|Name of the Case||Sehgal School of Competition v. Dalbir Singh|
|Citation||2009 (3) CPR 363 (NC): III (2009) CPJ 33 (NC): 2009 (3) CPC 187|
|Court||National Consumer Disputes Redressal Commission, New Delhi|
|Date of Decision||30th April 2009|
|Appellant||Sehgal School of Competition|
|Bench||B.N.P. Singh, J. (Presiding Member) and Dr. P.D. Shenoy, Member|
|Acts Involved||Consumer Protection Act, 1986|
|Important Section||Section 2(r), 6(e) of Consumer Protection Act, 1986|
India is a democratic country and believes in the supremacy of the constitution. Indian Constitution provides Article 301 which deals with the free intercourse, trade and commerce across the nation. The Consumer Protection Act, 1986 provides easy and immediate compensation to the aggrieved party. It motivates the consumers to speak for their rights and seek redressal for the insufficiency or inconvenience suffered by them. Consumer Protection Act, 1986 provides various rights to the consumer and to redress their grievances or dispute various agencies are formed such as district forum, national commission etc. The stated matter is about refund of fee paid to the educational institute or school by a student wherein the court held that it is unjust to collect the total fee of the course and not refunding it back if any inconvenience is caused.
Consumer Protection Act, 1986 is an act which aims at providing better protection of the interests of consumers and for that purpose to make provision for the establishment of consumer councils and other authorities for the settlement of consumers’ disputes and for matters connected therewith. The case is one of the top ten cases of consumer dispute decided by B.N.P. Singh, J.and Dr. P.D. Shenoy. The case is all about refund sought by respondent to the petitioner’s school. It was first placed before the District Forum which delivered its decision in the favor of respondent (complainant) and directed the school to refund the part of fees.
Now the case has been placed before the National Consumer Disputes Redressal Commission (NCDRC). Prior when the case was before District Forum, it also relied upon the view which has been upheld by the National Commission and the same view was also taken by the Supreme Court that, “no institute or coaching center shall charge lump sum fees for the whole duration or should refund the fees if there is deficiency in service in the quality or coaching, etc. or for which period the student does not attend coaching as any clause saying that fees once paid shall not be refunded are unconscionable and unfair and therefore not enforceable”. However the petition filed by the school was dismissed by NCDRC as they found the order of the State Commission as authentic or unquestionable and do not see any material irregularity or jurisdictional error in the order passed by the State Commission.
Background of the Case
In this case the commission NCDRC has interpreted the situation wherein the payment was made by student for full course in advance and then because of deficiency in services provided, he decided to quit the school. When he asked for the refund of fee, the school declined. The case was first placed before the District Forum by Dalbir Singh (Complainant), who decided the case in the favor of the complainant. Further a revision petition was filed before the National Consumer Disputes Redressal Commission (NCDRC) numbered Revision Petition No. 813 of 2009 and Appeal No. 08/1043. The complaint was first filed by respondent Dalbir Singh before the District Forum. Further as the petitioner was not satisfied with the directions given by the District Forum, subsequently the petitioner filed a revision petition before the NCDRC to look into the matter. Hence the rights of consumers are protected from unfair and unsafe business practices.
In the present matter, Respondent Dalbir Singh was a medical student of Petitioner who took admission in the Sehgal School of Competition (hereinafter referred as ‘School’) for the coaching of medical entrance exam. The course for coaching was for the duration of two years. Respondent deposited lump sum amount of Rs 18,734 on 1st May 2005 and remaining amount Rs 18,734 in two installments on 7th July 2005 and 7th October 2005. The respondent deposited the fee of two years, but later he was not satisfied with the teaching manner of the school. Therefore, he decided to discontinue the course and quit the coaching after a year on the ground that the coaching was not up to the mark.
He further stated that he took admission for the coaching in medical entrance exam whereas the faculty member of the institute were teaching subjects of engineering and engineering students were given preference over the medical students. So the respondent thought to quit the school by not again wasting his one more year, subsequently he withdrew himself from the school and asked for refund of balance fee. The institute clearly declined to refund the balance fee. Consequently he filed a complaint before the District Forum, The District Forum directed the petitioner to refund part of the fees to the tune of Rs. 18,734 without any further compensation for mental agony, etc. Now, the school has filed a revision petition before NCDRC seeking a satisfactory decision.
Whether a student can seek refund of fees paid for full course to the school or institute for the rest period of classes which are yet to be held or not?
- Section 2 (r) of Consumer Protection Act, 1986 defines Unfair Trade Practices as “a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice including any of the following practices, namely:—
(1) the practice of making any statement, whether orally or in writing or by visible representation
(2) Any reference in this Act to any other Act or provision thereof which is not in force in any area to which this Act applies shall be construed to have a reference to the corresponding Act or provision thereof in force in such area.”
- Section 6(e) of Consumer Protection Act, 1986 deals with the objects of the Central Council as, “The objects of the Central Council shall be to promote and protect the rights of the consumers such as,—
…. (e) the right to seek redressal against unfair trade practices [or restrictive trade practices] or unscrupulous exploitation of consumers;…”
- Homoeopathic Medical College & Hospital, Chandigarh v. Miss Gunita Virk, I (1996) CPJ 37 (NC)
- Nipun Nagar v. Symbiosis Institute of International Business, I (2009) CPJ 3 (NC)
- Anupam College of Engineering v. Amit Ahlawat & anr. (2017 SCC OnLine NCDRC 209)
- Maharashi Dayanand University v. Surjeet Kaur (2010) 11 SCC 159)
The judgment of this case is one of the important cases of right of student to get refunded for the remaining classes. In this case the commission held that the situation is not a fair trade practice and is against the natural justice.
However it was held that, “Therefore, we do not see any material irregularity or jurisdictional error in the order passed by the State Commission. Accordingly, this Revision Petition is dismissed. There shall be no order as to cost.”
The Commission said that, “We have heard the learned Counsel for the petitioner. He submitted that the student had withdrawn voluntarily and, therefore, there was no deficiency of service. The petitioner’s school has shown excellent results. Hence it is wrong to observe that their coaching was not upto the mark. He also submitted that one of the conditions imposed by their school which accepting lump sum fees for two years is that ‘refundability/transferability of seat/fee is not possible under any circumstances.”
According to the National Consumer Disputes Redressal Commission collection of fees for total period of course is unjust and unfair trade practice by the educational institute. Therefore the Commission dismissed the petition filed by the school and gave its decision in favour of the respondent. However the additional compensation for mental agony caused due to approaching the legal forum was not granted, as it was not asked in the petition. Hence there shall be no order relating to the cost and the school was ordered to refund the amount to the student.
The case highlights the better protection of rights of consumer enshrined under Consumer Protection Act, 1986. The consumer has right to seek redressal of the grievances against the unfair trade practice or unscrupulous exploitation of the consumer. The case highlights that when a student pays the full course fees and if he quits the educational institute, then it is unjust to decline for refunding the money to him.