Dr. NTR University Of Health Sciences vs Nagalli Udaya Sree & Anr

Avm J. Rajendra, Avsm Vsm (Retd.),Presiding Member

The present Revision Petition has been filed under Section 58(1)(b) of the Consumer Protection Act, 2019 (the “Act”) against the Order dated 02.01.2018, passed by the learned State Consumer Disputes Redressal Commission, Andhra Pradesh (‘State Commission’) in FA Nos. 410/2015 and 185/2016. The State Commission dismissed both the appeals and upheld the District Consumer Disputes Redressal Forum, Kurnool (‘District Forum’) order dated 05.08.2015 in CC No. 138/2014.

For convenience, the parties are referred to as placed in the original Complaint filed before the District Forum and the State Commission.

Brief facts of the case, as per the Complainant, are that having completed her Intermediate education with M.P.C. group the complainant applied for admission to B.Sc. Nursing for the academic year 2014-2015. She followed the required procedures, including paying fees and attending counseling and she was provisionally admitted into Rayalaseema College of Nursing, Kurnool. However, upon reporting to the college, her admission was rejected on the grounds that she did not meet the eligibility criteria as she completed her Intermediate in Mathematics, Physics and Chemistry, without the required Biology stream. She contended that this was due to negligence by Dr. NTR University of Medical Sciences (OP-1) in admitting her. Being aggrieved, she sought damages for the mental distress and educational loss she suffered in the complaint filed before the District Forum under Sections 11 and 12 of the Consumer Protection Act, 1986 seeking admission into the Rayalaseema College of Nursing for academic year 2014-2015 or Compensation of Rs. 20,00,000 for distress, mental agony, and loss due to the negligent act of the opposite parties and costs of litigation.

In reply before the District Forum, OP-1 contended that the complainant is not a "consumer" under the Act and that disputes related to admissions in educational institutions do not fall within the ambit of consumer law. The eligibility criteria was made clear in the prospectus, requiring candidates to have completed 10+2 with Physics, Chemistry, Biology, and English. She having completed the MPC group without Biology, did not meet the eligibility mandate. Due to an error during the scrutiny process, she was mistakenly issued a merit card and provisionally admitted. This was rectified when Rayalaseema College of Nursing rejected her admission after verifying her original certificates. OP-1 offered to refund Rs. 5,500 (Rs.1,000 counseling fee and Rs.4,500 admission fee).

Despite service of notice, OP-2 (Principal of Rayalaseema College of Nursing, Kurnool) did not respond or appear and was, therefore, placed ex parte.

The learned District Commission vide Order dated 05.08.2015 partly allowed the complaint against OP-1 and dismissed the same against OP-2 as under:-

“12. In the result, the complaint is partly allowed directing the opposite party No.1 to pay the amount of Rs.6,500/- with interest 9% from the date of complaint i.e., on 12.12.2014 till the date of realization and further direct to pay compensation for a sum of Rs.50,000/- (fifty thousand) towards mental agony and Rs.1,000/- as a cost of the case. Time for compliance is one month from the date of receipt of this order. The complaint against opposite party No.2 is dismissed.”

Being aggrieved by the District Forum order, the Complainant-Nagalli Udaya Sree and OP-1 i.e. Dr. NTR University of Health Sciences filed Appeal Nos. 410/2015 and 185/2016 respectively and the learned State Commission vide Order dated 02.01.2018, dismissed both the Appeals with the following observations:-

“FA No.185/2016

…

We have considered the above contentions and perused the material on record.

There cannot be any controversy that as per Ex. B1 Regulations and B2 Notification a candidate seeking admission into B.Sc., Nursing course should have passed intermediate with science i.e. Physics, Chemistry and Biology subjects and also English with aggregate of 45% marks. Admittedly the complainant did not possess the said qualification. She did her intermediate in Mathematics, Physics and Chemistry. Therefore, she was not eligible for admission into nursing course. However, she was not only permitted to submit the application but was also given provisional admission in the counseling. It is to be noted that before calling a candidate for counseling the authorities are required to scrutinize the application and find out whether ne/she is eligible for the course. The eligibility of the candidates should be thoroughly verified at the counseling.

We are surprised to note that the University failed to notice the ineligibility of the complainant at both the stages and the complainant reached the final stage of admission.  We are sure that but for the vigilance on the part of opposite party No. 2 – Principal, she would have even completed the course. From this it is very clear that there was total negligence on the part of the University.

