New guidelines issued by the Central Consumer Protection Authority (CCPA) say that restaurants cannot levy service charges to consumers by default.

“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. No restriction on entry or provision of services based on collection of service charge shall be imposed on consumers. Service charge shall not be collected by adding it along with the food bill and levying GST on the total amount,” a PIB release said Monday.

This means that restaurants now have to make it amply clear that the service charge they are applying is completely voluntary, and can be taken off the bill if the consumer requests so.

This comes in the backdrop of Union Minister Piyush Goyal’s comments last month where he said that service charge is used to trick consumers. "We cannot mislead people by charging for service," Goyal had said.

Consumers can file complaints against any violation of these guidelines by calling National Consumer Helpline (NCH) 1915 or through the NCH mobile app, the government said.

The CCPA was set up in 2020 to prevent unfair trade practices and false advertising in the country. It was set up under Section 10(1) of The Consumer Protection Act, 2019.

Tell me in notes what are your views about this ? 💭

Sources - https://cfo.economictimes.indiatimes.com/amp/news/restaurants-cannot-add-service-charge-automatically-govt/92658993