign exchange and

(f) the provider of service and recipient of service are not merely establishments of a distinct person in accordance with item (b) of Explanation 3 of clause (44) of section 65B of the Act (2) Where any service is exported, the Central Government may, by notification, grant rebate of service tax or duty paid on input services or inputs, as the case may be, used in providing such service and the rebate shall be allowed subject to such safeguards, conditions and limitations, as may be specified, by the Central Government, by Notification."

24. The above insertion of Rule 6A was made by the Service Tax (Second Amendment) Rules 2012 by Notification No. 36/2012-ST dated 20th June 2012. A significant change is that Rule 6A brings within its ambit export of even non-taxable services whereas Section 94 (2) (f) permits making rules only in respect of 'taxable service'. As already noted, prior to 1st July 2012 export of service was not a 'taxable service'.

25. Rule 6A (1) of the ST Rules creates two problems for the Indian tour operator organising tours for foreign clients. While clauses (a) (b) and (c) are satisfied inasmuch as the tour operator is located in India, the recipient is located outside India, and the service is not included in the negative list under Section 66 D of the FA, clause (d) may not be satisfied where the service provided is a composite one viz., the place of provision of a part of the service is inside India and the remaining part outside India. Thus clause

(d) is satisfied, if at all, only in part. The second issue that arises is that such service provided outside India cannot be made amenable to service tax under the FA since it is not a service rendered in the 'taxable territory'.

26. Rule 6A is a departure from the earlier regime governing export of services. It may be recalled that under Rule 4 of the ESR 2005, tour operator service could be exported without payment of service tax. Further the proviso to Rule 3 (1) (ii) of ESR 2005 stated that where such taxable service is partly performed outside India, "it shall be treated as performed outside India." This took care of composite tour operator services which may have been provided partly outside India and partly within India. They were entirely outside the ambit of service tax. Rule 6A of the ST Rules, which substitutes the repealed ESR 2005, however, changes this position. While clauses (a) to (c) of sub-rule (1) of Rule 6A is consistent with the pearlier description of 'export of services', clause (d) brings about a change inasmuch as it recognises only such tour operator service rendered outside India as 'export of service'. Further sub-rule (2) of Rule 6A states that the central government may by notification grant rebate of service tax or duty paid input services or inputs subject to conditions where there is an export of services. This pre-supposes that such provision of service outside India is in fact amenable to service tax. However, as already noticed, the entire Chapter V of the FA applies only to taxable services and taxable services are those provided in the taxable territory i.e. the whole of India except Jammu and Kashmir.

27. A further and more serious difficulty for the Indian tour operator, after 1st July 2012, stems from Rule 9 of the PPSR 2012 which states that where services provided are intermediary services, then the place of provision of service "is the location of service provider." For the purposes of the PPSR WP (C) 5267 of 2013 Page 11 of 26 2012, tour operator services are a species of 'intermediary services'. This has been clarified by the central government itself in the document titled:

Taxation of Services: An Education Guide dated 20th June 2012 published by the Tax Research Unit (TRU) of the Central Board of Excise and Customs. Para 5.9.6 of this Guide prepared by the TRU clarifies that services provided by a tour operator will qualify as 'intermediary services.' Thus even where in terms of Rule 6A of the ST Rules, the service provided outside India by the Indian tour operator it is an 'export of service', under Rule 9 of the PPSR 2012 the place of provision even for such service would be "the location of the service provider" which would make it a service provided in India, when in fact it is not. Thus services provided to a foreign tourist both inside India and outside India are brought within the net of service tax by virtue of the combined operation of Rule 6A (1) and (2) ST Rules and Rule 9 of the PPSR 2012.

Foreign Trade Policy

28. At this stage, it is necessary to examine Foreign Trade Policy (FTP) for years 2009-14 regarding export and import of goods and services. Para 3.11 talks of 'Services Exports'. As per para 3.11.1 (a) thereof, all tradable services covered under the General Agreement on Trade in Services (GATS) are listed in Appendix 10 of Hand Book Procedure v1. If consideration is received in free foreign exchange, these tradable services would be considered as service exports. Clause (b) states that "all provisions of this Policy shall apply mutatis mutandis to export of services as they apply to goods." GATS includes 'tour operator services' which is covered under the sector 'Tourism and Travel Related Services'. If consideration is received in WP (C) 5267 of 2013 Page 12 of 26 free foreign exchange, these would be considered as service exports. Thus the policy of the Government of India was to encourage export of tour operator services as it earned valuable foreign exchange.

Representations by the Petitioner

29. It is stated that Indian tour operators through the Petitioner Association sought the extension of the benefit of export of services to tour operators. The Petitioner made a representation dated 22nd May 2012 to the Joint Secretary, TRU in the Ministry of Finance seeking exemption to the tour operators under the amended provisions based on foreign exchange earnings. It was inter alia contended that the principle of Export of Services cannot be changed year after year and that it should be defined through legislation by Parliament and not by the Rules. Since tour operators were earning huge foreign exchange for the country, they ought to be given the status of exporters of service. However, there was no response thereto.

30. It may be noted here that pursuant to an order dated 23rd August 2013 passed in the present case, the Petitioner filed an additional affidavit on 27 th August 2013 bringing on record certain facts relevant to the functioning of the members of the Petitioner and the services provided by them. Inter alia it was pointed out that although payments were received in convertible foreign exchange the members of the Petitioner Association did not get the benefit of exports since the place of provision of service was treated as India.

31. According to the Petitioner, the action of the Respondent adversely affected the interests of tour operators. They had to suffer huge service tax WP (C) 5267 of 2013 Page 13 of 26 liability without being extended the benefit of 'Export of Service'. The net result was that in terms of PPSR 2012, the place of provision of service was deemed to be the location of the service provider which is in India. In order to qualify as an export of service under Rule 6 A the place of provision of service had to be outside India. Thus tour operator services provided to foreign tourists, part of which was provided outside India and part within, could not be treated as export of services.

Submissions on behalf of the Petitioner

32. Mr. J.K. Mittal, learned counsel appearing for the Petitioner, submitted that there was an anomalous situation where provision of package tour services to foreign tourists outside India, for instance in the neighbouring countries, were also sought to be taxed in India. Mr. Mittal referred to the decision of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) in Cox & Kings India Limited v. Commissioner 2014 (35) STR 817 (Tri-Del) where it was held that service tax cannot be levied with regard to outbound tours arranged for Indians by the Indian tour operators since it was a service provided outside the taxable territory of India. It was held that the FA did not have extra-territorial operation.

33. The central thrust of the submissions of Mr. Mittal is that Rule 6A suffers from the vice of excessive delegation. This is because as non-taxable services such as services provided outside the taxable territory to foreign tourists, are sought to be brought within the ambit of service tax. Rule 6A is assailed as being ultra vires the FA. Reference was made to the decisions of the Supreme Court in Union of India v. S. Srinivasan ( 2012) 7 SCC 683 WP (C) 5267 of 2013 Page 14 of 26 and General Officer Commanding-in-Chief v. Subhash Chandra Yadav (1988) 2 SCC 35. Mr. Mittal pointed out that Section 94 (2) (f) of the FA enabled the central government to make rules only for determining export of taxable services. No tax thereon could be levied by the central government in terms of the said provision. That was an essential legislative function which could not have been delegated to the central government. Reference was made to the decisions in Municipal Corporation of Delhi v. Birla Cotton Spinning & Weaving Mills AIR 1968 SC 1232 and Union of India v. Indian Charge Chrome 1999 (112) ELT 753 (SC).

34. Mr. Mittal submitted that if Section 94 (2) (f) of the FA was interpreted as permitting such delegation of essential legislative function, then Section 94 (2) (f) of the FA too would be vulnerable to invalidation on the ground that it was ultra vires the FA. Mr. Mittal submitted that as a result of having to pay service tax, which had to be passed on to the customers i.e. foreign tourists, the Indian tour operators were losing business to their foreign counterparts. It was further contended that Rule 6A was arbitrary, discriminatory and violative of Articles 14 and 19 (1) (g) of the Constitution of India.

Submissions on behalf of the Respondents

35. Mr. Amit Bansal, learned counsel appearing for Respondent No. 3, Commissioner of Service Tax, submitted that in terms of Section 94 (1) of the FA it was permissible for the central government to make rules as long as they were consistent with the object and purpose of the FA. Mr. Bansal referred to the decisions in Pratap Chandra Mehta v. State Bar Council of Madhya Pradesh ( 2011) 9 SCC 573, and Kunj Behari Lal Butail v. State of WP (C) 5267 of 2013 Page 15 of 26 H.P. AIR 2000 SC 1069. He maintained that Rule 6A of the ST Rules was validly made in terms of the power granted to the central government under Section 94 (2) (f) of the FA. Reliance was placed on the decision in State of T.N. v P. Krishnamurthy (2006) 4 SCC 517.

36. Mr. Bansal did not dispute that the services provided outside the taxable territory cannot be made amenable to service tax under Section 66B of the FA. He also was unable to dispute that in the counter affidavit filed in the present case there is an admission by the Respondents that no service tax is leviable on export of services. He submitted that de hors Section 66B, the central government could make rules for determining the place of provision of services. Rule 9 of the PPSR 2012 read with Rule 6A of the ST Rules permitted levy of service tax since the service to the foreign tourist was provided in India by the tour operator located in India. Mr Bansal pointed out that if service tax was paid on such services then under Rule 6A (2) the corresponding input tax credit would also be available. According to Mr. Bansal, Rule 6A did not alter the taxability or non-taxability of a service provided by a tour operator.

37. Mr. Bansal submitted that under Section 93A of the FA, rebate was granted in cases "where any goods or services are exported." Section 93B of the FA stated that all rules made under Section 94 and applicable to the taxable services shall also be applicable to any other service insofar as they are relevant to the determination of any tax liability, refund, credit of service tax or duties paid on inputs and input services or for carrying out the provisions of Chapter V of the Finance Act .

38. Mr. Bansal submitted that the principle of purposive construction of statutes should be applied. He referred to the decision in K.P. Varghese v. ITO, Ernakulam AIR 1981 SC 1922. He submitted that Rule 6A of the ST Rules was not beyond rule making power of the central government and was not ultra vires the FA. He further submitted that Section 66C read with Section 94 (2) (hhh) of the FA gave the central government power to determine the rate of service tax and the place of provision of taxable service. Therefore, it could not be said that the Parliament has established no criteria, or no standard or that there was plenary, unguided and uncontrolled delegation of the essential legislative function to the central government. The mere receipt of convertible foreign currency from foreigners cannot be the only criteria for determining whether the provision of services by tour operators to foreign tourists in India should be considered as export of services. Reliance was placed by Mr. Bansal on the decision in Subhash Photographics v. Union of India 1993 (66) ELT 3 (SC) where it was held that the Courts should not question the wisdom of government's policy and interfere with delegated legislation. Reference was also made to the decision in Avinder Singh v. State of Punjab (1979) 1 SCC 137.

