11/24/2016

ADeemedUniversityvsTheDistrictConsumerDisputes...on9January,2015
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Cites37docs[ViewAll]
Article226inTheConstitutionOfIndia1949
IslamicAcademyOfEducationAnd...vsStateOfKarnatakaAndOtherson14August,2003
theConsumerProtectionAct,1986
SuryaDevRaivsRamChanderRai&Orson7August,2003
R.GowthamivsTheRegionalOfficeron9March,2012

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UserQueries
consumerdisputes
consumerdisputesredressal
commission

MadrasHighCourt
A Deemed University vs The District Consumer Disputes ... on 9 January,
2015

prospectus
nationalconsumer
nationalconsumerdisputes
redressalcommission
nationalconsumerdisputes

ncdrc
nationalcommission

engineeringcollege

Transfercertificate
consumerprotection

"ugc"

thanjavur

BEFORETHEMADURAIBENCHOFMADRASHIGHCOURT

unaided
streams

DATED:09.01.2015

closure
consumerredressalforum

CORAM

consumerprotectionact

THEHON'BLEMs.JUSTICEK.B.K.VASUKI

whoisconsumerinconsumer
protectionact

WP.(MD)Nos.13993of2012

bindingprecedent

WP.(MD)Nos.13994to13995and15058of2012
andMP.Nos.1+1+1+1of2012&1+1of2014
ShanmugaArtsScienceandTechnologyResearchAcademy
(SASTRAUniversity)
ADeemedUniversity

...Petitioner

representedbyitsRegistrar
Dr.Balachandran

vs.

1.TheDistrictConsumerDisputesRedressalForum
Thanjavur613002.
2.ConsumerProtectionCouncil,TamilNadu
D53,8thCross,ThillaiNagar,
Tiruchirapalli18
representedbyS.Pushpavanam

