SCOPE OF MEDICAL NEGLIGENCE AND

EDUCATIONAL INSTITUTIONS UNDER

CONSUMER PROTECTION ACT,1986

Institute of Law,
Panjab University Regional
Centre,Ludhiana

Submitted To: Submitted By :

Dr.Aditi Sharma Mantinder Jot Singh
Assistant Professor L.L.B - Ist Year (2016)
UILS,PURC,Ludhiana Roll No:30
 Preface

The development of consumer protection regime is fairly young. At the

domestic front, the consumer movement started with enactment of the
Consumer Protection Act, 1986. The Act aims to provide for better protection
of interest of the consumers and for the establishment of the quasi-judicial
authorities for the settlement of the consumer disputes. This Act has primarily
given statutory recognition to the rights of the consumers in India. However,
prior to these developments, the concern for protection of consumers‟ rights
and interests may be located under the Law of Torts which is even now
equally effective and enforceable.
In the monograph, attempt has been made to throw light on the relationship
of Law of Torts vis-à-vis Consumer Protection with special emphasis on
Medical Negligence and Educational Institutions.
SYNOPSYS

 INTRODUCTION
 Procedures under the Act
 Applicability of the Consumer Protection Act to Medical
Practitioner
 Negligent Medical Services and Consumer Protection
 Medical Profession: Whether under Consumer Protection Act?
 Informed Consent: How Significant?
 Recent Judicial Trends in Medical Negligence
EDUCATIONAL INSTITUTIONS UNDER THE SCOPE OF
CONSUMER PROTECTION ACT, 1986
---------------------------------------------------------------
POSITION IN LAW IN RESPECT OF THE VARIOUS KINDS OF
EDUCATIONAL ACTIVITIES
 Student-teacher relationship
 Provision of defective study material-
 Provision of infrastructure (misrepresentation
 Activities in respect of examination
 Activities in respect of fees
 Duty of care cases

MISREPRESENTATION BY EDUCATIONAL INSTITUTES

SUPREME COURT CASES EXCLUDING EDUCATION FROM
THE PURVIEW OF THE 1986 ACT
DECISIONS HOLDING EDUCATIONAL ACTIVITIES AS
SERVICES
CURRENT POSITION IN LAW
CONCLUSION
INTRODUCTION

Consumer law is a legal area that focuses on giving protection to the

consumer when they buy a product or service. This part of the legal system is
designed to make sure that consumers buying a product or service are
protected against issues such as fraud and miss-selling. There are various
elements of consumer law that protect consumer rights and that can be
used to help them solve a case against a retailer or sales company.

On April 9, 1985, the General Assembly of the United Nations, by Consumer

Protection Resolution No. 39/248, adopted the guidelines to provide a
framework for Governments, particularly those of developing countries, to
use in elaborating and strengthening consumer protection policies and

legislation.1 The legitimate needs which the guidelines are intended to

meet include the protection of consumers from hazards to their health and
safety and availability of effective consumer redress.

The Indian parliament enacted the Consumer Protection Act in 1986 to be

safeguard the consumer interest in compliance with these UN guidelines. By
passing such legislation the Legislature has proposed speedy solution of the
disputes of the consumer for the benefit of the people at large.

Since the enactment of Consumer Protection Act there was a lot of

confusion in the Indian judiciary as well as the medical fraternity regarding
the application of Act in cases of medical negligence. The definition of
service, consumer, as well as the medical fraternity, contained in the Act and
their relevance in the context of medical practitioner was not clear. Various
high courts also reached different conclusions.

1 SK Verma, A. Wani, SS Jaswal, A Treatise on Consumer Protection Laws, Indian Law Institute, New Delhi,
2004.
Procedures under the Act

The Act sets up a three tier structure for the redressal of consumer
grievances.District Consumer Forum, State Commission and National
Commission are the respective adjudicating bodies for medical negligence
complaints based on pecuniary jurisdiction.
Provision for appeal
An appeal against the decision of the District Forum can be filed before the
State Commission. An appeal will then go from the State Commission to the
National Commission and from the National Commission to the Supreme
Court. The time limit within which the appeal should be filed is 30 days from
the date of the decision in all cases.
Procedure for Appeal is regulated by section 15 of The Act (Any person
aggrieved by an order made by the District Forum may prefer an appeal
against such order to the State Commission within a period of thirty days
from the date of the order, in such form and manner as may be prescribed)
Section 18 of the Act deals with Procedure, applicable to State
Commissions
Section 19 deals with procedure for appeal against the decision of State
Commission, to the National Commission
Section 22 deals with procedure applicable for national Commission.

The State Commission can exercise revisional powers on grounds similar to

those contained in relation to a consumer dispute pending before or decided
by a District Forum and the National Commission has similar revisional
jurisdiction in respect of a consumer dispute pending before or decided by a
State Commission. Further, there is a provision for appeal to the Supreme
Court for an order made by the National Commission on a complaint or on
an appeal against the order of a State Commission.

Any person aggrieved by an order made by the National Commission may

appeal against such order to the Supreme Court according to section 23 of
the Act.
 Applicability of the Consumer Protection Act to Medical Practitioner

Consumer- According to Section 2(d) of the Consumer Protection Act, 1986

Consumer means any person who;
1) buys any goods for a consideration which has been paid or
promised or partly paid and partly promised or under any system
of deferred payment and includes any user of such goods other
than the person who buys such goods for consideration paid or
promised or partly paid or partly promised or under any system
of deferred payment when such use is made with the approval of
such person, but does not include a person who obtains such
goods for resale or commercial purpose or
2) (hires or avails of) any services for a consideration which has
been paid or promised or partly paid and partly promised, or
under any system of deferred payment and includes any
beneficiary of such service other than the person who (hires or
avails of) the services for consideration paid or promised, or partly
paid and partly promised or under any system of deferred payment
when such services
are availed of with the approval of the first mentioned person but
does not include a person who avails of such services for any
commercial purposes.
A consumer is a person who enters in a legal relationship with a seller or a
supplier of goods or services. It is clearly obvious that consumer has a duty
to pay consideration but it is not a matter of law which that consideration has
been paid or promised or partly paid and partly promised or under any system
of deferred payment.