Challenge to Rule 6 A on the ground of excessive delegation

39. Rule 6A of the ST Rules is a piece of delegated of legislation. It is a rule made by the central government in exercise of the powers under Section 94 (1) read with Section 94 (2) (f) of the FA. The grounds on which delegated legislation can be challenged are well-settled and set out in G. P. Singh's Principles of Statutory Interpretation, 10th Edition as under:

"Grounds for judicial review Delegated legislation is open to the scrutiny of courts and may be declared invalid particularly on two grounds: (a) violation of the Constitution; and (b) violation of the enabling Act. The second ground includes within itself not only cases of violation of the substantive provisions of the enabling Act, but also cases of violation of the mandatory procedure prescribed. It may also be challenged on the ground that it is contrary to other statutory provisions or that it so arbitrary that it cannot be said to be in conformity with the statute or Article 14 of the Constitution or that it has been exercised in bad faith. The limitations which apply to the exercise of administrative or quasi- judicial power conferred by a statute except the requirement of natural justice also apply to the exercise of power of delegated legislation. Rules made under the Constitution do not qualify as legislation in true sense and are treated as subordinate legislation and can be challenged in judicial review like delegated legislation. Compliance with the laying requirement or even approval by a resolution of Parliament does not confer any immunity to the delegated legislation but it may be a circumstance to be taken into account along with other factors to uphold its validity although as earlier seen a laying clause may prevent the enabling Act being declared invalid for excessive delegation."

40. In General Officer Commanding-in-Chief v. Dr. Subhash Chandra Yadav (supra), the Supreme Court explained the position thus:

"It is well settled that rules framed under the provisions of a statute form part of the statute. In other words, rules have statutory force. But before a rule can have the effect of a statutory provision, two conditions must be fulfilled, namely, (1) it must conform to the provisions of the statute under which it is framed; and (2) it must also come within the scope and purview of the rule making power of the authority framing the rule. If either of these two conditions is not fulfilled, the rule so framed would be void."

41. In Union of India v. S. Srinivasan (2012) 7 SCC 683 the above principles were reiterated in the following words:

"16. At this stage, it is apposite to state about the rule making powers of a delegating authority. If a rule goes beyond the rule making power conferred by the statute, the same has to be declared ultra vires. If a rule supplants any provision for which power has not been conferred, it becomes ultra vires. The basic test is to determine and consider the source of power which is relatable to the rule. Similarly, a rule must be in accord with the parent statute as it cannot travel beyond it."

42. An essential legislative function cannot be delegated to the executive. It has to be exercised by the legislature. This was emphasized in the decision in Vasu Dev Singh v. Union of India (2006) 12 SCC 753 in the following words:

"118. A statute can be amended, partially repealed or wholly repealed by the legislature only. The philosophy underlying a statute or the legislative policy, with the passage of time, may be altered but therefor only the legislature has the requisite power and not the executive. The delegated legislation must be exercised, it is trite, within the parameters of essential legislative policy. The question must be considered from another angle. Delegation of essential legislative function is impermissible. It is essential for the legislature to declare its legislative policy which can be gathered from the express words used in the statute or by necessary implication, having regard to the attending circumstances. It is impermissible for the legislature to abdicate its essential legislative functions. The legislature cannot delegate its power to repeal the law or modify its essential features."

43. The question that requires to be answered is whether the levy of tax on services is an essential legislative function that cannot be delegated? The answer perhaps lies in the language of Section 94 of the FA itself. Section 94 (1) is the general power given to the central government to make rules to carry out the provisions of Chapter V of the FA. The words 'carry out' necessarily imply providing a mechanism for the levy enforcement and WP (C) 5267 of 2013 Page 19 of 26 collection of service tax. The Rules in this sense are instrumental and intended to achieve the objects of the main statute.

Rule 6A is ultra vires Section 94 (2) (f)

44. Turning to Section 94 (2) , it basically lists out the topics on which rules can be made. It talks of laying down the procedure for carrying out various tasks set out in the FA or to provide the form in which returns are to be filed, appeals preferred. Specific to the case on hand, Section 94 (2) (f) empowers central government to make rules for 'determining' when export of 'taxable services' can be said to take place. It does not empower the central government to determine whether there can be an export of non-taxable services viz., services provided outside the taxable territory. Secondly, it does not empower the central government to make rules levying or making amenable the provision of certain services to service tax. Section 94 (2) (hhh) also permits making rules regarding the 'date for determination of rate of service tax' and 'place of provision of taxable service'. It does not provide for making rules on determination of taxability of a service. 'Subjecting certain types of services to tax is an essential legislative function. In this case, since the FA envisages Chapter V applying only to taxable services, bringing non-taxable services within the ambit of service tax, is impermissible.

45. Section 93 B of the FA states that the Rules made under Section 94 would also apply to any other service "in so far as they are relevant to the determination of any tax liability...or for carrying out the provisions of Chapter V" of the FA. However the whole of Chapter V applies only to taxable service. If by means of rules under Section 94 , what is not taxable WP (C) 5267 of 2013 Page 20 of 26 under the FA cannot be made taxable, equally they cannot even by rules under Section 93 B. The words 'any other service' occurring in Section 93 B is subject to Section 64 (3) of the FA that precedes it. It cannot expand the scope of Chapter V itself. As already noted, this is an essential legislative function and cannot be delegated to the central government.

46. As already noticed Rule 6A (1) (d) treats even services provided outside the taxable territory i.e. where the place of provision of service is outside India, as an export of 'taxable' service. Since such service by virtue of Section 66B read with Section 65 (51) and (52) read with Section 64 (1) and (3) of the FA is not amenable to service tax in the first place, and is therefore not 'taxable' service, Rule 6A is ultra vires the FA. Even Section 94 (2) (hh) of the FA permits central government to determine when there would be an export of 'taxable service' and not 'non-taxable service.' Something which is impermissible under the FA cannot, by means of the rules made thereunder, be brought within the net of service tax.

47. Viewed from another angle, since tour operator services are intermediary services and under Rule 9 of the PPSR 2012 the place of provision of service is the location of the service provider, the package tours service provided by an Indian tour operator to a foreign tourist will, notwithstanding that some part of it is provided outside India, be treated as service provided in India. As a result no Indian tour operator can expect the service rendered by him to a foreign tourist to be considered as an 'export of service' under Rule 6A as he will never be able to meet the requirement of Rule 6A (1) (d) of the ST Rules. Thus under a combination of Rule 6A of the ST Rules and WP (C) 5267 of 2013 Page 21 of 26 Rule 9 of the PPSR 2012 something which is non-taxable under the FA is sought to be brought to tax.

48. As already noticed since by virtue of Section 64 (3) the whole of Chapter V applies only to taxable services, and Section 66 C of the FA falls in that very chapter, the rules made by the central government under Section 66 C has to necessarily be only in relation to taxable services viz., services provided in the taxable territory of India. The legal fiction of treating service rendered outside India to be a service rendered in India cannot be introduced by way of rules. That too would partake the character of an essential legislative function, which cannot be delegated to the central government. In fact such service cannot be brought to tax without amending Section 64 (3) of the FA.

49. Parliament has for the first time under the Constitution (One Hundred and First Amendment) Act, 2016 effective 8th September 2016 amended Article 286 (1) to provide that there will be tax on the export of services out of the territory of India. Article 286 (2) of the Constitution of India has been amended simultaneously to provide that Parliament may by law formulate the principles to determine when an export of services takes place in any of the ways mentioned in Article 286 (1). This is another indication that these tasks cannot be delegated to the central government to determine by rules.

50. While it is one thing to say that tour operator service provided in India is not in the negative list under Section 66 D of the FA and is, therefore, amenable to service tax, it is another to contend that notwithstanding that Chapter V of the FA applies only to taxable services by virtue of Section 64 WP (C) 5267 of 2013 Page 22 of 26 (3) FA, a non-taxable service that is provided outside the taxable territory can also be included by Rule 6A of the ST Rules in determining what constitutes export of services. Thus not only Rule 6A but even Section 94 (2) (f) of the FA would also be unconstitutional if it were to be interpreted to permit determination of even export of non-taxable services not to talk of bringing to tax what is non-taxable under the FA.

Taxability of composite services

51. At this juncture it is necessary to examine what is the types of service provided by the Indian tour operator to a foreign tourists when arranging for package tours not only in India but in the neighbouring countries as well. Let us take the example of an Indian tour operator organising a package tour for foreign tourists in India and its neighbouring countries say Nepal and Bhutan. Undoubtedly this would comprise a composite bouquet of services. This might involve several steps at each stage such as planning, scheduling and organising the tour. Incidental steps would include fixing the probable dates and venues, finalising the itinerary, booking of accommodation in hotels in India and foreign countries, making travel and transport arrangements, arranging visa and travel insurance, sight-seeing trips, catering arrangements, providing services of tourist guides, providing a tour leader to accompany the touring party; arranging for complementary bags/snacks hampers, shopping bags, passport pouches etc. The tasks might involve co-ordinating with foreign counterparts or directly the clients themselves through e-mails, phone calls etc. Some of these services are provided in the territory outside India, some possibly within India. When the service is composite and a payment therefor is charged and made in a WP (C) 5267 of 2013 Page 23 of 26 lumpsum, it is difficult to make the apportionment of the charges as being towards services rendered in the taxable territory i.e. India and the balance towards those provided outside India.

52. Therefore, apart from the fact that the provision for taxing export of services has to be found in the statute itself (and not in the rules) the statute must also provide the machinery by which it can be determined with some certainty how much of the composite service can be said to be rendered in the taxable territory and of what value for the purposes of levy and collection of tax. If there is no such machinery provided, that would an additional ground of invalidation of the levy itself. In Govind Saran Ganga Saran v. Commissioner of Sales Tax AIR 1985 SC 1041 the Supreme Court explained in para 6, as under:

"6. The components which enter into the concept of a tax are well known. The first is the character of the imposition known by its nature which prescribes the taxable event attracting the levy, the second is a clear indication of the person on whom the levy is imposed and who is obliged to pay the tax, the third is the rate at which the tax is imposed, and the fourth is the measure or value to which the rate will be applied for computing the tax liability. If those components are not clearly and definitely ascertainable, it is difficult to say that the levy exists in point of law. Any uncertainty or vagueness ill the legislative scheme defining any of those components of the levy will be fatal to its validity."

53. Section 6A (1) of the ST Rules, insofar as it applies to export of tour operator services, suffers from the vice of excessive delegation inasmuch as the central government has been permitted to determine what shall constitute export of services, both taxable and non-taxable. Such an essential legislative function could not have been delegated to the central government.

Once the Parliament determines by law what is amendable and not amenable to service tax, the modalities for working out the procedure for levy and collection of such tax can be left to the Rules. However, the question of whether certain services should be amenable to tax cannot be left to be determined by rules made by the central government.

