To round off bill, or not

Pushpa Girimaji

Last fortnight, I bought some pastries at a bakery and the bill came to Rs90 and paise 50. However, the bakery charged me Rs91 and when I questioned them about the overcharging, I was told that because of coin shortage, this was the practice — to round off fractions to the nearest rupee. If the fraction was less than 50 paise, consumers would not be charged, but if it was 50 paise or more, it would be rounded off to a rupee. I feel this is an unfair trade practice and would like to challenge this before the consumer court. Can I do that?

I fully agree with you that a consumer should not be charged more than what is due and consumers must challenge this practice. However, I must mention that unfortunately, the highest consumer court in the country, the National Consumer Disputes Redressal Commission, in its order of July 26, 2021, has held that such rounding off the fraction of a rupee is neither an unfair trade practice nor can it be described as a deficient service.

Having said that, I must point out that the National Commission, in this case, confined the revision petition only to the question of quantum of compensation awarded by the consumer courts at the district and the state level, and in order to determine that, examined the practice of rounding off the fraction. So the commission did not look at the practice per se in its entirety.

Besides, the commission did not look at digital payment of bills. If the convention of rounding off fractions to the nearest rupee is meant to overcome coin shortage, then obviously, there is no justification for it in respect of digital payments. Besides, it also did not look at such practice vis-a-vis pre-packed goods, where the Legal Metrology (Packaged Commodities) Rules apply and the rules mandate that fraction of less than 50 paise be rounded off to the preceding rupee and fractions above 50 paise and up to 95 paise, to 50 paise.

Even the Reserve Bank circulars on the issue that the commission considered were obviously directions to the banks on banking transactions and not retail purchases.

So you can file a complaint on this issue, but your arguments have to be really strong and cohesive in order to convince the consumer commissions at the district and the state levels to take it up despite the National Commission’s order and for the National Commission to re-consider its views.

Can you give more details about the order of the commission you are referring to?

This order has its origin in the purchase of four ice-cream cones by the complainant from McDonald’s Family Restaurant, wherein, the bill which came to Rs85.50 was rounded off to Rs86. Alleging deficiency in service and unfair trade practice, the consumer, in her complaint filed in 2012, sought refund of the excess amount plus compensation and costs, besides imposition of penalty on the restaurant to recover the excess amount charged from consumers in the previous two years.

The District Commission directed the restaurant to refund the excess amount of 50 paise, along with 10 per cent interest, calculated from August 4, 2012, and pay Rs25,000 to the consumer as compensation and Rs5,000 as costs, besides Rs25,000 to the Consumer Welfare Fund.

The State Commission dismissed the appeal of the restaurant, saying that as per the definition of ‘complaint’ in the Consumer Protection Act, charging for the goods in excess of the price agreed between the parties or displayed, constituted deficiency in the service rendered by the restaurant.

The National Commission took up a bunch of such appeals filed by the restaurant against similar decisions of the lower consumer courts, confining itself to the question of quantum of compensation awarded by the lower commissions. And it set aside the orders of the lower commissions through a common order, holding that the consumers in these cases were not entitled to any compensation as the restaurant, in rounding off the fraction to the nearest rupee, had neither indulged in an unfair trade practice nor was there any deficiency in service. To arrive at this decision, it looked at various circulars issued by the Reserve Bank to the banks on rounding off fractions to the nearest rupee. (M/SMcdonald Family Restaurant Vs Nisha Goyal, RP No 1246 of 2016).