India, April 28 -- Restaurant associations have challenged the Delhi High Court's March 28 order prohibiting imposition of service charges -- typically in the range of 5-20% -- on top of the consumer's pre-tax bill. The Delhi HC, and before that, several advisories by the Union government and several state governments, underlined the voluntary nature of such payment, made as a gratuity for services. The restaurant business doubling down on making it compulsory indicates a coercive approach.

At the heart of the matter are three issues. The first is consumer rights. A "compulsory" gratuity goes against the principle of basic fairness. Consumers, as individuals and even as a class, have no bargaining power against restaurants -- something t...