...Respondents

1&2inallWPs
3.V.SrinivasaRao...3rd Respondent in WP.13993/2012 S.Venkataraman ... 3rd Respondent in
WP.13994/2012K.Ramesh...3rdRespondentinWP.13995/2012SrinivasaMurthyCherukupally
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...3rdRespondentinWP.15058/2012WritPetitionsfiledunderArticle226ofTheConstitution
of India praying this Court to issue a Writ of certiorari, to call for the records relating to CC
Nos.31, 32, 33 and 48 of 2012 on the file of the District Consumer Disputes Redressal Forum,
Thanjavurandquashthesame.
!ForPetitioner:Mr.K.K.SenthilforM/s.G.R.Associates.
For Respondents : Mr.G.Muthukannan, GA (R1) Mr.S.Pushpavanam Party in person (R2) No
appearance(R3):COMMONORDERAllthewritpetitionsarefiledtoquashtheproceedingsin
CCNos.31,32,33and48of2012pendingonthefileoftheDistrictConsumerDisputesRedressal
Forum, Thanjavur against the petitioner herein, arising out of the complaint filed by the third
respondentstudentineachofthewritpetitions.
2.The circumstances under which the third respondent in each of writ petitions come forward
with the respective complaint against the petitioner institution are as follows : The respective
thirdrespondentinWP.No.13993to13995/2012wereadmittedtoB.TechcourseinECEStream
inthepetitionerUniversitybetween21.6.2010and2.7.2010onpaymentofRs.52,000/asinitial
fees.Theycompletedfirsttwosemesters.Aftertheclasseswerecommencedduringsecondyear,
they wanted to leave from the petitioner University for joining some other college. For that
purpose,theysoughtfortransfercertificate.ThepetitionerUniversityasperthespecificclause
contained in the application, issued transfer certificate and returned other certificates on
payment of fee for entire course to the tune of Rs.1,77,000/ . Thereafter, the third respondent
demanded refund of the fee amount remitted by them. On their failure of the petitioner
University to do so, the third respondent through the second respondent, made the complaint
before the first respondent, seeking various reliefs of refund of amount paid by way of tuition
fees,punitivedamagesandcompensation.
Insofar as the third respondent in WP.15085/2012 is concerned, he was admitted in B.Tech
course in EEE stream on 17.7.2012 on payment of Rs.57,000/ as fees. The classes were
commenced from 18.7.2012. The third respondent, after having attended the classes for more
thanamonthandaftertheclosuredateformakingadmission,wantedtodiscontinuethecourse
ashegotadmissioninsomeothercollegeandrequestedfortransfercertificateon21.8.2012.The
petitioner University as per the specific clause contained in the application, refused to issue
transfercertificate,withoutremittingthebalancefeeforentirecourse.Ontheirrefusaltodoso,
thecomplaintcametobefiledbeforethefirstrespondent,forrefundoftuitionfeesalreadypaid
andfordamagesandcompensationandalsoreturnoftheoriginalcertificates.
3.The issue raised in all the complaints by the students is that the petitioner University is not
authorisedtocollectentirecoursefeefromthestudent,whodiscontinuehisstudiesinthemid
stream and the failure to return the certificate by demanding entire course fee is illegal and
against the legal pronouncement made by the Apex Court and National Consumer Disputes
RedressalCommission,NewDelhiandalsoagainstthecircularissuedbyUGC.
4.The petitioner University has come forward with these writ petitions seeking to quash the
complaints pending on the file of the first respondent Forum on the grounds that the first
respondenthasnojurisdictiontoentertainthecomplaintsagainstthewellsettledlegalprinciples
and the present proceedings pending against the petitioner is hence nothing but an abuse of
processoflaw.
5.The Secretary of the Consumer Protection Council on behalf of the respondents 2 and 3
seriously opposed the relief sought for herein by questioning the maintainability of the writ
petitionsandbyrelyingontheprincipleslaiddownbytheApexCourtandNationalConsumer
Disputes Redressal Commission, New Delhi. The Secretary of the second respondent would
reiterate the same ground as raised before the first respondent Forum that the petitioner
University has no authority to collect the entire fee and to retain the certificates by demanding
entirecoursefee.
6.Boththepetitionersaswellastherespondents2and3havealso,insupportoftheirrespective
contentions,citedthejudgmentsoftheApexCourtandourHighcourtandtheorderpassedby
theNationalConsumerDisputesRedressalCommission,NewDelhi.
