Service charge by restaurants, hotels not mandatory: Centre

THE CENTRE on Monday announced that service charge on a food bill is not compulsory and a customer can choose to have it waived if not satisfied with the experience.

The Union Consumer Affairs Ministry said in an official statement that it has also asked the states to ensure that hotels/ restaurants disseminate this information through displays at their premises.

Arbitrary surcharge being levied as part of the bill by some hotels and restaurants in the name of service charge has been a major sore point with consumers, with many consumer rights groups also filing complaints with the government over this practice.

“A number of complaints from consumers have been received that hotels and restaurants are following the practice of charging ‘service charge’ in the range of 5-20 per cent, in lieu of tips, which a consumer is forced to pay irrespective of the kind of service provided to him,” the ministry said.

Highlightingprovisionsunder the Consumer Protection Act, 1986, the ministry said the law provides that a trade practice which, for the purpose of promoting the sale, use or the supply of any goods or for the provision of any service, adopts any unfair method or deceptive practice, is to be treated as an unfair trade practice.

Following complaints, the Ministry had also sought a clarification from the Hotel Association of India, which replied that “service charge is completely discretionary and should a customer be dissatisfied with the dining experience,he/shecanhaveitwaived”. The Association said it was “deemed to be accepted voluntarily”.

A consumer can make a complaint to the appropriate consumer forum against such unfair trade practices.

“The Department of Consumer Affairs has asked the stategovernmentstosensitisethe companies, hotels and restaurantsinthestatesregardingaforementioned provisions of the Consumer Protection Act, 1986,” the ministry said.

‘Service charge is completely discretionary and should a customer be dissatisfied with the dining experience, he/she can have it waived,’ said Hotel Association of India

Nirmal Harindran Maharashtra Chief Minister Devendra Fadnavis with Shiv Sena chief Uddhav Thackeray in Mumbai on Monday.