SC to examine if educational institutions fall under the ambit of Consumer Protection Act

SC to examine if educational institutions fall under the ambit of Consumer Protection Act

A three-judge Bench of Justices DY Chandrachud, Indira Banerjee and Indu Malhotra admitted an appeal arising out of a judgment of the National Consumer Disputes Redressal Commission (NCDRC) as to whether an educational institution or university can be sued under the consumer protection law for deficiency in services.

The Bench noted, "Since there are divergent views of this Court bearing on the subject as to whether an educational institution or University would be subject to the provisions of the Consumer Protection Act 1986, the appeal would require admission."

Vinayaka Mission University had been accused of deficiency in service and unfair trade practice by complainants Manu Solanki and others. The complainants had accused the University of inducing them to get admitted in an unrecognised offshore programme [dental course] in 2005-2006 consisting of two-year study in Thailand and two-and-a-half-year study in the University. The programme was neither affiliated with the university nor recognized by Dental Council of India, they alleged.

Aggrieved by the NCDRC's decision that said 'educational institutions' didn't impart 'services' and hence the consumer courts didn't have jurisdiction to entertain complaints against them, the complainants have now moved the Top Court.

The NCDRC judgment was based on the Supreme Court's decision in Anupama College of Engineering versus Gulshan Kumar in which it was said educational institutions didn't render 'service'.

According to the University, the complaint was not maintainable as the complainants were not 'consumers' and 'education' was not a commodity. It also argued that 'educational institutions' were not providing 'service' – a pre-condition to be covered by the Consumer Protection Act, 1986.

The University pointed out that the Supreme Court had in Maharshi Dayanand University versus Surjeet Kaur and PT Koshy and Another versus Ellen Charitable Trust ruled that 'education' was not a commodity and educational institutions were not engaged in providing 'service'. The Supreme Court had held that in matters of admission, fees there cannot be a question of deficiency in service, it submitted.

The complainants placed reliance on the Supreme Court's decision in P Sreenivasulu and Another versus PJ Alexander and Another wherein it was said educational institutions would come within the purview of the Act as 'education' was a 'service'.