Restaurant Service Charge Ruling: Your Rights!

A consumer court in Jalandhar has ruled that restaurants cannot add service charges to bills without customer consent, reinforcing diners' rights and labeling such practices as unfair trade. The case involved a Rs 151 service charge disputed by an advocate, which resulted in the restaurant being ordered to refund the amount with interest and pay Rs 15,000 in compensation.

The Central Consumer Protection Authority (CCPA) issued guidelines in 2022 prohibiting the automatic addition of service charges. Experts emphasize that regardless of terminology used, such as 'staff contribution,' clear disclosure and customer agreement are mandatory. The court found that merely mentioning a charge on the menu is insufficient if prior consent is not obtained.

This ruling serves as a caution to restaurants, stressing the importance of transparency and voluntary payment for service charges. Consumers are advised to carefully review their bills for any unconsented charges and assert their right to object or seek redressal, even for small amounts.