Restaurant Owners To Stage Protest In Delhi Following Service Charge Ruling

Mondays may come along with a whole bunch of blues and also may not be the best day of the week to eat out, especially not this coming Monday as it will have one extra added “blue” to it. To demonstrate their angst towards a recent Supreme Court ruling, which deems levying an additional service charge illegal, a number of restaurants in Delhi have decided to remain shut on 1^st May. Further, they will also stage a protest at the Capital’s dharna-central, a.k.a., Jantar Mantar.

Make It Clear

The hospitality industry and the government have been going back and forth on the issue of levying service charge on food for the past few months. While some eateries stopped charging the extra 10 percent, other restaurants paid no heed and levied the charge nonetheless whilst letting diners know about this, and a few took the midway by reducing the amount, but charging still.

Moreover, in a recent notice, restaurants have been asked to make it clear to their customers that no service charge will be levied on their food by displaying sign boards reading: ‘No service charge will be collected here’.

Food and civil supplies minister U T Khader said on Tuesday: “We will shortly convene a meeting of hotel industry representatives and apprise them about the Centre’s guidelines. The state government will come out with an order prohibiting hotels and restaurants from collecting service charge from customers.”

Angst Level: Jantar Mantar

According to reports, the main aim of the protest this Monday is to request the apex court to trash its ruling and “let the restaurants decide” on the matter. Additionally, the National Restaurants Association of India (NRAI) will also submit a memorandum regarding the same to Ram Vilas Paswan, Minister of Consumer Affairs, Food and Public Distribution.

In an official statement, NRAI President Riyaaz Amlani said: “Guidelines are not laws. The present statement by the government is causing unnecessary confusion in public, which is adversely affecting the smooth functioning of restaurants. It is once again reiterated that, as of now, levying of service charge by restaurants is legal and does not violate the provisions of Consumer Protection Act, 1986, since the same is mentioned in the menu or price list and informed to the customer.

“Levying of service charge directly benefits six million people employed in the industry. Of these, more than 60 per cent employees depend on service charge to augment upto 30 per cent of their income. All the organised food and beverage operators employ the service charge method to ensure that all employees are beneficiaries and not just waiters but also cooks, toilet attendants, and cleaners. Unless there is a legislation, restaurants will continue to levy service charge”, Amlani added.

Weighing in on the debate, Junkyard Cafe and Garam Dharam owner Umang Tewari told DNA, “It is a misconception that owners pocket the amount collected as service charge. We distribute it equally to all the staffers and it is an additional source of income for them. Instead of clamping down on us on one matter or the other, the government should let us run our businesses the way we want.”

Will the restaurants and the government finally see eye to eye on the subject? We shall wait and see!