The Karnataka State Tourism Department’s decision to shift homestay approvals to an online platform, while also increasing the number of required clearances from various departments – has thrown the sector into disarray.
Until recently, the process was relatively straightforward. Prospective homestay owners required only a No-Objection Certificate (NOC) from the Police and the local Panchayat or Municipality. However, under a new circular issued by the Director of Tourism Department, owners must now obtain NOCs from ten departments:
The Police, Forest Department, Fire Department, Zilla Panchayat, Taluk Panchayat, Town Panchayat, Municipality, Food and Health Department, CRZ Authorities and the Power Supply Company.
This has alarmed many homestay owners, most of whom are small planters relying on income from homestays as a vital supplementary source. They fear that such a lengthy and cumbersome process will inevitably cause delays, bureaucratic hurdles, and create openings for corrupt practices.
Backlog and Frustration with New Policy
Due to these changes, many renewal applications have accumulated within the department. Some homestay owners allege that authorities are using the new regulations as a pretext to delay or withhold approvals.
Speaking to TOI; Coorg Homestays Association’s President Monti Ganesh said the state govt has assured bringing homestay NOCs under the ambit of Sakala services. “So, the website is being updated. Homestay owners should not get worried,” she added.
Sakala Services: Not a Foolproof Solution
While the State Government has announced that homestay NOCs will be brought under the ambit of Sakala services, skepticism persists. The Sakala scheme, introduced to ensure time-bound service delivery, has its own issues. According to a Deccan Herald report, more than one lakh applications remain pending, with at least half delayed between three and nine months.
Although the scheme aims to eliminate delays, instances of corrupt practices have been reported. In many cases, applicants have felt compelled to pay bribes to “expedite” files or bypass intentionally created delays.
Homestay Owner’s Perspective
Cariappa, a homestay owner, remarked, “The “Guidelines for Registration of Homestay Establishments – 2025” clearly states that a homestay is a non-commercial activity. Yet, we are being treated like five-star hotels. Forcing us to seek approvals from so many government departments is unrealistic. Also forcing it online, especially for homestays located in remote areas of Kodagu and Malnad, where mobile and internet connectivity is often unreliable is not practical. The online compliance requirement simply doesn’t account for these ground realities.”
Sakala Penalties: Too Insignificant to Deter Misconduct
Sakala is far from a foolproof solution. Although the Act promises time‑bound service delivery, delays still occur due to corrupt practices.
Recently, Kalaburagi Deputy Commissioner B. Fouzia Taranum issued a stern warning that delays in resolving Sakala applications would result in penalties, including salary deductions for officers responsible for processing the applications. She emphasized that the Sakala Services Act, introduced in 2011, was meant to ensure timely service delivery with a simple mantra: “No more delays, no excuses — deliver on the promised date”.
While her stance is commendable, it is worth noting that the role of a Deputy Commissioner, like that of other government officials, is a transferable one. Should a future DC not pursue the matter with the same diligence, delays and hurdles will continue unabated. Moreover, the penalties prescribed under the Sakala Act – Rs. 20 per day, capped at Rs. 500 – are too insignificant to deter delays or corrupt practices. In many cases, government staff and middlemen regard this penalty as a negligible cost compared to the gains they make from extracting bribes.
According to a New Indian Express report, middlemen have already infiltrated the Sakala Services process, making it yet another avenue for exploitation.
Call for Simpler Regulations And Involvement of Grassroots Organizations
Cariappa added, “This is a serious issue. The Karnataka Tourism Department must reconsider its new registration and renewal policies and return to the earlier, simpler process where approvals were granted by the local Panchayat or Municipality and the local Police station. The new system complicates the process unnecessarily and exposes homestay owners to delays and corruption.”
Another homestay owner from Madikeri, Poonacha, told CLN, “It would be far more beneficial if an locally based independent body, such as COHERA or CHA(Coorg Homestays Association) were authorized to inspect, vet, grade and register homestays. This approach can also be implemented in Chikmagalur and other areas. Since homestays operate within homes where owners reside, forcing owners to obtain clearances from departments like Food and Health, Fire Services, and CESCOM is impractical and unfair. The government has already stated that commercial electricity charges are not applicable for homestays. Similarly, it should recognize that owners and staff reside on the premises, making strict hotel-style regulations inappropriate and unnecessarily burdensome.”
Grassroots model needs support. Generates Tax – Why Burden It with Bureaucracy ?
Poonacha added, “The reality is that the Karnataka Tourism Department played no role in the development of the homestay sector in Coorg. This model grew organically at the grassroots level, without any support or intervention from the department. In this context, it would be more practical and effective to delegate the responsibility of registration and renewals to grassroots organizations such as COHERA or the CHA(Coorg Homestay Association), which have been closely involved with and understand the ground realities of the homestay ecosystem.
