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Restaurants can continue to levy service charge for now, says Delhi HC
The court's remarks came while hearing an appeal against the single judge's order which had put on hold guidelines issued by the CCPA or Central Consumer Protection Authority, barring restaurants from automatically adding service charges to food bills.
The Delhi high court on Thursday said restaurants across the country can continue to levy a service charge for now. The court also observed that eateries are under a legal obligation to pay their employees, but the cost cannot be put on customers.
The court's remarks came while hearing an appeal against the single judge's order which had put on hold guidelines issued by the CCPA or Central Consumer Protection Authority, barring restaurants from automatically adding service charges to food bills.
The Delhi HC bench, comprising chief justice Satish Chandra Sharma and justice Subramonium Prasad, also gave 10 days' time to CCPA to file their response to the plea by the restaurant as it sent the matter back to the single judge for reconsideration. The court disposed of the appeal filed by the CCPA.
Also read | Customers perceive service charge as govt levy: Delhi HC
The bench posted the matter for hearing on August 31 even though it said that the interim orders would continue.
On July 20, justice Yashwant Varma had put on hold CCPA guidelines issued on July 4 that barred restaurants from automatically adding service charges to food bills, a controversy that has raged for years.
Justice Varma had added that all eateries must prominently display a levy of service charge on menus and other places. The court also recorded a submission by counsels for the National Restaurant Association of India and Federation of Hotel & Restaurant Associations of India that they would not levy this charge on takeaways.
The CCPA had appealed against the order contending that a consumer should not be forced to pay the service charge.
(With inputs from bureau)
