NCDRC Holds New Delhi Institute Of Management Studies Liable For Misleading Student For Joining MBA Course

Brief Facts:

The Complainant alleged that New Delhi Institute of Management Studies (“NDIMS”) and its admission officer falsely informed him that the MBA course he intended to join was a regular two-year course associated with Madhuraj Kamraj University and approved by the University Grants Commission (“UGC”). The Complainant, relying on this information, enrolled but did not receive job training during the course. Upon filing an RTI, the Complainant discovered from the UGC that Madhuraj Kamraj University was unauthorized to open an off-campus study centre beyond the state's territorial jurisdiction. Feeling aggrieved, the Complainant filed a consumer complaint before the District Consumer Disputes Redressal Commission, Patna (“District Commission”). The District Commission directed NDIMS to refund the first-year fee of Rs. 1,55,000/- and awarded Rs. 25,000/- for compensation and litigation costs. Both the Complainant and NDIMS filed an appeal before the State Consumer Disputes Redressal Commission, Bihar (“State Commission”). The State Commission dismissed NDIMS's appeal but partially allowed the Complainant's appeal by increasing the compensation to Rs. 35,000/- and adding litigation costs of Rs. 10,000/-.

Feeling aggrieved, NDIMS filed a revision petition before the National Consumer Disputes Redressal Commission (“NCDRC”). It contended that educational institutes are not covered under the Consumer Protection Act. Further, it contended that the District Commission and the State Commission lacked territorial jurisdiction and failed to consider the improper appreciation of the approval letter from the Complainant.

Observations by the NCDRC:

The NCDRC reviewed the District Commission's order, which stated that the Complainant believed the institute had UGC approval for the MBA course. However, a letter from the UGC dated 12.08.2009 clarified that Madurai Kamraj University was not authorized to open study centres or run distance education programs beyond its territorial jurisdiction without UGC approval. District Commission's order was then upheld by the State Commission, which found no material to support NDIMS's claim that the MBA course had UGC approval.

The NCDRC observed that the Complainant was misled into believing that NDIMS was authorized to conduct the MBA course on behalf of Madurai Kamraj University. This misrepresentation amounted to a deficiency in service and an unfair trade practice. The NCDRC further held that the Complainant fell under the definition of 'consumer' under the Consumer Protection Act.

As a result, the NCDRC dismissed the appeal filed by NDIMS and held that the State Commission awarded fair compensation to the complainant. The orders of the District Commission and the State Commission were upheld.

Case Title: New Delhi Institute of Management Studies vs Shamaneshwaram and 2 Ors.

Case No.: Revision Petition No. 346-347 of 2019

Advocate for the Institute: Dr Bipin Dwivedi, Mr Ankit Aakash and Mr Sunil Kumar

Advocate for the Complainant: None

Date of Pronouncement: 23rd July 2024