As per Section 2 (d), a patient is a costumer when he goes to a medical

practitioner or hospital and pays for his treatment. He can claim
compensation if there is any deficiency in the service and suffer any
damage.

The term consideration refers to the fees paid or even promised to be paid
by the medical professional or health care institution for receiving medical
treatment.
Fees may be paid in part (advance) or in full. It may be paid by patient himself
or his relatives. Irrespective of the amount of money paid, all patients enjoy the
status of consumers under the Act and are eligible to claim compensation for
the deficiency in service.
The decision of Supreme Court of India to consider patients as consumer has
not been welcomed wholeheartedly by the medical community of India.
Various medical associations debated and disputed this point strongly, but
were left with no other option but accept the decision of the apex court. Beside
the patients, beneficiaries of a service are also considered to be consumers.
When a young child is taken to a hospital by his parents and the child is treated
by the doctor, the parent would come within the definition of consumer having
hired the services and the young child would also become a consumer under
the exclusive definition being a beneficiary of such services.2

If the parents are looking after their married daughter who is in a

vegetative state and they spend for her medical treatment, their claim for
compensation would be accepted even if the husband has not filed the

lawsuit.3

In the case of death of patient who is a consumer, legal heirs of the

deceased patient will be considered as consumer.4

Donations collected from a patient are not treated as consideration for the

professional services rendered by doctors.5

The Rajasthan SCDRC has observed that a pensioner who avail the facility of
free supply of medicines under Rajasthan State Pensioner‟s Medical
Concession Scheme, by making a monthly contributions at the rate
prescribed while in service, has hired the service in exchange for the

contributions, and is, therefore a consumer as per the Act. 6

Similarly, the beneficiary of ESI Corporation7 and CGHS8 also received the
right to sue the doctors working in ESI hospital and CGHS approved hospital
and dispensaries even if the treatment is free of cost. This is in stark
contrast to the earlier judgments wherein free treatment was considered

outside the purview of Consumer Protection Act.9

In opposite some other lawyer believe it is not contrast to the earlier
judgments because it is not free of charge but the service rendered to an
employee is on the bases of his condition of service and thus the

judgment is complied with the meaning of the Act.10

 The same in Kishore Lal v. Chairman Supreme Court held that wherever
charge for medical treatment are borne under an insurance policy , it would
be a services rendered within the ambit of Section 2(1) (0) of the Act, it
means that the services are not free of charge.

2 Harjot Ahluwalia v. Spring Meadows Hospital, II (1997) CPJ 98 (NC).

3 Rajaram S. Parab v. Dr. Kalpana Desai, 1998 (3) CPJ 398 (MUMBAI).Nirmala R. Parab v. Dr.Kalpana Desai, 1998 (3)

CPJ 66 and 1998 (3) CPJ 527( Mah. SCDRC).

4 Cosmopolitan Hospital v. Smt Vasantha P. Nair, 1 (1992)CPJ 302(NCDRC).

5 C.V. Madhusudhana v. Director, Jayadeva institute of Cardiology,II (1992) CPJ 519 (Karnataka SCRDC).

6 Treasury Office and Member Security Pensioner Medical Fund v. G. K. Joshi, I (1996) CPJ22(Rajasthan

SCDRC).

7 Kishore Lal v. Chairman, ESIC(2007) 4 SCC579.

8 Jagdish Kumar Bajpai v. Union of India, 2007 MLR 175(NC).

9 Gupta, Kiran, “The standard of care and proof in medical profession, A shift from Bolam to Bolitho”, XIV-XV National

Capital Law Journal 1(2011-2012).

10 Kumar Koley, Tapas, Medical negligence and the law in India, 2010 new Delhi, India, p151
 Negligent Medical Services and Consumer Protection

It has been observed medical profession, despite being one of the noblest
professions, is not immune to negligence which at times results in death of
the patient or complete/partial impairment of limbs, or culminates into
another misery. Thus the consumers are often found running pillar to post
to get relief for no fault of theirs. There are instances wherein most
incompetent or ill/ under-educated doctors, on their own volition, have
made prey the innocent consumers or patients. The magnitude of
negligence or deliberate conduct of the medical professionals has many a
times led to litigation. Although, needless to mention that a person engaged
in some particular profession is supposed to have the requisite knowledge
and expertise needed for the purpose and he has a duty to exercise
reasonable degree of care in the conduct of his duties. The standard of
care needed in a particular case depends on the professional skills
expected from persons belonging to a particular class. Medical profession
is considered to be the most pious profession wherein a doctor is placed
only second to almighty God b e c a u s e h e r e n d e r s h u m a n i t a r i a n
service. Though its objective is improvement of life of the people but it is
also a science of uncertainty and the art of possibility at the same time.
The chief characteristics of any profession generally would include: that
the nature of work is skilled & specialized, substantial part is mental
rather than manual; and needs a commitment to moral principles
beyond the general duty of honesty. Professionals are subject to
professional code and standards on matters of conduct and ethics,
enforced by professional regulatory authorities and they enjoy high status
and respect in the society.
Medical negligence: The apex court while considering the question of medical
negligence in context of treatment of patient observed that “negligence has
many manifestations—it may be active negligence, collateral negligence,
comparative negligence, concurrent negligence, continued negligence, criminal
negligence, gross negligence, hazardous negligence, active and passive
negligence, willful or reckless negligence or negligence per se.”11

11 Poonam Verma v. Ashwin Patel, (1996) 4 SCC 332 at p. 348, para 42.
Doctors generally have certain duties towards their patients. Some of
the important duties include:
(i) to exercise a reasonable degree of skill and knowledge and a
reasonable degree of care
(ii) to exercise reasonable care in deciding, whether to undertake the
case and also in deciding what treatment to give and how to
administer that treatment;
(iii) to extend his service with due expertise for protecting the life of
the patient and to stabilize his condition in emergency situations;
(iv) to attend to his patient when required and not to withdraw his
services without giving him sufficient notice;
(v) to study the symptoms and complaints of the patient carefully and to
administer standard treatment;
(vi) to carry out necessary investigations through appropriate laboratory
tests wherever required to arrive at a proper diagnosis;
(vii) to advise and assist the patient to get a second opinion and call a
specialist if necessary;
(viii) to obtain informed consent from the patient for procedures with
inherent risks to life;
(ix) to take appropriate precautionary measures before administering
injections and medicines and to meet emergency situations;
(x) to inform the patient or his relatives the relevant facts about his
illness;
(xi) to keep secret the confidential information received from the patient in
the course of his professional engagement; and
(xii) To notify the appropriate authorities of dangerous and communicable
diseases.