It is true that unless a person is a consumer as defined under section 2 (1) (d) of the Act and unless there is deficiency in service on the part of a service provider, a complaint is not maintainable under the C.P. Act. Section 2 (1) (e) is the definition of consumer dispute, while section 2 (1) (f) is the definition of defect and section 2 (1) (g) is the definition of deficiency.

The question whether an institution imparting education falls within the ambit of "service" as defined under section 2 (1) (o) of the Act was considered by the Hon'ble National Commission in Bhupesh Khurana and others Vs. Vishwa Budha Parished and others, 2000 CTJ 801, and it was held therein as follows:-

In our opinion, the Appellant case has a merit. If the Kerala University had not recognized B.G.L. Degree of the Mysore University as a qualifying degree for taking LL.B (three years course degree examination of the Kerala University, the Appellant should have been told at the threshold, i.e. at the time of admission to the LL.B. Course or at the time of writing the 1st year LL.B. examination. The appellant studied and completed the three years course and was declared pass in all 1st 2nd  and 3rd LL.B. examinations conducted by the University. The University allowed him to complete the course. On completion of the course, the appellant demanded the professional certificate of LL.B. Degree and at that point of time, he was informed that he did not possess the recognized qualifying degree for the LL.B. course. The appellant hired the services of the University for consideration for imparting education. In the case of Bhupesh Khurana and Others Vs. Vishwa Budha Parshed and Others, this Commission, relying upon the Judgement of the Supreme Court in the case of Bangalore Water Supply and Sewerage Board Vs. A. Rajappa and others, this Commission held as under:-

"Importing of education by an educational institution for consideration falls within the ambit of 'Service' as defined in the Consumer Protection Act, Fees are paid for services to be rendered by way of imparting education by the educational institutions. If there is по rendering of service question of payment of fee would not arise. the complainants had hired the services of the Respondent for consideration so they are consumers as defined in the Consumer Protection Act".

The said Principle is reiterated in Sreedharan Nair N.  Vs. Registrar, University of Kerala 2001 (3) CPR 27 (NC).

It is true that the admission of the complainant was only provisional and she did not join the course. But on that ground it cannot be said that she is not a consumer since not only the actual user of the service but also a potential user is a consumer under the Act.

We, therefore, find no merit in the contention of the University that the complainant is not a consumer and the complaint filed her is not maintainable under the Act. We see no merit in the appeal and the appeal is accordingly dismissed. No costs.

FA No. 410/2015.

It is already noticed that the Forum has directed the University to refund a sum of Rs.6,500/- paid by the complainant towards the application fee, counseling fee and admission fee (application fee Rs.1,000/- + counseling fee of Rs. 1,000/- + Rs. 5,500/- admission fee). The said amount has been directed to be paid with 9% interest from the date of complaint i.e. 12-12-2014 till realization. The Forum has also awarded Rs. 50,000/- as compensation towards mental agony besides costs of Rs.1,000/-.

In this appeal the complainant is seeking enhancement of compensation to Rs.20,00,000/- on the ground that she suffered loss of an academic year by denial of admission. We did not find any basis for such exhorbitant compensation, even if she had lost one academic year. We find that the mistake is not entirely attributable to the University. Applications for admissions were invited only from the qualified candidates after duly disclosing the eligibility criteria in the notification. The complainant was supplied with Regulations also. Therefore, she is expected to make herself sure of her eligibility before submitting the application. We do not find any diligence shown by her and she blindly submitted the application.  In our considered view the complainant is equally responsible for losing an academic year. Therefore, in the circumstances we are of the view that Rs.50,000/- awarded by the Forum is just and reasonable. There are nо merits in the appeal and the appeal is accordingly dismissed. No costs.”

Being dissatisfied with the impugned order dated 02.01.2018 the OP-1 have filed the present Revision Petition.

The learned counsel for Petitioner/OP-1 reiterated the facts of the case and argued that ‘Education’ is not a commodity. Thus, educational institutions, including universities, do not render any ‘service’ while providing education and collecting fees. He asserted that not only are the impugned orders are liable to be set aside, but also the complaint filed by the Complainant is not maintainable and should be dismissed. He relied on the following judgements in support of this argument:

A. Manu Solanki & Ors. v. Vinayaka Mission University; 2020 SCC OnLine NCDRC 7;

B. Kailashchandra Bansal Collage of Technology vs. Deepika Chauksey, 2021 SCC OnLine NCDRC 881;

C.  Registrar, Manonmaniam Sundaranar University vs. Sreosi Chatterjee and Ors., 2022 SCC OnLine NCDRC 337;

D. Director Xavier Institute of Management & Entrepreneurship Kinfra Hi-Tech and Ors. Vs. Sujay Ghose, 2022 SCC OnLine NCDRC 621;