54. The Courts will not ordinarily question legislative wisdom. However, the Courts will strike down delegated legislation that is ultra vires the parent statute. Even a legislative policy has to conform to the Constitution. In State of Rajasthan v. Basant Nahata (2005) 12 SCC 77 the Supreme Court explained:

"66. The contention raised to the effect that this Court would not interfere with the policy decision is again devoid of any merit. A legislative policy must conform to the provisions of the constitutional mandates. Even otherwise a policy decision can be subjected to judicial review."

55. For all the aforementioned reasons, the Court declares that:

(i) Rule 6A (1) read with Section 6A (2) of the ST Rules, insofar as it seeks to describe export of tour operator services to include non-taxable services provided by tour operators, is ultra vires the FA and in particular Section 94 (2) (f) of the FA and is, therefore, invalid.

(ii) Section 94 (2) (f) or (hhh) of the FA does not empower the central government to decide taxability of the tour operator services provided outside the taxable territory. They only enable the central government to determine what constitutes export of service, the date for determination of WP (C) 5267 of 2013 Page 25 of 26 the rate of service or the place of provision of taxable service.

(iii) Section 66 C of the FA enables the central government only to make rules to determine the place of provision of taxable service but not non-

taxable service.

56. The net result is that the services provided by Indian tour operators to foreign tourists during the period 1st July 2012 to 1st July 2017, which has been paid for in convertible foreign exchange would not be amenable to service tax.

57. Mr. Bansal urged that this Court should apply the principle of prospective overruling so that the central government does not have to refund the service tax collected on the services provided by Indian tour operators to foreign tourists. This Court would only like to observe that if as a result of this judgment any service tax becomes refundable, the claim for refund will be processed and paid in terms of the extant provisions of the FA read with the Central Excise Act 1944 and the rules thereunder.

58. The writ petition is disposed of in the above terms with no order as to costs.

S.MURALIDHAR, J.

PRATHIBA M. SINGH, J.

AUGUST 31, 2017 Rm WP (C) 5267 of 2013 Page 26 of 26

Aviation Laws and Regulations India 2023-2024

ICLG - Aviation Laws and Regulations - India Chapter covers common issues in aviation laws and regulations - including aircraft trading, finance and leasing, litigation and dispute resolution.

Chapter Content Free Access

2. aircraft trading, finance and leasing, 3. litigation and dispute resolution, 4. commercial and regulatory, 5. in future.

1.1        Please list and briefly describe the principal legislation and regulatory bodies which apply to and/or regulate aviation in your jurisdiction.

The Ministry of Civil Aviation (“ MoCA ”) is the nodal Ministry responsible for the formulation of policy and regulation of civil aviation in India.  The MoCA oversees the planning and implementation of schemes for the growth and expansion of civil air transport, airport facilities, air traffic services and the carriage of passengers and goods by air.  The following are the principal regulatory authorities functioning under the authority of the MoCA:

• The Directorate General of Civil Aviation (“ DGCA ”) enforces civil aviation regulations and regulates air transport services, air safety and airworthiness standards.
• The Airports Authority of India (“ AAI ”) creates, upgrades, maintains and manages civil aviation infrastructure both on the ground and in the airspace of India.
• The Airport Economic Regulatory Authority (“ AERA ”) determines the tariff for aeronautical services and Passenger Service Fees to monitor performance standards relating to quality, continuity and reliability of service.
• The Bureau of Civil Aviation Security ensures that the aviation security standards follow national and international obligations/treaties on air safety, to which India is a signatory.

Based on the field of activity concerned within the aviation sector, the applicability of regulatory laws may also differ.  Some of the principal regulations are as follows:

• The Aircraft Act, 1934 (“ Aircraft Act ”) and the Aircraft Rules, 1937 (“ Aircraft Rules ”): (i) regulate the manufacture, possession, use, operation, sale, and the import and export of aircraft; and (ii) stipulate the parameters for determining air worthiness, maintenance of aircraft, general conditions for flying and safety, registration of aircraft and the conduct of investigations.
• The Airports Authority of India Act, 1994 (as amended from time to time) (“ AAI Act ”): (i) establishes the AAI; and (ii) makes the AAI responsible for the development, finance, operation and maintenance of all Government airports in India.
• The Civil Aviation Requirements (“ CAR ”): the CARs are issued by the DGCA under Rule 133A of the Aircraft Rules and provide the standards expected to be met before a licence, certificate, approval or permission is granted/accorded.  The DGCA also issues Aeronautical Information Circulars (“ AIC ”) which contains explanatory or advisory information concerning flight safety, air navigation, technical, administrative or legislative matters.
• The Carriage by Air Act, 1972 (as amended from time to time) (“ Carriage Act ”): governs the rights and liabilities of air carriers and is applicable to both domestic and international carriage by air, irrespective of the nationality of the aircraft performing the carriage.
• Airports Economic Regulatory Authority of India Act, 2008 (as amended from time to time) (“ AERA Act ”) provides for: (i) the establishment of AERA; (ii) regulates tariff and other charges for services rendered at airports; and (iii) establishes an appellate tribunal for the adjudication of disputes.
• Aircraft (Security) Rules 2011 (as amended from time to time): deals with the air safety and security regulations for aerodromes and aircraft.

1.2        What are the steps which air carriers need to take in order to obtain an operating licence?

Rule 134 of the Aircraft Rules provides that no person shall operate any scheduled air transport service from, to, in, or across India except with the permission of the Central Government, granted in accordance with the provisions of Schedule XI of the Aircraft Rules.

The aforesaid permit is equivalent to the Air Operator’s Certificate that is required to be issued by a Member State of the International Civil Aviation Organization (“ ICAO ”).  Besides other requirements, the issuance of a permit shall depend on the applicant demonstrating adequate organisation, method of control and supervision of flight operations, a training programme and maintenance arrangements consistent with the nature and extent of the operations specified. 

The CAP 3100 Air Operators Certification Manual, as issued by the DGCA, provides guidance to an applicant seeking an Air Operator’s Permit on the systematic procedures to be followed during the certification process.  The entire certification process has been classified and divided into different phases as listed below:

• Pre-application phase – Wherein the applicant is required to submit a letter of intent to the DGCA outlining the proposal and apply to the MoCA for issuance of a No-Objection Certificate upon examining the proposal from financial, economic and legal perspectives, which may also include a pre-application meeting.  The MoCA, upon satisfaction of these aspects, may issue the No-Objection Certificate.
• Formal application – The applicant is required to submit a complete application in the prescribed form to the DGCA, along with prescribed fees and relevant supporting documents; upon completing the assessment of the applicant’s proposal, the DGCA may invite the applicant for a formal meeting to discuss further details relating to the certification process.
• Document evaluation – During this phase, the DGCA shall conduct a series of discussions to assess the applicant’s capability to conduct aircraft transport operations by verifying the documents submitted by the applicant.  The documents shall reflect precisely the mode and way the applicant intends to conduct the proposed operations and, upon approval, they shall form a part of the understanding between the DGCA and the applicant regarding future functioning of the applicant as the operator.
• Demonstration and inspection – The applicant is then required to demonstrate to the DGCA its capability of conducting the proposed operations in accordance with the procedures detailed in the documents/manuals reviewed during the previous phase.  All the details provided by the applicant shall be scrutinised in detail, including inspection of facilities and sufficiency of resources.  In the event the DGCA is satisfied with the authenticity of the documents and the inspection process, approved flight(s) will be conducted to destinations of intended operations, as determined by the DGCA.  In the event the DGCA requires the applicant to make operational changes, the same shall be carried out by the applicant prior to moving on to the next phase.
• Certification – Upon completion of the procedure stated in the previous phases and the fulfilment of criteria stipulated by the DGCA in this regard to the DGCA’s satisfaction, an Air Operator’s Permit shall be issued by the DGCA along with the associated operations specifications.

Once certified, the operator is responsible for continued compliance with the initial conditions of certification and applicable legislative requirements and the DGCA’s requirements promulgated from time to time.

1.3        What are the principal pieces of legislation in your jurisdiction which govern air safety, and who administers air safety?

India follows the ICAO guidelines on Safety and Standards and Recommended Practices (“ SARPs ”).  The DGCA regulates the safety requirements to be observed by aircraft, including foreign aircraft operating in India.  The Aircraft Rules in Part II (General Conditions of Flying), Part III (General Safety Conditions) and Part VI (Airworthiness) stipulate the conditions of safety that an aircraft is required to be compliant with in order to be operated in Indian airspace.  The DGCA issues a Certificate of Airworthiness prior to the flying of aircraft, confirming that they conform to the design standards, are safe for operation, and meet minimum requirements with respect to engineering, inspection and maintenance.  Each aircraft either manufactured in India or imported into India for which a Certificate of Airworthiness is issued must conform to the design standards and be in a condition for safe operation.  To be eligible for issuance of a Certificate of Airworthiness, an aircraft must be Type Certified, its type certificate validated or its type accepted by the DGCA.

Section 5 of the CARs released by the DGCA provides mechanisms for reporting air accidents and reporting.  Further, it requires every aircraft operator to formulate a flight safety manual and have it approved by the DGCA; this flight safety manual should clearly lay down the operator’s safety policies as well as its Flight Safety Awareness and Accident/Incident Prevention Programme.

The DGCA released a five-year National Aviation Safety Plan (2018–2022), which promotes and supports the prioritisation and continuous improvement of aviation safety in India.  Being one of the first countries in the world to have a State Safety Programme consistent with ICAO requirements, India’s National Aviation Safety Plan incorporates the Safety Enhancement Initiatives contained in the Regional Safety Plan of RASG-APAC and is in line with ICAO’s Global Aviation Safety Plan.

1.4        Is air safety regulated separately for commercial, cargo and private carriers?

The safety of commercial, cargo and private carriers are not regulated by differential safety conditions.  However, the application processes for obtaining an Air Operator’s Permit for commercial, cargo and private carriers are different.

1.5        Are air charters regulated separately for commercial, cargo and private carriers?

No air transport service, other than a scheduled air transport service, can be operated by any undertaking except with the special permission of the Central Government or under a non-scheduled operator’s permit granted by the Central Government.

Air charter operations are regulated for passenger services which only apply to twin-engine aeroplanes with seating capacity of not more than nine seats, single-engine aeroplanes and single-piston engine aeroplanes.  Cargo operations can only be undertaken by non-scheduled air transport operators which operate multi-engine fixed-wing aircraft (freighter version) and single or multi-engine helicopters.

The DGCA also regulates the operation of tourist charter flights to and from India as part of an Inclusive Tour Package under the Aeronautical Information Circular dated February 6, 2020.

1.6        As regards international air carriers operating in your jurisdiction, are there any particular limitations to be aware of, in particular when compared with ‘domestic’ or local operators?  By way of example only, restrictions and taxes which apply to international but not domestic carriers.

The DGCA and AAI regulate foreign aircraft operating in India and Indian airports.  As per the Bilateral Air Services Agreements entered into between India and other foreign countries, every such foreign country is required to designate airline(s) for operating the agreed services on the specified routes and to withdraw or alter such designations.  However, international flights are not permitted to pick up passengers/load at any place in India and disembark/discharge at any other place in India, i.e. “cabotage” is not permitted.