A professional may be held liable for negligence on one of the two

findings: one, either he was not possessed of the requisite skill which he
professed to have; or two, that he did not exercise, with reasonable

competence in a given case, the skill which he did profess.12

12 Jacob Mathew v. State of Punjab (2005) 6 SCC 1

Reasonable Degree of Care
In order to ascertain whether a reasonable degree of care has been taken or
not by the doctor and accordingly hold him liable would largely depend upon
the following considerations:

 That whether the degree of care and competence which an ordinary

competent member of the profession who professes to have those
skills would exercise in the circumstances in question have been
exercised or not, that is to say the concept of reasonable man becomes
relevant here;
 That the standard of care is constant while the degree of care is
variable, i.e. the same standard of care is expected from a generalist
and a specialist; but the degree of care would be different.
 The doctor would be guilty of negligence when he falls short of the
standard of a reasonably skillful medical man.
 The law will condemn the doctor when he falls short of the accepted
standards of a great profession.
 Generally a doctor is not guilty of negligence if he acted in accordance
with the practice accepted as proper by a responsible body of medical
men skilled in that particular art.13 A man need not possess the
highest skill; it is sufficient if he exercises the ordinary competent
man exercising that particular art. In the case of a medical
professional,
negligence means failure to act in accordance with the standards of
competent reasonable man at the time. There may be one or more
perfectly proper standards, and if it conforms with one of those proper
standards then he is not negligent.

Thus a surgeon or a doctor will be judged by the standard of an average

practitioner of class to which he belongs or holds himself out to belong.

However, in case of a specialist, a higher degree of skill is needed.14

13 Bolam v. Friern Hospital Management Committee (1957) 1 WLR 582

14 Dr. P Narasimha Rao v. G Jayaprakasu, AIR 1980 AP 207AP 207
Medical Profession: Whether under Consumer Protection Act?

15
In Indian Medical Association v. V.P. Shantha and Ors. , the apex court
has held that patients aggrieved by any deficiency in treatment, from both
private clinics and Government hospitals, are entitled to seek damages under
the Consumer Protection Act, 1986. A few important principles laid down in
this case include:

 Service rendered to a patient by a medical practitioner (except where

the doctor renders service free of charge to every patient or under a
contract of personal service) by way of consultation, diagnosis and
treatment, both medicinal and surgical, would fall within the ambit of
“service” as defined in section 2(1) (o) of the C.P. Act.
 The fact that medical practitioners belong to medical profession and
are subject to disciplinary control of the Medical Council of India and,
or the State Medical Councils would not exclude the service rendered
by them from the ambit of C.P. Act.
 The service rendered by a doctor was under a contract for personal
service rather than a contract of personal service and was not
covered by the exclusionary clause of the definition of service
contained in the C.P.Act.
 A service rendered free of charge to everybody would not be service
as defined in the Act.
 The hospitals and doctors cannot claim it to be a free service if the
expenses have been borne by an insurance company under medical
care or by one‟s employer under the service conditions.
From the above judgment two things are clear: one that medical service is a
service within the ambit of the C.P. Act; and two that services rendered free of
charge are excluded from the purview of the C.P. Act.

15 AIR 1996 SC 550 ; the apex court has laid down 12 important principles stating the law with definite terms in this
case.
Informed Consent: How Significant?

At times, the patient may be required to undergo surgery or other

investigations wherein his consent would be expressly needed.
Under the doctrine of informed consent, no medical procedure may be
undertaken without patient's consent, obtained after the patient has been
provided with sufficient information to evaluate the risks and benefits of the
proposed treatment and other available options. It may be further noted
that the doctor who performs a medical procedure without having first
furnished the patient with the information needed to obtain an informed
consent will have infringed the patient‟s right to control the course of his/her
medical care, and will be liable in battery even though the procedure was

performed with a high degree of skill and actually benefited the patient.16

In M. Chinnaiyan v. Sri Gokulam Hospital & Anr.17,the complainant

approached to the defendant hospital with abdominal pain and was advised
to undergo hysterectomy for which the consent was obtained from the
complainant. However, the complainant suffered from bleeding of uterus as
a result two units of blood was transfused after the operation. The blood
units, so transfused, were not tested for contamination. The patient suffered
with HIV-AIDS after three and a half year of the transfusion and died. The
hospital was held liable. It was noted that the consent of the patient was
required for transfusion of blood. It was clear from the records that the
complainant had given consent only for hysterectomy operation and not
for transfusion of blood.

In Dr. Sathy M Pillai & Anr. v. S. Sharma & Anr 18;It was held that, where
informed consent is taken on the printed form without any specific mention
about the name of the surgery, or signatures are taken from patient/relative
in mechanical fashion, much in advance of the date scheduled for surgery,
such forms cannot be considered as informed consent.

16 See, Malette v. Shulman, 72 OR (2d) 417 in Ontario Court of Appeal

17 III (2007) CPJ 228 (NC)
18 IV (2007) CPJ 131 (NC)
However, there are certain exceptions to the requirement of informed consent.
These are discussed below:

Therapeutic Privilege: A doctor can invoke protection of therapeutic privilege

for non-disclosure in non- elective treatment, i.e. one that is essential from a
therapeutic point of view, where there is no choice to the patient but to opt for
it, in such cases, if the doctor believes on a reasonable assessment of the
patient's condition that the disclosure will be detrimental to the patient's
health, the doctor may exercise this privilege. However, it cannot be extended
to an elective treatment or a non-life threatening treatment like sterilization
operation i.e. one that a patient is free to choose.

Emergency: In circumstances of great urgency warranting immediate

treatment to save the life of a patient and there is no time to disclose the risks,
the nature of proposed treatment and alternative methods of treatment and as
such the doctor can withhold the information with immunity from liability.

