Chandigarh

DF-I

CC/17/2015

Vikas Kuthiala - Complainant(s)

Versus

Barbeque Nation Restaurant - Opp.Party(s)

Sunil Narang

17 Aug 2015

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-I, U.T. CHANDIGARH

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Consumer Complaint  No	:	CC/17/2015
Date  of  Institution	:	09/01/2015
Date   of   Decision	:	17/08/2015

 

 

 

 

 

Vikas Kuthiala s/o Sh. Kuldip Kuthiala, resident of House No.105, Sector 27-A, Chandigarh.

…...........Complainant

Vs

 

[1] Barbeque Nation Restaurant, SCO 39, Sector 26, Madhya Marg, Chandigarh, through its Manager.

 

[2] Barbeque Nation Hospitality Limited, being Franchise of Barbeque Nation Restaurant at SCO 39, Sector 26, Madhya Marg, Chandigarh, through its Manager/ Director.

 

[3] Chandigarh Administration, U.T. Secretariat, Sector 9, Chandigarh, through its Excise & Taxation Commissioner.

….......... Opposite Parties

 

BEFORE:    MRS.SURJEET KAUR                PRESIDING MEMBER

           SH. SURESH KUMAR SARDANA   MEMBER

 

Present:      Sh. Sunil Narang, Counsel for Complainant.

            Sh. Rajwinder Singh, Counsel for OPs No.1 & 2.

            Sh. Jatinder Singh, Govt. Pleader for OP No.3.

 

PER SURJEET KAUR, PRESIDING MEMBER

 

 

 

1.      The epigrammatic facts of the case are that on 02.05.2014, the complainant along with his family members and a guest family, went to the Opposite Party No.1, for refreshments and dinner. After the Complainant and his family had finished their meal, he requested to provide him the bill, upon which he was handed over bill No.P0014000052854 dated 02.05.2014 (Annexure C-1) by Opposite Party No.1. It is alleged that the Complainant was shocked to find that Opposite Party No.1 had charged an additional amount of Rs.193.60Ps., towards service charges (being 4% of the total billed amount of Rs.4840/-). It has been further stated that the Opposite Party No.1 explained that this amount was charged according to the company policy and have to be paid by everybody. As such, left with no other alternative, the complainant had to pay the said service charges, to the Opposite Party No.1. Hence according to the Complainant the aforesaid act of the Opposite Parties No.1 & 2, amounted to deficiency, in rendering service, as also indulgence into unfair trade practice. When all the frantic efforts made by the Complainant failed to elicit any fruitful results, he filed the instant Complaint u/s 12 of the Consumer Protection Act, 1986, before this Forum, alleging the aforesaid act & conduct of the Opposite Parties No.1 & 2 as deficiency in service and unfair trade practice.

 

2.      Notice of the complaint was sent to Opposite Parties seeking their version of the case.

 

3.      The Opposite Parties No.1 & 2 in their joint written statement while admitting the factual matrix of the case, have pleaded that VAT @12.50% is charged from all the customers on the total bill amount (excluding liquor) plus Service Tax is charged @4.9449% on total bill amounting including service charge which is paid to the Chandigarh Administration by the answering Opposite Parties and the said amount is not pocketed by them. It has been asserted that the Complainant never objected to the service charge reflected in the bill and rather he paid the entire bill amount without any objection. Denying all other allegations, the Opposite Parties No.1 & 2 have prayed for dismissal of the complaint.

 

4.      The Opposite Party No.3 in its written statement while admitting the factual matrix of the case, has pleaded that vide letter dated 31.10.2014 all the Hotel/Restaurants in Chandigarh were instructed not to charge any service charges from the customers. However, in supersession of letter dated 31.10.2014, letter dated 24.2.2015 (Annexure R-2) was issued wherein it was again clarified that the service charge is not a govt. levy but still it is collected by the restaurants ranging between 5% to 10% over and above the bill for food etc. Accordingly, all the restaurants/ eateries were directed to show cause as to why the service charge levied and collected by them from the consumers over and over the bill for food etc. be not included in the gross turn over and taxed and penalized accordingly as per the provisions of Section 2(zg) of the Punjab Value Added Tax Act, 2005, as extended to and applicable to U.T. Chandigarh. Denying all other allegations, the Opposite Party No3 has prayed for dismissal of the complaint.

 

5.      The Complainant also filed rejoinder wherein the averments as contained in the complaint have been reiterated and those as alleged in the written statement by the Opposite Parties No.1 & 2 have been controverted.

