Allowing an appeal against a district consumer redressal forum order that said educational institutions are not providing a “service”, the National Consumer Disputes Redressal Commission (NCDRC) has held that institutes charging a service tax, are indeed providing “services”.
Complainant Ajay Verma moved the apex consumer panel after a district forum dismissed a plea against FIIT JEE coaching institute, on the grounds that the coaching institute was not providing a “service”.
Directing the district forum to hear the matter again, the NCDRC held, “The counsel for the appellant [complainant] submitted that the respondent [institute] had charged service tax of ₹30,503, meaning that it had enrolled itself with the Service Tax Department and collected service tax. Thus, it was providing service and is covered under the Consumer Protection Act.”
The directions came while the apex consumer forum was hearing a plea moved against an order passed by a district forum that had dismissed the complaint against FIIT JEE coaching institute.
The plea had been dismissed by the lower forum, which stated, “Education was not a commodity and educational institutions are not providing any kind of service. So they are not covered under the Consumer Protection Act.”
The NCDRC also observed, “The argument of the appellant carry some weight. Apart from that, the main reason is that by now a difference has been drawn between educational institutions affiliated to university or which grant degree or diploma, vis-à-vis educational institutions which simply provide coaching. The latter are covered under the Consumer Protection Act.”
“For the going reasons the appeal is accepted, impugned order is set aside and the case is remanded back to District Forum to proceed in accordance with law,” the NCDRC also said.
The complainant and the institute have been asked to appear before the district forum within 30 days.