The Managing Directors/CEO's/Owners/Director/Partners/General Managers             
All FHRAI Members                

CC:      All Members of the Executive Committee       
             All Regional Associations         

SUB: DELHI HIGH COURT STAY ON SERVICE CHARGE DIRECTIONS OF CCPA

Dear Member,

We are extremely pleased to inform you that on the writ petition filed by FHRAI in the Hon’ble High Court of Delhi against the arbitrary and discriminatory provisions in the CCPA Guidelines dated 04.07.2022, the High Court has ordered a stay on para 7 and other directions in the CCPA Guidelines.

For your ready reference, para 7 of the CCPA Guidelines is reproduced as hereunder: 

7. Therefore, to prevent unfair trade practices and protect consumer interest with regard to levying of service charge, the CCPA issues the following guidelines-

1.            No hotel or restaurant shall add service charge automatically or by default in the bill.
2.           Service charge shall not be collected from consumers by any other name.
3.          No hotel or restaurant shall force a consumer to pay service charge and shall clearly inform the consumer that service charge is voluntary, optional and at consumer’s discretion.
4.          No restriction on entry or provision of services based on collection of service charge shall be imposed on consumers.
5.           Service charge shall not be collected by adding it along with the food bill and levying GST on the total amount.

The Hon’ble High Court has also granted a stay on all directions issued under the CCPA Guidelines subject to a condition that no Service Charge will be levied by the restaurants on take-aways and the restaurants shall prominently display that they levy Service Charge and also inform the customers about the same.

Members are hereby requested to comply to the following while levying service charge in you establishments:

1. Display prominently outside the hotel / restaurant that “ We Levy Service Charge”.
2. Display prominently in the menu card that “ Service Charge will be Applicable”.

We will update our members about any further development on this matter.

With best regards, 

Jaison Chacko
Secretary General
_____________________________________________________
The Federation of Hotel & Restaurant Associations of India
Regd. Off.: B-82, 8th Floor, Himalaya House, 23 K.G. Marg, New Delhi - 110 001
Tel.: 011-40780780, Email: fhrai@fhrai.com  Website: www.fhrai.com