Don't eat in restaurants if you can’t pay service charge: Delhi High Court

The Delhi High Court made its comment while continuing the stay on the CGPA guidelines regarding service charges.

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New Delhi: The Delhi High Court on Wednesday continued the stay on the CGPA guidelines regarding service charges. Justice Yashwant Verma had listed the NRAI’s petition for hearing on July 20 during which the Delhi High Court today continued the stay on CCPA’s guidelines. Delhi High Court said that it is a matter of choice, if you do not want to pay then do not eat in the restaurant.

The CCPA had said that more than 500 complaints were received from consumers, after which new guidelines were issued on July 4. According to this, hotels and restaurants cannot add a service charge to the bill. But if the customer wishes, they can voluntarily pay. ()

After this, a petition was filed on behalf of the National Restaurants Association of India (NRAI) and the Federations of Hotels and Restaurants Association of India (FHRAI). In the petition, they demand to cancel the instruction issued by the CCPA. ()

Senior advocate Sumit Sethi appearing for FHRAI submitted that the restaurants were paying GST on the charges added and the CCPA did not even have the authority to pass such orders. He said that if he adds a service charge to the price of an item sold, then the price of the food will increase. This will also affect the consumer who is ordering online. The service charge is only applicable to such customers who are visiting the restaurants as it is for the service provided by the waiters and the back-end staff.

The court has continued the interim stay on the guidelines till the next date of hearing. Along with this, now notice has been issued to the Central Ministry of Consumer Affairs and CCPA to respond to the petitions. The bench has also said that the restaurant will have to prominently display the share of service charge in the cost of the food. Apart from this, the restaurant will not charge service charges on takeaway/ delivery.