Delhi HC grants time to restaurant body to file rejoinder
Oct 06, 2022
New Delhi [India], October 6 : The Delhi High Court on Thursday granted time to the National Restaurant Association of India (NRAI) to file a rejoinder on the reply filed by the Central Consumer Protection Authority (CCPA).
This matter is connected with the issue of levying service charges by the restaurant. The court had granted an interim stay on CCPA guidelines retraining restaurants from levying service charges.
Justice Yashwant Varma on Thursday was informed by the counsel for CCPA that the Federation of Hotels and Restaurants of India (FHRAI) has filed its rejoinder on their reply. It was also informed that NRAI has not yet filed the rejoinder.
Thereafter the bench granted time to NRAI to file a rejoinder. The matter has been listed on November 3 for further hearing. The court directed that the interim stay will continue till the next date of hearing.
The bench had on July 20 stayed the guidelines issued on July 4 by CCPA. This order was challenged by the restaurant body. Thereafter the stay order was challenged before the division bench. The authorities were asked to approach the single judge for relief.
The Central Government and the Central Consumer Protection Authority (CCPA) had moved a plea in the Delhi High Court seeking vacation of the stay on the guidelines prohibiting levying of service charges on consumer bills by hotels and restaurants
The counsel for the authorities argued before the division bench that the stay order was passed by a single judge without giving them an opportunity to file their reply on the petition against the guidelines.
The council said that various complaints were received that restaurants were restraining consumers who were not paying the service charge.
The High Court said that it's a matter of choice. Don't enter the restaurant if you don't want to pay.
The petition moved by the Federation of hotels and restaurants of India (FHRI) stated that CCPA can only issue guidelines. The latest guidelines restraining the levying of service charge is arbitrary.
Earlier the guidelines were challenged by the National restaurant association of India (NRAI).
The High court while issuing the notice on another petition by the FHRI had set down conditions that restaurants prominently display service charge components in the price of the food.
Restaurants will not charge service charges on taking away/delivery of food, the High court said.
The petitioner restaurant association had contended the issue of levying service charges was not merely like giving a 'tip' and that it pertained to an industry practice governed by the right to business under Article 19(1)(g) of the Constitution and has been going on for 70 years.
