CCPA Orders Rs. 20,000 Penalty Against Amour Bistro for Automatic Levy of "Restaurant Experience Charge"

Background and Overview

The Central Consumer Protection Authority (CCPA) initiated suo-moto proceedings against Amour Bistro, a dining establishment operating as a unit of Ambrosia Hospitality, located at 10/48, Malcha Marg, New Delhi. The proceedings arose from a grievance dated 28.05.2025, which brought to light the restaurant's practice of automatically imposing a 10% "Restaurant Experience Charge" on customer bills, over and above the applicable CGST and SGST.

What made this case particularly significant was not merely the existence of the additional charge, but the manner in which it was embedded into the restaurant's billing software — making it a default line item on every dine-in bill, irrespective of whether the assessee (consumer) had explicitly consented to paying it.

How the Charge Appeared on the Bill

The investigation revealed a structured billing pattern. A food subtotal of Rs. 890.10 attracted an automatic 10% "Restaurant Experience Charge" of Rs. 89.00, after which CGST of Rs. 24.48 and SGST of Rs. 24.48 were applied on the enhanced amount, resulting in a grand total of Rs. 1,028.00.

This billing structure meant that the assessee was effectively paying GST on a non-statutory charge — an amount that was never voluntarily agreed upon in the first place.

The charge was presented as a standard line item, formatted similarly to statutory levies like GST, thereby creating a strong impression in the minds of consumers that the payment was legally compulsory.

Consumer Protection Act, 2019

Before examining the CCPA's findings, it is essential to understand the statutory provisions that came into play:

  • Section 2(9)(ii) of the Consumer Protection Act, 2019 guarantees consumers "the right to be informed about the quality, quantity, potency, purity, standard and price of goods, products or services, as the case may be, so as to protect the consumer against unfair trade practices."

  • Section 2(9)(v) of the Consumer Protection Act, 2019 protects "the right to seek redressal against unfair trade practices or restrictive trade practices or unscrupulous exploitation of consumers."

  • Section 2(28) of the Consumer Protection Act, 2019 addresses misleading representations — when a restaurant displays specific menu prices, it communicates a definitive cost to the consumer. Any subsequent addition of a mandatory charge creates an implied misrepresentation about the true price.

  • Section 2(46) defines "unfair contract" as a contract between a service provider and a consumer that causes a significant imbalance in rights and obligations to the consumer's detriment, imposing unreasonable charges or conditions without the consumer's explicit consent.

  • Section 2(47) defines "unfair trade practice" to encompass deceptive or unethical methods used in the promotion or provision of goods and services.

CCPA Guidelines, 2022

The Guidelines to Prevent Unfair Trade Practices and Protection of Consumer Interest with Regard to Levy of Service Charge in Hotels and Restaurants, issued on 04.07.2022, lay down explicit restrictions:

"3. Service charge is being levied in addition to the total price of the food items mentioned in the menu and applicable taxes, often in the guise of some other fee or charge."

"4. It may be mentioned that a component of service is inherent in price of food and beverages offered by the restaurant or hotel. Pricing of the product thus covers both the goods and services component. There is no restriction on hotels or restaurants to set the prices at which they want to offer food or beverages to consumers. Thus, placing an order involves consent to pay the prices of food items displayed in the menu along with applicable taxes. Charging anything other than the said amount would amount to unfair trade practice under the Act."

The Guidelines further direct, under Clause 7: