Hotels can't levy service charge; here’s how you can complain

The Central Consumer Protection Authority (CCPA) on Monday (July 4) issued guidelines for preventing “unfair trade practices and violation of consumer rights with regard to levying of service charge in hotels and restaurants”.

As per the guidelines, “hotels or restaurants shall not add service charge automatically or by default in the food bill”, the Ministry of Consumer Affairs, Food & Public Distribution said in a press release.

Also read: Nothing justifies restaurant service charges; law to end it is right

“No collection of service charge shall be done by any other name. No hotel or restaurant shall force a consumer to pay service charge and shall clearly inform the consumer that service charge is voluntary, optional, and at consumer’s discretion. No restriction on entry or provision of services based on collection of service charge shall be imposed on consumers. The service charge shall not be collected by adding it along with the food bill and levying GST on the total amount,” the ministry said.

If a restaurant levies a service charge, then customers have the option of filing a complaint on the National Consumer Helpline (NCH) by calling 1915 or on the e-daakhil website or via email to CCPA.

Also read: Govt warns restaurants over service charge; eateries say it’s not illegal

“If any consumer finds that a hotel or restaurant is levying service charge in violation to the guidelines, a consumer may make a request to the concerned hotel or restaurant to remove service charge from the bill amount. Also, the consumer may lodge a complaint on the National Consumer Helpline (NCH), which works as an alternate dispute redressal mechanism at the pre-litigation level by calling 1915 or through the NCH mobile app,” the ministry said.

“The consumer may also file a complaint against unfair trade practice with the Consumer Commission. The Complaint can also be filed electronically through e-daakhil portal www.e-daakhil.nic.in for its speedy and effective redressal. Furthermore, the consumer may submit a complaint to the District Collector of the concerned district for investigation and subsequent proceeding by the CCPA. The complaint may also be sent to the CCPA by e-mail at com-ccpa@nic.in,” it added.

Also read: Restaurants cannot add service charge in food bills: Goyal

According to the ministry, “A number of complaints have been registered in the NCH by consumers with regard to levying of service charge. The issues raised by consumers include restaurants making service charge compulsory and adding it in the bill by default, suppressing that paying such charge is optional and voluntary and embarrassing consumers in case they resist paying service charge.

“Various cases relating to levying of service charge have also been decided by consumer commissions in favour of consumers, holding the same as an unfair trade practice and in violation of consumer rights.”