Waiver: A patient may repose his confidence on a doctor and request him not
to disclose any information to him, in which case the doctor may get a

privilege of withholding information.19

The informed consent, even though mandatory legal necessity, is either

expressly not taken or if taken, it is through a mechanical process, i.e.
without informing the patient or his relatives about its necessity and even
at times consent taken for different purposes and different treatment/tests
are conducted making person of an individual a laboratory.

19 M.K. Balachandran, Consumer Protection Act and Medical Profession, Department of Consumer Affairs, Govt of
India in association with I.I.P.A., New Delhi, 2006, reprint 2008, p. 28.
Recent Judicial Trends in Medical Negligence

Indian Medical Association v. V.P. Shantha is considered to be the

landmark judgment as it has not only widened the ambit of the Consumer
Protection Act by stating that the Medical practitioners are not immune from a
claim for damages on the ground of negligence but also have issued several
directions of immense significance for ensuring welfare of the consumers.

In A.S.Mittal v. State of UP,20 an irreparable damage was done to the eyes

of some of the patients who were operated at an eye camp organized by
the government of Uttar Pradesh. Some of the patients who underwent
surgery could never see the light of the day, i.e. whatever little vision they
had even that was lost.
The apex court coming heavily on the erring doctors held that, “the law
recognizes the dangers which are inherent in surgical operations and that will
occur on occasions despite the exercise of reasonable skill and care but a
mistake by a medical practitioner which no reasonably competent and a
careful practitioner would have committed is a negligent one.” The
compensation was awarded.
Most important contribution of this decision is that even though service
rendered free of charge does not come under the purview of the Consumer
Protection Act yet the court went a step ahead in recognizing that although
no direct charges were paid by the patients but the State had paid on behalf
of the patients to the doctors engaged in the free eye camp.

20 AIR 1989 SC 1570

In Achutrao Hari Bhau Khodwa v. State of Maharashtra21, it was alleged
that a mop was left in the body of the patient which resulted in the
formation of pus and eventually leading to her death. The court held that the
doctrine of res ipsa loquitor is clearly applicable and the State is liable to pay
compensation for the negligence of the doctors.

In Poonam Verma v. Ashwin Patel22,- a doctor who was registered as a

medical practitioner and was entitled to practice in homoeopathy was found
to be guilty of negligence for prescribing allopathic medicines resulting in
the death of the patient. The doctor was grossly negligent and in clear
breach of duty as a doctor. He defied all sense of logic and forgot his ethics.

In certain cases, it is seen that the complainants have requested the relief
which is not given under the Consumer Protection Act, 1986. In such cases,
the courts/forums have refrained to award remedies so claimed.

Parmod Grover & Ors. v. Manvinder Kaur (Dr.) & Ors.,23, complications
during pregnancy resulted in death of the patient. The complainant alleged
medical negligence and claimed relief in the form of permanently restraining
and debarring Opposite Parties from practicing medical profession and
cancellation of their medical certificates. The relief was denied to the
complainant as, according to the court, it cannot be granted under section 14
of the Consumer Protection Act, 1986. Similarly direction regarding closure of
OP nursing home was also not allowed under section 14 of CPA with a
direction that the complainant is at liberty to approach civil court.

21 [1996] 2 SCR 881. 2. 2.

22 (1996) 4 SCC 322
23 II (2007) CPJ 63 (NC)
In one of the most recent decision in Kusum Sharma v. Batra Hospital24, the
Hon‟ble Supreme Court has settled the law relating medical negligence.
According to the court, „while deciding whether the medical professional is
guilty of medical negligence "the following well-known principles must be kept
in view:

 Negligence is the breach of a duty exercised by omission to do

something which a reasonable man, guided by those considerations
which ordinarily regulate the conduct of human affairs, would do, or
doing something which a prudent and reasonable man would not do.
 Negligence is an essential ingredient of the offence. The negligence to
be established by prosecution must be culpable or gross and not the
negligence based upon the error of judgment.
 The medical professional is expected to bring a reasonable degree of
skill and knowledge and must exercise a reasonable degree of care.
Neither very highest nor a very low degree of care and competence
judged in the light of the particular circumstances of each case is what
the law requires.
 A medical practitioner would be liable only where his conduct fell below
that of the standards of a reasonably competent practitioner in his field.
 In the realm of diagnosis and treatment there is scope for genuine
difference of opinion and one professional doctor is clearly not
negligent merely because his conclusion differs from that of the other
professional doctor.
 The medical professional is often called upon to adopt a procedure
which involves higher element of risk, but which he honestly believes
as providing greater chances of success for the patient rather than a
procedure involving lesser risk but higher chances of failure. Just
because a professional looking to the gravity of illness has taken higher
element of risk to redeem the patient out of his/her suffering which did
not yield the desired result may not amount to negligence.
 Negligence cannot be attributed to a doctor so long as he performs his
duties with reasonable skill and competence. Merely because the
doctor chooses one course of action in preference to the other one
available, he would not be liable if the course of action chosen by him
was acceptable to the medical profession.
 It would not be conducive to the efficiency of the medical profession if
no doctor could administer medicine without a halter round his neck.
 It is our bounden duty and obligation of the civil society to ensure that
medical professionals are not unnecessarily harassed or humiliated so
that they can perform their professional duties without fear and
apprehension.

24 (2010) 3 SCC 480

  The medical practitioners at times have to be saved from such a class of
complainants which use criminal process as a tool for pressurizing the medical
professionals/hospitals, particularly private hospitals or clinics for extracting
uncalled for compensation. Such malicious proceedings deserve to be
discarded against the medical practitioners.
 The medical professionals are entitled to get protection so long as they perform
their duties with reasonable skill and competence and in the interest of the
patients. The interest and welfare of the patients have to be paramount for the
medical professionals.

