FIIT JEE LTD vs Pramod Panwar

THIS revision petition has been filed by M/s. FIIT JEE Ltd. (hereinafter referred to as the ''Petitioner '') being aggrieved by the order of the State Consumer Disputes Redressal Commission, Delhi (hereinafter referred to as the ''State Commission '') in Appeal No. 552/2007 decided in favour of Pramod Panwar, Respondent herein who was the original complainant before the District Forum.

THE facts of the case according to the Respondent/Complainant are that he had got his son admitted for a two years '' course at the Petitioner/institute and the total fee for this course was Rs. 94,282against which Petitioner paid a sum of Rs. 77,446 to the Petitioner/Institute at one go. After attending the course for about 534 months, Respondent ''s son was not satisfied with the poor quality of teaching imparted at the Petitioner/Institute and Respondent, therefore, withdrew his son on 29.10.2006. Respondent thereafter applied for refund of the balance fee amounting to Rs. 55,000 for the period during which Respondent ''s son did not avail services of the Petitioner/Institute which Petitioner/Institute refused to refund. Aggrieved by this, Respondent filed a complaint before the District Forum and requested that Petitioner be directed to pay him the balance fee of the course for the period from 12.5.2006 to 29.10.2006 along with interest @ 24% per annum, Rs. 50,000 towards mental and physical pain and Rs. 11,000 as litigation costs. The above contentions were denied by the Petitioner/Institute who stated that the Petitioner is a well reputed Institute imparting quality education to students and whose admissions are based on admission test and who subsequently get admission in institutes of academic excellence like the NTs. The results have always been uniformly good and therefore, the allegation that the quality of teaching was poor is not correct. Further, at the time of the admission the Respondent and his son had agreed in writing to abide by the relevant rules in letter and spirit which inter alia stated that once a fee is paid, it is not refundable for whatever reasons nor can it be adjusted for another course at the Petitioner/Institute yet to be launched or otherwise. Therefore, the complaint is without any basis and deserves to be dismissed.

THE District Forum after hearing both parties and considering the evidence led by parties, allowed the complaint by relying on the judgment of this Commission in FIIT-JEE v. Dr. Minathi Rath, IV (2006) CPJ 255, and directed the Petitioner/Institute to pay the Respondent a sum of Rs. 55,000 towards refund of fee, Rs. 5,000 towards compensation and Rs. 2000 as litigation costs. Aggrieved by this order, Petitioner/Institute filed an appeal before the State Commission who dismissed the same by observing as follows: "In identical cases we have come very heavily upon such a practice by the educational institutions, education centres, schools, universities, of charging lump sum fees for 2-3 years duration in one go to charge consideration for the period for which it is yet to provide the service the institutes force the students to go on attending their institutes in spite of there being unsatisfactory services or grossest deficiency in the quality of teaching and jeopardize the career prospects of the students. We have also taken a view that any term of the contract which is unconscionable or voidable is not enforceable. No service provider like training institutes or coaching centres or educational centres can be allowed to forfeit the fees or consideration for the service which it neither provided nor availed. Thus the term that ''fees once paid is not refundable '' is unconscionable as well as voidable and therefore not actionable particularly when such fees is charged for the whole duration of the course in advance. A student or a trainee may leave in the mid-stream if he finds the service deficient and substandard and non-yielding and to tell him that fees once paid is not refundable is uncalled for and unfair trade practice as no service provider can retain the consideration for the service which it has either not given or has not availed or is yet to be provided. "

HENCE , the present revision petition. Learned Counsel for both parties made oral submissions. Learned Counsel for Petitioner stated that the Respondent ''s son took admission in a two year ''s course after signing the necessary declaration etc. which included that fees once paid are not refundable. In the instant case, Respondent ''s son left the course after 534 months not because of any deficiency in the teaching imparted by the Petitioner/Institute but because of other non-related reasons. None of the other 33 students in the same batch backed out. Further, one seat for the entire year got wasted because the student left the course midstream. Learned Fora below failed in not appreciating these facts and wrongly allowed the complaint of the Respondent. Counsel for Respondent on the other hand cited the judgment of the Hon ''ble Supreme Course in Islamic Academy of Education & Anr. v. State of Karnataka & Others, (2003) 6 SCC 697, wherein it has been held that an educational institution can only charge prescribed fees for one semester/year and not for any longer period. Counsel for Respondent stated that in the instance case, Petitioner/Institute had demanded Rs. 94,282 as full fees for two years course i.e. the entire duration of the course against which Respondent had also deposited Rs. 74,446. Since, Respondent ''s son had attended the course only for 5ï¿ 1/2 months, it was only fair that the balance fees be returned to the Respondent and the learned Fora below had therefore, rightly given the necessary relief by directing the Petitioner to pay the Respondent Rs. 55,000 as the balance fee, Rs. 5,000 as compensation and Rs. 2,000 as litigation costs.

WE have heard learned Counsel for both parties. In Islamic Academy (supra), the Hon ''ble Supreme has observed as follows: "It must be mentioned that during arguments it was pointed out to us that some educational institutions are collecting, in advance, the fees for the entire course i.e. for all the years. It was submitted that this was done because the institute was not sure whether the student would leave the institute mid-stream. It was submitted that if the student left the course in mid-stream then for the remaining years the seat would lie vacant and the institute would suffer. In our view an educational institution can only charge prescribed fees for one semester/year. If an institution feels that any particular student may leave in mid-stream then, at the highest, it may require that student to give a bond/bank guarantee that the balance fees for the whole course would be received by the institute even if the student left in mid-stream. "

WE agree that in terms of the above judgment of the Hon ''ble Supreme Court and its application in our own ruling in Dr. Minathi Rath (supra), Petitioner/Institute could not have collected fees for the entire duration of the course i.e. two years which comes to Rs. 94,282 and out of which Respondent had deposited Rs. 74,446. Since, Respondent ''s son had studied for 5 ï¿ 1/2 months, it would be reasonable for Petitioner/Institute to deduct Rs. 47,141 i.e. the fee for first year (since that seat would remain unutilised) of the course from Rs. 74,446 paid by the Respondent and refund the balance amount of Rs. 30,000 to the Respondent. The order of the State Commission is therefore, modified by reducing the amount of refund of balance fee from Rs. 55,000 to Rs. 30,000. However, the order regarding compensation of Rs. 5,000 and Rs. 2,000 towards litigation costs is upheld. Counsel for Petitioner states that Petitioner/Institute has already paid Rs. 25,000 to the Respondent in terms of this Commission ''s order dated 21.1.2008. If that be so, Petitioner/Institute is directed to pay the balance amount of Rs. 5,000 to the Respondent as well as Rs. 5,000 as compensation and Rs. 2,000 as litigation costs within a period of six weeks from the date of receipt of this order failing which the entire amount would carry interest @ 6% per annum from the date of default till payment. The revision petition is disposed of on the above terms. Revision Petition disposed of.