Is it Mandatory to Pay Service Charge at Restaurants, Know the Guidelines
Most of the times restaurants levy high service charges in the bill apart from the amount related with food. Read more to know if a customer can opt to not pay such charges.
Recently, the Ministry of Consumer Affairs has cautioned the restaurants to stop levying extra charges in the name of service charges as it is considered an unfair trade practice. Such practices impact customers and it is against consumer rights.
In view of the same, the Ministry of Consumer Affairs will chair a meeting on June 2 with the National Restaurant Association of India (NRAI). In the meeting, the ministry will be discussing the issue of levying extra charges on the customers.
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The matter will be scrutinized in detail, says the Ministry of Consumer Affairs
The Secretary of the Department of Consumer Affairs, Rohit Kumar Singh has pointed out in a letter sent to NRAI that restaurants are following malpractice in their trade on a large scale by collecting extra charges from the customers in the name of service charges. He also pointed out that these charges are totally voluntary at the discretion of the customer and they are not mandatory.
The letter reads, "Since this issue impacts consumers at large on a daily basis and has significant ramifications on the rights of consumers, the department construed it necessary to examine it with closer scrutiny and detail."
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Restaurants charge 10 percent of the bill amount as a service charge
On Monday, in a statement, the Ministry of Consumer Affairs said, "Any restriction on entry on the consumer by way of forcing her/him to pay the service charge as a condition percent to placing an order amount to 'restrictive trade practice' under the Consumer Protection Act."
In April 2017, the Ministry of Consumer Affairs has issued guidelines pertaining to service charge at the discretion of the customer. The guidelines said, "Tips or gratuity paid by a customer is towards hospitality received by him/her beyond the basic minimum service already contracted between him/her and the hotel management."
