Service charge: DMs asked to ensure advisory enforcement

New Delhi: Cracking a whip against the errant hotels and restaurants for levying service charges on food bills despite the issuance of advisory guidelines in this regard, the Central Consumer Protection Authority (CCPA) has directed all district collectors to ensure the enforcement of guidelines issued with regard to service tax by hotels and restaurants.

Even though most of the district collectors are still not "fully aware" of the legal provisions enacted in the advisory, which is more of law in nature, they have assured to adopt a zero-tolerance policy towards violators in their administrative districts.

According to the fresh diktat, the district collectors/magistrates have been asked to investigate the violation of the guidelines and submit the report to the authority within 15 days after the receipt of the complaints related to the violation of CCPA guidelines.

In a letter to the Chief Secretaries of all states/UTs and district collectors, the CCPA has asked them to arrange wide publicity of the guidelines along with its immediate implementation for the protection of consumer interest.

The letter gives clear direction that levying of service charge is in violation of the guidelines and constitutes unfair trade practice wherein affects the rights of consumers as a class, and cognisance of such complaints must be taken on priority.

Talking to Millennium Post, Patna DM Chandrashekhar Singh said that he has not yet received any letter in this regard and will respond to it only after getting the letter.

However, Munger DM Navin Kumar said that action would be taken against the violators within 15 days after receiving the service tax complaint. Surprisingly, in most of the districts, consumers are still clueless about the point of contact for lodging complaints against the unfair trade practice of levying service charges by errant hotels/restaurants.

As of now, the National Consumer Helpline (NCH) is the only saviour for aggrieved consumers as total 537 complaints were lodged by them from April 1, 2021, to June 20, 2022, and after the issuance of the guidelines on July 5, total 85 complaints have been registered on NCH in just four days. Maximum 18 complaints have been registered in Delhi followed by Bangalore (15), Mumbai (11), Pune (4) and Ghaziabad (3).

On the legal sanctity of the issued advisory, Chief Commissioner, CCPA Nidhi Khare said that the guidelines are not advisory in nature and are fully enforceable by law. "The guidelines have been issued under Section 18(2)(l) of the Consumer Protection Act, 2019, which empowers the CCPA to issue necessary guidelines to prevent unfair trade practices and protect consumers' interests," Khare clarified.

Commenting on the challenges in the enforcement of the law, consumer crusader Ashim Sanyal said, "Since the implementation of consumer protection law is a state subject, the district collectors need to issue local circular and send to all market associations, hotels and restaurants of their district to comply with order else penal actions would be initiated against the violators."

"The consumers must be provided a point of contact to register their complaints against violators and those hotels/restaurants that don't charge service charges should be incentivized," Sanyal said.