New Delhi: A Delhi consumer commission has held Swiggy and a restaurant responsible for displaying a misleading buffet price on the food delivery platform and directed them to jointly pay Rs 1 lakh as compensation to a customer for mental agony, harassment, inconvenience and litigation costs.

The District Consumer Disputes Redressal Commission, presided over by Divya Jyoti Jaipuriar, also directed Themis Barbeque House to refund Rs 3,988 to the customer for the excess amount charged over the price displayed on Swiggy Dineout. The restaurant was further ordered to refund Rs 254 collected as a service charge.

Both amounts will carry 9% annual interest, according to the commission’s order dated September 21.

The commission found that the pricing displayed on Swiggy’s Dineout platform did not accurately represent the buffet prices charged by the restaurant and held both the platform and the restaurant responsible for the misleading representation.

Customer books table for 14 people

The case arose from a complaint filed by advocate Praveen Kumar Singh, who booked a table for 14 people at Themis Barbeque House through the Dineout section of the Swiggy app on April 7, 2024.

The listing on Swiggy displayed the “cost for two” as Rs 1,500.

This effectively suggested a cost of Rs 750 per person. However, when the customer reached the restaurant, the actual buffet prices were significantly higher.

The restaurant charged Rs 1,050 per person for the vegetarian buffet and Rs 1,100 per person for the non-vegetarian buffet.

This meant customers were charged Rs 300 more per person for the vegetarian buffet and Rs 350 more per person for the non-vegetarian buffet compared with the price suggested by the Swiggy listing.

The difference ultimately resulted in the customer being charged an additional Rs 3,988 over the price indicated on the platform.

Commission finds price difference material

The consumer commission said the Swiggy listing did not clearly indicate that the “cost for two” amount was merely an estimate.

It noted that the difference between the price displayed on the platform and the actual buffet price was approximately 40-47%, describing the discrepancy as material.

The commission also said Swiggy had access to accurate and itemised pricing information but continued to display the lower figure.

It consequently held that the continued display of the lower price amounted to a deficiency in service and an unfair trade practice.

The commission said responsibility rested with both the restaurant and Swiggy because the misleading price appeared on the platform while the restaurant was responsible for the actual price charged to the customer.

“Responsibility falls on both,” the commission said while holding the two parties equally responsible for the misleading advertisement.

Swiggy’s intermediary defence rejected

Swiggy argued that it was merely an intermediary and sought protection under Section 79 of the Information Technology Act.

The consumer commission rejected the contention.

It said Swiggy could not escape responsibility simply by referring to the intermediary protection provided under the law.

The commission said the platform was required to demonstrate that it had exercised the necessary due diligence under the applicable legislation and rules.

“The OP-1 (Swiggy) cannot escape from its responsibility merely by quoting section 79 of the Information Technology Act,” the commission said.

It further observed that Swiggy had not placed sufficient material on record to demonstrate that it maintained a mechanism to reconcile the displayed “cost for two” amount with the actual prices charged by the restaurant.

The finding places responsibility on the platform for the accuracy of material pricing information displayed to consumers, rather than treating the listing as solely the restaurant’s responsibility.

Restaurant ordered to refund service charge

The commission also examined a separate issue concerning the restaurant’s levy of a 10% service charge on beverages.

According to the order, the menu did not disclose the service charge.

The bill also described the amount as “Service Charge” rather than “Staff Contribution”, which the commission noted was the terminology required under the interim directions applicable at the time.

The commission consequently held that the levy amounted to a deficiency in service and an unfair trade practice.

The restaurant was directed to refund Rs 254, representing the service charge collected from the customer.

The refund will carry 9% annual interest along with the Rs 3,988 refund ordered over the buffet price discrepancy.

Swiggy and restaurant to pay Rs 1 lakh compensation

In addition to the refunds, the commission ordered Swiggy and Themis Barbeque House to jointly and severally pay Rs 1 lakh to the customer.

The compensation covers mental agony, harassment, inconvenience and litigation costs arising from the dispute.

The commission’s order therefore imposes separate financial liabilities for the misleading buffet price and the service charge, while also awarding compensation against both parties.

The total amount ordered to be paid includes the Rs 1 lakh compensation, Rs 3,988 towards the excess buffet charge and Rs 254 towards the service charge, along with applicable interest.

Four-week deadline for payment

The commission directed the opposite parties to comply with the order within four weeks of receiving it.

Failure to make the payment within the stipulated period would attract 12% annual interest on the entire awarded amount after the four-week deadline expires.

The higher interest rate would therefore apply if the parties fail to comply within the period specified by the consumer commission.

The order highlights the importance of accurate pricing information on digital food and dining platforms, particularly when consumers rely on listings to make advance reservations and estimate their expenses.