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In a major development, top consumer panel has decided to take action against several Delhi restaurants over non-refund of service charges. The Central Consumer Protection Authority has taken suo motu cognizance following reports that five restaurants in Delhi failed to refund service charges, the Ministry of Consumer Affairs announced on Tuesday.

According to an official statement, the proceedings are underway against Makhna Deli, Xero Courtyard, Castle Barbeque, Chaayos, and Fiesta by Barbeque Nation. These establishments allegedly did not return mandatory service charges in defiance of a ruling by the Delhi High Court. As a result, the CCPA has issued notices under the Consumer Protection Act, 2019, ordering these restaurants to reimburse the collected service charges.

This initiative seeks to alleviate undue pressure on consumers who are often compelled to pay extra charges while dining out. As per the law, hotels and restaurants are prohibited from enforcing service charges or collecting them under alternate labels.

Earlier, on July 4, 2022, the CCPA had released a set of guidelines designed to eliminate unfair business practices and uphold consumer rights with regard to service charges in hospitality venues. The key directives include:

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