The Central Consumer Protection Authority (CCPA), the country’s top consumer watchdog, has asked the district collectors to take cognisance of complaints about levying of service charges by hotels and restaurants in violation of the government’s guidelines and take “appropriate” action for the protection of consumer interests.
The CCPA has also written to chief secretaries of all states and Union Territories to publicise its guidelines. “CCPA has also written to district collectors with a clear direction that levying of service charge in violation to the guidelines constitutes unfair trade practice and affects rights of consumers as a class, and cognisance of such complaints must be taken on priority,” the CCPA said in a statement.
“The district collector may conduct investigation on violation of the guidelines on the basis of such a complaint and submit his report to CCPA within 15 days,” the statement said.
According to the statement, “Nidhi Khare, chief commissioner, CCPA, has clarified that the guidelines are not advisory in nature and are fully enforceable by law.”
The move comes days after the CCPA barred hotels and restaurants from adding service charges “automatically or by default” to food bills.
Releasing guidelines on Monday, the CCPA said that a consumer could ask a hotel or restaurant to remove the service charge, or seek redressal by filing a complaint.
As per the guidelines, “No hotel or restaurant shall force a consumer to pay service charge and shall clearly inform the consumer that service charge is voluntary, optional and at consumer’s discretion.”
The CCPA also said 537 consumers had complained through the National Consumer Helpline between 01.04.2021 and 20.06.2022 about hotels or restaurants levying service charges.
“From 05.07.2022 to 08.07.2022 i.e., after the guidelines were issued by CCPA, 85 complaints have been registered on the NCH. The top five cities of service charge complaints are New Delhi, Bangalore, Mumbai, Pune and Ghaziabad with 18, 15, 11, 4 and 3 complaints respectively,” its statement added.
“The major grievances include hotels/restaurants making service charge compulsory, embarrassing consumers in case they resist paying service charge, adding service charge by some other name and suppressing from consumers that paying service charge is optional and voluntary,” it added.
The guidelines have been issued under Section 18(2)(l) of the Consumer Protection Act 2019.
“The difference between the new guidelines issued by CCPA and the previous guidelines by the Department of Consumer Affairs is that,