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7.Heardtherivalsubmissionsmadeonbothsidesandperusedthematerialsplacedbeforethis
Court.
8.Before going into the relief sought for herein on merits and on facts, the first issue to be
consideredhereinisthemaintainabilityofthewritpetitions.Accordingtothelearnedcounselfor
thepetitioner,theordersandproceedingsofajudicialcourtsubordinatetotheHighCourtare
amenabletowritjurisdictionoftheHighCourtunderArticle226oftheConstitutionandWritof
Certiorari under Article 226 of the Constitution can be issued for correcting gross errors of
jurisdiction i.e., when a subordinate court is found to have acted (i)without jurisdiction ? by
assumingjurisdictionwherethereexistsnone,or(ii)inexcessofitsjurisdiction?byoverstepping
orcrossingthelimitsofjurisdiction,or
(iii)actinginflagrantdisregardoflawortherulesofprocedureoractinginviolationofprinciples
ofnaturaljusticewherethereisnoprocedurespecified,therebyoccasioningfailureofjustice.The
learned counsel for the petitioner in support of such contention, relied on the following
judgments: (i)CDJ 2003 SC 178 (State of Karnataka v. Vishwabarathi House Building Coop.
Societyandothers)and(ii)(2003)6SCC675(SuryaDevRaiv.RamChanderRaiandothers).
9.On other hand, the learned counsel for the second respondent relying on the following
authorities,contendedthatwhenanalternativeefficaciousremedybywayofappealorrevisionis
available to the person if aggrieved, supervisory jurisdiction may be refused to be exercised:
(i)2001supp(1)SCR466(Punjab National Bank v. O.C.Krishnan and others) (ii)(2003) 6 SCC
675(SuryaDevRaiv.RamChanderRaiandothers)(iii)(2012)8SCC524(CicilyKallarackalv.
VehicleFactory) and (iv)2009 (2) CPR 74 (Cox and Kings (I) Limited v. Raj Kumar Mittal and
another)(DelhiHighCourt).
10.Itistruethatinthedecisionscitedonthesideoftherespondents,theHon'bleSupremeCourt
and Delhi High court are of the view that when there is an alternative remedy available to the
personifaggrieved,itcannotbeproperexerciseofjurisdictiontopermitthepartiestobypassthe
statutory appeal to such higher court and entertain petitions in exercise of its powers under
Article 226 of the Constitution of India and the same amounts to improper exercise of
jurisdictionanditisnotappropriatefortheHighCourtstoentertainwritpetitionsunderArticle
226 of the Constitution of India against the orders passed by the lower forum, as a statutory
appealisprovidedandliestotheSupremeCourt.
11.This Court is bound by the principles so laid down above. However, the same are not
applicabletothefactsofthepresentcase,wherein,whatischallengedbeforethiscourtisnotany
orderpassedbythefirstrespondentforum,butverymaintainabilityoftheproceedingsbeforethe
firstrespondentforum.Asthesameischallengedonthegroundofwantofjurisdiction,thesame
iscoveredbythelawlaiddownbytheSupremeCourtinSuryaDevRai'scase,wherein,theApex
Court referring to the views of the Constitution Bench and three Judges Bench of the Supreme
Courtinthefollowingjudgmentsheld(i)AIR1954SC440(T.C.Basappav.T.Nagappa)
(ii)AIR 1950 SC 222 (Province of Bombay v. Khushaldas S.Advani) and (iii)AIR 1966 SC 81
(DwarkaNathv.ITO)innouncertaintermsthatawritofcertioraricanbeissuedagainsttheacts
orproceedingsofajudicialorquasijudicialbodyconferredwithpowertodeterminequestions
affectingtherightsofsubjectsandobligedtoactjudicially:TheHon'bleSupremeCourthasalso
in the same judgment, referred to other judgments of the Apex Court, which dealt with the
exercise of original jurisdiction of the High court and supervisory jurisdiction and the
circumstances under which and the forum against whom the same can be exercised. The Apex
Court, after due analysis of all the cases and the principles laid down therein, has gone to the
extentofsayingthatthewritofcertioraricanbedirectedagainsttheact,orderorproceedingsof
thesubordinatecourtanditcanbeissuedevenifthelisisbetweentwoprivatepartiesandoneof
the 9 principles laid down in the same decision is that Certiorari under Article 226 of the
Constitutioncanbeissuedforcorrectinggrosserrorsofjurisdictionie.,whenasubordinatecourt
isfoundtohaveacted(i)withoutjurisdictionbyassumingjurisdictionwherethereexistsnone,
or (ii)in excess of its jurisdiction ? by overstepping or crossing the limits of jurisdiction, or
(iii)actinginflagrantdisregardoflawortherulesofprocedureoractinginviolationofprinciples
ofnaturaljusticewherethereisnoprocedurespecifiedtherebyoccasioningfailureofjustice.

