Key Compliances under Jharkhand: Bihar Shops and Establishment Act, 1953 (Part II)

Background

The Bihar Shops and Establishments Act, 1953, originally enacted to regulate working conditions in shops and commercial establishments in the undivided state of Bihar, continues to apply to Jharkhand after its formation in 2000. It governs aspects such as working hours, wages, leave, employment of women and young persons, and conditions of work to ensure employee welfare. The Act is supplemented by the Bihar Shops and Establishment Rules, which provide procedural clarity on registration, record-keeping, and compliance requirements. In Jharkhand, this framework remains a key labour regulation for shops and establishments until replaced or amended by state-specific legislation.

Applicability

Applicable to all shops and commercial establishments operating within the State of Jharkhand. An establishment means:

an establishment  which carries on any business, trade or profession  or any work in connection  with,  or incidental  or ancillary  to any business, trade or profession and includes —

(i) administrative or clerical service appertaining  to such establishment;

(ii) a shop, restaurant,  residential  hotel, eating house, theatre or any place of public amusement or entertainment; and 2[a society Registered under Societies Registration Act, 1860 (xxi of 1860)  charitable or other trust, whether registered or not which carries on any business, trade or profession or work in connection with or incidental or ancillary there to, journalistic establishments, contractors or auditors establishments, educational or other institutions run for private gain and premises in which business of banking, insurance, stocks and shares brokerage or produce exchange is carried on.

Compliance Requirement under the Act in accordance with the Rules

  • Payment of wages for the allowed leave period in Jharkhand (Section 22)

An employee, who has been allowed leave for not less than five days in the case of a child and four days in any other case, shall before his leave begins, be paid the wages due for the period of the leave allowed.

  • Time period for the payment of wages in Jharkhand (Section 23)

Wages must be paid within 7 days after the wage period ends. If an employee is absent, payment must be made within 3 working days after they return or demand payment. On termination, earned wages must be paid within 2 working days.

Wages must be paid on a working day, at or near the workplace, during working hours. The State Government may exempt an employer from this requirement for certain employees under specified conditions.

  • Mode of payment of wages in Jharkhand (Section 24)

All wages must be paid in current coins or currency notes, or in both.

  • Deductions from wages in an establishment in Jharkhand (Section 25, Rule 18)

Employers shall not make any deductions from an employee’s wages except those permitted under the prescribed rules.

Employers may make deductions as permitted:

    • Fines (not for children)
    • Absence from duty proportionate to time absent
    • Loss/damage to goods or money due to employee’s neglect
    • House accommodation or amenities accepted by employee
    • Government-authorized services, provident fund contributions, approved insurance, co-operative societies, savings schemes, or National Defence Fund contributions (with employee consent where required)
    • Income tax or court-ordered deductions.
    • Revenue stamps on pay receipts.
    • Supply of cooked food/refreshments under approved schemes
    • advance recovery/over payment of wages

Fines or deductions for damage/loss must be explained in writing and in person, allowing the employee to respond. Fines realized must be spent for employees’ benefit. Deductions for loss cannot exceed actual damage, and deductions for absence or services cannot exceed the value proportionate to time or service provided. Government may set additional conditions for some deductions.

  • Form XI: Register of Fines and Deductions in Jharkhand (Rule 19)

All fines collected and deductions made from employees’ wages must be recorded in a register maintained in Form XI.

  • Notice of dismissal/discharge of employment by the employer in Jharkhand (Section 26 (1), Rule 20)

Employees with 6-month continuous service can’t be terminated without reasonable cause & 1 month notice/wages in lieu. Additionally if employed for 1 year or more & terminated without misconduct, they must also receive compensation equal to 15 days avg wages for each completed year of service & any part at least for  6 months

The following acts constitute misconduct for discharge under Section 26:

    • Willful insubordination or disobedience to lawful orders.
    • Willful damage or loss of employer’s property.
    • Bribery or illegal gratification.
    • Theft, fraud, or dishonesty related to employer’s business/property
    • Habitual or extended absence without leave (over 10 days).
    • Habitual breach of law applicable to establishment.
    • Habitual late attendance.
    • Riotous, disorderly, or subversive behavior during work.
    • Habitual or gross negligence of work.
    • Striking or inciting strikes against law or rules.
    • Breach of certified Standing Orders.

