You can deny paying service charge at restaurants. Here's why
The recent violent clash between a restaurant's staff and customers at Noida's Spectrum Mall over the service charge levied on the bill has taken the country by storm. This has left many in confusion about whether or not they must pay the charge or have it removed. However, the recent notice issued by the Department of Consumer Affairs (DCA) clears it all.
What is a service charge?
Apart from the food and beverages that you order and the overall GST on them, restaurants and hotels put a 5-10% additional charge on the bill as a "service charge." It is an amount earned by the restaurant to serve guests.
What are the guidelines against service charges by CCPA?
When it comes to service charges, there are a few guidelines in place by Central Consumer Protection Authority (CCPA). Firstly, hotels/restaurants may not force any consumer to pay the service charge. They must inform the customer that paying the service charge is voluntary/optional. Additionally, they must not add any service charge to the food bill automatically or by default.
More guidelines issued by CCPA
Restaurants or hotels cannot collect the service charge under any other name/head. In addition to this, they cannot restrict entry or the provision of services based on the payment of service charges by the customer.
Service charge should be removed: Department of Consumer Affairs appeal
Per the recent notice issued by the Department of Consumer Affairs in the wake of the Noida restaurant case, customers dining at a restaurant can get the service charge removed on request. It should not be "imposed forcefully on consumers, especially when consumers are dissatisfied with the service provided to them by the restaurant," says the notice.
National Restaurant Association of India disagrees, moves to high court
National Restaurant Association of India (NRAI) president Kabir Suri expressed his disagreement against the notice issued by the Department of Consumer Affairs. He has filed a petition and moved to the Delhi High Court where the order has been stayed until the next hearing on November 25 this year. This means the restaurants and hotels can continue to levy service charges.
What to do if restaurants force you to pay
As per CCPA guidelines, you can request the restaurant to remove the service charge from the bill. If they force you, you can file a complaint against the restaurant on the National Consumer Helpline (NCH) by calling 1915 or on the NCH mobile app. The easier way is to complain directly to the concerned District Collector or write to CCPA at com-ccpa@nic.in.
No legal charges for not paying the service charge
If you don't wish to pay the service charge, you won't land into legal trouble as it is the decision of the customer whether they choose to pay for it or not. If it is added to your bill, you can ask the restaurant staff to deduct it and get you a fresh bill. The restaurant can't force you to pay a service charge.
