Service charge on a food bill is not compulsory and a customer can choose to have it waived if not satisfied with the experience, the government said. The Centre has also asked states to ensure that hotels/ restaurants disseminate this information through displays in their premises.
"A number of complaints from consumers have been received that hotels and restaurants are following the practice of charging 'service charge' in the range of 5-20 per cent, in lieu of tips, which a consumer is forced to pay irrespective of the kind of service provided to him," Union Consumer Affairs Ministry said in an official statement, reports PTI.
The Ministry had sought clarification from the Hotel Association of India, which replied that "service charge is completely discretionary and should a customer be dissatisfied with the dining experience, he/she can have it waived off. Therefore, it is deemed to be accepted voluntarily." Highlighting provisions under the Consumer Protection Act, 1986, the ministry said this law provides that a trade practice which, for the purpose of promoting the sale, use or the supply of any goods or for the provision of any service, adopts any unfair method or deceptive practice, is to be treated as an unfair trade practice. A consumer can make a complaint to the appropriate consumer forum against such unfair trade practices.
According to the PTI report, "The Department of Consumer Affairs has asked the state governments to sensitise the companies, hotels and restaurants in the states regarding aforementioned provisions of the Consumer Protection Act, 1986... "...and also to advise the hotels/restaurants to disseminate information through display at the appropriate place in the hotels/restaurants that the 'service charges' are discretionary/voluntary and a consumer dissatisfied with the services can have it waived off," the statement said.