The Managing Directors/CEO's/Owners/Director/Partners/General Managers
All FHRAI Members
CC: All Members of the Executive Committee
All Regional Associations
The President
SUB: DELHI HIGH COURT DIRECTIVE TO FHRAI REGARDING SERVICE CHARGE
Dear Member,
As you are aware that the Central Consumer Protection Authority (CCPA) on 4th July 2022 had issued a guidelines and Para 7 of which mandated the hotels and restaurants to not add Service Charge automatically in the bill and to inform the consumers that paying Service Charge is voluntary and optional. In furtherance to the notification of the said Guidelines, FHRAI had filed a Writ Petition before Hon’ble High Court of Delhi, thereby challenging the Guidelines.
While accepting FHRAI’s petition, the Hon’ble High Court of Delhi had granted a stay on the Para 7 and other directions in the said 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 inform the customers about the same.
During further hearing in the matter, the Hon’ble High Court of Delhi has passed an order on 12th April, 2023 wherein the Hon’ble Court directed FHRAI to furnish the following information:
- How many FHRAI members impose Service Charge as a mandatory condition in their bills?
- Whether the term Service Charge can be replaced by some other terminology so as to prevent confusion in the minds of the consumer that the same is not a Government levy and a distinction can be made between a government mandated charge and an amount charged by the Hotels & Restaurants for the benefit of their staff members.
- The percentage of members who are willing to make Service Charge as voluntary and not mandatory, giving the consumers an option to make their contribution to the extent they are voluntarily willing subject to a maximum percentage that may be charged.
With reference to the aforesaid directive of the Hon’ble High Court of Delhi, the members are requested to kindly share their responses by Tuesday, 27th June 2023 at asg@fhrai.com.
Since this information will be very vital for the final outcome on the legal matter in the Delhi High Court, valued feedback from all our members is highly appreciated and welcomed.
With best regards,
Jaison Chacko
Secretary General
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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, 40780714 (D), Email: fhrai@fhrai.com, Web.: www.fhrai.com