Is it legal for platforms like Zepto to charge “GST on handling fee” and “GST on rain fee”? Here's the truth

Zepto’s rain fee and GST charges have sparked public frustration with users demanding clearer and fairer billing. Let’s now examine the legal perspective. Many people who use Zepto to order groceries or quick items have noticed extra charges on their bills. These charges include a handling fee and a rain fee. On top of these extra fees, Zepto applies the Goods and Services Tax (GST), causing many customers to question if this practice aligns with Indian laws.

After carefully studying the rules under Indian law and looking at the consumer protection laws, it appears that Zepto’s practice of charging these fees and applying GST on them is legal, provided certain conditions are met but there are important details you should know to understand your rights as a consumer.

Why Does Zepto Charge GST on These Fees

Zepto is a popular online grocery delivery platform known for providing quick delivery of daily essentials across numerous Indian cities. Zepto adds certain extra charges to your bill to continue providing fast delivery. These include a handling fee, which is for managing and packing your order, and a rain fee, which is said to cover the extra effort of delivering during rainy weather. These fees often appear in your final bill, and GST is charged on these amounts.

GST must be charged on the full value of a supply under the Goods and Services Tax Act of 2017. This value includes any fees that are collected in relation to the supply of goods or services.

The handling fees collected by Zepto represent a service provided by the company, thus attracting GST. Typically, such service fees carry a GST rate of 18 percent.

The rain fee is charged to cover the extra effort of delivering during rain, which may involve additional safety measures for delivery personnel and maintaining delivery speed despite bad weather. Although rain fees are not specifically listed in the GST schedule, they are considered a service charge. Since GST applies to all services unless there is a specific exemption, platforms like Zepto are required to charge GST on these rain fees as well.

Is It Legal for Zepto to Charge These Fees

Apart from GST, we need to check if Zepto is allowed to charge these fees in the first place. According to the Consumer Protection Act of 2019, any charges collected from customers should not be unfair or hidden. They must be clearly shown to the customer before they confirm the order.

Handling fees are common across many e-commerce and delivery platforms, including Blinkit and Swiggy Instamart. These fees are used to cover operational expenses related to managing and fulfilling orders. Zepto’s terms of service mention that such fees may be charged, and if the fee is shown to you before you place your order, it is considered legal.

Rain fees are a newer type of charge and have caused more confusion among customers, especially when they see a rain fee added to their bill on days when there is no rain. Some users on Reddit have shared experiences of being charged a rain fee even during clear weather. Legally speaking, if Zepto shows the rain fee before you complete your order and you still place the order, it is likely to be within the law. No legal case or government action has been taken against Zepto for charging a rain fee as of today.

Public Reactions

People on Reddit have a lot to say about Zepto charging a rain fee and GST on it. Many are confused and annoyed by these extra charges popping up on their bills.

One user said Zepto is adding too many small fees to trick customers, and it would be better if they just added a simple rain surcharge like Uber or Ola. Another explained that while it is legal to add GST on service fees, it is Zepto’s choice to charge a rain fee, so the blame is on the platform, not the tax.

Some users joked about it, saying we might soon see “sunlight fees” or “GST on GST.” Others pointed out that delivering in the rain is tough, but they are unsure if the rain fee actually goes to the delivery person or just into the company’s pocket.

A student shared that they only use Zepto when there are discounts or in emergencies because local shops are often cheaper and do not add unnecessary fees. Many people suggested buying from nearby stores to avoid these hidden charges and to support small businesses.

What Should You Do As a Consumer

If you see a handling fee or a rain fee on your bill, check if Zepto showed these charges before you confirmed your order. If the charges were shown and you completed the order, it means you accepted the charges, and GST on them will be applied legally.

If you ever feel that you have been charged a fee without any notice, or that the fee was unfairly applied, you have the right to file a complaint with Zepto’s customer service or with the consumer helpline. If the issue is not resolved, you can approach the consumer court for further action.