It may be noted that any decision, judgment passed by the Supreme Court becomes
law of the land and is automatically binding on all other lower courts in the country by

virtue of Article 141 of the Constitution of India.25 Thus the above principles must be
taken as "law of the land on medical negligence‟. The decision is progressive in nature
as it provides a safety net to the medical professionals against unnecessary
harassment and humiliation which will allow them to perform their duties without
fear and apprehensions and would save them from undue pressure for extracting
uncalled for compensation. Ultimately the doctors are not the insurers of life. Error in
judgment in prescribing treatment so long as it is within the prescribed medical
standards should not incur unnecessary liability to the doctor/hospital.
This decision would benefit both the parties, i.e. the doctors/hospitals shall not be put to
unnecessary harassment and at the same time any casual, careless or negligent
performance of professional duty on their part shall definitely hold them liable in
negligence. The judgment is likely to ensure welfare of consumers.

25Article 141 reads: “Law declared by the Supreme Court shall be binding on all courts within the territory of
India”.
 EDUCATIONAL INSTITUTIONS UNDER THE SCOPE OF CONSUMER PROTECTION
ACT, 1986

The education sector is one of the largest and most important sector of the Indian
economy. Nevertheless, it continues to be in a deplorable state, plagued with multiple
shortcomings in various respects,5 and despite being one of the largest education
sectors in the world,6 it is also one of the most problem riddled ones.
In the last decade imparting education has become just another business rather than
service to the society. To be cheated and lose hard earned money is one thing but
more important fact is that the future of many students is at stake.
The scope of CPA in respect of the educational institutions is one of the most
obfuscated, controversial areas of Indian consumer law; with a catena of conflicting
decisions, which have left it fraught with impenetrable turbidity. Things took a turn when
the Supreme Court of India stepped into the fray and over the course of three of its
decisions gradually ousted educational institutes and educational activities performed
by them, from the ambit of the 1986 Act, with its last order to date – P.T. Koshy v. Ellen
Charitable Trust1 (‘P.T. Koshy’), ostensibly excluding education altogether from the
purview of the 1986 Act.
The c a u s e of the confusion or ambiguity around the classification of educational
activities as ‘services’ under the 1986 Act is the lack of a clear and precisely
demarcated definition of ‘educational activities’.
The closest attempt at defining and categorizing educational ac- tivities was made by
the National Consumer Dispute Redressal Commission (‘NCDRC’) in Maharshi
Dayanand University v. Ruchika Jain,2 where it divided educational activities into
two kinds:

First, those performed in the discharge of statutory duties, such as laying down rules
and regulations for conducting examinations, eligibility criteria for permitting students to
take the examination, the evaluation of the answer scripts and declaration of results etc.
Second, activities other than those performed in discharge of statutory duties, such as
the provision of admission, recovery of fees etc.

1 P.T. Koshy v. Ellen Charitable Trust, (2012) 3 CPC 615 (SC).

2 Maharshi Dayanand University v. Surjeet Kaur, (2010) 11 SCC 159.
POSITION IN LAW IN RESPECT OF THE VARIOUS KINDS OF EDUCATIONAL
ACTIVITIES
1. Student-teacher relationship- The issues of whether the relationship between a
teacher and a student in educational institutes was within the purview of the 1986
Act; arose for adjudication in three cases:-

In N. Taneja case3,- The Court held that the relationship between teachers and students
in an educational institute is not one of service-provider and consumer, as the position of
students in such a relationship is not akin to that of a buyer of commercial or
marketable goods; further, that there was no transfer of property from a teacher to a
student through the impartation of education, which precluded teachers from being
regarded as sellers; that education, not being expressly enumerated in the inclusionary
part of the definition of service, and further, being of a vocational or religious nature, as
against a trade-oriented activity, it was not classifiable as service as defined in the 1986
Act.
In Gorav Kumar4, the Rajasthan State Commission held, by a majority, that neither did
the activities performed by a teacher in respect of students constitute service, as
teaching could not be equated to the rendition of a marketable service, nor could the
students in respect of whom such activities were performed, be regarded as
consumers, as they were not the buyers of any economic goods; education not being a
commercial activity.
In Oza Nirav Kanubhai5, the National Commission held that the private educational
institute rendered service, and was a provider of services, for the purpose of the 1986
Act, and that the aggrieved complainant was a consumer thereunder.

The National Commission held that the institution, not being statutorily established, the
relationship between itself and the student was purely contractual, that therefore,
activities performed by it respecting the student were classifiable as service as defined
in the 1986 Act.

On one hand, N. Taneja and Gorav Kumar expressly held that the relationship between
the teacher and student or for that matter, a university and a student cannot be
regarded as constituting a relationship of a service- provider and consumer. On the
other hand, Oza Nirav Kanubhai held private educational institutes (to be classifiable
as service providers, and students enrolled therein, or their sponsors, as consumers.
The decision in Oza Nirav Kanubhai restricted the exemption granted to educational
institutes, and educational activities performed by them, from subjection to the 1986
Act.The distinction drawn by Oza Nirav Kanubhai thus is consistent with the judicial
approach in exempting only statutorily established institutes, and not every institute,
from the purview of the 1986 Act.

3 N. Taneja v. Calcutta District Forum, 1991 SCC OnLine Cal 241 : AIR 1992 Cal 95
4 Central Academy Educational Society v. Gorav Kumar, (1996) 3 CPJ 230.
5 Oza Nirav Kanubhai v. Centre Head Apple Industries Ltd., (1992) 1 CPR 736.
2. Provision of defective study material-
In Jai Kumar Mittal v. Brilliant Tutorials,6 the NCDRC held that the supply of
defective study materials by an institute can sustain a valid claim against it for
deficiency of service. There has not been another decision on the same matter since,
and it is safe to assume that educational institutes are susceptible to claims of deficient
service, in respect of providing defective or erroneous study materials.
3. Provision of infrastructure (misrepresentation)
In Bhupesh Khurana v. Vishwa Budha Parishad7 the issue before the National
Commission was whether students, who had been defrauded by a sham university into
joining it, were entitled to a refund of fees remitted thereof.

In this case, the opposite party ran a sham college, which solicited applications through
advertisements, which averred the college to be affiliated to Magadha University, and
accorded recognition by both the Dental Council of India and the Bodh Gaya Dental
Council, despite such affiliation and recognition, respectively having been expressly
denied to it.
The National Commission held, in respect of the recovery of the fees paid to the
institute, that the institute was liable to refund the fees, having lured the students to
enroll in it through deceit- ful tactics, and further imposed punitive damages. On appeal
(by the institute), the Supreme Court held in Buddhist Mission Dental College and
Hospital
v. Bhupesh Khurana,8 affirming the decision of the National Commission, that
educational institutes can be said to provide services for consideration, where they
charge fees, and therefore that they are liable to compensate the students for having
scammed them.

