Service Charges are Discretionary and Voluntary

Last updated: 15 March 2017

Service Charges are Discretionary/ Voluntary: Ministry of Consumer Affairs, Food and Public Distribution 

The Ministry of Consumer Affairs, Food and Public Distribution has issued advisory to all the State Governments/UTs to sensitise the companies, hotels and restaurants in the state regarding the relevant provisions of the Consumer Protection Act, 1986 on unfair trade practices. It also aims to advise the hotels/restaurants to disseminate information through display at the appropriate place in the hotel/restaurants that the “service charges” are discretionary/voluntary and a consumer dissatisfied with the service can have it waived off. 163 complaints related to Service Charges were received at National Consumer Helpline during April 2016 to February 2017.

Under the provisions of the Consumer Protection Act, 1986, a three tier quasi-judicial mechanism, called Consumer Fora, has been set up at the District, State and National levels to provide for simple and inexpensive justice to consumer disputes.  The Act further provides that a trade practice which, for the purpose of promoting the sale, use or the supply of any goods or for the provision of any service, adopts any unfair method or deceptive practice, is to be treated as an unfair trade practice. A consumer can make a complaint to the appropriate consumer forum established under the Act against:-

(i) an unfair trade practice adopted by any trader or service provider 
(ii) the services hired or availed of, suffered from deficiency in any respect
(iii) a trader or service provider, as the case may be, has charged for the goods or for the services a price in excess of the price

(a) fixed by or under any law for the time being in force,
(b) displayed on the goods or any package containing such goods,
(c) displayed on the price list exhibited by him or under any law for the time being in force or
(d) agreed between the parties.

This information was given by Shri C.R. Chaudhary, the Minister of State for Consumer Affairs, Food and Public Distribution, in written reply to a question in Lok Sabha today.

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