Kerala Consumer Forum Upholds Students’ Rights: Coaching Institutes Cannot Retain Fees Midway

A recent judgment by a consumer forum in Kerala emphasized that coaching institutes do not possess the right to retain fees from students who opt to discontinue a course midway due to dissatisfaction with the services provided by such institutes.

The District Consumer Disputes Redressal Commission in Ernakulam expressed concerns regarding unscrupulous coaching institutes engaging in unethical practices and exploiting students and their families.

A bench of President DB Binu and members V Ramachandran and Sreevidhia TN, underscored the importance of ensuring fairness and preventing these institutions from imposing unfair terms and conditions on consumers in the education sector.

“In the field of education, while many coaching institutions offer valuable services to prepare students for higher education, there unfortunately exists a presence of unscrupulous coaching institutions engaging in unethical practices, exploiting students and their families. These institutions should not have the right to retain the fees of students who choose to leave a course midway due to dissatisfaction with the services provided. It is essential to ensure fairness and prevent these institutions from imposing unfair terms and conditions. Protecting consumers, particularly in the education sector, is of utmost importance to guarantee that students and parents are treated with the respect and honesty they deserve,” stated the bench.

The consumer forum was hearing a case filed by a former student (complainant) of VLCC Institute in Kochi, a coaching institute for weight loss and beauty solutions.

The complainant asserted that she had enrolled in a cosmetology course in January 2021, followed by advanced courses in March 2021 at the institute. Due to COVID-19, physical classes were disrupted, and the complainant, after testing positive, continued with online classes until they were also discontinued.

She claimed that the institute persuaded her to enroll in additional courses but failed to conduct classes for them despite collecting fees.

Furthermore, when she requested a refund of the fees, the institute suggested buying VLCC products instead.

The complainant stated that, after multiple failed attempts to receive her refund, she was prompted to file a petition before the Legal Services Authority.

She noted that the institute did not participate in the proceedings.

The complainant alleged unfair trade practices and sought a refund of her course fee, compensation for mental distress, legal costs, and other appropriate relief from the commission.

The consumer forum referred to the decision of the National Consumer Disputes Redressal Commission (NCDRC) in the case of Flit Jee Ltd, & Others v/s Dr. (Mrs.) Minathi Rath & Others and emphasized the need to protect students and parents from unscrupulous coaching institutes in the education sector by preventing the unfair retention of fees for those dissatisfied with services.

“The precedent set in the case of Flit Jee Ltd. v/s Dr. (Mrs.) Minathi Rath & Others by the NCDRC establishes that coaching institutions providing educational services for consideration fall under the purview of the Consumer Protection Act. It was ruled that fees once paid could be refunded after deducting non-refundable service charges for the unattended portion of the course,” the order said.

In this case, the consumer forum ruled that there was a clear deficiency of service on the part of the opposite parties for failing to provide timely classes.

“We found that the issues are in favour of the complainant due to the serious deficiency in service and unfair trade practices on the part of the opposite parties. Naturally, the complainant has suffered a great deal of inconvenience, mental anguish, hardships, and financial loss, etc., as a result of the negligence on the part of the opposite parties. In view of the above facts and circumstances of the case, we are of the opinion that the opposite parties are liable to compensate the complainant.”

Hence, it directed the Institute to refund ₹2.79 lakh paid as fees to the institute. It also directed the institute to pay ₹50,000 to the complainant as compensation for the mental agony, inconvenience, physical hardships, and deficiency in service and ₹10,000 as costs.