Government says no hotels or restaurants can add service charge automatically or by default to the food bill

Ministry of Consumer Affairs has said that no hotels or restaurants can add service charges automatically or by default in the food bill. In this regard, the Central Consumer Protection Authority (CCPA) has issued guidelines for preventing unfair trade practices and violation of consumer rights.

The guidelines highlighted that the collection of service charges will not be done by any other name. It said, a hotel or restaurant cannot force a consumer to pay the service charge and will clearly inform the consumer that the service charge is voluntary, optional and at the consumer's discretion.

The guidelines further mentioned that no restriction on entry or provision of services based on the collection of service charges will be imposed on consumers. The service charge will not be collected by adding it along with the food bill and levying GST on the total amount.

The Ministry said that the consumer may complain about the violator hotel or restaurants on the National Consumer Helpline, NCH by calling 1915 or its NCH mobile app.

The Ministry highlighted that the consumer may also file a complaint against unfair trade practice with the Consumer Commission through the e-daakhil portal www.e-daakhil.nic.in for its speedy redressal. It said, furthermore, the consumer may submit a complaint to the District Collector of the concerned district for investigation and subsequent proceedings by the CCPA. The complaint may also be sent to the CCPA by e-mail at [email protected].

The Ministry in its release said, "Several complaints have been registered in the National Consumer Helpline (NCH) by consumers with regard to levying of service charge. The issues raised by consumers include restaurants making service charge compulsory and adding it in the bill by default, suppressing that paying such charge is optional and voluntary and embarrassing consumers in case they resist paying a service charge."

It added that various cases relating to the levying of service charges have also been decided by consumer commissions in favour of consumers, holding the same as an unfair trade practice and in violation of consumer rights.