New Delhi, March 25 The Central Consumer Protection Authority (CCPA) warned hotels and restaurants on Wednesday not to levy additional charges, such as "LPG charges" and "fuel cost recovery", and said these are unfair trade practices, and strict action will be taken against them.
The authority has termed this an unfair trade practice under the Consumer Protection Act, 2019, pointing out that only applicable taxes can be added to the price mentioned in the menu.
According to an official statement, the CCPA has "taken serious note of hotels and restaurants levying additional charges such as "LPG charges", "gas surcharge" and "fuel cost recovery" in consumer bills".
The CCPA observed that such charges are being imposed to circumvent existing guidelines on service charges.
The authority has issued a fresh advisory under section 10 of the Consumer Protection Act 2019, directing that no such charges shall be levied automatically, and warned that violations may invite strict action.
"The CCPA has observed, based on grievances received on the National Consumer Helpline (NCH), and media reports, that certain hotels and restaurants are levying such charges in the consumer bill by default, over and above the price of food and beverages displayed in the menu and applicable taxes," the statement said.
Such practices result in a lack of transparency and impose unjustified costs on consumers.
The CCPA clarified that input costs, such as fuel, LPG, electricity, and other operational expenses, are part of the cost of running a business and must be factored into the pricing of menu items.
Recovery of such costs through separate mandatory charges constitutes an unfair trade practice under Section 2(47) of the Act, the authority said.
The CCPA has advised that "No hotel or restaurant shall levy "LPG charges", "gas charges", or similar charges by default or automatically in the bill".
The price displayed in the menu should be the final price, exclusive of applicable taxes.
"Consumers shall not be misled or compelled to pay any additional charge that is not voluntary in nature," the authority said.
The CCPA stated that any such charges, irrespective of nomenclature, are in the nature of service charges or additional fees and their levy by default would amount to a violation of the CCPA Guidelines issued on July 4, 2022, and may attract action under the Consumer Protection Act, 2019.
