Can Be Challenged in Consumer Forums
Yes, law is on the side of students as long as their complaints are genuine and they are justified in their demands. So, if a student wants to leave an institute or course midway and is seeking refund of fees paid in advance for the full course, she is legally eligible to get the same.
The fee receipt that you get at the time of your child’s admission in a new institute is one of the longest receipts wherein you see you have paid for about a dozen elements. The fee includes tuition fee, registration fee, annual charges, admission fee, development fee, caution money, library, I-card… Basically, in most cases you get an unjustifiable break- up of the lump-sum amount with a note reading ‘the fee paid is not refundable’.
In most cases, students continue to be in the institute till the completion of the course even if the institute fails to keep its promises and does not deliver as per expectation, all because of the fear of losing the mammoth fee paid. Such students and their guardians must realize that if they are paying to an education
institution for certain services and the institute fails to deliver those as promised, they have the right to withdraw from the institute and also demand the fee refund. Even if the institute has a clause in its rulebook saying that the fee cannot be refunded, you must know that such rules are not bigger than that of the country’s law and you can easily challenge them in the court of law.
Although the admission of your complaint in the consumer forum solely depends on its nature, there is no confusion over the fact that colleges and universities can be challenged in consumer forums. As education falls in the ambit of ‘service’ under Consumer Protection Act, all education institutes become provider of this service and become answerable under the law.
Cases to Know
The most cited case is that of Bhupesh Khurana and Others versus Vishwa Budha Parishad (2001 JRC 240).
After thorough understanding of the complaint, the State Commission held that the ‘ complainant’ was a ‘ consumer’ as she had hired the services of the university for consideration. For this, the State Commission relied upon the decision of the National Commission in a case wherein it was held that imparting of education by an educational institution for consideration fell within the ambit of ‘service’ as defined in the Consumer Protection Act. Fees are paid for services to be rendered by way of imparting education by the educational institution. If there is no rendering of service, question of payment of fee will not arise. The complainant had hired the services of the respondents for consideration, so she was a consumer as defined in the Consumer Protection Act.
The court concluded: “In the case of the university or an educational institution, their nature of activity is ex hypothesi education, which is a service to the community. Ergo, the university is an industry.” Before arriving at this judgement, the court had here referred to the decision of the Supreme Court in Bangalore Water Supply and Sewerage Board versus A Rajappa and Others case (AIR 1978 SC 548).
In 2003, in the matter of Usmania Islamic Academy versus State of Karnataka being argued in the Supreme Court, a three-judge bench comprising Chief Justice KG Balakrishnan, Justice VN Khare and Justice SN Variyavaha pronounced a detailed order holding educational institutes answerable before consumer forums by discussing every aspect covered by educational institutes in providing education to students.
This powerful bench also directed Universities Grant Commission (UGC) to frame rules on the basis of this order. UGC accordingly framed guidelines for universities that read: They cannot retain more than Rs 1,000 as proportionate fee in case students leaves the institute. They cannot retain the original certificates. They cannot demand fee for the entire course, can only ask fee for one term.
How Liable Are Education Institutes?
Education institutes have been, through various judgements, reprimanded by the consumer forums for various reasons including withholding scheduled exams, delayed declarations of results and discriminating in issuance of roll numbers. All these and many such activities are services under the Act and can be looked into by consumer forums. Forums have also held that it is not within their jurisdiction to determine whether particular rules in an institution’s prospectus are illegal or not, but if they defy the promised service they can certainly be questioned. In many such cases that have come before the National Commission, the apex consumer court has clearly held that providing education is a service and has compensated the aggrieved consumer.