AIC 09/2020 dated June 12, 2020 on “Requirements for grant of Operating Authorisation to Foreign Airlines under the Bilateral Air Services Agreements” (“ AIC No. 9 ”) imposes conditions on ownership, effective control and the safety qualifications of foreign airlines.

The Airports Authority of India (Ground Handling Services) Regulations, 2018 and the AVSEC Order No. 03/2009 dated August 21, 2009, as amended from time to time, also contain certain restrictions on foreign airlines undertaking self-handling in respect of passenger- and baggage-handling activities.

1.7        Are airports state or privately owned?

Airports in India can be owned, developed and operated by State entities, such as the AAI under the AAI Act, as well as private parties after they have obtained a licence to operate airports from the DGCA and by entering into operation, management and development agreements (“ OMDAs ”) with the AAI.  All airports, whether managed by AAI or private parties, must be operated according to the provisions of the AAI Act as well as the Aircraft Act.

In line with the Government’s open-skies policy, the AAI has collaborated with private entities for operation, management and development under the public-private partnership model (“ PPP model ”).  The airports of Ahmedabad, Bengaluru, Cochin, Delhi, Hyderabad, Lucknow, Mangalore and Mumbai are currently operated under the PPP model by way of entering into OMDAs with the AAI.  The AAI currently manages a total of 137 airports which include 24 International airports (three Civil Enclaves), 10 Custom Airports (four Civil Enclaves) and 103 Domestic airports (23 Civil Enclaves).  Further, as at the time of writing this chapter, the Government of India has granted “in principle” approval for setting up about 21 greenfield airports in the country, to be developed by private parties, State Government or other Government agencies.

1.8        Do the airports impose requirements on carriers flying to and from the airports in your jurisdiction?

The Aircraft Rules and the AAI Act restrict and qualify access to airports in India.  Further, AIC No. 9 imposes certain requirements such as conditions on ownership, effective control and safety qualifications of foreign airlines.

1.9        What legislative and/or regulatory regime applies to air accidents? For example, are there any particular rules, regulations, systems and procedures in place which need to be adhered to?

Developed by ICAO, the SARPs contained in the 19 Technical Annexes to the Convention on International Civil Aviation are applied universally and produce a high degree of technical uniformity which has enabled international civil aviation to develop in a safe, orderly and efficient manner.  According to the provisions laid down in ICAO Annex 13 to the International Civil Aviation Convention – Aircraft Accident and Incident Investigation, States are required to investigate or delegate the investigation of accidents which have occurred in their territory.

The Aircraft (Investigation of Accidents and Incidents) Rules, 2017, provide for the establishment of the Aircraft Accident Investigation Bureau of India, which is responsible for the investigation of accidents or incidents arising out of, or during, navigation in or over India of any aircraft, and prescribes a list of powers and functions of the investigating body, procedure of investigation, reporting of incidents and powers of the inquiry officer.  The schedule also lists out guidance on damage to the aircraft and various instances of serious accidents.

Section 5 of the CARs issued by the DGCA also provide for implementing Flight Safety Awareness, and an Accident/Incident Prevention Programme for all operators engaged in scheduled or non-scheduled air transport services.

Further, AIC S. No. 16/2021 issued by the DGCA on September 23, 2021 provides for a voluntary reporting system of anyone who witnesses or is involved in or has knowledge of a situation which may possess a potential hazard/threat to flight safety and provides for maintenance of confidentiality of the reporter.

1.10      Have there been any recent cases of note or other notable developments in your jurisdiction involving air operators and/or airports?

• Jet Airways (India) Limited entered into a corporate insolvency process on June 20, 2019.  The National Company Law Tribunal, Mumbai by its order dated June 22, 2021 (“ Order ”) has accepted the Resolution Plan of Jalan-Kalrock Capital as approved by the Committee of Creditors in the Jet Airways (India) Limited bankruptcy proceeding under the (Indian) Insolvency and Bankruptcy Code, 2016 (“ IBC ”), which shut down its operation in April 2019 due to heavy debt.  Jet is the first airline to see a successful resolution under the IBC.  As per the Order, the bankruptcy proceeding has now ceased to exist; however, the airline is facing issues with regard to its slot allocation as the slot allocation for the airline cannot be restored on a historic basis.  The airline would now need to seek slots as and when it has the aircraft and the attendant wherewithal and logistical support in place as per the approved Resolution Plan.  Although the airline has received its Air Operating Permit from the DGCA, there is no definite information available as to when the airline plans to commence operations.
• On October 8, 2021, Tata Group’s bid emerged successful in the divestment process of the national carrier Air India, its wholly owned subsidiary Air India Express and a 50% stake in Air India STATS.  The Tata group’s holding company, Tata Sons, through its wholly owned subsidiary Talace Pvt Ltd submitted a winning bid of INR 18,000 crore as the Enterprise Value of Air India with debt to be retained at INR 15,300 crore and cash component of INR 2,700 crore.  The Government of India has finally privatised the debt-ridden airline in its third attempt in the last 20 years.  AirAsia India is an Indian low-cost airline headquartered in Bengaluru.  The airline was a joint venture between Tata Sons and AirAsia Bhd.  Tata Sons currently holds a 100% stake in the airline, after AirAsia Bhd recently sold its remaining 16.33% stake to Air India.
• In relation to a petition filed by an aircraft lessor of SpiceJet Limited on account of non-payment of lease rentals, the Delhi High Court issued an interim order on September 22, 2021 prohibiting SpiceJet from transferring its assets worth the decretal amount to a different entity.  SpiceJet Limited has entered into a settlement agreement with the aircraft lessor which now ends all litigation proceedings between the parties including before the UK Court and Execution Proceedings before the Delhi High Court.
• Late stock market investor Rakesh Jhunjhunwala started an airline operation by the brand name, “Akasa Air” through aviation venture SNV Aviation which received its “air operating certificate” on July 7 2022 from the DGCA.  The airline operates as a low-cost carrier on the basis of an Ultra Low Cost Carrier business model, whereby, the airline has been focusing on keeping operating costs even lower than typical budget airlines like IndiGo and SpiceJet.
• In March 2021, the Indira Gandhi International (“ IGI ”) Airport in Delhi announced a key expansion project to increase its passenger-handling capacity.  The expansion project includes a new terminal, advanced facilities, an additional runway and improved capacity to handle more passengers.
• Noida International Airport, also known as “Jewar Airport” is set to become operational by 2024.  Once operational, Jewar Airport will become India’s largest airport.  The airport will be developed through a public-private partnership model by the international bidder Zurich Airport International A.G, as concessionaire, in close partnership with the Government of India.
• The DGCA issued a circular dated August 26, 2021 pursuant to which the Government of India has allowed operations of MAX 737-8 and 737-9 aircraft in India.  The decision to ground the MAX B737-8 and B737-9 was taken by the DGCA in light of the fatal crash of Ethiopian Airline B737 MAX 8 Aircraft ET-AVJ, which occurred after take-off on March 10, 2019 near Addis Ababa, Ethiopia.

1.11      Are there any specifically environment-related obligations or risks for aircraft owners, airlines, financiers, or airports in your jurisdiction, and to what extent is your jurisdiction a participant in (a) the EU Emissions Trading System (EU ETS) or a national equivalent, and (b) ICAO’s Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)?

India is not a participant in the EU ETS.  However, there are a number of regulations and obligations imposed on airlines and airports for environmental protection in India:

• Indian airports that have more than 50,000 aircraft movements per calendar year; and
• all Indian scheduled and non-scheduled passenger and cargo airline operators except: a) flights of all small aircraft with MTOW <5,700 kg; b) flights engaged in search & rescue, patrolling or fire-fighting activities; c) flights engaged in humanitarian grounds and emergency medical service; d) flights engaged in carrying VVIP, Head of States and other eminent personalities; and e) all foreign registered airlines operating to/from India. As per the Climate Change CAR, airport operators and airline operators are required to develop an annual emission management report.  It provides for various other compliances for airport operators and airline operators including, but not limited to, emission management by airport operators, fuel management by airline operators and Local Air Quality Monitoring by airport operators.
• The DGCA also issued a circular on September 16, 2009 for the creation of an Aviation Environment Cell in airlines, aerodrome operators and air navigation service provider organisations in order to address aviation environmental issues.

India has not volunteered to participate in ICAO’s Carbon Offsetting and Reduction Scheme for International Aviation (“ CORSIA ”).  However, the DGCA has issued CARs (Section 10 – Aviation Environment Protection, Series “C”, Part I) which govern the rules and regulations towards monitoring, reporting and verifying annual CO 2 emissions of aeroplane operators and offsetting requirements from international flights.  This requirement is based on ICAO’s SARPs, as contained in Annex-16, Environmental Protection, Volume-IV: CORSIA.

The Government of India issued a “White Paper on National Green Aviation Policy” in 2019 in order to create a simplified regime for sustainable and inclusive growth of the Indian civil aviation sector and align it with ICAO’s vision and mission.  As of today, the MoCA has not published any National Green Aviation Policy.

2.1        Does registration of ownership in the aircraft register constitute proof of ownership?

An aircraft in India is registered in terms of Rule 30 of the Aircraft Rules.  The register of the DGCA is merely a “notation” register; courts in India would accept the certificate of registration, issued by the DGCA, as prima facie evidence of lessor, lender or owner interest in the aircraft.  It would be difficult to defend a case in the courts against third parties if the owner has no title or a defective title as per the records of the DGCA.

2.2        Is there a register of aircraft mortgages and charges? Broadly speaking, what are the rules around the operation of this register?

There is no separate register of aircraft mortgages in India.  However, the CARs require the owner of an aircraft to file a notarised and apostilled copy of the mortgage documents evidencing the creation of the charge with the DGCA, which will endorse the name of the mortgagee on the certificate of registration.

As per Indian company law, if the mortgagor is an Indian company or a company with a registered place of business in India, the mortgagor must, within a prescribed period, register any charge (which includes a mortgage) created with the relevant Registrar of Companies (“ ROC ”) in the prescribed form.  Such filings would have to be made within 30 days of the creation of the charge, in the prescribed form, along with the complete particulars of the charge, including the instrument creating such charge.

2.3        Are there any particular regulatory requirements which a lessor or a financier needs to be aware of as regards aircraft operation?

India has ratified Article 83 bis of the Chicago Convention and therefore, prior to an Indian operator leasing an aircraft to/from a foreign operator, it is mandatory to obtain permission from the DGCA.  There is no specific requirement for a lease to be in any specified form/format or in any particular language.  However, the terms of the lease must be in compliance with the CAR prescribed by the DGCA (CAR Section 3, Air Transport, Series “C”, Part 1, dated March 24, 2017, as revised from time to time, in respect of criteria for leasing of aircraft by Indian Operators) and such other CARs as may be issued by the DGCA from time to time.  Further, the lessor/financier should also ensure compliance with the Aircraft Leasing Manual (CAP 3200), relevant taxation laws, contract laws, foreign exchange laws and stamp duty laws.

