CASE BASED ON CONSUMER PROTECTION ACT

Title of the Case:

Sehgal School of Competition v Dalbir Singh

Summary of Case:
The case concerning educational institutions that dates back to
the year 2005.a student was asked to deposit lump sum fees of
₹18,734 as fees for coaching for medical entrance examinations
for the next two years.the fees was deposited by the student in
two complete installments in the first six months classes.However,
the student realised later that the quality of the coaching institute
was substandard, and therefore sought a refund for the remaining
period, which was refused by the coaching institute.

Issue:
● Can a student seek a refund of the fees paid to the
coaching classes for the remaining term of the classes that
has to be held ?
● In case of a refusal to refund fee, can a claim for mental
agony for pressing legal charges to be sought?

Decision:
It was held that violation of consumer protection act was done and
the educational institution was held responsible for the violation
and charged accordingly to the consumer protection act.
Reasoning:
● Clauses prohibiting refund of fees are unfair – The
Commission notes that educational institutes or coaching
centres that charge a lump sum fees for the whole duration
or should refund the fees if service is deficient in the quality
of coaching.
● Any clause saying that fees once paid shall not be refunded
is unfair and therefore not enforceable. This view was
maintained by District and State Forums as well as in appeal
by the National Commission.
● The respondent coaching centre argued before the
commission that the student had withdrawn voluntarily and,
therefore, there exists no deficiency of service. They
submitted 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.To justify taking the entire fees of two
years lump sum,it was stated that the conditions imposed by
the coaching required non-transferability of the seat, and
therefore no refund of the fee was possible under any
circumstance.The court dismissed this argument and further
quoted UGC guidelines that mention that even if a student
has not attended even a single class, an amount of ₹1000
may be deducted and proportionate charges for hostel fees,
etc, and the balance amount has to be refunded in its
entirety. On blocking of the seat, the Commission advised
that a reserve list of candidates may be maintained, and
waitlisted candidates may be given the opportunity to apply
for the seat.
 Additional compensation​:
● In the order by State Consumer Forum, 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.
CASE BASED ON BREACH OF CONTRACT

Title of the Case:

Badri Prasad v. State of Madhya Pradesh & Anr.

Summary of Fact:
The appellant Badri Prasad entered into a contract in respect of
certain forests and became entitled to cut teak trees with some
specifications.After a legislation vesting the estate in the State,
Badri Prasad was prohibited from cutting timber in exercise of his
rights under the contract. On Feb, 1, the State said that Badri
Prasad's claim to cut trees would be considered only if he gave
up his claim to a sum of Rs. 17,000 which he had already paid
under the contract and was willing to pay a further sum of Rs.
17,000 to the state. On February 5, 1955, Badri Prasad
expressed his willingness to pay the additional sum but reserved
his right to claim a refund of the first sum. The State rejected A’s
right to cut trees. Badri Prasad then filed a Suit claiming specific
performance of the contract.

Issue:
Whether the property was vested in the state by the Act or
transferred to the Appellant?

Decision:
Trial Court: Favoured the Appellant, Badri Prasad
High Court (MP): Allowed the appeal of the State and dismissed
the suit brought by Badri Prasad .

SUPREME COURT (favoured the State)

Reasoning:

● The forest and trees vested in the State under the Act.
● Under the contract A had not become the owner of the trees
as goods. The property in the timber could pass to A only
when the trees are felled, but before they were felled, the
trees had vested in the State.
● Under the terms of the contract, there was no sale of the
whole of the trees, and, it had to be ascertained which trees
fell within the description of trees which the appellant was
entitled to cut. Till that was done they were not ‘ascertained
goods’ within s. 19 of the Sale of Goods Act 1930.
● Even if the letter of Feb 1 could be treated as an offer, there
was no unconditional acceptance of the offer, because there
was a reservation by the appellant of his right to claim refund
in his letter dated 5th Feb and hence there was no
concluded contract.