No employee may be discharged for misconduct without written notice of the allegations and an opportunity to defend themselves.

  • Notice of termination of employment by employee to employer in Jharkhand (Section 27)

No employee shall terminate his employment unless he has given to his employer a notice of at least one month.

Where an employee fails to give notice as above, his employer may forfeit any unpaid wages for a period not exceeding fifteen days.

  • Inspection Book to be maintained by the employer (Section 30(1), 40(2)(m), Rule 29)

Every employer must maintain an Inspecting Officer’s Visit and Inspection Book to record inspection remarks regarding any defects that may come to light in the course of an inspection of the establishment and produce it whenever required by the Inspecting Officer.

The Inspecting Officer’s Visit and Inspection Book must be a bound 7”×6” book with at least 100 pages, every second page consecutively numbered, and the unnumbered page between numbered pages perforated at 1” margin. Each numbered page must include establishment/employer name, locality, registration number, inspection date, time, and remarks. If the book is lost, the employer must immediately report it in writing and maintain a new Visit Book.U/s 30(1): 30(1): Inspector may, during prescribed hours, enter any establishment, inspect or take extracts from registers/records/notices, seize relevant documents relating to offences, record statements of persons for the purposes of the Act (without compelling self-incriminating evidence), and exercise other prescribed powers.

  • Display of notices in establishment containing extracts of applicable acts and rules in Jharkhand (Section 33, Rule 31,32)

Every employer shall exhibit in his establishment a notice containing such extract of the Act and these rules as the Inspecting Officer may direct

Rule 32: Manner in which notices should be exhibited:  Any notice required to be exhibited under these rules shall be exhibited at the main entrance of the establishment and shall be renewed whenever it becomes defaced or otherwise ceases to be clearly legible.

  • Entries in registers, records and notices to be made by employer in Jharkhand (Section 33, Rule 33)

Entries in any register or record required under these rules must be made on the same day to which they relate and must be signed and dated.

  • Time period for which registers, records and notices should be preserved in Jharkhand (Rule 34)

Unless otherwise provided, all registers, records, and notices for a calendar year must be preserved for three years after the end of that year.

  • Supply of adequate drinking water in an establishment in Jharkhand (Section 40 (2), Rule 36)

The employer shall make arrangement for the supply of adequate and wholesome drinking water for the employees. The area around the place where drinking water is distributed shall be kept clean and properly drained.

  • Cleanliness to be maintained by the employer in Jharkhand (Section 40 (2), Rule 36-A)

All inside walls, ceilings, passages, and staircases of an establishment, whether plastered or not, shall be lime-washed or colour-washed at least once every 12 months from the last wash and must be maintained in a clean condition.

    1. All beams, rafters, window-frames and other wood work with the exception of floors shall be either lime-washed, colour-washed at intervals of not more than twelve months, dating from the time when they were last lime-washed or colour-washed or shall be painted or varnished at intervals of not more than seven years dating from the time when they were last painted or varnished and shall be maintained in a clean state.
    2. Rubbish, filth, or debris shall not be allowed to accumulate or to remain on any part of the establishment for more than 24 hours and shall be disposed within the said period. All filth and other decomposing matters shall be kept in covered receptacles.
    3. The establishment and the compound surrounding shall be maintained in a strictly sanitary and clean condition. The floor shall be swept or otherwise cleaned at least once daily, and the ceiling, shall be dusted at least once a month.
  • Ventilation in establishment in Jharkhand (Section 40 (2), Rule 36-B)

Every establishment must provide ventilation openings that allow a continuous supply of fresh air.

