University bound to refund fees if student withdraws admission (Landmark Judgement)
The Supreme
Court, in the Bihar
School Examination Board vs Suresh
Prasad Sinha, held that a student is not a consumer. Overlooking the
context that this decision was in respect of conduct of exams, most consumer
fora began dismissing complaints for deficiency in services by educational
institutions.
A couple of months ago, the Maharashtra State Commission differentiated between services rendered by educational institutions, and exams being conducted by boards and universities.This interpretation has been confirmed by the National Commission in another case, in Revision Petition 3288 of 2016 decided on December 8.
Case Study: Megha Gupta had taken admission for a BTech Course at Mody University of Science and Technology at Sikar in Rajasthan. After enrolling, she decided not to join the course, and requested for withdrawal of admission and refund of fees.The university , however, forfeited the entire fee of Rs 1,44,000, and merely refunded the caution money .Terming this to be an unfair trade practice, Gupta filed a complaint against the university .
When the dispute reached the National Commission, the university argued that the complaint was not maintainable before the consumer fora in view of the SC ruling that a student is not a consumer.
The commission observed that the Supreme Court's decisions that a student is not a consumer was rendered in the context of a Statutory Board or University which could not be considered to be a service provider in respect of conducting academic examinations. Hence, consumer complaints for alleged defi ciency in service in respect of conducting examinations or declaration of results would not be maintainable under the Consumer Protection Act. The commission, however, pointed out that SC judgments do not lay down an abstract proposition of law that a student taking admission in an educational institute can never be a consumer of an educational institution. The National Commission rejected the University's argument that a consumer complaint would not be maintainable. It observed that since Gupta's grievance was in respect of unfair trade practice for non-refund of fees, she was entitled to approach the con sumer forum for re dressal of her griev ance.
On
merits, the National Commis sion observed that the University had failed to
produce any evidence to show that the seat given to Gupta had gone vacant due
to withdrawal of ad mission. In such cases, the guidelines of the University
Grants Commission (UGC) provide for refund of fees. The forfeiture of the
fee in violation of the UCG guidelines would amount to an unfair trade
practice.
Accordingly , by it order of December 8, delivered by the bench of Justice D K Jain, the president, along with member M Shreesha, the National Commission upheld Gupta's complaint and directed the University to refund Rs 1,44,000 within four weeks. If delayed, the amount would carry interest at 9% p.a.
Impact: Educational institutions render service and are amenable under the Consumer Protection Act. A college or university is bound to refund the fees in accordance with the UGC guidelines.
Source |
Times of India | 19 December 2016
Regards
Pralhad
Jadhav
Senior
Manager @ Library
Khaitan & Co
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