Service charge in hotels/restaurants not mandatory now: Ram Vilas Paswan

As per the guidelines, the column of service charge in a bill will be left blank to customers to fill up before making the final payment.

By: Express Web Desk | New Delhi | Updated: April 21, 2017 5:56 pm
service charge, service charge hotel, hotel service charge, restaurant service charge, ram vilas paswan, paswan, indian express, latest news Ram Vilas Paswan. (File Photo)

Dining in hotels and restaurants will be less expensive now as the government has made service charge on hotel and restaurant bills ‘totally voluntary’. In a series of tweet, Union Minister for Consumer Affairs Ram Vilas Paswan on Friday said that service charge on hotel and restaurant bills is “totally voluntary” and not mandatory after the government approved guidelines on service charge.

“Hotels/Restaurants should not decide how much service charge is to be paid by customer and it should be left to discretion of customer. Government has approved guidelines on Service Charge. Service Charge is totally voluntary and not mandatory now,” tweeted Paswan.

The minister also said that the guidelines are being sent to states for necessary action at their ends.

As per the guidelines, the column of service charge in a bill will be left blank to customers to fill up before making the final payment. “If there is mandatory levy of service charge, customers can file a complaint in the Consumer Court,” a senior Consumer Affairs Ministry official told PTI. Hefty fines and stringent action against violation cannot be taken at present as the current Consumer Protection Law does not empower the ministry to do so, the official said. However, the new Consumer Protection Bill under which an authority will be set up will have powers to take action, the official added.

Last week, Paswan had said that the ministry has prepared an advisory on the service charge issue and the same was sent to the PMO for approval. “Service charge does not exist. It is being wrongly charged. We have prepared an advisory on this issue. We have sent it to the PMO for approval,” Paswan had said.

A number of complaints from consumers have been received that hotels and restaurants were charging ‘service charge’ in the range of 5-20 per cent, in lieu of tips, the ministry had said earlier.

Earlier too, on several occasions, Paswan spoke against unfair imposition of service charge on food bill and had even sought explanation from hotels and restaurants’ bodies. In January, the department of consumer affairs stated that service charge on food bills is not compulsory and a customer can choose to have it waived if not satisfied with experience.

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  1. S
    SK Gupta
    Apr 22, 2017 at 5:15 am
    Service Charge should Not appear in the Bill at all. Nobody wants to make an issue after having their food. Govt should have it removed. Those who want to leave tips for excellent service can leave it. Isn't all types of service included in the basic price itself? It cannot be cost of ingredients only. Taj group does Not charge it. Does it mean they don't give service? This is plain dishonesty and govt should simply abolish it.
    1. P
      Prakash A
      Apr 21, 2017 at 7:25 pm
      Though the move by the government to make service charges voluntary is welcome,some hotels may resort to the simple expedient of raising the rates on their itemized menu card,and thus recover service charges through the back door,rather than waiting for the customer to pay these charges voluntarily.
      1. S
        SK Gupta
        Apr 22, 2017 at 5:17 am
        Let the restaurant do that. They can still do that and also levy Service Charge again!
      2. G
        Gangu Radhakishan
        Apr 21, 2017 at 7:00 pm
        Government should encourage the chain of 100 percent Vegetarian restaurants across India started by yoga guru Sri Ramdev Baba. Most of the colleges/universities/offices should have access to these foods stores (lke pizza hut, Mcdonold's, burger king in USA) which will enhance the health of the society overall.
        1. G
          Gangu Radhakishan
          Apr 21, 2017 at 6:52 pm
          Great decision by the central government. Also should take steps to improve the cleanliness in kitchens which should have modern look and facilities, along with upkeep of surroundings of the hotels/restaurants. Should enforce use and through or highest quality utensils, giving top priority to cleanliness. Vegetarian and non-vegetarian sections should be totally separate and should not intermix in the kitchens.
          1. S
            Apr 21, 2017 at 6:42 pm
            What about service charge on new houses/flats? Builders are charging 10-15 .
            1. H
              HG KETKAR
              Apr 21, 2017 at 5:57 pm
              Welcome decision and direction given by the Food and Suppliers Minister. It is really harsh to mandatorily pay to the Hotel for eateries.
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