2.4        As a matter of local law, is there any concept of title annexation, whereby ownership or security interests in a single engine are at risk of automatic transfer or other prejudice when installed ‘on-wing’ on an aircraft owned by another party? If so, what are the conditions to such title annexation and can owners and financiers of engines take pre-emptive steps to mitigate the risks?

No, there is no concept of automatic “title annexation” of engines in India.  An aircraft in India is registered wholly with its engines, spare parts and other components attached to the aircraft.  As mentioned earlier, the Aircraft Registry of India is only a notation register and does not confer title upon registration, and in the event of dispute, title will have to evidenced through relevant transfer of title documentation.  The DGCA does not maintain a separate register for aircraft engines.

In our experience, provisions in relation to title, security and obligations or restrictions in relation to spare parts are set out in the lease agreement, which also records evidence of the owner’s title and beneficial interest in relation to the parts (present and future) and also on the spare parts (present and future), whether such spare parts are repaired or replaced.  Title of replacement parts would not automatically transfer to the aircraft owner where the replacement part is annexed, and specific title transfer documentation would have to be entered in order to transfer title.

2.5        What (if any) are the tax implications in your jurisdiction for aircraft trading as regards a) value-added tax (VAT) and/or goods and services tax (GST), and b) documentary taxes such as stamp duty; and (to the extent applicable) do exemptions exist as regards non-domestic purchasers and sellers of aircraft and/or particular aircraft types or operations?

Indirect tax

• GST is applicable on taxable supply of goods or services in India.  For a transaction of supply of goods or services to be taxable under GST, its place of supply should be located in India.
• If the supply of goods involves the movement of goods, then the place of supply would be the location of goods at the time at which the movement of goods terminates for delivery to the recipient.
• In case where the supply does not involve movement of goods, then the place of supply would be the location of such goods at the time of delivery to the recipient.

Based on the above, if the place of supply or delivery of the aircraft is determined to be outside India, then in our view, GST would not apply to such a transfer of aircraft.

Further, import of aircraft into India is subject to customs duty and integrated goods and services tax (“ IGST ”).  The applicability of customs duty and IGST on the import of aircraft is subject to any exemption provided under the relevant law.

It may be noted that subject to certain conditions, the GST law provides for IGST exemption on the import of leased aircraft into India.  One of the prescribed conditions is that the importer undertakes to pay IGST on lease rentals.

Under Indian laws, stamp duty differs from State to State; some States have enacted their own stamp duty laws, whilst other States have adopted the Indian Stamp Act, 1899 (with State amendments in respect of the rates of the prescribed stamp duty).  The liability to pay stamp duty in a particular State arises: (i) if the instrument is executed in that State; (ii) if it is executed outside that State, such instrument is brought into the State and relates to a matter or thing done or to be done in that State; or (iii) if it relates to property located in that State.  Any instrument that is not duly stamped is not admissible in evidence for any purpose, nor shall it be acted upon unless it bears the stamp prescribed by law.

In some States such as Maharashtra, where the city of Mumbai is located, copies of instruments relating to a property situated therein or in relation to a thing done or to be done must also be stamped with the same duty as the original.

2.6        Is your jurisdiction a signatory to the main international Conventions (Montreal, Geneva and Cape Town)?

India is a party to the Warsaw Convention (1929), the Hague Protocol (1955) and the Montreal Convention (1999); the provisions provided therein, subject to the provisions of the Carriage Act, have the force of law in India in relation to any carriage by air irrespective of the nationality of the aircraft performing the carriage.

India ratified the Cape Town Convention on International Interests in Mobile Equipment and the Protocol to the Cape Town Convention on International Interests in Mobile Equipment (Protocol) on March 31, 2008 (“ CTC ”). 

India has not ratified the Geneva Convention.

2.7        How are the Conventions applied in your jurisdiction?

Although India acceded to the CTC on March 31, 2008, only specific provisions of the same became effective from July 1, 2008.  From February 2015, the Aircraft Rules were amended to give the Central Government of India the power to cancel the registration of an Indian-registered aircraft, to which the provisions of the CTC apply by way of an application from the IDERA holder, prior to the expiry of the lease.

2.8        Does your jurisdiction make use of any taxation benefits which enhance aircraft trading and leasing (either in-bound or out-bound leasing), for example access to an extensive network of Double Tax Treaties or similar, or favourable tax treatment on the disposal of aircraft?

The Income Tax Act, 1961 (“ ITA ”) provides that a person who is eligible to avail benefits under a Double Taxation Avoidance Agreement (“ DTAA ”) signed by India has the option to be governed by the provisions of the ITA or the DTAA, whichever are more beneficial to him.  Lease rentals payable to a non-resident for use of aircraft for the purpose of a business carried on in India by the payer (whether resident or non-resident) are taxable in India as royalties under the domestic tax law and are subject to withholding tax at the rate of 10% (plus applicable surcharge and cess) on a gross basis.  Availability of DTAA benefits will be subject to the general anti-avoidance rule (“ GAAR ”) contained in the ITA.  GAAR applies to “impermissible avoidance arrangements”, which means an arrangement whose main purpose is to obtain a “tax benefit” (i.e. a reduction or avoidance of tax that would be payable under the ITA), and, amongst other things, such arrangement “lacks” or is “deemed to lack” commercial substance in whole or in part.  This could, if alleged by the tax authorities as applicable and successfully invoked by them, result in denial of a tax benefit, including denial of DTAA benefits.  There is an exemption from applicability of GAAR; however, the same applies only to income arising from a transfer of investments made prior to April 1, 2017.

Please also refer to our observations at question 5.1 in relation to International Financial Services Centres (“ IFSCs ”).

2.9        To what extent is there a risk from the perspective of an owner or financier that a lessee of aircraft or other aviation assets in your jurisdiction may acquire an economic interest in the aircraft merely by payment of rent and thereby potentially frustrate any rights to possession or legal ownership or security?

Please refer to our response at question 2.4.

An operating lease does not give rise to any equitable or other similar interest in an aircraft.  However, in case of a finance lease, while the law does not specify the interest of lessee in the aircraft, the Supreme Court in the matter of Association of Leasing and Finance Companies v. Union of India (2010 (20) STR 417) explained that a finance lease “ is a form of long term financing.  In a finance lease, it is the lessee who selects the equipment to be supplied by the dealer or the manufacturer, but the lessor [finance company] provides the funds, acquires the title to the equipment and allows the lessee to use it for its expected life.  During the period of the lease the risk and rewards of ownership are transferred to the lessee who bears the risk of loss, destruction , and depreciation or malfunctioning.  The bailment which underlies the finance leasing is only a device to provide the finance company with a security interest [its reversionary right].  If the lease is terminated prematurely, the lessor is entitled to recoup its capital investment [less the realizable value of the equipment at the time] and its expected finance charges [less an allowance to reflect the return of the capital] ”.  In light of this judgment of the Supreme Court, if the lessee has made a considerable amount of rental payments towards the aircraft under a finance lease, it may be able to argue that it has obtained an equitable interest in the aircraft, and that the interest of the lessor is only a security interest.  However, this argument in respect of aircraft lease transactions is yet to be tested in courts, therefore adequate contractual safeguards should be provided in the lease to protect the proprietary interest of the lessor.

3.1        What rights of detention are available in relation to aircraft and unpaid debts?

DGCA, the central regulatory body for civil aviation in India, is expressly empowered under clause (b) of subsection (1) of Section 8 of the Aircraft Act to detain any aircraft if it is of the opinion that such detention is necessary to secure compliance with any provisions of the Aircraft Act or rules framed thereunder, or to implement an order made by any court.  If, however, the operator is insolvent or undergoing insolvency proceedings at the company law tribunals under the IBC, the Authority would need the leave of the tribunal before exercising its right to detain the aircraft.

3.2        Is there a regime of self-help available to a lessor or a financier of an aircraft if it needs to reacquire possession of the aircraft or enforce any of its rights under the lease/finance agreement?

Typically, the lease agreement should set out the powers and responsibilities as well as the recourse in case of disputes, etc.  There is no specific statutory provision for self-help in India.

Reaching an amicable settlement for repayment or rescheduling of payment deadlines with the lessee/borrower is, perhaps, the only self-help available to a lessor or a financier.  Alternatively, contractual rights can be enforced by approaching the courts or initiating deregistration and repossession proceedings with the DGCA.

Clause (iv) of sub-rule (6) and sub-rule (7) of Rule 30 of the Aircraft Rules govern the process of deregistration of an aircraft prior to the expiry of the lease agreement on receipt of an application from the IDERA holder by the DGCA.  The DGCA must accept a valid and recorded IDERA and deregister the aircraft within a time frame of five days when accompanied with a certificate stating that all registered interests ranking in priority have been discharged, or that the holders of such interest have consented to such deregistration and export.

3.3        Which courts are appropriate for aviation disputes?  Does this depend on the value of the dispute?  For example, is there a distinction in your jurisdiction regarding the courts in which civil and criminal cases are brought?

The subject matter of the dispute determines the forum for adjudication, for instance: disputes with respect to the Competition Act, 2002 (“ CA02 ”) are dealt with by the Competition Commission of India (“ CCI ”); individual consumer complaints are dealt with by consumer courts; accidents in the aircraft are to be looked into by the Aircraft Accident Investigation Bureau as per the Aircraft (Investigation of Accidents and Incidents) Rules, 2017; and compensation-related matters under Section 9B of the Aircraft Act are dealt with as per the existing agreement or by an arbitrator appointed by the Central Government.  Further, the value and nature of the dispute (civil or criminal) also determines which court shall have jurisdiction in the matter.

The Supreme Court of India is the final court of appeal concerning all forms of disputes.  The High Courts under their Writ Jurisdiction are a preferred forum for adjudication of aviation disputes.  Lessors have taken to the High Courts for lodging winding-up petitions against defaulting lessees, or praying for issuance of writs directing the DGCA to act upon their deregistration request in time.  Petitions of lessees requesting delay in the de-registration process so that they could reach settlements with financiers/lessors are not unheard of at the High Courts.

Aviation disputes concerning consumers vis-à-vis airlines and airports authorities are preferred in the three-tier consumer disputes redressal forums established under the Consumer Protection Act, 2019 (“ CPA ”), with appeals lying before the Supreme Court.

Furthermore, the AERA Appellate Tribunal was established under Section 17 of the AERA Act to adjudicate any dispute between service providers and consumers.  Appeals against the orders of the said Appellate Tribunal lie before the Supreme Court under Section 31(1) of the AERA Act.

Criminal proceedings shall be initiated by the Regional Director/Head of Directorate as per the procedure laid down in the Code of Criminal Procedure, 1973.  In view of the fact that offences under the Aircraft Act and Aircraft Rules (except violation of Rule 91 of the Aircraft Rules) are non-cognisable and bailable, a criminal complaint can be filed in the court of a Magistrate of competent jurisdiction depending on the Police Station where the offence was committed.  In case of violation of Rule 91 of the Aircraft Rules (which is a cognisable offence dealing with the prohibition of slaughtering and flaying of animals, and depositing of rubbish and other polluted or obnoxious matters in the vicinity of aerodrome), a First Information Report (“ FIR ”) may be registered with the Police, who will prosecute the offenders directly.

