Raising concerns regarding the service charges levied by restaurants, the Consumer Affairs Ministry has called for a meeting with restaurant industry body, National Restaurant Association of India (NRAI), on June 2. In a statement on Monday, the Department of Consumer Affairs said it has received several consumer complaints on the National Consumer Helpline and social media on the levy of service charges by restaurants.

In a letter written by Rohit Kumar Singh, Secretary, Department of Consumer Affairs, to the National Restaurant Association of India, the Ministry pointed out that the restaurants and eateries collect service charges from consumers by default, even though collection of any such charge is voluntary and at the discretion of consumers and not mandatory as per law.

The Ministry said consumers are forced to pay service charge, often fixed at arbitrarily high rates by restaurants. “Consumers are also being falsely misled on the legality of such charges and harassed by restaurants on making a request to remove such charges from the bill amount. Since this issue impacts consumers at large on a daily basis and has significant ramification on the rights of consumers, the department construed it necessary to examine it with closer scrutiny and detail,” the letter adds.

Issues expected to be raised at the meeting include restaurants making service charge compulsory, addition of service charge in the bill in the guise of some other fee, and the supression of the fact that payment of service charge is optional and voluntry, among others.

According to the guidelines issued by DoCA, entry of a customer in a restaurant cannot be itself construed as a consent to pay service charge. “Any restriction on entry on the consumer by way of forcing her/him to pay service charge as a condition percent to placing an order amount to ’restrictive trade practice’ under the Consumer Protection Act,” the Ministry stated.

“The guidelines clearly mention that placing of an order by a customer amount to his/her agreement to pay the prices displayed on the menu card along with the applicable taxes. Charging for anything other than the afore-mentioned. without express consent of the customer. would amount to unfair trade practice as defined under the Act,” the statement added.

“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,” the Ministry added.

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