  • Form and manner for maintenance of records and registers in Jharkhand (Section 40 (2), Rule 37)

Registers, records, and notices required under these rules must be maintained in English, Hindi (Devanagari), or the local court language. They must be kept at both the establishment’s office and the place of business.

If the Inspecting Officer finds that an establishment’s muster roll or register already provides the required details of Forms IX, X, and XI, they may direct in writing that it be treated as the official register in place of Forms IX, X, and XI.

  • Annual Returns by an Establishment in Jharkhand (Rule 42)

Employers with 10 or more employees must submit an annual return to the Inspecting Officer with details of employment, wages, and working conditions for the calendar year by 31 March of the following year.

  • Form XIX: Quarterly Returns by an Establishment in Jharkhand (Section 40 (2), Rule 43)

Every employer of an establishment employing ten or more persons shall furnish within thirty days of the end of each quarter to the Inspecting Officer of the area concerned a quarterly return in Form XIX for the quarters ending on the 31st March , 30th June, 30th September and 31st December of each year.

  • Online return filing by an Establishment in Jharkhand (Section 40 (2), Rule 43 (A))

Notwithstanding the provisions contained in Rule 42 and Rule 43 w.r.t Annual/Quarterly Returns, where online returns are filed in the format prescribed by the Government, only online return is required, and it must be submitted on or before 30 June each year.

  • Restriction on carrying of loads by man/woman/young person in an establishment in Jharkhand (Section 40 (2), Rule 44)

No person may lift or carry loads exceeding prescribed limits: Adult male 75 kg, adult female 30 kg, adolescent male 30 kg, adolescent female 20 kg, male child 16 kg, and female child 13 kg.

No person may lift, move, or carry materials exceeding the maximum weight limits per the schedule, whether alone or with others. If reducing weight is impractical, mechanical aids like wheelbarrows or forklifts must be provided, with assistance available to lift loads from them.

  • Proof of age of employees to be maintained by an establishment in Jharkhand (Section 40 (2), Rule 38)

Employer shall have an authentic extract from records of any School, Village Panchayat or Municipality, or in the absence of such extract at least a certificate from Registered Medical Practitioner showing the age of any person employed by such employer. Same shall be produced on demand by Inspector

An Inspecting Officer may require an employer to produce an authentic extract from the records of any School, Village Panchayat or Municipality, or in the absence of such extract at least a certificate from a Registered Medical Practitioner showing the age of any person employed by such employer.

Penalty and Punishment

Section 34: Penalties. —Any employer who contravenes any provisions of this Act or any rule or order made thereunder shall, if no other  penalty  is provided for the offence, be punishable with fine which may extend to five thousand rupees for the first offence and to ten thousand rupees for every subsequent offence after the first conviction.

U/s 35: Penalty whether the employer is a firm or company.—If the person contravening any provision of this Act or a rule or order made thereunder is a company or a partnership firm every director, partner, manager or secretary thereof shall, unless he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention, be deemed to be guilty of such contravention.

Rule 7: Late applications for registration or amendment.- – If an application for registration of an establishment or amendment of registration certificate is not received by the Inspecting Officer within time specified in the foregoing rule the establishment shall be registered or the registration certificate shall be amended, as the case may be, on payment of a fee calculated in the following manner. The process of Registration or amendment shall be completed and for the delay of every subsequent 3 months or part thereof 50% additional fee on the prescribed original fee shall be payable in one installment.

Rule 8: Penalty for making incorrect statement.- If any statement made in Form I or in Form IV is found to
be incorrect, the employer shall be punished with fine which may extend to one hundred rupees.

Section 32: Penalty for obstructing Inspecting Officer, etc.—Any person who voluntarily obstructs an Inspecting Officer in the exercise of any power conferred on him by or under this Act or any person lawfully assisting an Inspecting Officer in the exercise of such power or who  fails without  sufficient cause to comply  with any lawful direction  made  by an Inspecting Officer shall be punishable with imprisonment which may extend to six months or with fine which may extend to five thousand rupees, or with both. This penalty is applicable only when Inspector is obstructed in exercise of his powers and company shall note the sane.

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