3.4        What service requirements apply for the service of court proceedings, and do these differ for domestic airlines/parties and non-domestic airlines/parties?

Section 27 and Order V of the Code of Civil Procedure, 1908 govern the applicable service requirements for service of court proceedings.  Summons are issued by civil courts and served to the defendant in person or to his/her legal representative, by way of paper publication, or are posted to his/her last known place of residence or work, for the defendant to appear and answer the claim within 30 days of the institution of the suit.

For non-domestic airlines/parties, the procedure is additionally governed by the Hague Convention, 1965, to which India is a signatory, and therefore the civil court hearing the suit must forward a summons request to the central authority of the State concerned, along with the document to be served.

3.5        What types of remedy are available from the courts or arbitral tribunals in your jurisdiction, both on i) an interim basis, and ii) a final basis?

Interim injunctions, ex parte decrees, final injunctions and final orders/awards covering aspects such as damages, compensation, repossession or sale of aircraft are available.

3.6        Are there any rights of appeal to the courts from the decision of a court or arbitral tribunal and, if so, in what circumstances do these rights arise?

Yes, rights of appeal exist and may arise as a matter of right or upon exercise of discretion by the courts.  For example, a judgment of a court may be challenged before a superior court if it is certified by the inferior court as involving a substantial question of law of general importance; or an arbitral award may be challenged on the ground that it suffers from legal mala fides , where enforcement would be contrary to public policy or that the arbitral tribunal did not have jurisdiction over the matter.

3.7        What rights exist generally in law in relation to unforeseen events which might enable a party to an agreement to suspend or even terminate contractual obligations (in particular payment) to its contract counterparties due to force majeure or frustration or any similar doctrine or concept?

The doctrine of frustration is incorporated under Section 56 of the Indian Contract Act, 1852.  A contract is treated as frustrated if the substratum of a contract is lost due to impossibility of performance.  If the entire performance of the contract becomes substantially impossible or useless without fault on either side, then such contract is prima facie dissolved by the doctrine of frustration.  The principles of frustration apply only if the contract does not have an express or implied “ force majeure ” clause.

The Supreme Court in the case of Energy Watchdog v. CERC [(2017) 14 SCC 80] held that Section 56 of the Indian Contract Act, 1852 must be considered to be exhaustive of the law relating to frustration of contracts in India and the courts cannot travel outside the terms of the section in the matter.  Force majeure clauses are to be interpreted narrowly – unless a particular event clearly falls within the ambit and scope of a force majeure clause in the contract, courts may not accept the invocation of “ force majeure ”.  The Bombay High Court in the case of Standard Retail Pvt. Ltd. v. M/s G.S. Global Corp & Ors. (Commercial Arbitration Petition [(L) No. 404 OF 2020)] held that the COVID-19 pandemic cannot be used as an excuse from performance of contract since the force majeure clause did not include any pandemic event.  Commercial unviability to perform a contract cannot be the basis to trigger the force majeure clause.

4.1        How does your jurisdiction approach and regulate joint ventures between airline competitors?

The CA02 is the principal statute that governs the anti-trust regime in India.  The CA02 does not specifically deal with or govern the airline sector.  However, more generally, a joint venture between two competing airlines may require assessment under the following two provisions under the CA02:

• The CA02 prohibits any anti-competitive agreement between competing enterprises, including cartels (“ Horizontal Agreements ”).  Such anti-competitive agreements include price-fixing, bid-rigging, limiting production, supply, etc.  A limited exception to Horizontal Agreements is the agreements entered into between competing enterprises, which are in the nature of a joint venture (“ JV Exemption ”).  However, the JV Exemption applies only when such an arrangement demonstrably increases efficiency in production, supply, distribution, storage, or acquisition of control of goods or services.
• The CA02 prescribes for a mandatory notification requirement for mergers and acquisitions (including, in certain circumstances, JVs) (“ Combination ”) if the asset value and turnover of the parties involved a breach of the jurisdictional thresholds prescribed under the CA02 and no other statutory exemption is applicable.  The CA02 provides for a suspensory regime.  As such, in case of a notifiable Combination, parties are required not to complete or close the transaction until receipt of the CCI approval or the lapse of 210 days (subject to statutory exclusions) from the date of filing of the notification, whichever is earlier.

4.2        How do the competition authorities in your jurisdiction determine the ‘relevant market’ for the purposes of mergers and acquisitions?

While assessing a pre-merger notification, the CCI is required to determine the relevant market with reference to the relevant product market (“ RPM ”) and relevant geographic market (“ RGM ”).  For the purposes of determining (a) the RPM, the CCI is required to consider various factors including physical characteristics, price, consumer preference, industrial classifications, etc. to map potential overlaps between products/services, and (b) the RGM, the CCI is required to make its determination based on factors such as regulatory trade barriers, transport costs, language, local specifications, etc.

4.3        Does your jurisdiction have a notification system whereby parties to an agreement can obtain regulatory clearance/anti-trust immunity from regulatory agencies?

As stated above, the CA02 provides for a mandatory suspensory regime whereby all notifiable Combinations that meet the jurisdictional thresholds and do not benefit from any statutory exemption are required to be notified to and approved by the CCI.  The CCI (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011 prescribe the thresholds/exemptions.

However, there is no other anti-trust immunity or any other approval mechanism under the CA02 for any agreement entered into between competing enterprises: (a) that are not in the nature of a Combination; or (b) that do not entail a notifiable transaction to the CCI.

4.4        How does your jurisdiction approach mergers, acquisition mergers and full-function joint ventures?

The CA02 creates no distinction between the assessment of any notifiable Combination, i.e. a merger, acquisition or full-function joint venture.  Irrespective of the type of transaction, the assessment of the CCI is based on whether the proposed Combination would potentially cause an appreciable adverse effect on combination in India.

As stated above, in case of a non-notifiable combination or an arrangement between competitors as a full-function JV, the parties would need to self-assess if the JV results in any of the efficiencies set out in question 4.1 above, in order to ensure compliance with the provisions of Section 3 of the CA02, which seek to prohibit Horizontal Agreements.

Besides the CA02, the Companies Act, 2013 and Securities Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 2011 (the “ Takeover Code ”) also govern mergers and acquisitions of unlisted and listed companies, respectively.  The National Company Law Tribunal is the adjudicating authority in case of unlisted companies, whereas the Securities Exchange Board of India is the nodal agency when it comes to mergers and acquisitions of listed companies as well as companies proposing to be listed on the stock exchange.  The Takeover Code specifies situations where any acquisition may trigger open offer requirements.

Further, the exchange control-related aspects of mergers and acquisitions are regulated by the Reserve Bank of India under the extant Foreign Exchange Management regulations, which prescribe strict reporting and pricing requirements.  Foreign investment-related aspects are dealt with by the Ministry of Commerce.

4.5        Please provide details of the procedure, including time frames for clearance and any costs of notifications.

As stated in response to question 4.3 above, all notifiable Combinations are required to be notified to and approved by the CCI.  A brief overview of the timelines, costs and procedure is set out below: 

• Form of the notification – The Combination Regulations specify that a Combination may either be notified in the shorter “Form-I” or a longer “Form-II” depending on the combined market shares of the parties to the Combination in the relevant market for overlapping business activities and in the markets that are vertically linked to each other.  The parties may choose to notify a Combination in Form-II if their combined market share is (i) more than 15% in the relevant market for overlapping business activities, or (ii) more than 25% in the markets that are vertically linked to each other.
• Obligation to notify – In the case that a Combination involves an acquisition of shares, voting rights or assets, the acquirer is required to notify the Combination to the CCI.  However, in case of a merger, the merging parties collectively are required to notify the Combination to the CCI.
• Timing of the notification – A Combination can be notified to the CCI at any time after the binding transaction documents have been executed between the parties.
• Timeline for the approval – The CA02 mandates that the CCI should form its prima facie opinion on actual or likely appreciable adverse effect on competition (“ AAEC ”) of a Combination within 30 days from the date of notification.  In the event that the CCI prima facie observes that a Combination either has or is likely to have an AAEC in a relevant market in India, it has an additional 180 days to investigate further into the likely anti-competitive impact of the Combination on the relevant market, and either disallow or approve the same with necessary modifications if any, which may either be proposed by the CCI or the parties themselves.  Upon expiry of 210 days from the date of notification, the Combination will be deemed to be approved by the CCI.

The CCI has introduced a deemed approval mechanism process which is called the Green Channel approval as notified on August 13, 2019.  The parties may avail of Green Channel approval only if they are not engaged in providing any similar/substitutable products, vertically linked products, or complementary products either directly or through any of their controlling or non-controlling stakes in any entity.  In the case that a Combination is notified pursuant to the Green Channel, CCI’s Deemed Approval will be considered as having been granted once the Combination has been notified in Form-I and the CCI has acknowledged the receipt of the notification.

With regard to the costs of notification, Form-I must be accompanied with a filing fee of INR 20 lakhs (approximately USD 24,200) while a Form-II will have to be accompanied with a filing fee of INR 65 lakhs (approximately USD 78,600).

4.6        Are there any sector-specific rules which govern the aviation sector in relation to financial support for air operators and airports, including (without limitation) state aid?

There are no sector-specific rules that prescribe financial support or aid to air operators and airports.  The Central Government may, at its discretion, grant such aid or other financial support and facilities to the aviation sector as a matter of State policy, keeping in mind the growth and development of the aviation sector.

The current pattern of financing is predominantly based on internally generated resources of the AAI.  Funding through external assistance, external commercial borrowings, loans and equity has been negligible.  The allocation of budgetary grants is limited to certain airports in remote and inaccessible areas.

The National Civil Aviation Policy, 2016 (“ NCAP 2016 ”) introduced the Regional Connectivity Scheme (“ RCS ”) that, inter alia , seeks to provide various concessions and support to air operators, airports and other stakeholders; for example, an excise duty of 2% is levied on aviation fuel, no airport charges are levied for operations under the RCS, etc.

Under the UDAAN Scheme, efforts have been made to provide support to Selected Airline Operator(s) in the form of Viability Gap Funding (“ VGF ”) and other concessions/support offered by the Central Government, State Governments and airport operators, including: reduction of VAT to 1% or less on ATF at RCS airports located within a particular State for a period of 10 years from the date of notification; provision of minimum land, if required, free of cost and free from all encumbrances for development of RCS airports; providing multi-modal hinterland connectivity (road, rail, metro, waterways, etc.) as required; providing security and fire services free of cost at RCS airports through appropriately trained personnel and appropriate equipment as per applicable standards and guidelines by relevant agencies; provision of, directly or through appropriate means, electricity, water and other utility services at substantially concessional rates at RCS airports; and provision of a certain share (20%) towards VGF for respective RCS routes (pertaining to the State), provided the share of States in the North-Eastern region of India and Union Territories would be 10%.

