School ‘refuses refund’ after daughter’s admission cancelled, father wins Rs 36,000

The existing practice under which many institutions collect advance fee payment but refuse to refund it later should be done away with, the commission stated. (AI-generated image)

The Hyderabad District Consumer Disputes Redressal Commission has directed a school to pay Rs 36,000 to a father after he cancelled his daughter’s admission allegedly within a week of paying the fees in 2019. The commission held that refusing to refund Rs 21,000 just because the fee was “non-refundable” amounted to an unfair trade practice, especially since the cancellation was made before the academic year began and before the school rendered any services.

President Vakkanti Narasimha Rao, along with members P V T R Jawahar Babu and Suma Vala, was hearing the complaint filed by a 49-year-old man who was expecting to be shifted to Secunderabad, which did not happen, causing him to seek a refund of the admission fees paid for his daughter in a Secunderabad school.

“Fees are paid for services to be rendered by way of imparting education by the educational institutions. If there is no rendering of service, the question of payment of fee would not arise. A request for refund was made within a few days, well before commencement of the academic year in June. The school had ample time to fill up the seats which had fallen vacant,” the August 19 order read.

Sought to cancel admission within 6 days

The man approached the school on February 9, 2019, to enrol his daughter for the 2018-19 academic year. The school offered him a fee discount if he paid before February 10. He accordingly paid Rs 21,000 towards the annual fee and completed the admission formalities.

However, on February 14, he informed the school that his move to Secunderabad had been postponed, and sought cancellation of the admission and a refund. The school, however, allegedly replied that the fee once paid is not refundable, nor transferable, nor adjustable.

Aggrieved, he moved the commission seeking a refund and compensation of Rs 20,000 from the school. The man was represented by advocate G M Mohiuddin.

‘Blatant act’

The commission noted that the school did not file a written version before it. It also mentioned that the student who leaves in between or mid-session or after attending for a few days or months should be denied a refund of the fee for the remaining period, which they did not attend.

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However, the commission said that the existing practice in many institutions of collecting advance payment and not refunding it should be done away with. “Such blatant acts of the opposite parties (school) are a clear example of unfair trade practice,” it stated.

Pointing out that schools are doubly enriching themselves by admitting another candidate without refunding the fees of a student who has withdrawn admission, the commission said, “Such institutes have become commercial shops, and there cannot be any worse form of unscrupulous and unfair trade practice in the field of education.”

Accordingly, it directed the school to refund the sum of Rs 21,000 along with compensation of Rs 10,000 towards mental agony and physical trauma caused to the complainant. The commission also directed the school to pay Rs 5,000 towards costs of the litigation within 45 days.

Takeaway

The ruling highlights that a school cannot automatically retain admission fees by simply labelling them “non-refundable” when a student withdraws before classes begin, and no educational services have been provided.

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Aggrieved consumers may contact the consumer helpline in their respective states (Telangana: 0771-2582902) or call the National Consumer Helpline at 1915 for assistance.

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Richa Sahay is a Legal Correspondent for The Indian Express (Digital), where she focuses on simplifying the complexities of the Indian judicial system. A law postgraduate, she leverages her advanced legal education to bridge the gap between technical court rulings and public understanding, ensuring that readers stay informed about the rapidly evolving legal landscape. Expertise Advanced Legal Education: As a law postgraduate, Richa possesses the academic depth required to interpret intricate statutes and constitutional nuances. Her background allows her to provide more than just summaries; she offers context-driven analysis of how legal changes impact the average citizen. Specialized Beat: She operates at the intersection of law and public policy, focusing on: Judicial Updates: Providing timely reports on orders from the Supreme Court of India and various High Courts. Legal Simplification: Translating dense "legalese" into accessible, engaging narratives without sacrificing factual accuracy. Legislative Changes: Monitoring new bills, amendments, and regulatory shifts that shape Indian society. ... Read More