Government questions on mandatory inclusion of service charge, calls for meeting on June 2: NRAI responds


The Department of Consumer Affairs called a June 2 meeting with restaurant owners. The issue at hand was the “arbitrarily high rates” that customers are asked to pay as a service charge.

On May 23, Consumer Affairs Secretary Rohit Kumar Singh expressed concern that restaurants and eateries should charge service charges at the discretion of consumers. These charges are now being levied by default. The letter to the National Restaurant Association of India (NRAI) said that the practice should be taken into consideration.

The Department of Consumer Affairs (DoCA) – which comes under the Ministry of Consumer Affairs, Food and Public Distribution – will meet with the National Restaurant Association of India to discuss issues related to service charges levied by restaurants.

However, yesterday, the NRAI issued a statement stating: “Information regarding the amount of service charge is displayed by restaurants on their menu cards and otherwise displayed on the space so that customers can Be well acquainted with the charge. “

“Once the diner is informed of such a charge in advance and then decides to place an order, it becomes an agreement between the parties, and is not an unfair trade practice.”

The decision to pay service tax was made optional by the government in 2017. The NRAI’s response reads that service charges have always been the subject of “personal policy” and have never been illegal.

The letter, addressed to the NRAI, said the mandatory inclusion of the service was affecting many on a daily basis. The letter said, “This issue affects a large number of consumers on a day-to-day basis and has a significant impact on consumer rights, so the department considered it necessary to investigate and investigate it in detail.”

According to guidelines published by the Department of Consumer Affairs in 2017, forcing a customer to pay a service charge as a condition after placing an order is tantamount to ‘prohibited trade practice’.

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