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12.Thatbeingthelegalposition,theobjectionregardingmaintainabilityofthewritpetitionsfor
theissuanceofwritofCertioraritocallfortherecordsrelatingtothecomplaintspendingbefore
the first respondent forum and to quash the same on the jurisdiction issue, is hence legally
untenableandisliabletobenegatived.
13.Beforegoingintothefactsofthecaseonmerits,itisusefultoquotetheprincipleslaiddown
by the Apex Court and our High court and the National Consumer Disputes Redressal
Commission,NewDelhi.TheConstitutionBenchoftheApexCourtinthejudgmentreportedin
2003(6)SCC697(IslamicAcademyofEducationandanotherv.StateofKarnatakaandothers),
has observed that insofar as the institutions imparting professional education are concerned,
having regard to the public interest, they are bound to maintain excellence in standard of
educationandthewidthoftherightsandlimitationsthereofofunaidedinstitutionswhetherrun
by a majority or a minority must conform to the maintenance of excellence. With a view to
achievethesaidgoalindisputably,theregulationscanbemadebytheStatebyensuringorderly,
efficient and sound administration and by preventing maladministration. The Supreme Court
hasinthesamejudgmentupheldtherightsoftheunaidedinstitutiontoearnreasonablesurplus
for development of education and expansion of the institution, by getting profit out of their
investmentsandnottheprofessionalinstitutions,whichbecomeauctionhousesforthepurpose
ofsellingseats.Itisfurtherobservedthatthecommitteeconstitutedforfixingthefeestructureis
requiredtotakeintoconsiderationthesalaryorremunerationpaidtothemembersofthefaculty
and other staff, investment made by them, infrastructure provided and plan for future
development of the institution as also expansion of the educational institution and future
planning or improvement of facilities and investment in expensive devices or a powerful
computeretc.Afterhavingobservedso,itislaiddownbytheSupremeCourtthattheinstitutions
shallchargefeeonlyforoneyearinaccordancewiththerulesandshallnotchargethefeesforthe
entire course and fees once fixed should not ordinarily be changed for a period of three years,
unless there exists extra ordinary reason. However, if for some reason, fees have already been
collected for a longer period the amount so collected shall be kept in a fixed deposit in a
nationalisedbankagainstwhichnoloanoradvancemaybegrantedsothattheinterestaccrued
thereupon may enure to the benefit of the students concerned. Ordinarily, however, the
managementshouldinsistforabondfromtheconcernedstudents....Ifaninstitutionfeelsthat
anyparticularstudentmayleaveinmidstreamthen,atthehighest,itmayrequirethatstudentto
giveabond/bankguaranteethatthebalancefeesforthewholecoursewouldbereceivedbythe
instituteevenifthestudentleftinmidstream.Ifanyeducationalinstitutionhascollectedfeesin
advance,onlythefeesofthatsemester/yearcanbeusedbytheinstitutionandthebalancefees
mustbekeptinvestedinfixeddepositsinanationalisedbank.Asandwhenthefeesfallduefora
semester/year, only the fees falling due for that semester/year can be withdrawn by the
institution. The rest must continue to remain deposited till such time that they fall due. At the
endofthecourse,theinterestearnedonthesedepositsmustbepaidtothestudentfromwhom
thefeeswerecollectedinadvance.
14.The Apex Court in the judgment reported in 2002 (8) SCC 481 (T.M.A. Pai Foundation &
othersv.StateofKarnatakaandothers)heldthatprivateunaidedcollegeshavetherighttoadmit
students of their choice, subject to an objective and rational procedure of selection and the
compliancewithconditions.
15.TheApexCourtinthejudgmentsreportedinAIR2003SC1082(NeeluAroraandanotherv.
Union of India (UOI) and others) by applying its earlier view in Medical Council of India v.
MadhuSinghandothersreportedinMANU/SC/0761/2002andinAIR2003SC1084(Supreet
Batraandothersv.UnionofIndia(UOI)andothers),ruledagainstthemidsessionadmissions,
evenifseatsareunfilled.
16.The Bombay High Court in the order dated 11.6.2012 made in WP.No.2933 of 2011 (Amit
SadashivVaidyav.ThePrincipal,K.C.CollegeofEngineeringKopri,Thandandothers),having
regardtotherules,framedbytheDirectorateofTechnicalEducationtotheeffectthatnorefund
of fees except for the security of deposit can be granted, where a request for cancellation of
admissionisreceivedbeforeorafterthestartoftheacademicsessionastheseatcannotbefilled
bytheinstituteispleasedtoobservethattherulesseektobalanceononehand,refundoftuition
fees to students, who obtain more preferential allotments, with the rights of management as a
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resultofthewithdrawalbythepetitionerfromtheseatallotted,theseatwouldremainvacantfor
aperiodoffouryears.AccordinglytheBombayHighCourtdeclinedtograntthereliefforrefund
oftuitionfeesalreadypaid.
17.TheDivisionBenchofPunjabandHaryanaHighCourthasinthedecisionreportedin(2003)
134PLR215(NavdeepSinghv.I.I.T.T.CollegeofEngineeringandothers)statedthatitissettled
law that provisions contained in the prospectus issued by the University are binding on the