4. Activities in respect of examination- Courts and forums have been tasked whether
activities of educational institutes in connection with exams comprises as services
under the 1986 Act.The judicial answer to the aforementioned question has predomi-
nantly been in the negative. The NCDRC has consistently held that boards of
examinations, in the discharge of the aforementioned activities, did not ren- der any
service for hire; that the discharge of such activities being statutorily required, such
activities were not amenable to the 1986 Act. In University of Karnataka v. Poonam
9
G. Bhandari, the National Commission observed:

“We are clearly of the view that in carrying out its statutory function of
conducting the examination, evaluating answer papers, publishing the results
of candidate, the University was not performing any service for consideration
and a can- didate who appeared for the examination cannot be regarded as a
person who had hired or availed of the services of the university for
consideration.”

6 Jai Kumar Mittal v. Brilliant Tutorials, 2005 SCC OnLine NCDRC 23 : (2005) 4 CPJ 156 (NC): (2006) 1 UC 43.
7 Bhupesh Khurana v. Vishwa Budha Parishad, (2001) 2 CPJ 74 (NC)
8 Budhist Mission Dental College and Hospital (2) v. Bhupesh Khurana, (2009) 4 SCC 473, 12, 13.
9 University of Karnataka v. Poonam G.. Bhandari, FA No. 245 of 1992, decided on 16-9-1993.
Likewise, in R.C. Sharma v. Jage Ram,10 the National Commission held that the two
year delay on part of the Central Board of Secondary Education, in declaring
examination results of the complainant’s son, did not amount to deficiency of service,
on the aforementioned grounds.

On the other hand, in Himachal Pradesh University v. Sanjay Kumar,11 the NCDRC
held that the failure (due to negligence) on part of the University to allot the roll number to
a candidate, in time, so as to enable him to participate in the exam, which failure
caused him to be disallowed from participating in the exam and consequently lose a
year, amounted to deficiency of service.
5. Activities in respect of fees

The view, which has consistently been expressed by the consumer commissions at all
tiers, is that the fees remitted by a student, ought to be refunded by the institute, if the
student unrolls from it – where the vacancy created by such un enrollment is
subsequently filled by the institute, but not otherwise.
In Birla Institute of Technology & Science v. Abhishek Mengi12 (‘Birla Institute of
Technology’), the National Commission was tasked with the determination, of whether
the retention by the opposite party university of the fees remitted by a person, even
after having withdrawn from the university, having secured admission in another
institute, and consequent refusal to refund more than a small part of such fees, upon the
request of such person, amounted to deficient service for the purpose of the 1986 Act.
Holding that it did, the National Commission observed, regarding the patent
unreasonableness of policies which entitled institutes to cause to be forfeited, fees
remitted to them by students, either in part of in full:

“In our view, the service provider cannot forfeit the fees (in full or in part)
for the services, which it has neither provided, nor the student has
received such services and as such, the forfeiture of such fees is not only
a deficiency in service but also an unfair trade practice and if there is
any such term of the contract to the contrary the same is surely an
uncon- scionable contract and therefore, void and not binding on the
complainant.”

Provision of infrastructure

In Swami Parmanand Para-Medical & GNM School of Nursing

v. Pardeep Kaur,13 the State Commission was tasked with the determination of
whether the refusal of the opposite party institute to refund the fees when the
complainant, dissatisfied with the quality of the accommodation and food provided to
her by the institute, did not wish to remain a residential student, and instead become a
day student, and sought a refund, constituted deficient service. The State Commission
held that complaints, in respect of the quality of accommodation and food provided by
the institute, or fees remitted, are not within the purview of the 1986 Act, and therefore
that the institute was not liable for deficient service.

10 R.C. Sharma v. Jage Ram, (2003) 1 CPJ 248 (NC).

11 Himachal Pradesh University v. Sanjay Kumar, (2003) 1 CPJ 273 (NC).
12 Birla Institute of Technology & Science v. Abhishek Mengi, 2013 SCC OnLine NCDRC 394 : (2013) 2 CPJ 681 (NC).
13 Swami Parmanand Para-Medical & GNM School of Nursing v. Pardeep Kaur, FA No. 1765 of 2009, decided on 24-1-2014.
 6. Duty of care cases

In Madan Lal Arora v. Mahashya Chuni Lal Saraswati Bal Mandir Senior Secondary
School14 (‘Madan Lal Arora’), the issue which arose before the National Commission
was whether the omission of the teachers of the school to personally accompany a
student, or otherwise ensure his safety, while he took a bath in the river during the
school excursion, where the student ended up slipping into the river and drowning, and
the subsequent failure in promptly initiating rescue efforts amounted to deficient
service, on part of the school, on grounds of being a breach of duty to care, of the
teachers, especially since the student had signed an undertaking, absolving the
school of responsibility, in respect of the materialization of unforeseen accidents or
injuries. The National Commission held that the aforementioned omissions constituted
deficient service on part of the school.
However, this case must be contrasted with that of Fakhre Alam v. Amity Business
School15 (‘Fakhre Alam’), where the opposite party university was not held liable for
deficient service, in respect of a fact situation which was almost identical to that of
Madan Lal Arora, the dif- ference however, being the age of the deceased – the
deceased in Fakhre Alam, was a major, and in Madan Lal Arora, a minor.
In Fakhre Alam, the issue arisen was whether the conduct of the faculty of the opposite
party university, in permitting students (who were adults) to go to the beach as part of
their trip/excursion, without accompanying them or otherwise ensuring their
safety,where the students ultimately drowned at sea, constituted deficient service on
part of the university, on grounds of being a breach of duty to care, of the teachers. The
National Commission held that there was no such duty of care on part of the teachers, in
respect of adult students, and that it was unreasonable to expect them to accompany
the students to the beach or otherwise ensure their safety by arranging for life-guards
etc.

