Non-refund of admission fee does not constitute a deficiency in service under the Consumer Protection Act.

Mr. Mahesh Chandra, Member—The present appeal has been filed under Section 15 of the Consumer Protection Act, 1986 (hereinafter to be referred to as ‘the Act’) against the order dated 11.8.1999 passed by District Forum (South), in Complaint Case No. 2059/1996 entitled Shri Ashu Mittal v. Fore School of Management. The facts of the case relevant for the disposal of this appeal are as follows:

Respondent Shri Ashu Mittal sought admission to the Post Graduate Diploma in Business Management (PGDBM-Full Time) Wave V in the appellant institute and deposited fee of Rs. 39,500/-. In the meanwhile, the respondent was also admitted in K.J. Somaiya Institute of Management Studies and Research, Bombay and he decided to joint the other institute and deposited fee there. Subsequently, the respondent on 19.6.1996 requested the appellant to refund the deposited fee. However, the appellant refused to refund the fee and stated that fee once deposited cannot be refunded as per terms of the brochure given to the respondent earlier. Hence the respondent Shri Ashu Mittal filed a complaint before the District Forum (South) alleging deficiency in service on the part of the appellant and for refund of the fee along with the interest and compensation for harassment and mental agony.

2. The appellant contested the claim before the District Forum on the ground that there was no provision for refund of fee under any circumstances and this was in the knowledge of the respondent at the time of seeking admission. He deposited the fee having full knowledge of this fact. The appellant also denied that any such assurance was given to the respondent that in case the respondent is admitted to some other institute, the fee shall be refunded. The learned District Forum after hearing both the parties ordered for the refund of 90% of the deposited fee holding that non-refund of the fee constitutes gross deficiency in service.

3. Aggrieved by the aforesaid order of the District Forum the appellant has preferred this appeal before this Commission, mainly on the ground that non-refund of fee is not a consumer dispute as held by the Hon’ble National Commission in Ramdeo Baba Engineering College v. Sushant Yuvraj Rode, reported as III (1994) CPJ 160 (NC). It has been argued that the appellants were not rendering any service to the respondent who on his own wish chose to join some course and the seat allotted to the respondent went vacant. It has also been stated that the appellant conducted the course as per schedule and never refused to render any service to the respondent and hence there was no deficiency in service. It has been argued that the refund of admission fee is not a service being provided by the appellant. The appellant also stated that in the year 1995-96 the number of seats in the Diploma Course were increased from 100 to 120 and in that year only 105 candidates took up the course and the seat vacated by the respondent remained vacant. It has also been argued that the appellant institute or its Registrar never gave any assurance to the respondent that the fee shall be refunded if the respondent was selected in any other institute and if he applies for cancellation of admission before the commencement of the session.

4. We have heard both the parties at length and also carefully gone through the records of the District Forum. The main argument advanced on behalf of the appellant is that refund of admission fee is not a consumer dispute and non-refund of the admission fee is not a deficiency in service. The appellant has relied upon the view expressed by the Hon’ble National Commission in the case entitled Ramdeo Baba Engineering College v. Sushant Yuvraj Rode and Another, where the Hon’ble National Commission has specifically held that non-refund of admission fee is not a deficiency in service. The Hon’ble National Commission has also held that admission fee is a consideration of admission and the service, which the college was to render to the students, wa