partiesandthecourtcannotissuedirectionwhichmayresultinviolationthereof.
18.ThePunjabandHaryanaHighCourtinthedecisiondated9.5.2012inCWPNo.1133of2011
(L.K.Talwarandanotherv.LovelyProfessionalUniversity)heldthatiftheseatconsumedisstill
lyingvacant,thereisnoquestionforrefundoffees.
19.TheDelhiHighCourtinthejudgmentreportedin127(2006)DLT606(KalkaInstforRese
andadvancestudiesandanotherv.HiteshKumarandothers)wasoftheopinionthatsincethe
petitionerhasattendedtheclassesforaboutonemonthandappliedforwithdrawalmuchafter
closureofadmission,thefeewasnotrefundable.
20.The Karnataka High Court has in the judgment reported in ILR 2006 KAR 2220 (Sharifa
B.T.Mohamed Ali Jinnaha v. The Vice Chancellor Manipal Academy of Higher Education, The
AssistantDirector,InternationalAdmissions,ManipalAcademyofHigherEducation,TheDean,
KasturbaMedicalCollegeandtheChairman,MedicalCouncilofIndia)heldthatonceacandidate
has declared and signed the condition/rules and regulations of the University/College, such a
candidateisnotentitledtoturndowntheundertakingandredressthegrievancecontrarytothe
existingrulesandregulations.
21.TheKeralaHighCourtinthejudgmentdated15.3.2011madeinWP.29635/2004(M.Shajilav.
theUniversityofCalicutandothers)observedthatthecourtwillnotbejustifiedincompellingthe
management to refund the fee and special fee, if the discontinuance is after the closure of the
admissionandwhenthepetitionerisnotabletodemonstratethattheseatvacatedbyher/him
wasfilledupbyadmittingsomeothercandidate.
22.Inthefollowingjudgments,ourHighcourthasrepeatedlyheldthatifthestudentwithdraws
afterthecommencementoftheclasseswiththeseatremainingunfilled,thetermsagreeduponat
the time of admission is binding on the petitioner the institution is right in collecting the fees
from the petitioner and there is no illegality in such action it is well settled law that the
prospectushasforceoflawandthattheinstitutionaswellasstudentisboundbytheprospectus
foradmission.Aspertheprospectusthatthefeealreadypaidcannotberefundedandtheparties
are bound by the terms of the prospectus and the institutions are bound by the public notice
issued by the University Grants Commission : (i)WP (MD) No.13041/2011 dated 7.2.2013
(B.Uthanda Harihara Sudhan v. The Registrar, Sasthra University, Thanjavur) (ii)WP(MD)
No.935 of 2008 dated 17.7.2008 (G.Maria Jeblin Lincy v. The Principal, Sun College of
Engineering and Technology, Kanyakumari District and another) (iii)WP.21490/2007 dated
9.11.2010 (S.K.Sethuraman v. The Registrar, Sastra University (iv)(2012) 4 MLJ 666
(R.Gowthamiv.RegionalOfficer,AllIndiaCouncilforTechnicalEducation,Chennaiandothers)
and (v)WP.2956/2008 dated 12.2.2013 (A.Arun v. The Registrar, Tamil Nadu Agricultural
University,Coimbatoreandothers).
23.The Full Bench of National Consumer Disputes Redressal Commission, New Delhi in the
decisionreportedin1995(3)CPR467,(HomoeopathicMedicalcollege&Hospital,Chandigarhv.
GunitaVirk)heldthatforaconstitutedundertheConsumerProtectionActhavenojurisdictionto
declare any rule in a prospectus of any institution providing for nonrefund of tuition fee as
unconscionable or illegal. If a student applies for admission and deposits the fees and later on,
doesnotwanttojointhecourse,thentheseatsovacatedwillremainvacantthroughouttheyear.
Insuchcircumstances,itwillbecomeverydifficultforanyinstitutiontoruninapropermanner.
24.The National Consumer Disputes Redressal Commission (NCDRC), New Delhi, in the order
madeinRevisionPetitionNo.4464of2012dated31.5.2013(GlobsynBusinessSchoolv.Mayuri
Ghosh), held that UGC circular was not applicable to unaided institutions. It is observed by
NCDRCinthedecisionreportedinI(2009)CPJ10(NC)(ApeejayInstituteofManagementand
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InformationTechnologyv.PrashantAshok)thatrefundcannotbeclaimedaspertheundertaking
signed by the guardian. In the order dated 31.3.2006 made in CC.No.987 of 2004 (Manu v.
Central Counselling Board and others) by the District Consumer Disputes Redressal ForumII,
UT,Chandigarh,thepetitionerhereinisthesecondrespondenttherein.Itisheldthereinthatas
thestudentleftthecourseofhisown,afterattendingitforthreedaysandastheUniversitywas
willingandreadytoimparteducation,butthestudentwasnotinterested,therewasnoground
forblamingthecollegefordeficiencyinservice.InanotherdecisionbyNCDRCreportedin1994
(3) CPJ 160 (Ramdeobaba Engineering College v. Sushant Yuvraj Rode and another), it is
observedthatasthestudentwithdrewfromthecollegetojoinanotherinstitutevoluntarily,there
wasnodeficiencyinserviceonthepartoftheEngineeringCollegeandnonrefundofadmission
fee is not a deficiency in service and admission fee is a consideration for admission and the
servicewhichtheEngineeringcollegewastorendertothestudentinthematterofhispursuing
studiesinthecollegeafteradmissionanditisaquidproquoforsuchservice.NCDRCinthecase
ofFIITJEELtdv.SajjanKumarGuptavideorderdated21.5.2014inRevisionPetitionNo.4476
of2013heldthattherewasnodeficiencyinserviceornegligenceindutyinanymannerandas
theinstitutionchargedtheinfrastructurecostfeeandadmissionfeeand10%ofthetuitionfees
