CCPA fines Chaayos, Barbeque Nation among 41 restaurants over service charge

New Delhi: The Central Consumer Protection Authority (CCPA) has penalised 41 restaurants across India for imposing mandatory service charges on customers without their explicit consent. The list includes popular chains such as Chaayos and Barbeque Nation, along with Zorro-Night Club and several others.

The action comes after months of complaints from diners who found service charges automatically added to their bills, often without any prior notice or option to opt out.

Minister warns violators

Union Minister Pralhad Joshi, who oversees consumer affairs, issued a stern warning to the restaurant industry. He said violators will face fines and repeated offenders could face stricter penalties.

“Service charge cannot be mandatory. It must be left to the discretion of the customer,” Joshi stated. The government has made it clear that any establishment forcing this charge is violating consumer rights.

What the law says

The CCPA had earlier issued guidelines stating that service charge is optional. Customers can choose to pay it or not. Restaurants cannot add it to the bill by default or refuse service if a customer declines to pay.

Despite these guidelines, many eateries continued the practice. The regulator launched an investigation after receiving hundreds of consumer complaints.

Names on the list

Besides Chaayos and Barbeque Nation, the penalised outlets include Zorro-Night Club and other regional players. The CCPA has not released the full list yet but confirmed that fines have been imposed on all 41 establishments.

Officials said the quantum of penalties varies based on the severity and frequency of violations. Repeat offenders have been charged higher amounts.

Consumer reaction

Consumer rights groups have welcomed the move. Many customers had long complained about the lack of transparency in billing. The mandatory service charge often added 5-10 per cent to the total bill without any explanation.

The CCPA has urged consumers to report any restaurant that continues to levy mandatory service charges. Complaints can be filed through the National Consumer Helpline or the consumer affairs portal.

The restaurant industry body, the National Restaurant Association of India (NRAI), has not commented on the penalties yet. Industry sources indicate that many members are reviewing their billing practices to comply with the law.

What happens next: The CCPA is expected to monitor compliance closely. More restaurants could face action if they fail to adhere to the guidelines. Consumers are advised to check their bills carefully and report violations.