The government continues to benefit from tax revenues, as all homestays accepting bookings through OTAs such as MakeMyTrip, Airbnb, and others are already paying GST under the Reverse Charge Mechanism (RCM). However, if the government were to overregulate the sector and by also making the registration and renewals difficult for the homestay owners, it risks disrupting this ecosystem – potentially leading to a decline in compliance and a consequent loss of tax revenue.”
New rules announced by the Department of Tourism will only generate more chaos. Homestay as the name suggests, is a stay at a local home, where the guests spend time with local hosts to know more about local culture, to taste local cuisine, relax in a home atmosphere and return to their urban city busy daily schedules.
Kodagu being famous for hospitality, let the local planters allow guests at home – however avoid people from outside Kodagu to buy land here in the name of Agriculture, build homes and start selling as Homestays – this ACTIVITY should be banned.
I remember on 18th March
2021 there was an event (Connect – 2021) conducted by Karnataka Tourism Forum at a Resort in Madikeri. Though this was a promotional event conducted to promote Homestays & Resorts, one of the KTF member restricted Homestay Owners to speak by allotting only a few minutes to speak about their grievances and allowing Hotels & Resorts for more discussion. This shows the partiality by officials.
Kodagu DOES NOT REQUIRE more FIVE STAR RESORTS built in mud-slide sensitive and prone areas. If there are, let’s say, one thousand properly graded, trained and functional home stays, no FIVE STAR resort can provide a comparable experience. Perhaps the only exception is ama Stays & Trails | Plantation Trails Coorg – but even here conscious efforts have to be made to keep up the standards. Over expansion of the concept leads to falling standards.
Having spent close to 3 decades in hospitality, my heartfelt request would be if the DC looks into these new rules and withdraw the unwanted non-value adding processes. Instead, provide good training through bodies like COHERA for operating homestays in a professional manner. Invite top rated Homestay Associations from the country to provide periodic training and skills to raise the quality, service, supply chain and logistics and most importantly guidance on pricing.
Thereafter, If required let the various departments visit the homestays to verify if the owner is genuinely staying at the property and are abiding with the rules.
Lets not make Kodagu a platform for corruption. 🙏🏼
Great responses by the people/readers…but a solution will never be found with the Government coming up with inconsequential new rules to HomeStays. The residents of Kodagu and the Government has to solve the real issue of restricting the inflow of tourists – especially individual vehicle driven variety.
Garbage collection and dispersal, stopping new construction of resorts and stopping conversion of agri land to commercial – especially by non-natives of the district (who do not understand nor respect the terrain). This category of people who buy land purely for commercial exploitation and speculation, should be STOPPED FORTHWITH and in fact decisions reversed. Look at what is happening with the sale BBTC and subsequent resale – the latest is development of Luxury Villas in prime environmentally sensitive areas.
Look at the continuing devastation of the environment and mud slides in places like Ooty, Wayanad, Himachal Pradesh, Uttarakhand, Goa etc. Should this not be stopped?
It took nearly 50 years for progressive leadership to dismantle the draconian License Raj that had stifled India’s manufacturing sector throughout the 20th century.
Now, it appears that the License Raj has returned from the ashes – this time in a new avatar, targeting the homestay sector with an onerous and opaque approval process.
The beneficiaries of this convoluted system are self-evident.
If left unchallenged, homestay owners may soon find themselves subjected to regular visits from shady officials, demanding unofficial payments.
It is imperative that the Homestay Association takes a firm stand against this new regulation. A collective approach involving direct dialogue with elected MLAs must be initiated without delay.
While changing Homestay approvals to online sounds progressive on paper, adding layers like mandatory NOCs from the police and local panchayats risks turning into yet another bureaucratic maze. The number of outstanding/pending applications are already beyond the control of the Approving Authority.
Instead of genuinely streamlining the process, this could open doors to harassment, delays and even corruption at the local level.
If the Government truly wants to encourage tourism and support local entrepreneurs it must ensure these new requirements are transparent, time bound and corruption free – else it becomes just another hurdle for honest Homestay Owners.
Equally, Homestay Owners should exercise genuine responsibility for following the prescribed rules, quality of accommodation, vetting of visitors – it should be self-regulated. If defaulters are found, they should be taken to task. At the end of the day, genuine well run HomeStays has the potential to generate revenue for the exchequer. Surely this can be reinvested into Training, enabling good Power (concessional if possible), incentives for Entrepreneurs and such proactive and positive action. The District Administration should also consider setting up a Grievance Cell for COMPLAINTS against unwanted practices on all fronts.
Strange rules now ..…. When it all started the Government was nowhere to be seen. They could have channelled it in a proper direction making it viable / sustainable and relevant as a secondary source of income for the planters, as also the Government.
Now the Government is basically making it difficult for everyone instead of doing things thoughtfully.