Guru Gobind Singh Indraprastha University vs P.L. GIRDHAR

THE facts of this case demonstrate a highly unfair, unscrupulous and uncouth practice being adopted by the educational institutions, including the University whereby they forfeit huge sums under the garb of the admission fees without providing any service of tuition or any other service. In the past we have come very heavily on such institutions and today again we are dealing with a University set up by the Delhi Government known as Guru Gobind Singh Indraprastha University.

AT the outset we express our anguish that the appellant-University has filed which is highly misconceived and misdirected appeal. The relevant facts giving rise to this appeal need to be stated, in brief. Vide impugned order dated 15.6.2005 passed by the District Forum the appellant has been directed to refund Rs. 58,500 with 9% interest and pay Rs. 5,000 as compensation and Rs. 1,000 as cost of litigation. Feeling aggrieved it has preferred this appeal. Relevant facts lie in a narrow compass and are as under: Respondent deposited a sum of Rs. 58,500 as tuition fee for admission in Maharaja Agarsen institute of Technology in the paid category. When she came to know that she was given admission on All India basis from CBSE Board, Delhi at Chandigarh on 23.8.2002, she applied for withdrawal of admission and refund of the fee, security and other charges on 29.8.2002. Despite repeated requests only a sum of Rs. 2,500 was refunded 25.9.2002. But the reason for non-refund of the remaining amount given by the appellant is that complainant was entitled for a refund of security deposit of Rs. 5,000 and examination fee of Rs. 2,500 only and the entire tuition fee amounting to Rs. 58,500 was forfeited as per provisions of Clause 45(b) of the Information Bulletin, which provides as under: "Withdrawal of Admission and Refund of Fee- (a) I a student applies for a withdrawal of admission on or before 15th July, 2002 upto 5.00 P.M., the fee after deduction of 20 percent amount subject to a minimum of Rs. 5000 will be refundable. The request for withdrawal of admission is to be submitted in the Room No. 107 of the Admission Branch and proper receipt will be issued. (b) No refund of fee, except deposit and examination fee amounting to Rs. 7,500 will be made on withdrawal, cancellation of admission after 15th July, 2002 upto 2nd September, 2002. Thereafter only security deposit amounting to Rs. 5,000 will be refundable and the same will be refunded by the concerned institutions. (c) If any student admitted during second counselling or thereafter against the vacancies and subsequently applies for withdrawal, cancellation of his/her admission, no fee except the security deposit and examination fee amounting to Rs. 7,500 will be refundable and that too upto 2nd September, 2002. Thereafter only security deposit amounting to Rs. 5,000 will be refundable and the same will be refunded by the concerned institutions.

On the face of it such a clause is against the public policy and against the provisions of Consumer Protection Act as no person can retain the consideration for a service which it has not provided at all. Had the respondent joined the course and taken some tuition for some period, Clause 4.5(b) would have been invoked and that too in reasonable and rational manner. By forfeiting an amount of Rs. 58,500 without providing the service of tuition as the respondent withdrew from the admission without joining the class.

IF this is the way to enrich oneself less said the better. The provisions of Consumer Protection Act have so much wide ramifications against a person who provide service against consideration. IF he commits any fault or shortcoming or deficiency is bound to compensate the consumer as to the loss or injury suffered by him. Here is a case where no tuition was provided nor even the respondent attended any class but still the appellant refused refund of the tuition fees paid by the respondent at the time of applying for admission. There cannot be worse deceptive practice than this. No body can be allowed to arrogate itself with the power of forfeiting the amount even by incorporating such a clause that runs against the public policy, good conscience and principles of natural justice and is vitiated under the Contract Act. By no stretch of imagination we find ourselves to ram down the throat that institution like the University would adopt such a practice which is not only deceptive, unfair and violates the statutory provisions of Consumer Protection Act. At the most the appellant could have deducted the amount, which was reasonable and incurred by it in the process of admission, and no other amount.

THE reliance of the Counsel for the appellant for justifying forfeiture of such an amount under the garb of unscrupulous term of contract by introducing Clause 4.5(b) in the Information Bulletin which even otherwise is a unilateral contract and is not signed by the respondent is highly misconceived and misplaced: (i) Petition No. 3039 of 2002, Neha Sharma v. Vice Chancellor, GGS Indraprastha University & Others reported as 118 (2005) DLT 518. (ii) Homeopathic Medical College and Hospital, Chandigarh v. Ms. Gunita Verk, reported as I (1996) CPJ 37 (NC). (iii) Medical Council of India v. Madhu Singh & Others, reported as V (2002) SLT 209=2002 (6) SCALE 332.

The facts involved in the aforesaid cases were altogether different and the difference of facts of this case and the cases referred above sticks out for miles. Here we are concerned with the fact whether the service of tuition was at all provided to the respondent or not and merely because candidate withdrew from the admission because of some ineligibility clause empowered the appellant to retain or forfeit the amount for which no service was provided at all. It is for curbing such type of unfair practice and for protecting the interest of consumer that the Consumer Protection Act 1986 was brought on the Statute Book. How can a person be allowed to forfeit an amount for which he has not provided any service? If it is not unjust enrichment, what else is it?

SINCE the District Forum awarded interest @ 9% which we find was just on equitable grounds, the compensation of Rs. 5,000 was not awardable as interest itself is compensation in terms of Section 14 of the Consumer Protection Act. In this regard the reference to the view taken by the Supreme Court in Sovintorg (India) Ltd. v. State Bank of India, New Delhi, II (1999) CPJ 4 (SC)=VI (1999) SLT 545=(1999) 6 SCC 405., needs to be reproduced. It reads as under: "There was no contract between the parties regarding payment of interest on delayed deposit or on account of delay on the part of the opposite party to render the service. Interest cannot be claimed under Section 34 of the Civil Procedure Code as its provisions have not been specifically made applicable to the proceedings under the Act. We, however, find that the general provision of Section 34 being based upon justice, equity and good conscience would authorise the Redressal Forum and Commission to also grant interest appropriately under the circumstances of each case. Interest may also be awarded in lieu of compensation or damages in appropriate cases. The interest can also be awarded on equitable grounds.

IN the result, we partly allow the appeal by setting aside the amount of compensation of Rs. 5,000 but retain direction No. 1 and enhance cost of litigation from Rs. 1,000 to Rs. 5,000 as the respondent has been dragged further by way of misconceived appeal. IN all, appellant shall pay Rs. 63,500 to the respondent within one month. Appeal is partly allowed and disposed of in aforesaid extent.

Bank Guarantee/FDR, if any, furnished by the appellant be returned forthwith.

A copy of this order as per the statutory requirements, be forwarded to the parties free of charge and also to the concerned District Forum and thereafter the file be consigned to record room. Copy of this order be sent to all the Presidents of the District Forums for guidance for levying punitive damages and the quantum of damages in such like cases. Appeal partly allowed.