Can restaurants demand service charges? Read on

The DoCA has convened a meeting with the National Restaurant Association of India in New Delhi on June 2 to discuss the issue, following grievances registered by consumers on the National Consumer Helpline.

FPJ BureauUpdated: Monday, May 23, 2022, 11:59 PM IST
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Can restaurants demand service charges? Read on | Photo: Pexels

The restaurants can’t levy service charges on consumers as it is the discretion of the latter, according to the Department of Consumer Affairs (DoCA).
The DoCA has convened a meeting with the National Restaurant Association of India in New Delhi on June 2 to discuss the issue, following grievances registered by consumers on the National Consumer Helpline.
In a letter to the president of the association, DoCA secretary Rohit Kumar Singh has pointed out that restaurants and eateries are collecting service charge from diners by default, even though such a charge is voluntary and not mandatory as per the law.
It has been pointed out in the letter that diners are often charged arbitrarily by restaurants. They are also being misled on the legality of such charges and harassed by restaurants on making requests to remove such charges from the bill amount. “As this issue impacts consumers at large on a daily basis and has a significant ramification on the rights of consumers, the department construed it necessary to examine it with closer scrutiny and detail,” the letter further adds.
The department has already published guidelines dated April 21, 2017, on service charges by hotels/restaurants. The guidelines note that the entry of a customer in a restaurant cannot itself be construed as consent to pay service charge. As per the guidelines, a customer is entitled to exercise his/her rights as a consumer to be heard and redressed under provisions of the Act in case of unfair/restrictive trade practices. Consumers can approach a Consumer Disputes Redressal Commission / Forum of appropriate jurisdiction.

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