fromthestudent,thereisnojurisdictionfortherefundoffees,ifthestudenthasleftthecourse
midstream.Itisheldso,byfollowingtheobservationsoftheHon'bleSupremeCourtinthecase
of Islamic Academy of Education v. State of Karnataka (cited supra) that an institute is not
debarred from collecting the entire fees in advance and it has not been stated anywhere that a
studentisentitledtogetrefund,ifheleavesthecoursemidstream.
25.Whereas, the Secretary of the second respondent has in support of his contention that the
student is entitled for refund of money for the period, they had not attended the
college/institution,asperthepublicnoticeissuedbyUGC,citedtheordersofNationalConsumer
Disputes Redressal Commission in (i)1986 ? 2009 CONSUMER 15848 (NS) (Sehgal School of
Competition v. Shri Dalbir Singh) (ii)1986 ? 2009 CONSUMER 16192 (NS) (Registrar,
G.G.S.IndraprasthaUniversity,Delhiv.Vaibhav)(iii)19862002Consumer5207(NS)(Bhupesh
Khurana and others v. Vishwa Buddha Parishad and others) (iv) Revision Petition No.1668 of
2012 dated 23.4.2013 (Birla Institute of Technology and Science, Pilani and others v. Abhishek
Mengi)
(v)RevisionPetitionNo.3432of2009dated10.11.2010(ShreiSaravpreetSinghv.ThePrincipal,
LalaLajpatRaiInstituteofEngineering&Technology,Moga,Punjabandanother)(vi)Revision
Petition nos.347 and 350 of 2012 dated 25.5.2012 (Ganpati College of Engineering for Girls v.
Shivaniandanother)andthedecisionofDelhiStateConsumerDisputesRedressalCommission,
NewDelhireported in2012(1) CPR 285 (Guru Gobind Singh Indraprastha University v. Disha
Jain).Inallthesecases,theNationalaswellasStateConsumerDisputesRedressalCommission
upheldtheordersforrefundofcoursefeealreadypaid.
26.The learned counsel for the respondents has in support of his contention, also relied on the
followingdecisions.Intheorderdated26.11.2009madeinWP.No.19908of2009(M.Sumerv.
The Chairman, PMR Institute of Technology, Chennai and others), the then learned brother
JudgeofthiscourtK.Chandru,J.observedthatifatallitcanonlybeacivilliability,whichthe
institutionwillhavetoestablishbeforetheappropriatecivilcourtandcannottakethelawinto
theirownhandsbyholdingtheTransfercertificateasransomandthusruinthelifeofanyoung
student.
27.ThePunjabandHaryanaHighCourtintheorderdated21.7.2010madeinCivilW.P.No.13308
of2009(Sh.AtamParkashKhatterv.CommissionerandSecretaryandanothertoGovernmentof
Haryana and others), observed that Education Institution cannot act like commercial
establishment and there is no justification on the part of the institution in retaining the
substantial fee paid by a student, who decides not to pursue his/her studies in the said
institution.
28.The Punjab and Haryana High Court in another decision reported in CDJ 2009 PHC 151
(Prabhjot Singh v. Punjab University, Chandigarh), held that in view of the instructions of the
AICTEandUGC,therespondentUniversitywasdutyboundtorefundthefee,ifthestudenthas
withdrawnbeforethecommencementofthecourse.
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29.In the decision reported in (2002) 10 SCC 487 (Ramdeo Baba Kamala Nehru Engineering
Collegeandothersv.SanjayKumarandothers),theHon'bleSupremeCourthasheldthatinthe
event of cancellation of admission at the behest of either party, money ought to be refunded,
subjecttodeductions.
30.AsfarastheorderspassedbytheNCDRCorStateConsumerDisputesRedressalCommission
citedonthesideoftherespondentsareconcerned,thesamearenotbindingonthiscourt,inview
of the principle laid down by this court in the judgment reported in AIR 2003 Mad 389 (Arun
Balakrishnan Iyer and another v. Soni Hospital and others), wherein it is clearly held that the
orders passed by the District Consumer Redressal Forum or State Commission or National
CommissionfunctioningundertheConsumerProtectionActarenotbindingprecedentsandsuch
decisions cannot be relied or referred before this court or before any subordinate court as
precedents and those decisions are not judgments but only orders. Under Article 141 of the
ConstitutionofIndia,thejudgmentsrenderedbytheSupremeCourtarebindingonall.Further,
thejudgmentoftheHighCourtsarebindingprecedentsonthecourtoverwhichtheHighcourt
exercises supervisory and revisional powers under Article 227 of the Constitution of India.
....Onlytheratiodecidendiinthedecisionsofthehighercourts,viz.,theSupremeCourtandthe
HighCourtsarebindingprecedents.Therefore,thedecisionsoftheConsumerDisputesRedressal
includingtheStatecommissionandtheNationalCommissionarenotbindingprecedentsonthe
courts.......Therefore,thedecisionsoftheStateCommissionorNationalCommissionconstituted
undertheConsumerProtectionActarenotjudgmentslayingdownaratiodecidendi,assuch,the
decisionsoftheNationalandStateConsumerDisputesRedressalCommissioncitedontheside
oftherespondentstoupholdtheorderofrefund,areinnowayhelpfultotherespondents2and
3.
31.ItmaybetruethatthelearnedbrotherJudgeofourHighCourtandPunjabandHaryanaHigh
courthaveinthedecisionsabovecitedheldthatthestudentisentitledforrefundofcoursefee
deposited and the certificate cannot be withheld as ransom. However, other judgments of the