14 Madan Lal Arora v. Mahashya Chuni Lal Saraswati Bal Mandir Senior Secondary School, 2013
SCC OnLine NCDRC 363 : (2013) 2 CPJ 450 (NC).
15 Fakhre Alam v. Amity Business School, 2015 SCC OnLine NCDRC 1839.
MISREPRESENTATION BY EDUCATIONAL INSTITUTES
Valid claims against educational institutes can lie in respect of misrepresentations
made by them, which induced and occasioned the enrolment of the student in the
university, and subsequently the remission of fees by such student. While these cases
do not come under the banner of ‘educational activities’, they do constitute an important
chunk of the cases relating to educational institutes, which arise for adjudication before
courts and consumer forums.

In Mukesh Gupta v. Kiran Thakur,16 the issue which arose before the National
Commission was, whether the false representation of the opposite party institute
regarding affilliation amounted to deficient service, and whether therefore, fees
remitted by students, who had in reliance of such false representation, joined the
course, was refundable to them. The National Commission held that the
misrepresentation of the opposite party institute amounted to deficient service under the
1986 Act.
In Dr. Alexander Educational Foundation v. B. Chandrasekaran,17 The State
Commission of Pondicherry held that the misrepresentation by the opposite party
constituted deficient service, and further,rejecting the contention that activities of an
institute are not within the purview of the 1986 Act,that the fact of admitting students in
exchange for monetary consideration constituted service, in respect of the performance
of which an action could be maintained under the 1986 Act.

The position in this regard, therefore, has consistently been that educational institutes
shall be liable for deficient service for inducement of en- rolment as well as remission
of fees through misrepresentation as to affilia- tions, accreditations and recognitions
that they may have.

16 Mukesh Gupta v. Kiran Thakur, 2010 SCC OnLine NCDRC 218 : (2010) 3 CPJ 400 (NC).
17 Dr. Alexander Educational Foundation v. B. Chandrasekaran, 1994 Indlaw SCDRC 12329.
 SUPREME COURT CASES EXCLUDING EDUCATION FROM THE
PURVIEW OF THE 1986 ACT

Up until 2009, the Supreme Court did not tackle the issue of whether educational
institutes and the educational activities they performed were amenable to the
provisions of the 1986 Act. It, however, over the course of three of its decisions, namely,
Bihar School Examination Board, Surjeet Kaur and P.T. Koshy, started the trend of
excluding from the purview of the 1986 Act, educational institutes and educational
activities performed by them, with P.T. Koshy ostensibly excluding education from the
purview of the Act altogether. All three of these decisions shall be detailed in this
section.

A. BIHAR SCHOOL EXAMINATION BOARD V. SURESH PR ASAD SINHA18

The issue which arose for adjudication in this case was whether the incorrect
issuance, by the Bihar Board of Secondary Education, of identical roll numbers to three
different candidates, in respect of the Board Examination, and subsequent failure in
declaring the results of one of the candidates, amounted to deficient service. The
Supreme Court held, first, that the 1986 Act was not applicable in respect of the
discharge of statutory functions by statutory bodies, that the Board, being a statutory
body, did not, in conducting and administering exams, evaluating the answer scripts
thereof, and publishing results subsequent to such evaluation, all of which were done
in discharge of its statutory functions did not provide services for hire; second, that the
fees paid or payable for the performance by the board, of its examina- tion related
activities did not constitute consideration, that it was merely the charge to be paid for
the privilege of writing the examination and therefore; third, that students, who
participate in examinations cannot be regarded as consumers. In support of the first
holding, the Court observed that the 1986 Act did not contemplate as being within its
ambit, the discharge, by statutorily established bodies, of their statutory functions, and
to this end, it interpreted Lucknow Development Authority, very restrictively, holding it to
be applicable only to fact situations, which involve services relating to housing
constructions.

B. MAHARSHI DAYANAND UNIVERSITY V. SURJEET K AUR19

Maharshi Dayanand University v. Surjeet Kaur (‘Surjeet Kaur’) was the second of the
three cases whereby the Supreme Court excluded educational activities from the
purview of the 1986 Act. In that case, a student had enrolled in two courses
simultaneously, one full time course and one correspondence course. Such enrolment
being in contravention of the rules, the university directed her to unroll from one of the
courses, pursuant to which she unrolled from the correspondence course. However,
she participated in the supplementary exam in respect of the correspondence course,
despite having cancelled her enrolment therein, and passed it. However, her having
taken the exam for the correspondence being in contravention of the university rules,
the university refused to confer the degree on her.

18 Bihar School Examination Board v. Suresh Prasad Sinha, (2009) 8 SCC 483.
19 Maharshi Dayanand University v. Surjeet Kaur, (2010) 11 SCC 159.
One of the issues, which arose before the Court in Surjeet Kaur, was whether in
conducting examinations, universities rendered a service in respect of the rendition of
which a complaint under the 1986 Act was maintainable. The Supreme Court held,
following Bihar School Examination Board, that Universities, to the extent that they are
statutorily established, did not, by performing examination related activities, perform
any service.

Surjeet Kaur, therefore, ostensibly expanded the ratio of Bihar School Examination
Board, holding not only activities in respect of board examinations, but examinations
by every statutorily established institute, to be beyond the purview of the 1986 Act.
However, it is merely a reiteration of the stance, which had been adopted by the
National Commission, in its earlier decisions.

C. P.T. KOSHY V. ELLEN CHARITABLE TRUST20

P.T. Koshy was the third and last occasion that the Supreme Court dealt with the issue
of whether educational activities were within the pur- view of the 1986 Act. Rejecting
the special leave petition from the National Commission, the Supreme Court held, in a
brief order that educational insti- tutes do not, through the performance of educational
activities, render any ser- vice, in respect of which a complaint of deficiency could be
maintained, and that consumer forums did not have the jurisdiction to adjudicate
them.21