In his arguments, learned counsel for Complainant reiterated the facts of the case and emphasized that the State Commission and the District Forum have unanimously held that Petitioner/OP-1 was guilty of deficiency in service and unfair trade practices against them. They cited the decision of the Hon’ble Supreme Court in Lourdes Society Snehanjali Girls Hostel & Ors. Vs. H & R Johnson (India) Ltd. & Ors. Reported as 2016 (8) SCC 286 dated 02.08.2016 highlighting that the jurisdictional power of the National Commission under Section 21(b) of the Act, 1986 can only be invoked in cases of jurisdictional error, and not to re-examine the facts of the case. They pointed out that the consumer complaints in these cases dealt with instances of deficiency in service and unfair trade practices by OP-1, despite not being affiliated with any university nor recognized by UGC or any government body. Therefore, the actions of OP-1 squarely fall within the statutory provisions of the Act, 1986. He asserted that they are entitled to all the reliefs sought by them and granted by the District Forum. He argued in favour of the concurrent findings of the Fora below. He sought that the Revision Petition be dismissed with costs. He has also relied upon the judgment of the NCDRC in Bharti Axa Life Insurance Ltd. Vs. Amrik Kaur & Ors., R.P. Nos.3294 and 3295 of 2017 decided on 03.08.2023.

OP-2 did not appear despite service of notice and was, therefore, proceeded ex-parte vide order dated 02.05.2024.

I have examined the pleadings and associated documents placed on record and rendered thoughtful consideration to the arguments advanced by the learned Counsel for both the parties.

The main issue to be determined is whether educational institutions or services provided by them fall under the ambit of the Act? This question is crucial as it affects the jurisdiction of consumer fora over disputes involving educational institutions.

Hon’ble Apex Court, in the case of Bihar School Examination Board vs. Suresh Prasad Sinha, reported in IV (2009) CPJ 34 (SC), has clarified this issue. The Court held that the Bihar School Examination Board does not offer “service” to any candidate, nor does any student hire or avail of any “service” from the Board for a consideration. Paragraph No. 10 of the said decision is reproduced below:

“10. The Board is a statutory authority established under the Bihar School Examination Board Act, 1952. The function of the Board is to conduct school examinations. This statutory function involves holding periodical examinations, evaluating the answer scripts, declaring the results and issuing certificates. The process of holding examinations, evaluating answer scripts, declaring results and issuing certificates are different stages of a single statutory non-commercial function. It is not possible to divide this function as partly statutory and partly administrative. When the Examination Board conducts an examination in discharge of its statutory function, it does not offer its “services” to any candidate. Nor does a student who participates in the examination conducted by the Board, hires or avails of any service from the Board for a consideration. On the other hand, a candidate who participates in the examination conducted by the Board, is a person who has undergone a course of study and who requests the Board to test him as to whether he has imbibed sufficient knowledge to be fit to be declared as having competence vis-vis other examinees. The process is not therefore availment of a service by a student, but participation in a general examination conducted by the Board to ascertain whether he is eligible and fit to be considered as having successfully completed the secondary education course. The examination fee paid by the student is not the consideration for availment of any service, but the charge paid for the privilege of participation in the examination.”

A ‘Larger Bench’ of this Commission in Manu Solanki and Ors vs. Vinayaka Mission University and other connected cases reported in I (2020) CPJ 210 (NC) had held that educational matters do not come within the purview of Consumer Protection Act, 1986. Consequently, complaints filed by in such matters are deemed not maintainable. This precedent aligns with the position that educational institutions and the services they provide are not considered "services" under the Consumer Protection Act.

As a result, consumer fora do not have jurisdiction over disputes pertaining to educational matters, thereby reinforcing the conclusion that the present complaints are not maintainable under the Act. Based on the discussion above, I am of the considered view that the orders passed by the fora below suffer from material illegality and are erroneous. Therefore, the order passed by the State Commission dated 02.01.2018 in FA Nos. 410/2015 & 185/ 2016 and the order passed by the District Forum dated 05.08.2015 in CC No. 138/2014 are set aside. Consequently, the Revision Petition No.818 of 2022 is allowed.

Needless to say, the Complainant has right to approach appropriate legal fora to seek relief in respect of the grievances against the opposite parties. They may also seek benefit of the provisions of Section 14 of the Limitation Act, 1963 in doing so.

Keeping in view the facts and circumstances of the present case, there shall be no order as to costs.

All other pending Applications, if any, also stand disposed of accordingly.