2001 (12) TMI 903 - Commission - Indian Laws

Commission rules in favor of Pizza Express: Service charges not unfair or restrictive

S.S. Ahuja Versus Pizza Express

S.S. Ahuja Versus Pizza Express - TMI Issues:- Allegation of unfair and restrictive trade practices by Pizza Express, Connaught Place, New Delhi for levying compulsory service charges.- Whether the respondent engaged in unfair or restrictive trade practices.- Whether the trade practices were prejudicial to public interest or consumers.- Relief sought by the complainant.Analysis:1. The complainant accused Pizza Express of unfair trade practices under Sections 10(a)(i) and 36A read with Section 36B(a) and Section 37 of the Monopolies and Restrictive Trade Practices Act, 1969. The complaint centered on the imposition of compulsory service charges at 9% of the total bill for dining at the restaurant.2. Mrs. S.S. Ahuja discovered the service charges on her bill at Pizza Express, Connaught Place, considering them optional. The complaint alleged that this practice imposed unjustified costs on customers, leading to the filing of the complaint against the respondent for unfair and restrictive trade practices.3. The respondent defended the charges, stating they were approved by the Department of Tourism and displayed on the menu card. The respondent argued that the charges were not compulsory tips but a commercial decision aligned with industry standards, providing additional services beyond food.4. The issues framed included determining if the respondent engaged in unfair or restrictive trade practices, assessing the impact on public interest, consumers, and deciding on the relief sought.5. The Commission analyzed the evidence, finding that the service charges were approved by the Department of Tourism and clearly displayed on the menu card. The practice was not deemed unfair or deceptive, as customers were informed beforehand, and non-disclosure of reasons for the charges did not constitute unfair practice.6. The Commission noted that service charges were part of the price of food items served inside the restaurant, and the complainant failed to demonstrate unfair trade practices. The levy of service charges did not restrict competition or harm consumers, as customers had the choice to dine in or opt for takeaway service without the charges.7. Ultimately, the Commission concluded that the Notice of Enquiry was not maintainable, discharging it without costs, as the respondent did not engage in unfair or restrictive trade practices as alleged. The observations made earlier were not considered conclusive without evaluating the evidence presented during the trial.