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By law, restaurants can charge you more than MRP

delhi Updated: May 19, 2012 23:35 IST

Can a hotel or a restaurant charge for a bottle of drinking water more than the maximum retail price marked on the container? Unfortunately, the answer to this question is yes, they can and I am basing this answer on a judicial pronouncement on the subject.

But first, some background on the issue. As I said in my column last week, the Legal Metrology (Packaged Commodities) rules not only mandate that all packed goods should mention the MRP but also specify that such goods cannot be sold at a price higher than that.

The Department of Legal Metrology, Union Ministry of Consumer Affairs, in response to a representation from the hospitality sector in 2000 had said that the restaurants and hotels could levy a service charge on the MRP.

Not satisfied with this, the Federation of Hotels and Restaurants Association of India filed a writ petition before the Delhi High Court, which, relying on three judgements of the Supreme Court, holding that the supply of food or drinks to customers in a restaurant did not constitute 'sale' of goods, concluded that charging prices for mineral water in excess of MRP during the service did not violate the provisions of the Standards of Weights and Measures Act or the packaged Commodities Rules as the law pertains only to retail sale of goods.

Unfortunately, the government did not challenge this before the Supreme Court. So unless the highest court in the country looks at the issue or the government brings in an amendment, the judgement of the Delhi High court will prevail.

For want of space, I cannot go into the details of the judgement but from a reading of it, what one understands is that this applies basically to those restaurants and hotels which provide the ambience and service of a certain class and not to all the restaurants and hotels (where the dominant object is the sale of food and the rendering of service is merely incidental).

Similarly, if you are not sitting in that restaurant to enjoy its ambience and are just buying a bottle of water (or even soft drink) to drink it elsewhere, then the restaurant cannot charge you a price exceeding the MRP.

Having said that, I must emphasise the need for the government to look into the issue from the point of protecting the rights of the consumers and ensure that at least for water, particularly, only the price mentioned on the package is charged.

After all, there is no restriction on what a restaurant or a hotel charges for food or drinks. Why should they be allowed to charge an exorbitant sum for water? Consumers have written to me saying that restaurants are charging as much as Rs. 55 and Rs. 62 for a bottle of water costing Rs. 15. In fact, restaurants are supposed to serve drinking water along with food for free.

Hemant: All restaurants charge more for water than what is printed. What is the solution?

Answer: I have already answered your question. It's time that the consumers lobbied against this practice and demand that the government bring in measures to stop this.