City restaurants still say ‘service charge’ mandatory

City restaurants still say ‘service charge’ mandatory

How can tips, or service charge, be forcibly collected? Diners can refuse to pay, but not many are aware of their rights

It’s been over a year since the Central government barred restaurants from levying a mandatory service charge. But many restaurants still add it to the bill and customers unwittingly end up paying it. 

Chugg Gastro-Bar says collecting service charge is a ‘company policy’.

Shreya and Ram (names changed) visited Chugg Gastro-Bar on Church Street last week and got a bill with the service charge added. The manager told them it was mandatory, and “management policy.” It took a long argument before they could go without paying. 

Metrolife spoke to Balu, manager of Chugg, who said the restaurant had put up a notice outside saying it collects a service charge.

“The money goes to the establishment and the staff working here and we are given clear instructions that it should be added to the bill. We are aware that we shouldn’t make it compulsory but these are our company rules,” he says.

Not all restaurants insist, though. Shikha, content writer, dined with her family at Wolf’ish, Church Street, and was asked to pay Rs 118 as service charge in a total bill of Rs 1,369.

When she said she did not want to pay the service charge, the manager struck it off the bill.

She says, “Not many are aware that it is not compulsory so they end up paying. It’s not that I had a problem paying but I prefer to have that choice to myself.”


Hoteliers’ body: Don’t break law

Metrolife spoke to P Chandrashekar Rao, president of Bruhat Bangalore Hotels Association, says restaurants must abide by the rule concerning service charge.

“Yes, it is not compulsory to pay service charge if the customer does not want to. The restaurant is allowed to make announcements saying they charge 5 to 10% on the bill for service but it is completely up to the customer to pay or not. GST is compulsory but service charge isn’t. If any restaurant forces you to pay, they are breaking the law,” he says.

Naveen Suresh


Naveen Suresh, blogger: “I think it’s completely fine to collect service charge on the bill. If the service is good, they have the right to ask for it. Having said that, and according to government rules, you can choose to not pay. So if you are unhappy with the service, don’t pay. But for me, it doesn’t matter if it is added to the bill or not.”


Deepika Singhania


Deepika Singhania, content curator: “I wasn’t aware service charge is not compulsory till recently. There have been places that provided bad service and it’s upsetting to know I have had to pay them for that.”


Rohit Biddappa


Rohit Biddappa, marketing professional: “There are times when I have refused to pay the service charge. Thankfully, I haven’t had any bad experiences; it was waived for me. While this is has become one way for restaurants to make extra money, it’s important that the right people get paid when we pay a service charge. Customers deserve to know where their money goes.”



Soham Shoney


Soham Shoney, food photographer: “There are places that collect a service charge even if they haven’t said so on the notice board. But I end up leaving a tip if there is none asked for in the bill. I think it’s all right if there is a service charge as long as the money collected goes to the right people. Unfortunately, there is no way for the customer to know if it is done so or not.”