New Delhi: The Central Consumer Protection Authority, or CCPA, issued a directive on Monday prohibiting hotels and restaurants from automatically or by default including service charges in food bills. On the same day, the top consumer regulator released rules for preventing unfair trade practices and violations of consumer rights in the levying of service charges in hotels and restaurants.
“The Central Consumer Protection Authority (CCPA) has issued guidelines for preventing unfair trade practices and violation of consumer rights with regard to levying of service charge in hotels and restaurants,” the consumer affairs ministry said in a statement. Read More:
It also said that service charges should not be collected under any other name. A service charge cannot be imposed by a hotel or restaurant. They must explicitly advise the consumer that the service price is discretionary, elective, and at the discretion of the consumer. Read More:
Furthermore, service charges cannot be collected by adding them to the food bill and then applying GST to the whole amount.
If a consumer discovers that a hotel or restaurant is levying a service charge in contravention of the standards, he or she may request that the charge be removed from the bill amount.
Consumers can also file a complaint with the National Consumer Helpline (NCH), which serves as a pre-litigation dispute resolution process, by dialling 1915 or via the NCH mobile app.
They can also complain to the Consumer Commission.