Service charge

CCPA to challenge Delhi HC’s upholding of service charge standards for hotels

The Central Consumer Protection Authority (CCPA) said on Wednesday it would challenge the Delhi High Court’s decision to suspend recent government-issued guidelines prohibiting restaurants and hotels from levying service charges on food. food bills.

The CCPA is also expected to soon launch a nationwide crackdown on counterfeit household products. Household products were subject to quality control guidelines that were never implemented. These products include daily use items such as geysers, refrigerators and water heating rods.

It also takes action against coaching centers and institutes that mislead consumers by publicizing the names of deserving students.

On the High Court’s order on service fees, CCPA Chief Commissioner Nidhi Khare said the court had suspended the July 4 guidelines on service fees. The case is scheduled for a rehearing on November 25.

“We will challenge the order. We are reviewing and will take appropriate action to be heard,” Khare told reporters.

Hearing a petition filed by the National Restaurant Association of India (NRAI) and the Federation and Restaurant Associations of India challenging the July 4 guidelines, the High Court on July 20 ordered a stay.

Judge Yashwant Varma, during the hearing of the motion, said the matter needed to be considered. He ordered the CCPA to file its response and scheduled the case for a rehearing on November 25.

The July 4 guidelines — issued by the CCPA — prohibited hotels and restaurants from levying service charges automatically or by default on food bills. It allowed customers to lodge a complaint in the event of a violation.

Restaurants and hotels typically charge a 10% service charge on the food bill. The guidelines stated that there should be no collection of fees for service under any other name.

Khare said after the service charge guidelines, which created a nationwide outcry, there were instances where hotel and restaurant owners voluntarily stopped charging service charges. Moreover, consumers themselves have become much more aware of this.

She said the authority is also developing guidelines against fake reviews and bogus recommendations, which several companies engage in. These are made to increase visibility in social media and public platforms.