Sehegal School of Competition v. Dalbir Singh

Citation: III (2009) CPJ 33 (NC)

Bench: Justice J D Kapoor

This case relates to the fact that educational institutions must refund the extra-paid fee. 

Facts

• Petitioner in this case, paid lump-sum fees for two years within the first 6 months to a medical coaching centre. 
• However, the petitioner left the course mid-way on account of deficiency in the services. 
• The coaching centre refused to refund the remaining amount. 

Issues

• Whether a student can seek a refund of fees paid to a coaching center, school for the remaining period of classes that are yet to be held
• Whether in case of refusal to refund fee, a claim can be made for mental agony for pressing legal charges to be sought

Arguments

• The respondent coaching centre argued before the commission that the student had withdrawn voluntarily and, therefore, there exists no deficiency of service. 
• They also submitted the records that showed good results of the institute and alleged that it was wrong to observe that their coaching was not up to the mark. 

Decision

The State Tribunal, following the view of the apex court and the National Commission, held that no educational institution shall collect lump sum fee for the duration of the entire course and if one does, such extra fee should be returned in case the student drops out due to deficiency. It was noted that any clause in a contract contrary to this is invalid due to lack of equal bargaining power and contravention of the principles of natural justice. Further, it was mentioned that not just the balance amount of fee, but also a higher compensation for legal costs as well as the pain that the student had to undertake, could be availed in such cases.