Millennium Post

Hoteliers overcharging in name of service charge to face the music

Cracking the whip on errant hoteliers for overcharging in the name of service charge, the government has decided to issue an advisory to all state governments soon. The Ministry of Food and Consumer Affairs has sent a draft advisory to Prime Minister's Office (PMO) for the final approval.

"The ministry is hopeful of getting the PMO's approval on the advisory as it is in the interest of consumers. The restaurants or food outlets are charging for serving the food, which is against the provisions of consumer law. The service charge is a voluntary component and should not be imposed upon consumers," said Food and Consumer Affairs Minister Ram Vilas Paswan.

"The government will not bring any law to regulate it, but yes, there will be some advisories that the hotel industry would have to follow. It's a known practice that when a customer is treated well at any food outlet of the country, they voluntarily offer a tip to the waiter, but restaurants cannot make it mandatory that a certain percentage would have to be levied as service charge. It is a violation of consumer protection law," Paswan added.

Some hoteliers have approached the Supreme Court for relief in the matter after the National Consumer Disputes Redressal Commission's order came in the government's favour.

In another major development, Pepsi has decided to sell packaged mineral water Aquafina at the same maximum retail price (MRP) across the country, while Board of Control for Cricket in India (BCCI) has also ensured that bottled water would be sold at same MRP in all of its cricket stadiums. The decision in this regard has been taken after Paswan's push for the same MRP for packed food and beverage. The minister opined that after Pepsi's move, other may also follow suit in the larger interest of consumers.
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