01 April 2025 MSME (Micro, Small & Medium Enterprises) >> Business & Commercial Law  

In Accelerate Productx Ventures Pvt. Ltd. v/s State of Maharashtra, through Secretary–Industries Energy & Labour Department & Others., the Bombay High Court has delivered a significant verdict safeguarding the operational freedom of modern retail, specifically allowing "The New Shop," a 24x7 convenience store in Hadapsar, Pune, to function round the clock without unwarranted police interference. The court, in its order, firmly directed the Pune police not to coerce or force the petitioner to shut its operations after 10:00-11:00 p.m., emphasizing that no law or notification restricts such convenience stores from operating 24x7.

The petitioner, "The New Shop," operating a chain of 24x7 convenience retail stores across India and recognized as a startup and MSME, approached the High Court under Article 226 of the Constitution of India. Their grievance stemmed from the Hadapsar Police Station arbitrarily imposing closing hours of 10:00-11:00 p.m. on their Pune outlet, despite no such restrictions being in place under the Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017 ("2017 Act") or any notification issued by the competent authority.

The petitioner argued that their "convenience store" squarely fell under the definition of "Shop & Establishment" under the 2017 Act. They highlighted that the Act empowers the state government to regulate opening and closing hours for different classes of establishments, but no such restrictions were imposed on convenience stores operating beyond night hours.

Crucially, the petitioner pointed out a notification dated December 19, 2017, issued under Section 11 of the 2017 Act, which specifically restricted operating hours for permit rooms, bars, liquor shops, and cinema houses. A subsequent notification on January 31, 2020, lifted these restrictions for cinema houses and theatres, allowing them to operate 24 hours. The absence of convenience stores in these restrictive notifications strongly implied their freedom to operate 24x7 upon obtaining registration under the 2017 Act.

The petitioner further detailed how the Sub-Inspector of Hadapsar Police Station began orally instructing them to shut down operations by 10:00-11:00 p.m. Despite RTI applications to the state authorities clarifying that no additional police permission was required for 24x7 operation, the police persisted with their coercive actions. Representations made to senior police officials also went unanswered.

In response to the court's notice, the state government filed an affidavit clarifying that the 2017 Act defines "day" as a 24-hour period beginning at midnight and that the restrictive notifications only applied to specific categories of establishments, explicitly excluding convenience stores. The government unequivocally stated that there was no legal impediment for the petitioner to operate its shop 24x7.

The Police Department also filed an affidavit through the Senior Police Inspector of Hadapsar Police Station. In a significant admission, the police stated that the oral instructions to restrict operating hours were due to a "sheer misunderstanding" arising from the fact that the petitioner also sold food items, leading to an incorrect assumption that rules applicable to eating houses might apply. The police explicitly clarified that there was "no reason or intention to prohibit" the petitioner's lawful 24x7 operation and that the earlier insistence was merely "by way of abundant caution" and not in accordance with the law.

The Bombay High Court, after considering the affidavits and the submissions, firmly sided with the petitioner. The court observed that the 2017 Act and the issued notifications clearly did not impose any restrictions on the operating hours of convenience stores like "The New Shop." The court noted the police's admission of misunderstanding and their confirmation that no legal basis existed for their coercive actions.

In a broader observation, the court acknowledged the global popularity and benefits of 24x7 convenience stores, highlighting their convenience for consumers, particularly those with non-standard working hours, their potential to boost the economy through increased spending and job creation, and the state's apparent recognition of these advantages by not imposing restrictions on their operating hours.

Consequently, the Bombay High Court allowed the petition in terms of the prayer clause, issuing a writ of mandamus directing the respondent police authorities not to coerce or force "The New Shop" to shut its operations after 10:00-11:00 p.m. The rule was made absolute, with no order as to costs.

This judgment serves as a strong affirmation of the rights of businesses to operate within the legal framework without arbitrary interference and underscores the importance of clarity and proper understanding of regulations by law enforcement agencies.

MAHARASHTRA SHOPS AND ESTABLISHMENTS (REGULATION OF EMPLOYMENT AND CONDITIONS OF SERVICE) ACT, 2017