CCPA challenges stay on service charge norms for hotels issued by Delhi HC

India

oi-Deepika S

New
Delhi,
Aug
11:
The
Central
Consumer
Protection
Authority
(CCPA)
has
moved
an
appeal
in
the
Division
Bench
of
Delhi
High
Court
challenging
the
court’s
decision
to
stay
the
recent
guidelines
issued
by
the
government,
restraining
the
levy
of
service
charge
on
food
bills
by
restaurants
and
hotels.

The
appeal
would
be
taken
up
before
the
Chief
Justice-headed
division
bench
on
August
16.

Last
month,
the
Delhi
High
Court
on
Wednesday
stayed
the
recent
guidelines
prohibiting
hotels
and
restaurants
from
levying
service
charge
automatically
on
food
bills.

Hotels,
restaurants
barred
from
levying
service
charge:
Govt

Justice
Yashwant
Varma,
while
dealing
with
petitions
by
the
National
Restaurant
Association
of
India
(NRAI)
and
Federation
of
Hotels
and
Restaurant
Associations
of
India
challenging
the
Central
Consumer
Protection
Authority
(CCPA)’s
July
4
guidelines,
said
the
issue
requires
consideration
and
directed
the
authorities
to
file
their
reply.

“The
matter
requires
consideration.
Consequently,
until
the
next
date
of
listing
the
directions
as
contained
in
para
7
of
the
impugned
guideline
of
July
4,
2022
shall
remain
stayed,”
the
court
ordered.

The
court
said
that
the
stay
is
subject
to
the
members
of
the
petitioners
ensuring
that
the
levy
of
service
charge
in
addition
to
the
price
and
taxes
and
obligation
of
customer
to
pay
the
same
is
duly
and
prominently
displayed
on
the
menu
or
other
places.

Further,
the
members
will
also
undertake
not
to
levy
service
charge
on
any
take-away
items,
it
added.

“If
you
don’t
want
to
pay,
don’t
enter
the
restaurant.
It
is
ultimately
a
question
of
choice.
I
have
stayed
the
para
7
guidelines
subject
to
these
two
conditions,”
the
court
said.

The
court
listed
the
matter
for
further
hearing
on
November
25.

The
NRAI
has
claimed
in
the
petition
that
the
prohibition
under
the
July
4
order
was
“arbitrary,
untenable
and
ought
to
be
quashed”
as
it
has
been
issued
without
appreciation
of
the
facts
and
circumstances.