4.7        Are state subsidies available in respect of particular routes?  What criteria apply to obtaining these subsidies?

The NCAP 2016 seeks to sustain and nurture a competitive market environment in the civil aviation sector, including enhancement of regional connectivity through fiscal support and infrastructure development, providing for an RCS.  The operation of the scheme is proposed to be through a market mechanism where operators will: assess demand on routes; submit proposals for operating/providing connectivity on such route(s); seek VGF, if any, while committing to certain minimum operating conditions; and the same shall be finalised in interaction with other market participants.

Further, the RCS scheme provides that: for up to 10 years from the date of commencement of flight operations under an RCS, there will be no airport charges levied for operations under the RCS; landing, parking and Terminal Navigation Landing Charges shall be waived; and Route Navigation and Facilitation Charges will be levied on a nominal basis.  Prioritisation of routes will be carried out and reviewed from time to time so that there is balanced growth of regional connectivity in different parts of the country.  The UDAAN Scheme provides for the eligibility criteria, such as having a valid air operating permit, including the minimum performance specifications for an RCS flight.

As per the scheme, a State will identify international routes for which the AAI will determine a subsidy amount per seat and invite bids from domestic carriers.  This will be followed by airlines submitting their proposals, which will include the routes they wish to connect as well as the subsidy needed by them.  The Government will grant financial aid only for the actual number of passenger seats that are unsold, even if the airline had sought subsidy for a higher percentage of seating capacity at the time of bidding.

4.8        What are the main regulatory instruments governing the acquisition, retention and use of passenger data, and what rights do passengers have in respect of their data which is held by airlines and airports?

In India, data privacy and protection are governed by the provisions of the Information Technology Act, 2000 (“ IT Act ”), which provides legal recognition to transactions carried out by means of electronic data interchange.  Sensitive personal data includes, inter alia , information relating to: passwords; credit/debit card information; biometric information; and condition of physical, physiological and mental health, etc.  The Personal Data Protection Bill 2018 in India follows the implementation of the General Data Protection Regulation (“ GDPR ”), however, the Government of India has withdrawn the Personal Data Protection Bill 2018 and a revised bill is proposed to be tabled before the Parliament in the future.  The Telecom Regulatory Authority of India has stated that each user owns his data and the entities processing such data are mere custodians.

The transfer of personal data (defined as sensitive personal data or information) is governed by the Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal Data or Information) Rules, 2011 (“ SPD Rules ”).  The SPD Rules were issued under Section 43A of the IT Act, which holds a body corporate liable for compensation for any negligence in implementing and maintaining reasonable security practices and procedures while dealing with sensitive personal data or information.  The SPD Rules expand on the scope of these reasonable practices and procedures.  They define sensitive personal data and mandate the implementation of a policy for dealing with such data.  Further, various conditions such as consent requirement, lawful purpose, purpose limitation, subsequent withdrawal of consent, etc. have been imposed on the body corporate collecting such information.

The SPD Rules also require the prior consent of the provider of the information while disclosing sensitive personal data to a third party.  Transfer of sensitive personal data outside India is permitted on the condition that the same level of data protection is adhered to in the country, which is applicable to the body corporate under the SPD Rules.

4.9        In the event of a data loss by a carrier, what obligations are there on the airline which has lost the data and are there any applicable sanctions?

The Information Technology (Indian Computer Emergency Response Team and Manner of Performing Functions and Duties) Rules, 2013 (“ CERT-in Rules ”) impose an obligation on all corporate entities, which includes airlines, to notify the Indian Computer Emergency Response Team (“ CERT-in ”) in case of a cybersecurity breach.

4.10      What are the mechanisms available for the protection of intellectual property (e.g. trademarks) and other assets and data of a proprietary nature?

Since India has acceded to the Agreement on the Trade Related Aspects of Intellectual Property Rights, various other pieces of legislation have been enacted over the years to protect Intellectual Property Rights (“ IPRs ”).  The following statutes provide protection and remedies available to the respective IPRs:

• The Trade Marks Act, 1999, as amended by the Trade Marks (Amendment) Act, 2010.  The remedies available are in the form of damages, account of profits, injunction, search and seizure, and forfeiture.  Trademark infringement and counterfeiting are cognisable offences.  False entries, applications or trade descriptions are offences and are punishable by way of imprisonment or fine. 
• The Copyright Act, 1957, as amended by the Copyright (Amendment) Act, 2012.  The remedies available under the said Copyright Act are similar to those under the Trademarks Act; furthermore, infringement of copyright is punishable with imprisonment that may extend up to three years, or a fine of up to INR 200,000. 
• The Patents Act, 1970, as amended by the Patents (Amendment) Act, 2005 which also provides for remedies pertaining to patent infringement.

In addition to the above-mentioned remedies, criminal remedies are also available for offences such as false entries in the register, false claims and false information given to the Government.  According to the Designs Act, 2000, the remedies available for the infringement of copyright are also available for the infringement of registered design owners.  In recent times, the courts in India have been strictly enforcing IPRs and protecting the rights lying therein. 

While injunctions still remain the prominent and effective remedy, as can be seen above, courts have in exceptional cases awarded punitive damages.  Recently, intellectual property owners have increasingly been recording their IPRs, especially trademarks, before the relevant customs authorities to prevent counterfeit products from entering the Indian market.

4.11      Is there any legislation governing the denial of boarding rights and/or cancelled flights?

The DGCA has issued CARs (Section 3, Series “M”, Part IV – Facilities to be provided to passengers by airlines due to denied boarding, cancellation of flights and delays in flights dated August 6, 2010 (as revised from time to time) (“ Passenger CAR ”)), which govern the rules and regulations relating to denial of boarding rights and/or cancelled flights.  The CAR in question provides for the refund of the ticket fare amount and compensation in the event of denied boarding, even though the passenger has been given a confirmed booking for travel on the flight and has checked in for the flight well within the specified time ahead of the departure of the flight.

Airlines are required to inform the passenger of the cancellation at least two weeks before the scheduled time of departure and arrange an alternate flight/refund as acceptable to the passenger.  In case the passengers are informed of the cancellation less than two weeks before and up to 24 hours of the scheduled time of departure, the airline shall offer an alternate flight or refund the ticket, as acceptable to the passenger.  Additionally, the airline shall provide passengers with facilities at the airport in accordance with the CAR in the event the passengers have already reported for their original flight and whilst they are waiting for the alternate flight.

In case of foreign airlines, the amount of compensation paid to the passengers can be made in accordance with the regulations of their country of origin or as prescribed by the CAR.

Further, the airlines are required to display their policies in regard to compensation, refunds and the facilities that will be provided by the airline in the event of denied boarding, cancellations and delays on their respective websites as part of their passenger Charter of Rights.

4.12      What powers do the relevant authorities have in relation to the late arrival and departure of flights?

As per the Passenger CAR issued by the DGCA, in the event of delay, the airlines are required to provide facilities such as meals, refreshments and/or hotel accommodation depending on the number of hours of delay of the flight.  An exception to the above has been provided for delays caused due to extraordinary circumstances, as defined in the CAR, which could not have been avoided even if all reasonable measures had been taken.

4.13      Are the airport authorities governed by particular legislation? If so, what obligations, broadly speaking, are imposed on the airport authorities?

The AAI is the nodal authority controlling all airports in India.  It was established under the AAI Act, which was later amended in 2003 to include a legal framework for airport privatisation and the functions of the AAI, as well as providing guidance on the efficient management of airports, civil enclaves and aeronautical communication stations.  Further, it states that it is the duty of the AAI to provide an air traffic service and air transport service at any airport and civil enclave.  In the discharge of its functions, the AAI shall have due regard to the development of the efficiency, economy and safety of the air transport service.

4.14      To what extent does general consumer protection legislation apply to the relationship between the airport operator and the passenger?

In case of airline operators and passengers, the DGCA has set up the “AirSewa” web-portal/mobile application to deal with travel-related passenger grievances.  The Passenger CAR also provides for passengers to file for grievance related to delays, cancellations, etc., on the AirSewa App or through the portal.  The AirSewa portal launched by the DGCA provides a facilitative platform for passengers to file complaints with the respective airline.  The CPA also provides an additional remedy for passengers to claim compensation for any deficiency in the service provided by airlines.

In case of airport operators and passengers, there is no specific legislation and the general consumer protection legislation, i.e. the CPA, as amended from time to time, shall apply.  In the case of Geeta Jethani v. Airport Authority of India (2004 (2) C.P.C. 428) , the National Consumer Disputes Redressal Commission (“ NCDRC ”) held the AAI liable for deficiency in service in maintaining an escalator, resulting in the death of a young child at the Indira Gandhi International Airport.  The NCDRC, while holding that a complaint was maintainable under the Consumer Protection Act, 1986, stated that maintenance of the airport is a statutory function of the AAI.  It is the duty of the AAI to manage the airports, to provide air traffic service, air transport service and air safety service, to regulate the entry and exit of passengers and visitors at the airports, to provide transport facilities to the passengers travelling by air and to have due regard for the safety of such service.  The quantum of penalty in this case was decided on the basis of the criteria set out under the Carriage Act, as the complainants were non-residents.

4.15      What global distribution suppliers (GDSs) operate in your jurisdiction?

Computer Reservation Systems (“ CRSs ”) or Global Distribution Systems (“ GDSs ”) are computerised systems that contain information about air carriers’ schedules, availability, fares and fare rules, through which reservations can be made or tickets may be issued.  In India, GDSs are not governed by specific legislation.  However, the DGCA has issued CARs to regulate and promote fair competition in the airline sector and to ensure that consumers do not receive inaccurate or misleading information on airline services.  The said CAR on the CRS and GDS prescribes obligations on system vendors and participating carriers, as well as subscribers.

4.16      Are there any ownership requirements pertaining to GDSs operating in your jurisdiction?

The DGCA CARs are applicable to all GDSs, and to their essential elements operating in India displaying or selling air services, irrespective of: (i) the legal status or nationality of the system vendor; (ii) the source of the information used; or (iii) the location of the relevant data processing centre, and irrespective of where the air services are provided.  There are no specific ownership restrictions.

4.17      Is vertical integration permitted between air operators and airports (and, if so, under what conditions)?

A vertical integration which is in the nature of a combination between an air operator and an airport is not specifically governed under the provisions of the CA02.  Accordingly, such a combination, if permitted under other applicable laws, would be assessed by the CCI for any appreciable adverse effect on competition in India.

The AAI entering into an OMDA with private parties for the development and modernisation of airports is one such example.  The OMDA sometimes prescribes restrictions on vertical integration between airline operators and airport operators.

To date, only horizontal mergers have taken place between airline operators in India, such as Air India and Indian Airlines, Jet Airways and Sahara Airlines, Kingfisher Airlines and Deccan Airlines, etc.

4.18      Are there any nationality requirements for entities applying for an Air Operator’s Certificate in your jurisdiction or operators of aircraft generally into and out of your jurisdiction?