SupremeCourt,ourHighCourtandotherHighCourtscitedonthesideofthepetitioner,which
areinfavourofthepetitionerUniversity,wouldsquarelyapplytothefactsofthepresentcasefor
thefollowingreasons.
32.As already referred to, in Islamic Academy of Education v. State of Karnataka's case, the
Supreme Court has not decided against the collection of entire course fee at the time of
admission.Itisonlystatedthatifentirefeeiscollectedinadvance,oneyearfeealonewillbeused
bytheinstitutionandbalanceamountwillbekeptinvestedinfixeddepositinanationalisedbank
andtheinterestaccruedthereonshallberefundedtothestudentattheendofthecourse.Itis
further stated in the same decision that the institution is authorised to require the student to
furnishabond/bankguaranteethatthebalancefeesforthewholecoursewouldbereceivedby
theinstitutionevenifthestudentleftinmidstream.Thatmeans,thebankguaranteesoobtained
willbeenforceableforcollectionofbalancewholecoursefee,intheeventofthestudentleftin
midstream. It is nowhere stated in the decision that the student, who left in midstream is not
liabletopaywholecoursefee,whenthevacantseatsocausedremainunfilled.Itisclearlylaid
downintheauthoritiescitedonthesideofthepetitionerthatthestudentwholeavesthecollege
afterthecommencementofthecourseandaftertheclosureofdateofadmission,isnotentitled
forrefundofthefeesalreadypaidandisliabletopaythebalancefeesforallthesemesters.
33.AsfarasthethirdrespondentinWP.Nos.13993to13995of2012areconcerned,theyleftthe
college, after commencement of the course in the second year. By that time, the last date for
admission through later entry was over and the seats remained unfilled. As far as the third
respondent in WP.No.15058/2012 is concerned, he left the college, after commencement of the
courseinthefirstyearandaftertheclosureoftheadmission.Thestudents,wholeftthecollegein
the second year, were asked to pay the balance fees for the entire course, whereas the student,
wholeftthecollege,afterattendingtheclassesinthefirstyear,wasaskedtopaythefeeforthe
second semester. It is demanded so, in view of the specific clause contained in the application
formandinviewoftheundertakinggivenbytheparent/guardianandinviewofrefundpolicyof
the institution. It is not in dispute that one of the specific clauses in the General Instructions
appended to the application form is that fees once paid will not be refunded under any
circumstancesandthecandidateshouldpaytheentireprogrammefeeminuswhateverhasbeen
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alreadypaid,ifhe/shediscontinuestheprogrammeanytimeafteritscommencement.Attheend
oftheGeneralinstructions,theapplicantandparent/guardian,afterhavingacceptedthesame,
are required to execute a joint declaration to the effect that they are fully aware of the general
instructionsandareboundbythesameandagreedtotheaboveconditions.Inbothsetofcases,
thestudentsdiscontinuedthecourse,aftercommencementofthecourseinthefirstyearaswell
as in the second year, resulting in vacant seat which remained unfilled for the entire course
period.Ifthatisso,thepartiesareboundbytheconditionsandthegeneralinstructionsprevailed
overUGCguidelinesoranyotherruleframedbyAICTE.
34.The Constitution Bench of NCDRC has in the case of Homoeopathic Medical College &
Hospital,Chandigarhv.MissGunitaVirkreportedin1995(3)CPR467heldthatforaconstituted
undertheConsumerProtectionActhavenojurisdictiontodeclareanyruleinaprospectusofany
institutionprovidingfornonrefundoftuitionfeeasunconscionableorillegalandsuchrulingof
NCDRC is undoubtedly binding on the State and District Consumer Disputes Redressal
Commissions. The learned brother Judges of our High court have in A.Arun v. the Registrar,
TamilNaduAgriculturalUniversity,Madras'scaseinWP.No.2956of2008,heldthatinstruction
andpublicnoticeofAICTEcannotoverridetheprovisionsofprospectusissuedforadmissionsIn
theorderdated9.11.2010madeinWP.No.21490of2007(S.K.Sethuramanv.SastraUniversity)it
isclearlyheldthataspertheprospectus,thefeealreadypaidcannotberefundedandtheparties
are bound by the terms of the prospectus. In the decision reported in (2012) 4 MLJ 666
(R.Gowthami v. Regional Officer) it is clearly observed that as the petitioner had paid the fees
without any protest and got the Transfer certificate from the college, she is estopped from
claiming the refund of the said sum. In other case of G.Maria Jeblin Lincy v. Principal, Sun
collegeofEngineeringandTechnology,Kanyakumariandanother,decidedbythenlearnedSister
Judge K.Suguna, the claim for refund of fee was rejected. It is pointed out therein that neither
basingonthecirculardated5.7.2007issuedbytheAnnaUniversitynorasperthepublicnotice
dated 23.4.2007 issued by the University Grants Commission, the petitioner is entitled for the
refund of the amount paid by her and when the University Grants Commission has issued a
specificcircularinthisregard,onlyiftheseatwhichfallsvacantduetothediscontinuationofa
particularstudentisfilledbyothercandidates,theamountwillberefunded.Thatbeingso,the
claimofthethirdrespondent/studentsinWP.13993to13995of2012inviewofthewellsettled
positionoflaw,islegallyunsustainable.
