Restaurant owners-govt tussle over hotel service charge explained here
Premium- The major issue which the customers raised about the service charges are that some restaurants have made it compulsory levying of service charge
The government has said that it will soon come upwith a robust framework very soon as it went into a tussle over the issue of service charge being levied by the restaurants to the consumers. The government has said that it adversely affects consumers on a daily basis.
Bone of contention:
The major issues which the customers raised about the service charges are that some restaurants have made it compulsory levying of service charge, some adding it by default without taking the consent of the consumer.
The consumers in the helpline of Ministry of Consumer Affairs, Food & Public Distribution also complained about being embarrassed by the restaurant if they resist paying such charge
The other side of the story:
The restaurant owners also had thier side and said that when a service charge is mentioned on the menu, it involves an implied consent of the consumer to pay the charge." Service charge is used by restaurants/hotels to pay the staff and workers and is not charged for the experience or food served to consumers by the restaurant/hotel.
Consumer rights:
Meanwhile, many consumer organisation also said that levying of service charge by the restaurant is arbitrary and constitutes an unfair as well as restrictive trade practice under the Consumer Protection Act.
As per a guideline issued by the Department of Consumer Affairs in April 2017, placing an order by a customer amounts to his agreement to pay prices in the menu along with applicable taxes. Charging for anything other than the aforementioned, without express consent of the consumer, would amount to unfair trade practice under the Act, the department said.
Further, considering entry of a customer to a restaurant/hotel as an implied consent to pay service charge would amount to the imposition of an unjustified cost on customer as a condition precedent to placing an order for food and would fall under restrictive trade practice under the Act, it said.
"Since this adversely affects millions of consumers on a daily basis, the Department will soon come up with a robust framework to ensure strict compliance by the stakeholders," the Ministry of Consumer Affairs, Food & Public Distribution noted in the statement.