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4h ago

Delhi HC Questions Above-MRP Markups and Separate Service Fees in Restaurant Bills

The court declined interim relief, scheduling a final hearing on September 22.

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To illustrate its point, the bench cited the example of a water bottle priced at ₹20 MRP being billed at ₹100 in a restaurant — broken down as ₹80 for ambience and ₹10 as service charge. (HT Archive)
The High Court posed the questions to the counsel representing the associations for hotels and restaurants.
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Overview

  • A division bench led by Chief Justice D. K. Upadhyaya pressed NRAI and FHRAI on charging over the MRP under Legal Metrology and then adding a service levy.
  • Judges cited a ₹20 water bottle billed at ₹100—₹80 as an ‘ambience’ premium plus ₹10 as service charge—and asked why both are imposed.
  • The case arises from industry appeals to a March order that said service charges are voluntary and called mandatory levies an unfair trade practice and a GST ‘double whammy’.
  • The CCPA told the court many eateries still add service charges despite the order, and the bench suggested strengthening legal metrology enforcement.
  • The bench refused interim relief and listed the matter for a final hearing on September 22.