Consumer watchdog fines Chaayos Rs 50k for auto-adding service charge in bills
The Central Consumer Protection Authority has fined the cafe chain Chaayos Rs 50,000 for automatically adding service charges to customer bills. The authority ruled that such charges must be voluntary and ordered the company to refund the complainant and update its billing systems.
Why it matters
This ruling reinforces consumer rights against mandatory service fees, setting a precedent for transparency in the hospitality industry.
NEW DELHI: The Central Consumer Protection Authority (CCPA) has imposed a Rs 50,000 penalty on tea cafe chain Chaayos for automatically adding a service charge to customers' bills, ruling that restaurants cannot force consumers to pay what is meant to be a voluntary tip.In an order dated July 14, the consumer watchdog directed Chaayos to refund the service charge collected from the complainant, remove the default addition of service charges from its billing systems across all outlets, and submit a compliance report within 15 days.The case arose from a complaint filed by Shashank Sood through the National Consumer Helpline after he was charged a service fee over and above GST at a Chaayos outlet.
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