 

6.      Parties led evidence in support of their contentions.

 

7.      We have heard Sh. Sunil Narang, Counsel for Complainant, Sh. Rajwinder Singh, Counsel for Opposite Parties No.1 & 2 and Sh. Jatinder Singh, Govt. Pleader for Opposite Party No.3 and have also perused the record, along with the written arguments filed on behalf of the parties.  

 

8.      The key controversy swirls around the short question, “whether the action of the Opposite Parties No.1 & 2 in levying the Service Charge amounting to Rs.193.60P, on the total bill raised, from the Complainant, is justified or not. 

 

9.      Having bestowed our anxious consideration to the matter, we are of the opinion that in the light of the material on record, answer to the question posed has to be in the negative.

 

10.      It is evident from the averments of the Complainant, which are also not denied by Opposite Parties No.1 & 2, that the complainant has been charged service charge amounting to Rs.193.60P on the bill raised by Opposite Parties No.1 & 2 for the food items ordered by him.  Even though statute does not provide for levy of any service charge, the Opposite Parties No.1 & 2 have taken the amount of Rs.193.60P as Service Charge from the complainant, which according to them is as per the Policy of the Company.  We do not find any merit in this contention as there is nothing on record, to substantiate this fact.

 

11.      It is correct that Restaurateur provides many services, in addition to supply of food. He provides furniture, furnishings, linen, crockery and cutlery etc. and in order to compensate for these services, the Government has authorized the Restaurateur to charge the service tax @4.94% on 40% of the bill amount and they are authorized to do so under Section 2C of Service Tax (Determination of Value) Rules, 2006. So, in our opinion, if the Opposite Parties No.1 & 2 are charging any other illegal tax, it amounts to unfair trade practice.

 

12.      We feel that the Opposite Parties No.1 & 2 have been fleecing customers by charging money @4% on the bill as service charges as per Annexure C-1. By levying service charges, illegally, the restaurants are putting additional burden on consumers, who already have to pay around 25% taxes in form of Value Added Tax (VAT) at the rate of 12.5% and Service Tax at the rate of 4.94%. Pertinently, the Chandigarh Administration has recently declared service charge as illegal vide instructions dated 31.10.2014, superseded by another letter dated 24.2.2015. Meaning thereby, the service charge cannot be levied on food served at the table. The Opposite Parties No.1 & 2 have taken the stand of charging the service charge on the ground that the money charged was not pocketed by them and rather the same was paid to the Chandigarh Administration. However, the Opposite Parties No.1 & 2 have miserably failed to place on record any cogent, convincing and reliable evidence to show the same. Hence, the excuse taken by the Opposite Parties No.1 & 2 does not hold any water.

 

13.      It is significant to add here that there is no statutory law under which service charges are levied. Even otherwise also, the Opposite Parties No.1 & 2 have not placed on record any statute/ instructions/ guidelines, which entitles it to levy the service charge to the extent it charged from the Complainant, in the present Complaint. It is thus, legitimately, proved that the Opposite Parties No.1 & 2 had resorted to unfair trade practice in collecting the excess amount and had failed to return the same, which resulted in mental agony and harassment to the Complainant. 

 

14.      Since there are no allegations of deficiency in service, unfair trade practice or otherwise against the Opposite Party No.3 and no claim has been made against it, the instant Complaint qua Opposite Party No.3 is dismissed.

 

15.      In the light of above observations, we are of the concerted view that the Opposite Parties No.1 & 2 are found deficient in giving proper service to the complainant. Hence, the present complaint of the Complainant deserves to succeed against the Opposite Parties No.1 & 2, and the same is allowed, qua them. The Opposite Parties No.1 & 2 are, jointly & severally, directed to:-

 

[a]  To refund Rs.193.60P charged from the Complainant as Service Charge;

 

[b]  To pay Rs.10,000/- as compensation on account of deficiency in service and causing mental and physical harassment to the Complainant; 

 

[c] To pay Rs.7,000/- as cost of litigation;

 

 

16.      The above said order shall be complied within 30 days of its receipt by the Opposite Parties No.1 & 2; thereafter, they shall be liable for an interest @12% p.a. on the amount mentioned in sub-para [a] & [b] above from the date of institution of this complaint, till it is paid, apart from cost of litigation as in sub-para [c] above.  

 

17.      Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced

17^th August,2015                                      

Sd/-

(SURJEET KAUR)

PRESIDING MEMBER

 

 

Sd/-

(SURESH KUMAR SARDANA)

MEMBER