CCPA warns restaurants against levying ‘Gas’ or ‘LPG’ charges

In a stern warning to hotels and restaurants, the Central Consumer Protection Authority (CCPA) on Wednesday said that levying additional charges such as ‘LPG charges’ or ‘fuel cost recovery’ amounts to an unfair trade practice, and strict action will be taken against violators.

Noting that several complaints had been received against hotels and restaurants for adding such charges, the CCPA clarified that this practice violates the Consumer Protection Act, 2019.

It emphasised that only applicable taxes can be added to the price mentioned on the menu.

The authority has issued a fresh advisory under Section 10 of the Consumer Protection Act, 2019, directing restaurants not to levy any such charges automatically. It warned that violations may invite strict penal action.

“No hotel or restaurant shall levy ‘LPG charges’, ‘gas charges’, or any similar charges by default or automatically in the bill,” the CCPA stated adding that the price displayed on the menu should be the final price, exclusive of applicable taxes.

The CCPA further said, “Consumers shall not be misled or compelled to pay any additional charge that is not voluntary in nature.”

The authority clarified that input costs such as fuel, LPG, electricity, and other operational expenses are part of the overall cost of running a business and must be factored into the pricing of menu items.

Recovering such costs through separate mandatory charges constitutes an unfair trade practice under Section 2(47) of the Consumer Protection Act, 2019.The CCPA added that any such charges, irrespective of the nomenclature used, are in the nature of service charges or additional fees.

Levying them by default would amount to a violation of the CCPA Guidelines issued on July 4, 2022, and may attract appropriate action under the Consumer Protection Act, 2019, the statement said.