CCPA Cracks Down on 41 Restaurants for Sneaking in Service Charges

In a move that’s bound to make diners sit up straight, the Central Consumer Protection Authority (CCPA) has launched suo‑motu proceedings against 41 restaurants across India. The list reads like a who's‑who of popular chains – from the tea‑centric Chaayos to the grill‑heavy Barbeque Nation – and a slew of smaller outlets.

What triggered the action? A flood of complaints lodged with the National Consumer Helpline (NCH). Shoppers submitted copies of their bills, pointing out that a “service charge” had been tacked on automatically, with no clear ask for permission. In other words, the charge was slipped in by default, not by choice.

According to the CCPA’s statement on July 19, such a practice flies in the face of the Guidelines to Prevent Unfair Trade Practices and Protection of Consumer Interest with Regard to Levy of Service Charge in Hotels and Restaurants. Those guidelines, first issued on July 4, 2022, are crystal clear: service fees must be optional, explicitly communicated, and never mandatory.

The authority also cited Section 2(47) of the Consumer Protection Act, 2019, branding the automatic addition of service charges as an “unfair trade practice.” The Delhi High Court back‑up this stance, having upheld the CCPA’s guidelines in a March 2025 judgment (National Restaurant Association of India & Others vs Union of India & Another). The court said forcing diners to pay a service charge is illegal and that restaurants must honor the voluntary nature of such fees.

Chaayos (Sunshine Teahouse Pvt. Ltd.) was the first to feel the heat. The CCPA slapped the chain with a Rs 50,000 penalty and ordered it to refund the illegitimately collected charges. Moreover, Chaayos has been told to re‑engineer its billing software so that service fees can’t sneak in on their own.

Barbeque Nation and a host of other eateries – including Café Blue Bottle (Patna), China Gate Restaurant, Fiesta Barbeque Nation, FOO Ahmedabad, L’Opera French Bakery, and Zorro – have also received final orders. In most cases, the authority is demanding refunds and system changes, while investigations into the rest are still ongoing.

For ordinary diners, the message is simple: if a bill suddenly shows a service charge, you have the right to question it. The CCPA urges anyone who spots such an addition to call the toll‑free helpline 1915 or lodge a complaint via the NCH portal.

As the authority continues to monitor the hospitality sector, it promises to act swiftly against any breach of the Consumer Protection Act, 2019. In the meantime, restaurants are being reminded that transparency isn’t just good practice – it’s the law.