Restaurant to pay Rs 4,000 to customer over service tax

Hyderabad: In a significant consumer rights victory, a popular restaurant in Jubilee Hills has been instructed to reimburse Rs 3,000 to a customer after wrongly charging a service tax of Rs 247 following the customer’s visit in October last year. After a year-long battle, he won Rs 4,000 as compensation from the restaurant.

The customer, Harish Kumar Goud, a real estate businessman, had dined at the Chiguru restaurant located in Jubilee Hills, Road No 36, with his clients, where a bill of Rs 3,116 was generated.

On receiving the bill, the customer noticed Service Tax Optional (ST OPT 10 per cent) charges of Rs 274.90. He immediately called the waiter and demanded a refund, citing it as an illegal practice.

Despite his request, the restaurant refused to deduct the tax from the bill. However, after a legal notice was sent to the restaurant, the amount was returned to the customer.

When the customer enquired if the trend was discontinued, the restaurant stated that it would be continued. The disappointed customer immediately returned the amount.

Citing that the incident had caused great humiliation and insult before his clients and the other customers of the restaurant, Harish demanded a compensation of Rs 1,00,000 from the restaurant and the immediate removal of the ST charges from the bill.

The court, in its final order, directed the restaurant to refund the Rs 274 to the complainant paid towards ST OPT in addition to GST, with an interest rate of 9 per cent per annum from October 28, 2023.

Additionally, the Jubilee Hills restaurant has been directed to pay Rs 3,000 towards compensation for mental agony and Rs 1,000 towards other costs.