No Service Charge on Food Bills: If you are also fond of eating out in restaurants or often eat outside, then there is some useful news for you, which can help you save money on your bill. Delhi High Court has issued a guideline for hotels, according to which hotels and restaurants cannot charge a service charge in the food bill. This can reduce the bills of the customers, let’s know the whole matter in detail…
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No Service Charge on Food Bills
While giving its verdict on a case, the Delhi High Court has said that hotels and restaurants cannot make service charge compulsory in the food bill. If the customer wants, he can pay it at his own will, but it cannot be made compulsory.
Justice Pratibha M Singh delivered this verdict on a batch of petitions filed by the National Restaurant Association of India (NRAI) and the Federation of Hotel and Restaurant Association of India challenging the guidelines of the Central Consumer Protection Authority (CCPA). With this the court has rejected these petitions.
No Service Charge on Food Bills: What is a Reference for This Guideline?
According to a Bar & Bench report, the court has also imposed a fine of Rs 1 lakh on the restaurant association that challenged the CCPA guidelines. The CCPA issued guidelines to prevent unfair trade practices and violations of consumer rights.
These Guidelines Said
- Hotels or restaurants will not add a service charge automatically or by default to the food bill.
- The service charge cannot be taken in someone else’s name.
- No restaurant or hotel can force customers to pay a service charge. They must tell customers that it is optional and that customers can pay for it if they wish.
- No restrictions will be imposed on customers on entry or provision of services based on the collection of service charges.
- And a service charge will not be added to the food bill and collected by levying GST on the total amount.
NRAI’s petition states that there is no law that prohibits restaurants from levying service charge and no amendment has been made in the existing laws that makes levying service charges illegal. In the absence of proper authentication of the guidelines, their guidelines cannot be treated as an order of the government,” the petition said. The petitioner-association argued that the guidelines are arbitrary, capricious and should be quashed.
No Service Charge on Food Bills: What is a Service Charge?
When you buy a product or service, you have to pay some money for it. This is called service charge. That is, service charge is taken from the customer for serving food and other services in a hotel or restaurant.
Customers also pay the hotel or restaurant with a service charge without asking any questions. However, this charge is taken at the time of transaction and not at the time of taking the service.
BIG WIN FOR CONSUMERS!!
— Megh Updates 🚨™ (@MeghUpdates) March 28, 2025
Restaurants can't force service charge; Delhi High Court rules that service charge and tips are voluntary payments by consumers and cannot be made COMPULSORY or MANDATORY on food bills by restaurants or hotels.
UCM @JoshiPralhad Congratulates Consumers pic.twitter.com/7ww9GpUtA1
The service charge is written at the bottom of your hotel or restaurant bill. It can usually be some percentage of your bill. Mostly it is 5%. For example, if your bill is Rs 1,000, then this 5% service charge will become Rs 1,050.
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