35.SimilarreasoningisapplicabletothecaseofthethirdrespondentinWP.15058/2012,wholeft
the college after the course was commenced and after the date of admission was over. In that
event, the student is liable to pay the second semester fee as demanded by the petitioner
University,whichremainedunfilled.Itisrelevantatthisjuncture,torecollecttheobservationof
theHon'bleSupremeCourtinIslamicAcademyofEducationv.StateofKarnataka'scase(cited
supra) that the institution is entitled to have reasonable surplus for development of education
andexpansionoftheinstitutionandreasonablesurplusdoctrinecanbegiveneffecttoonlyifthe
institutionsmakeprofitsoutoftheirinvestments.Whiledoingso,theycannotbemadetosuffer
lossduetonofaultontheirpartorduetodiscontinuanceofthecoursebythestudentonhisown
orduetonofaultonthepartoftheUniversity.Itisnobody'scasethatthepetitionerUniversityis
deficiencyinserviceandisnotwillingandreadytoimparteducationtothestudents,whoopted
othercollegeandchosetoleavethepetitionercollegefortheirbetterment.Furtherhavingfound
that the specific contention of the petitioner University that the seats consumed by the third
respondentstudentsremainunfilled,isnowheredeniedbytherespondent2and3,itisfurther
heldthatthepetitionerUniversitycannotbepenalisedforthesame.
36.When that being the legal and factual position, the National Consumer Disputes Redressal
commissionisboundbythelegalprincipleslaiddownbytheApexCourtandourHighCourtand
other High courts in the matter of refund of college fee already paid to the students and in the
matterofpaymentofbalancefeebythestudentswholeftthecollegeinmidstream.Whenthefive
member Bench of NCDRC held that the forum cannot go into the question whether the refund
policyisconstitutionalornot,thesameisbindingonthefirstrespondent.Ifthatisso,thefirst
respondentcannoteithergointolegalityandenforceabilityofthespecificclausecontainedinthe
application form or reservation policy of the unaided institution, which is prevailing over the
UGCletter.Thefirstrespondentisalsoboundbythelegalprincipleslaiddownbythiscourt.In
suchcircumstances,theissueinvolvedinthecomplaint,whichisalreadydecidedbythehigher
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forum,cannotbereagitatedbeforethefirstrespondent.Intheeventofthesamebeingallowed
tocontinue,thesameamountstoabuseofprocessoflawasthereisnochanceofthecomplainant
succeedingintheirpursuit.
37.Atthisjuncture,itisnoteworthytoreferthedecisionoftheHon'bleSupremeCourtinthecase
of
K.K.Modi
v.
K.N.Modi
and
others
reported
in
Indian
Kanoon
http://indiankanoon.org/doc/1777887, wherein, the Apex court held that frivolous or vexatious
proceedings may also amount to an abuse of the process of the court especially where the
proceedings are absolutely groundless. The court then has the power to stop such proceedings
summarilyandpreventthetimeofthepublicandthecourtfrombeingwasted.Undoubtedly,itis
a matter of courts' discretion whether such proceedings should be stopped or not and this
discretionhastobeexercisedwithcircumspection.Itisajurisdictionwhichshouldbesparingly
exercisedandexercisedonlyinspecialcases.Thecourtshouldalsobesatisfiedthatthereisno
chanceofthesuitsucceeding.Whileobservingso,theApexCourthasatpage12ofitsjudgment
referred to the Supreme Court practice 1995 published by Sweet & Maxwell in paragraph
18/19/33 (page 344) which explains the phrase ?abuse of the process of the court? thus: This
termconnotesthattheprocessofthecourtmustbeusedbonafideandproperlyandmustnotbe
abused.Thecourtwillpreventimproperuseofitsmachineryandwillinapropercase,summarily
preventitsmachineryfrombeingusedasameansofvexationandoppressionintheprocessof
litigation.
38.Thus, for the discussions held above, the petitioner being unaided institution, is entitled to
claimfullfeeeitherfortheentirecourseorfortheparticularyear,asthecasemaybe,whenthe
students left the college in the mid stream, as such, the grievance raised by the students in the
impugnedcomplaints,doesnotmakeoutanyprimafaciecaseagainstthepetitionerUniversityto
subject the same to face the ordeal of trial. When the complaints are both legally and factually
unsustainable, the same cannot be, in the interest of justice allowed to go on, so as to cause
serious prejudice to the petitioner University amounting to abuse of process of law and the
complaintsarehenceliabletobequashed.
K.B.K.VASUKI,J.
rk
39.Intheresult,allthewritpetitionsareallowedandtheproceedingsinCCNos.31,32,33and48
of2012pendingonthefileoftheDistrictConsumerDisputesRedressalForum,Thanjavurstand
quashed.ThethirdrespondentinWP.No.15058of2012bynameSrinivasaMurthyCherukupally
is directed to pay the second semester fee and the petitioner is directed to hand over the
certificates to the third respondent within three days from the date of receipt of payment of
secondsemesterfee.Nocosts.Consequently,connectedmiscellaneouspetitionsareclosed.
09.01.2015rkIndex:Yes/NoInternet:yes/NoTo
1.TheDistrictConsumerDisputesRedressalForumThanjavur613002.
WP(MD)Nos.13993to13995and15058of2012

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