Yes, the DGCA has prescribed conditions for effective control of airlines in the following manner:

• a citizen of India; or
• that is registered and has its principal place of business in India;
• whose chairman and at least two-thirds of its directors are Indian citizens; and
• that is substantially owned and effectively controlled by Indian nationals.
• a citizen of India;
• a group of individuals of Indian nationality or a registered trust or society;
• a non-resident Indian or overseas corporate body; or
• an Indian-registered company having its principal place of business in India with or without foreign equity participation (excluding non-resident Indian equity).

5.1        In your opinion, which pending legislative or regulatory changes (if any), or potential developments affecting the aviation industry more generally in your jurisdiction, are likely to feature or be worthy of attention in the next two years or so?

The Ministry of Finance on September 30, 2021 amended Condition No. 102 of Customs Notification No. 50/2017 which now permits the transfer of aircraft from one lessee to another without re-exporting the aircraft, subject to certain conditions being satisfied.  Earlier, in order to transfer a lease from one lessee to another within India, the aircraft had to be physically exported and then re-imported into India for re-lease of the aircraft, which can now be avoided.

The MoCA has now notified the Drone Rules, 2021 (the “ Rules ”) in supersession of the Unmanned Aircraft System Rules, 2021 on August 26, 2021.  The Rules provide for registration, licencing requirements for pilots, and airspace segregation for drone operations.  Operations in certain restricted zones will need prior approval of the regulator.  The MoCA has also introduced an online platform for airspace maps and certification of drones.

The National Air Sports Policy, 2022 (“ NASP ”) has been formulated by the Government of India with the key objective of the promotion of air sports culture in India to include air sports such as drones, parachuting, paragliding, etc.  It is proposed that there would be a four-tier governing structure for air sports in India of which the Air Sports Federation of India, an autonomous body under MoCA, would be the apex governing body.

On June 22, 2020, the DGCA amended the CAR on Registration and Deregistration of Aircraft.  The amendment includes a new para. 7A which provides for the recordation of IDERA and/or its Certified Designee in the prescribed format with the DGCA.  This is likely to facilitate aircraft deregistration under the IDERA process without much administrative hassle.

The International Financial Services Centres Authority Act, 2019 (the “ IFSC Act ”) was notified by the Government of India on December 19, 2019 to provide for the establishment of an authority to develop and regulate the financial services market in the IFSCs in India.  The Ministry of Finance by way of a Notification dated April 27, 2020 established the International Financial Services Centres Authority (“ IFSCA ”) with its head office in Gandhinagar, Gujarat.  The Gujarat International Finance Tec-City (“ GIFT City ”) is a Government of India initiative to provide a platform to set up Indian companies whose businesses, inter alia , include banking, insurance, aircraft financing and leasing activities, etc. in the IFSC established under the IFSC Act.

The Ministry of Finance by a Notification dated December 14, 2021 notified a lease including any hybrid of operating and financial lease of such product or equipment as may be specified by IFSCA, as financial a product.  The inclusion of aircraft leases as financial products has created an opportunity for the establishment of a viable aircraft leasing market in India, especially in GIFT City.  The Government has provided multiple tax benefits and ease of set-up for lessors proposing to lease aircraft through establishments in the IFSC.  The IFSCA issued a circular dated May 18, 2022, the “Framework for Aircraft Leases”, which, inter alia , provides guidelines for the establishment of a lessor entity in GIFT City.  Further, the DGCA amended the Air Transport Circular No. 02/2017 dated September 19, 2022 (as revised from time time) to include the requirement in relation to the import of aircraft and acquisition of Indian registered aircraft in GIFT City.

The MoCA published the Protection and Enforcement of Interests in the Aircraft Objects Bill, 2022 (the “ CTC Bill ”) on April 16, 2022 (revised on July 20, 2022) in order to implement the CTC in India with a view to discharging the treaty obligations and to avail benefits of the Indian accession to the treaty.  The CTC Bill also contains provisions that will accord primacy to the provisions of the CTC Bill in case of conflict with any other law in force in India, permit self-help remedies, and give effect to applicable insolvency provisions of the CTC.  Irrespective of whether the parties to an agreement have chosen India as the place of jurisdiction or not, the remedies under the CTC Bill will be applicable to all transactions that have a connection to India unless the same has been specifically excluded under the relevant transaction documents.  Presently, the CTC Bill is undergoing public consultations and it is difficult to ascertain when it will be promulgated as legislation by the Parliament.

To download this chapter FREE Register or log in here

Contributors

Anand Shah AZB & Partners

Haseena Tapia Shahpurwalla AZB & Partners

Rishiraj Baruah AZB & Partners

Saptarshi Bhuyan AZB & Partners

AZB & Partners

We have updated our terms and conditions and privacy policy Click "Continue" to accept and continue with ET TravelWorld

We use cookies to ensure best experience for you

We use cookies and other tracking technologies to improve your browsing experience on our site, show personalize content and targeted ads, analyze site traffic, and understand where our audience is coming from. You can also read our privacy policy , We use cookies to ensure the best experience for you on our website.

By choosing I accept, or by continuing being on the website, you consent to our use of Cookies and Terms & Conditions .

• Leaders Speak
• Brand Solutions
• Associations
• IATO welcomes GST Council’s clarification on GST applicable on tour packages

The GST Council in its 47th meeting concluded in Chandigarh early this week, said that services provided by an Indian tour operator to a foreign resident for a tour partially in India and partially outside India, the tax will be proportionate to the tour conducted in India for such foreign tourists, with the condition that the concession does not exceed half of the tour duration.

• ETTravelWorld
• Updated On Jul 1, 2022 at 10:09 AM IST

• Published On Jul 1, 2022 at 09:30 AM IST

All Comments

By commenting, you agree to the Prohibited Content Policy

Find this Comment Offensive?

• Foul Language
• Inciting hatred against a certain community
• Out of Context / Spam

Join the community of 2M+ industry professionals

Subscribe to our newsletter to get latest insights & analysis., download ettravelworld app.

• Get Realtime updates
• Save your favourite articles

• Tour Operators
• Travel News
• GST Council
• Travel Industry

Nepal Passed New Rules for Climbing Everest. Not Everyone Is Happy.

Amid proclamations and revisions, guides and operators are left scratching their heads

O​riginally from Outside Online

I​t’s been a frustrating month for mountaineering guides who lead expeditions on Mount Everest. The laws governing climbers on the peak’s Nepali side have changed several times, leaving guides confused, anxious, and glued to the Internet awaiting future updates.

“It’s Nepal and nobody knows how the new regulations will be interpreted, implemented, and finally enforced,” said Austrian guide Lukas Furtenbach, the owner of Furtenbach Adventures, who leads Everest expeditions in Nepal.

The situation began on February 8 when the Khumbu Pasang Lhamu Rural Municipality, the governing body that, among other things, oversees the rules and regulations of Nepal’s Everest Base Camp (EBC), said that for 2024 and beyond, climbers would be required to haul their feces off of the peak and down to Base Camp via plastic WAG bags. Then, on February 14, officials with the agency released even more stringent guidelines. These rules regulated the size of square and dome tents, curtailed the use of helicopters to ferry gear to camp, prevented visitors and trekkers from sleeping in camp, and required every climber to carry down at least eight kilograms (17.6 pounds) of garbage from the mountain, among other things.

The document was laden with typos and logical holes, and some of the strict regulations on the size of tents and the helicopter transport left guides scratching their heads. Furtenbach told me that because of the statute’s vague text on tent size limitations, guides would likely just have to bring more, smaller tents. “We might see a Base Camp this year with more tents than ever because of the new regulations,” he said.

But Nepali officials weren’t finished, and February 28, they said that all climbers on Everest would be required to wear a tracking chip. Then, a week later on March 8, the governing body completely revised the rules issued on February 14, and the revisions all-but reneged on some of the rules.

“False alarm. Once again. Nepalese routine,” said Furtenbach.

When we corresponded on February 29, Furtenbach told me that Nepali officials hadn’t reached out to him or other Western operators about the new regulations—like everyone else, he had read about them online. There were several regulations that Furtenbach said did not pass his sniff test.

Among these initial strictures was a rule that forbade the use of helicopters to ferry gear to and from EBC. Instead, all tents, climbing gear, and personnel would need to be transported solely by yaks. The rule’s intention was to not only preserve nature and reduce helicopter traffic in the region, but to bolster the fading cultural practice and industry of yak herding. But Furtenbach told me that there simply aren’t enough yaks in the region to handle all of the gear.

“If this regulation is not relaxed, we will see chaos—teams not getting gear, food, and oxygen to the mountain in time,” he said. The timing of the announcement, just six weeks before the season begins, represented a major curveball for Furtenbach and other operators.

Luckily for them, the revised ruleset gives some leeway to chopper access. After the latest revision, some operators will be able to carry some logistical equipment to and from Base Camp via helicopter, but the process will be subject to a monitoring committee’s approval. However, according to the Himalayan Times , the municipality emphasized that yaks and local porters “should still be utilized for transporting climbing gear under normal circumstances.”

Regulations on tents became another point of contention when the municipality originally outlawed dining tents larger than ten square feet per person. Guides complained that this regulation essentially outlawed the tents used for mealtime and meetings. “This is an error and not practical—it barely accommodates one chair,” Dawa Steven Sherpa, a conservationist and the CEO of Asian Trekking told ExplorersWeb . This restriction has now been eased to 60 square feet for the dining tents and 80 square per person feet for sleeping quarters. While the regulations on dome tents were meant to curb luxury at EBC, the effect was negligible on big operators. “With those calculations in mind, you can use a large dome tent when you have enough members in your team,” said Furtenbach.

A no-visitor policy that would have required medical staff to purchase a separate climbing permit was also eased for guiding operations, but will remain in place for trekkers and general EBC visitors. Friends and family of climbers will now also be allowed to stay at Base Camp.

Another point of confusion was the widely-covered implementation of “tracking chips,” which, in fact, are nothing more than Recco reflectors. These reflectors are often used in avalanche incidents for body recovery, as they require a bulky detector that is often carried via helicopter. “Ground-based Recco searches are not often possible, and on Everest most rescue and recovery missions are above 7,000 meters (23,000 feet), where helicopters never fly,” said Furtenbach.

Furtenbach said his company has tested all manner of sensors, trackers, and even vital-sign monitors on Everest and says each one comes with its limitations, but none so much as Recco. Most climbers on Everest who get lost do so on the summit ridge, far beyond the possibility of a Recco-guided recovery. “A better solution to the problem of climbers getting lost on the mountain would be that their guides do not leave them alone,” he says.

These new rules aren’t coming out of a vacuum. Last year tied the deadliest year on record on the world’s highest peak. “The new [Recco] rule is in response to rising casualties on Everest,” Rakesh Gurung, director at the Department of Tourism told the Kathmandu Post . The Khumbu Glacier, on which EBC sits is melting rapidly . Clearly something has got to give. But with Everest season just a few weeks away, and these rules far from being set in stone, I don’t envy operators trying to suss out planning a group expedition.