Lumpsum Fee In Advance Exploits Students, Central Delhi Consumer Commission Orders Delhi Academy Of Medical Science To Refund ₹ 1 Lakh

Brief Facts:

In February 2020, Snehpal Singh (“Complainant”) approached Delhi Academy of Medical Science Private Ltd. (“Coaching Institute”) to enroll in physical coaching classes for a medical entrance exam. They discussed course details, fees, and assured physical classes. The complainant paid Rs. 1,16,820/- via demand draft and NEFT. The course began in February but was halted in March due to COVID-19. The complainant requested a refund due to the pandemic. The coaching institute initially promised a refund, later suggested online classes. The complainant faced technical issues and poor teaching quality in online classes. As a result, the complainant decided to not go ahead with the online classes and repeatedly asked for a refund but received no response. Emails were exchanged regarding refund, but the coaching institute didn't comply. The complainant even sent a legal notice to the coaching institute but no response was received. Consequently, the complainant filed a complaint in the District Consumer Dispute Redressal Commission [Central], Delhi (“District Commission”).

The coaching institute asserted that the complaint is based on incorrect information. The coaching institute acknowledged that the complainant sought admission for MD/MS exam preparation and agreed to the admission terms and conditions, including course details and fees. The coaching institute's website explicitly stated a 'no refund policy.' The coaching institute further contended that the complainant accepted these terms and voluntarily paid the non-refundable admission fee, as indicated on the fee receipt.

In response, the complainant highlighted alleged unfair trade practices by the coaching institute, claiming that the institute took advantage of its dominant position by charging a lump sum fee without delivering adequate education. Dissatisfied with the coaching quality, the complainant cited a previous judgment titled FIITJEE Ltd. vs. Minathi Rath Appeal No. 830/2006 where the Delhi State Commission ruled against a similar situation. The complainant argued that agreeing to terms and conditions isn't valid unless it aligns with legal principles and court rulings.

Observations by the Commission:

The District Commission observed that both parties agreed that the course offered by the coaching institute was originally intended to be conducted through physical classes, not online. The complainant's argument gained credibility as he stated that online classes were disrupted due to technical glitches and internet issues caused by the prevailing Covid-19 circumstances. Additionally, the complainant was in his hometown, away from the coaching institute's location. Furthermore, the decision to switch to online coaching was made unilaterally by the coaching institute without obtaining the complainant's consent. The District Commission held that the coaching institute cannot enforce online classes instead of the agreed-upon physical classes without the complainant's approval.

The District Commission drew upon the case of FIITJEE Ltd. vs. Minathi Rath Appeal No. 830/2006 where the Delhi State Consumer Disputes Redressal Commission ruled against the practice of demanding a lump sum payment upfront for the entire course duration. The judgment stated that this approach is designed to amass significant funds, unjustly benefiting the service provider, while also obligating the student to avail the entire course even if the quality is subpar and deficient.

Resultantly, the coaching institute was held liable to refund the fee amounting to Rs. 1,00,132/- (after deducting 1 month of fee for which the complainant availed offline classes) and Rs. 5,000/- for mental agony

Case: Snehpal Singh vs Delhi Academy of Medical Sciences Pvt. Ltd.

Case No.: Complaint Case No. CC/101/2020

Advocate for the Complainant: N.A.

Advocate for the Respondent: N.A.

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