Its brevity and ostensible simplicity are deceptive: P.T. Koshy is highly problematic – in
as much as its import and ratio are hard to decipher con- clusively. On one hand, it
purports to merely follow Surjeet Kaur, which was the sole decision it cited to support its
holding, but on the other, it holds educa- tional institutes in general, sans any
qualification as to the mode of origination thereof, which qualification was implicit in
Surjeet Kaur, (which held services rendered by only by statutorily established
institutes, and not all educational institutes, to be outside the purview of the 1986 Act).
There is thus, a conflict between the express phraseology of the order, and the ratio of
the decision it purports to follow without substantively altering, which makes the
discernment of its scope highly problematic. P.T. Koshy can be interpreted in two ways:
first, in an expansive manner – that it places a blanket embargo in respect of the clas-
sifiability of educational activities of every kind as services, as defined in the 1986 Act,
thereby taking them as well as the educational institutes that render them, completely
beyond the purview of the Act, second, in a limited manner
– in that it excludes from the purview of the 1986 Act, only the educational ac- tivities of
statutorily established educational institutes, and not non-statutorily established
institutes. The expansive interpretation is supported by the express phraseology of the
order, while the limited interpretation is consonant with the ratio of Surjeet Kaur. Some
insight, as to which interpretation is correct, can be gleaned from a perusal of
subsequent treatment of P.T. Koshy, by other judicial authorities, which perusal shall be
undertaken in the next section of this essay.

19 Maharshi Dayanand University v. Surjeet Kaur, (2010) 11 SCC 159.

20 P.T. Koshy v. Ellen Charitable Trust, (2012) 3 CPC 615 (SC).
21 Id.
 DECISIONS HOLDING EDUCATIONAL ACTIVITIES AS SERVICES

In Frankfinn Institute of Air Hostess Training v. Ashwini G.,22 the failure by

the institute to provide the thirty-hour in-flight training to the complainant,
which constituted an essential part of the curriculum of airhostess training of
the institute, amounted to deficiency of service. It was contended by the
institute, that disputes having arisen between the institute and the owner of
the airbus, it had become impossible for the institute to provide the in-flight
training, and further that the institute had in the subsequent year, offered to,
at its own expense, provide the same to the complainant, which offer had
not been responded to, by the complainant, and therefore, that it could not be
held liable for deficient service. The National Commission held, rejecting those
contentions, that the failure to provide the requisite training to the complainant
in the year of her enrolment constituted deficiency of service, notwithstanding
the circumstances which had precluded the provision of such training.

CURRENT POSITION IN LAW

The current position in law therefore in respect of the classification of

educational activities, which are performed by educational institutes as
service under the 1986 Act, post P.T. Koshy, is that the educational activities
performed by statutorily established bodies (including boards of examination,
universities and other educational institutes), do not amount to service, and
are thus outside the scope of the 1986 Act.
The position in respect of activities rendered by private institutes is yet
unclear, with some precedents holding them to be also excluded, as in the
case of statutory bodies, from the purview of the Act, while others without
directly mentioning P.T. Koshy, continue to hold educational activities
performed by private institutes as constituting service under the Act.

CONCLUSION: - Medical Negligence

The journey of the law relating medical negligence has not been smooth.
Initially Indian Medical Association argued that the composition of the
consumer forum is not appropriate for trial of medical negligence cases.
However rejecting this contention, the Supreme Court observed that the
members of consumer forum are very well versed with law and are well
qualified to decide a medical negligence lawsuit, even if it is a complex
nature. The medical negligence issues are often complex and for them
civil courts may be more appropriate forum. However, consumer forums
must scrutinize the evidence produced before them and decide cases
accordingly.

22 Frankfinn Institute of Air Hostess Training v. Ashwini G., 2009 SCC OnLine NCDRC 79.
Doctor being persons of medical profession cannot be immune from duty of
every citizen to help for justice. No one is above law and justice and it is
duty of doctors to come before summoning authority and give their
contribution without thinking it as wastage of time. Rather they should be
model citizens before all.Loss of eyesight due to medical negligence violates
right to Life and Livelihood of patient. Every patient should be entitled to
right against medical negligence and must have right to adequate
compensation for proven medical negligence. E a r l i e r i n India the High
Courts had different versions regarding whether medical profession falls within
the ambit of Consumer protection Act, recent decision of Indian Supreme
court in Indian Medical Association v. V.P. Shantha and Othersheld that
medical services provided by all private hospitals and health centers
except government hospitals are “contract for service” and fall within the
ambit of CP Act.

CONCLUSION: - Educational Institutions

The exclusion of educational institutes and educational activities from the

ambit of the 1986 Act is flagrantly in contravention to the very purpose, for the
securement and actualization of which, the 1986 Act was promulgated in the
first place,which is, to implement a protectionary framework to safeguard the
interest of consumers as a class, from acts and omissions stemming from
negligence, unscrupulous practices etc. of entities which cater to the needs
and desires of consumers.
The avowed objective of the 1986 Act is to provide cheap, speedy and
efficacious remedies to the consumers, through the effectuation of an in-
formal, extra-judicial hierarchy of quasi-courts, which follow a summary trial
procedure, as against the protracted procedural requirements entailed by
the Code of Civil Procedure, 1908 which are followed by the conventional
courts of civil judicature. The Consumer Disputes Redressal Commissions
have dis- pensed with the procedural formalities and stringencies entailed by
proceedings in conventional courts of civil ad judicature, in order to dispose
of complaints swiftly.
It makes no sense to force the consumer to resort to the highly tedious and
expensive conventional litigation,for petty issues like payment of fees or failure
to correct clerical mistakes, in respect to which the cost of litigation in
conventional courts would far exceed the claim by itself.
To preclude these claims would be to effectively disincentives consumers,
with legitimate complaints from seeking redressal, which they would not
attempt to seek, were they to be forced to resort to conventional courts to
secure the same, which is already overburdened with the pendency of a
catena of undecided cases.
 References
(i) Statutes
 The Constitution of India
 The Consumer Protection Act, 1986
 The Medical Council Act, 1956
(ii) Books

 R.K. Bangia, “Law of Torts”, Allahabad Law Agency, 6th Edn,

Reprint 2011.

 A. Laxminath and M Sridhar, Ramaswamy Iyer‟s The Law of Torts,

LexisNexis Butterworths, Ninth Editionn, 2003.

 M.K. Balachandran, Consumer Protection Act and Medical Profession,

Department of Consumer Affairs, Govt. of India in association with
I.I.P.A., New Delhi, 2006, Reprint 2008.

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http://www.consumer-voice.org/ConsumerMattersDetail.aspx?ArticleID=42
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