NCDRC: Consumer Forums Do Not Have Jurisdiction Over Educational Institutions

In In  CONSUMER CASE NO. 261 OF 2012, MANU SOLANKI & 8 ORS vs VINAYAKA MISSION UNIVERSITY, reference was made to the NCDRC by the appellants accusing the defendants of deficiency of service and unfair trade practice by inducing them and false assurances.

The problem before the NCDRC was the conflicting judgments of the Supreme Court whence in 2010, a division bench of the Supreme Court had in Maharshi Dayanand University v. Surjeet Kaur, 2010 (11) SCC 159, examined in detail the jurisdiction of the Consumer Fora to entertain a Complaint with respect to deficiency of service by Educational Institutions and held that they are not `service providers' and a student who takes an examination is not a `consumer', under the Consumer Protection Act, 1986. Again in PT Koshy & Anr. v. Ellen Charitable Trust & Ors., 2012 (3) CPC 615 (SC), whereby it was held that education is not a commodity. Educational institutions are not providing any kind of service, therefore, in matter of admission, fees etc., there cannot be a question of deficiency of service. Such matters cannot be entertained by the Consumer Forum under the Consumer Protection Act, 1986.  Oblivious of these judgments however, another division bench of the Supreme Court in P. Sreenivasulu & Anr. v. P. J. Alexander & Anr., Civil Appeal Nos. 7003-7004, in 2015, held that Educational Institutions would come within the purview of the Consumer Protection Act, 1986 and that Education is a Service.

NCDRC relied on Amar Singh Yadav & Ors. v. Shanta Devi & Ors., AIR 1987 Patna 191, in which the Supreme Court while deciding the Law of Precedence observed that when there is a direct conflict between two decisions of the Supreme Court of coequal Bench, the subordinate Court must follow the judgment which states the law more elaborately and accurately and that the question whether the decision is earlier or later is not material and decided to follow the law laid down in the Maharshi Dayanand University's case as the ruling therein was given on merits and appeared to be more elaborate and accurate.

However, the court noted that none of the above mentioned judgments had answered what comprises 'Core Education' and whether all activities related to Education/ Educational institutions would be excluded from the purview of the Act.

Clarifying the position on this aspect, the Commission has held that Institutions rendering Education including Vocational courses and activities undertaken during the process of pre-admission as well as post-admission and also imparting excursion tours, picnics, extra co-curricular activities, swimming, sport, etc. except Coaching Institutions, will not be covered under the provisions of the Consumer Protection Act.

Article referred: https://www.livelaw.in/news-updates/consumer-forums-do-not-have-jurisdiction-over-educational-institutions-as-they-do-not-impart-services-holds-ncdrc-read-judgment-151917?infinitescroll=1