OYO Rooms, a well-known name in budget accommodation, has been ordered to pay Rs 16 lakh in compensation following a court ruling over poor service. A student had taken legal action against the company after a hotel booking was cancelled, disrupting her studies and leading to significant distress.
The District Consumer Disputes Redressal Commission in Tamil Nadu’s Thoothukudi directed both OYO’s founder, Ritesh Agarwal, and a guest house in Chennai to pay over Rs 16 lakh in damages jointly. The student had initially booked a hotel room in Chennai in 2022, but the reservation was cancelled upon arrival. The booking was crucial for her younger sister, a law student preparing for the All India Law Entrance Test (AILET).
Despite having an online booking, the hotel refused to honour it, and OYO did not provide any alternative accommodation. Consequently, the student had to book a guest house at a higher cost, causing significant inconvenience.
In her petition, the student highlighted that the ordeal negatively affected her sister’s mental state and exam performance, resulting in her missing out on admission to the prestigious National Law University (NLU). The Consumer Court’s ruling on July 25 acknowledged the mishandling by both OYO and the guest house, noting that it severely impacted the student’s future prospects.
The court’s order includes:
- Rs 6,797 for booking and travel expenses
- Rs 1.23 lakh for the sister’s course fees
- Rs 10 lakh for the distress, wasted time, and disrupted aspirations
- Rs 5 lakh for mental anguish endured by both the complainant and her sister
- Rs 10,000 for legal expenses
The court stressed that the negligence of OYO and the guest house turned the sister’s hard work and aspirations into a ‘mirage’. The verdict was issued ex-parte as neither OYO nor the guest house representatives attended the court proceedings.
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