Many schools and colleges are emerging day by day. There are many fake
universities or claim of false affiliation with well-known Universities in India
as well as abroad. UGC on April 2018 made a state wise list of 24 fake
Universities. Most of suchColleges& Schools are being run by fly- by-night
operators with only commercial motives. In the last decade imparting education
has become just another business rather than service to the society. Depending
on the cause of action there are cases where the Educational Institution has
been fined under Consumer Protection Act 1986. A considerable number of
decisions delivered by State and National level Consumer Forums are available as
of now which protects the right of students with regard to fees, wrong allotment
of roll numbers, delay in declaration of results, admission in excess of the
allotted quota, misrepresentation about affiliation by the educational institute
to various universities etc. The judgments related to the above-mentioned cases
clearly indicate that student is a consumer as per the Act and the universities
or educational institutes fall within the category of service providers.
The Supreme Court of India earlier had a differing view. In the case of
Maharshi
Dayanand University v. Surjeet Kaur(2010) 11 SCC 159, relying upon all
earlier judgments, the Supreme Court held that education is not a commodity.
Educational institutions are not providing any kind of service, therefore, in
the matter of admission; fees etc., there cannot be a question of deficiency of
service. Such matters cannot be entertained by the Consumer Forum under the
Consumer Protection Act, 1986.
The Hon'ble Apex Court in its latest judgment in P.T. Koshy & Anr. v. Ellen
Charitable Trust & Ors2012(3) CPC 615., Changed the views and held that:
"Therefore, now the situation is complex and ambiguous. At this juncture, it is
of vital importance to analyze the various functions of university/educational
institutes to determine that whether the activities of university/educational
institutes are classifiable under the conventional definition of service as per
section 2(1)(o) of the Consumer Protection Act, 1986.
On the other hand, it is also necessary to assess the definition of the consumer
under Section 2(1)(d) of the Act so as to check that the relationship between
university and student fits with the conventional relationship of trader/service
provider and consumer? If these two criteria are satisfied then it can be said
that universities/educational institute come within the ambit of consumer
protection law."
Reference of words like service, business, profit, and industry-partnership is
available within the Central University Act, 2009, itself which clearly proves
that university is not a non-profit body rather it has some business
characteristics inherent in the Statutes and Acts which govern the functions of
the university.
While expanding the scope of Consumer Law, National Commission opened new doors
inBhupesh Khurana and others vs. Vishwa Budha Parishad and other,29
September, 2000, National Consumer Dispute Redressalthat imparting education
falls within the ambit of service as defined under Consumer Protection Act. The
term ‘service' is defined in Section 2(1)(o) of the 1986 Act:
"service of any description, which is made available to potential users,
including the provision of facilities in connection with banking, financing,
insurance, transport, processing, supply of electrical or other energy, board or
lodging or both, housing construction, entertainment, amusement or the purveying
of news or other information, but does not include the rendering of any service
free of charge or under a contract of personal service".
In Bhupesh Khurana caseit was held by the court that "Imparting of
education by an educational institution for consideration falls within the ambit
of 'service' as defined in theConsumer Protection Act. Fees are paid for
services to be rendered by way of imparting education by the educational
institutions. If there is no rendering of service, question of payment of fee
would not arise. The Complainants had hired the services of the Respondent for
consideration so they are consumers as defined in the Consumer Protection Act".
An educational Institution can also be held liable under the Consumer Protection
Act, 1986. Holding of exams, declarations of results are all services under the
Act & can be looked into by the consumer courts. Consumer courts have also held
that it is not within their jurisdiction to look into whether particular rules
in an institutions prospectus are illegal or not. Educational Institutions are
covered by the provisions of the Consumer Protection Act, 1986 and if there is
any deficiency in the services provided by the educational institutions, then
they are liable for deficiency in the services under the Act. In this case,
court held that there was deficiency in service on the part of the institute and
students are entitled to claim the relief in the form of monetary compensation.
Conclusion:
In view of the above discussions, is supported equally well on legal and
logical grounds that education falls within ambit of services. Students are
consumer or beneficiary of the service or facility provided by
University/educational institutes. All kinds of activities performed by
University/educational institutes may not be classifiable as marketable service
because of the nature of those particular services but it does not support the
complete exclusion of the University/educational institutes from the scope of
Consumer Protection Laws. The exemption of the University/educational institutes
from the scope of the Act, will convert the educational into a business sector.
In Bangalore Water Supply Case the Apex Court among its many other observations
recognized Educational Institutions as an industry. It was held that educational
institutions are Industry in terms of sec 2(j) of Industrial Dispute Act,1947.
In the manner industrial and customers disputes are redressed under consumer
laws. The consumer protection law is a really good checkpoint to balance the
business activity of University/educational institutes and make this sector more
accountable for serving the interest of students and country at large. It does
not make sense to force customer to resort to the highly protracted and tedious,
and not to mention, expensive conventional litigation for a matter like fees
payment or correction of mistake in such case cost of litigation will exceed the
claim itself. In such cases consumer laws can sufficiently provide speedy remedy
on individual level and can make institutions liable for deficiencies in their
services.
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