The Centre on Monday barred hotels and restaurants from levying a service charge “automatically or by default” on food bills. The government has urged customers to file complaints in case the ban is violated.

The Central Consumer Protection Authority, a regulatory body governed by consumer affairs ministry, issued a host of guidelines to prevent unfair trade practices and violation of consumer rights.

In May, the Consumer Affairs Department had written to the National Restaurant Association of India about the abuse of customer rights. The department had noted that the service charge fixed by the restaurants is often arbitrarily high. The letter also mentioned about misleading customers on the legality of the charges.

On Monday, the Central Consumer Protection Authority said that it is the duty of restaurants and hotels to tell the customers that a service charge is voluntary.

The guidelines state that a component of service is already included in the cost of food and beverages offered by a restaurant or hotel, PTI reported. “There is no restriction on hotels or restaurants to set the prices at which they want to offer food or beverages to consumers,” the guidelines added.

When customers order a dish on the menu along with the applicable taxes, they consent to pay for it, the authority said. “Charging anything other than the said amount would amount to unfair trade practices under the [Consumer Protection] Act,” the guidelines said.

The tip comprises a separate voluntary transaction between the consumer and staff of the hotel, the guidelines stated. “Only after completing the meal, a consumer is in a position to assess the quality as well as service and decide whether or not to pay a tip and if so, how much,” the authority added.

How to complain against violations:

  • If a hotel or a restaurant levies a service charge, a consumer can request to remove it.
  • The consumers can lodge a complaint on the National Consumer Helpline, which works as an alternate dispute redressal mechanism at the pre-litigation level, by calling 1915 or through the mobile app.
  • The customers can also file complaints with the Consumer Commission through the e-Daakhil portal.
  • The consumers can submit a complaint to the district collector.
  • An email can be directly sent to the Central Consumer Protection Authority at