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DNA Campaign: Many still unaware of new service charge rule

With restaurants and eateries either unaware of the clarification or refusing to budge, those consumers dissatisfied with services, are facing a tough time

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The bill worth Rs 881, with the 10% service tax, Jigar Pandya received.
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While the Department of Consumer Affairs recently clarified that it is totally up to the consumers to pay the 10 per cent service charge at restaurants, eateries and popular hangouts, the city seems to be oblivious of the rule.

With restaurants and eateries either unaware of the clarification or refusing to budge, those consumers dissatisfied with services, are facing a tough time.

Take the case of Jigar Pandya, a Mulund resident. He faced a tough time when he visited the popular Jo's Cafe on January 3 and tried to convince the accountant that it was not mandatory for him to pay the service charge.

Speaking to DNA, Jigar said that he visited the popular joint with his cousins a day after the Department of Consumer Affairs clarification. When the trio entered the cafe around 4pm, the place was relatively empty and the air conditioner wasn't working. After they occupied a table, they were not attended to for a considerable amount of time. Even repeated requests for water were ignored.

After a while, they ordered food and beverages. When Jigar asked for a brand of beverage from the menu, he was told it was unavailable. Another issue was the long delay in serving the food that was ordered. "We were very disappointed with the service. We were given a bill of Rs 881. We saw several charges and taxes such 5 per cent VAT, 6 per cent Swachh Bharat charges and 10 per cent service charge. We had to pay Rs 166 extra. We did not even know if the money would actually go to the waiters or not," said Jigar, who later found solace on Facebook and posted about his incident.

"We asked the accountant to deduct the service charge as we were not happy with the service and we had read the notification. Even after a long argument, he did not deduct it. We even showed him the notification. However, he kept arguing with us and told us we had to pay for it. We had no choice," Jigar added.

The manager of Joe Cafe, Birendra Khilar said: "We were not aware of the notification. We did not have any authority to add or deduct anything, since our owner is out of the country at the moment. However, now that we have read the notification, in case a customer is not willing to pay service charges, we would not force him to do so."

The Consumer Affairs Department had received a number of complaints from consumers that hotels and restaurants are still charging 5-20% service charge.

The Consumer Protection Act, 1986, 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 and that a consumer can complain to the appropriate consumer forum.

The Consumer Affairs Department and the Centre had called for a clarification from the Hotel Association of India, which replied that the service charge is completely discretionary, and should a customer be dissatisfied with the dining experience, s/he can have it waived off. Therefore, it is deemed to be accepted voluntarily.

The Department of Consumer Affairs has asked the state governments to sensitise companies, hotels and restaurants on the provisions in the Consumer Protection Act, 1986, and also to advise Hotels/Restaurants to disseminate information through display at the appropriate place in the hotels/restaurants that 'service charges are discretionary/ voluntary and a consumer dissatisfied with the services can have it waived off.

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