Complete Non-Compliance Of Orders: Delhi HC Imposes ₹1 Lakh Cost Each On Two Restaurant Associations In Service Charge Case

The Delhi High Court has imposed a cost of Rs. 1 lakh each on two restaurant associations i.e., the National Restaurant Association of India and the Federation of Hotel and Restaurant Associations of India for failure to comply with the orders related to service charge.

A Single Bench of Justice Prathiba M. Singh directed, “Accordingly, one last opportunity is granted to the Petitioners to properly file these affidavits within four days subject to payment of Rs.1,00,000/- as costs in each of the petitions which shall be paid to the Pay and Accounts Office, Department of Consumer Affairs, New Delhi by way of a Demand Draft. Without the cost being deposited, the affidavits shall not be taken on record.”

The Bench had earlier on April 12 this year, directed the said restaurant associations to disclose the complete list of their members in support of the writ petitions and inform about the percentage of members imposing the service charge as a mandatory condition in their bills.

Advocates Lalit Bhasin and Sameer Parekh appeared on behalf of the petitioners while ASG Chetan Sharma and CGSC Sandeep Mahapatra appeared on behalf of the respondents.

From the directions which were issued by the High Court, the petitioners had to make various compliances but neither of the petitioners filed the affidavits in terms of the said order. The Court was informed that the affidavit was filed on July 21, 2023, however, the respondent was stated to not have been served.

The affidavit was filed and it came on record that despite an objection by the Registry, the proof of service was not filed. ASG submitted before the court that approximately 4,000 more complaints were received from consumers who were complaining about the service charges being imposed by the petitioners and their members.

The High Court observed, “The clear impression that the Court gets is that the Petitioners are in complete non-compliance of the orders dated 12th April, 2023 and had filed the affidavits without serving the Respondents properly so as to ensure that the hearing does not proceed before this Court.”

The Court, therefore, permitted the respondents to file a response to the affidavits, if necessary, by August 20, 2023.

Accordingly, the High Court listed the matter for further hearing on September 5, 2023.

Cause Title- National Restaurant Association of India & Ors. v. Union of India & Anr.

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