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Service charge of Rs 5.94 costs coffee chain Rs 12,000

The forum ordered CCD to pay Rs 7,000 for deficiency in service, Rs 5,000 as litigation costs and also refund Rs 5.94 with 12% interest.

Chandigarh | Updated: April 17, 2015 3:56:11 am
Cafe Coffee Day Cafe Coffee Day admitted that it operated three cafes collectively as ‘Lounge’ where it collected a service charge from customers.

By Kartik Kumar

Forcing a customer to pay a service charge of Rs 5.94 has cost a franchise of a coffee chain Rs 12,000.

Holding that the service charge was “an unfair trade practice’’, the district consumer disputes redressal forum of Chandigarh has ordered the Cafe Coffee Day ‘Lounge’ at Elante Mall to pay the customer Rs 7,000 for deficiency in service, Rs 5,000 as litigation costs, and refund the service charge of Rs 5.94 within 30 days, with 12 per cent interest.

In his complaint to the forum, Lovepreet Singh, a resident of Mohali, had said that on July 7, 2014, he and his family went to the ‘Lounge’ and ordered two cups of cappuccino. The cost was Rs 198 but the bill also mentioned an additional amount of Rs 5.94 towards service charge.

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When Lovepreet questioned the staff about the extra charge, they failed to give a reasonable explanation, but insisted that he had to pay it.

In its reply to the forum, Cafe Coffee Day admitted that it operated three cafes collectively as ‘Lounge’ where it collected a service charge from customers, which was clearly mentioned in the menu card. The charge was for the purpose of paying to the waiters to provide them some extra earning above the basic minimum wage. The complainant placed his order only after looking at the menu card, it was stated.

In his order, forum president P L Ahuja said, “There is no statutory law under which service charges are levied. Also, the Chandigarh Administration had declared service charge illegal on October 31, 2014, and directed all restaurants and hotels to comply with its order. It is, thus, proved that the respondent had resorted to unfair trade practice in collecting the excess amount.”

The forum, therefore, ordered Cafe Coffee Day to pay Rs 7,000 for deficiency in service, Rs 5,000 as litigation costs and also refund Rs 5.94 collected as service charge within a period of 30 days with 12 per cent interest.

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