The National Restaurant Association of India and Federation of Hotels and Restaurants Association of India had on July 4 moved the court challenging the guidelines of the Central Consumer Protection Authority (CCPA).
The Delhi High Court on Wednesday made a big comment while continuing the stay on the CCPA’s guidelines regarding service charges. The court has given a statement. The eaters in the restaurant have been told that if they cannot pay the service charge, then do not eat food in the restaurant.
Delhi High Court continues the stay on the guidelines
The Consumer Protection Authority (CCPA) has banned the service charge. The CCPA had said that more than 500 complaints have been received from the consumers, after which new instructions have been issued regarding the service charge. The CCPA had directed district collectors of all states and union territories to implement the rules. It was said that consumers can also complain about the service charge being demanded by the restaurant.
Guidelines issued in July
The guidelines were issued by the Central Consumer Protection Authority (CCPA) on July 4. According to this, hotels and restaurants cannot add service charges to the bill. But customers can voluntarily pay the service charge if they wish. Subsequently, a petition was filed by the National Restaurant Association of India (NRAI) and the Federation of Hotels and Restaurants Association of India (FHRAI). In this, a demand was made to cancel the instructions issued by the CCPA regarding the ban on service charges levied by hotels and restaurants.
The court said – it is a matter of choice
The NRAI’s plea was listed for hearing by Justice Yashwant Verma on July 20, during which the Delhi High Court continues to stay the CCPA’s guidelines during the hearing today. Delhi High Court said on the issue of adding a service charge to the restaurant bill that it is a matter of choice, if you do not want to pay then do not enter the restaurant.
CCPA does not have the authority
Senior advocate Sumeet Sethi, appearing for FHRAI, submitted that the restaurants were paying GST on the charges and the CCPA did not even have the authority to pass such orders. He said that if I add a service charge to the price of the item sold, then the price of the food will increase. This will also affect the consumers ordering online. The service charge is applicable only to the customers who visit the restaurant as it is for the service provided by the waiters and back-end staff.
Senior advocate Lalit Bhasin argued
That there are three categories of restaurants. The first one is that does not charge a service charge. Second, those who charge a service fee without the customer’s consent. At the same time, there are third such, who charge service charges and it is also written in their menu. Lalit Bhasin has demanded from the court that the CCPA guidelines, which bar restaurants from charging service charges, should not apply to class III restaurants. Those who mention service charge in the menu.
The next hearing will be on November 25
The court has continued the interim stay on the guidelines till the next date of hearing. Along with this, notices have now been issued to the Centre, Ministry of Consumer Affairs, and CCPA to respond to the petitions. The bench also said that the restaurant has to prominently display the portion of service charge in the cost of the meal. Apart from this, the restaurant will not charge service charges on takeaway/delivery. The next hearing on this matter will be on November 25.
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