Educational Consultancy Not Vicariously Liable For Policy Decision Made By Foreign Nation – Supreme Court
A two-judge bench of Justice Abhay S. Oka and Justice MM Sundresh in an appeal challenging the order of the National Consumer Dispute Redressal Commission (NCDRC) directing the Appellant an Educational Consultancy, to compensate the Respondent for having to discontinue his MBBS course in the Philippines, held that Educational Consultancies cannot be held vicariously liable when a student is forced to discontinue a course in a foreign nation due to change in policy/policies made by the Government of that foreign nation.
Counsel Banke Bihari appeared for the Appellant while Counsel Shiel Sethi appeared for the Respondent before the Apex Court.
In this case, the Respondent had approached the Appellant seeking admission to MBBS Course in the Philippines. The Respondent paid the course fee through the Appellant. The Appellant had indicated that it was acting on behalf of both the college and the Government in the Philippines through its advertisement.
The Respondent joined the college in the Philippines in 2007. However, in 2008 the Republic of the Philippines abolished the MBBS program, and those enrolled in the course were offered to be re-directed to BS Biology.
The Respondent did not take the offer and chose to return to India, and immediately lodged a complaint against the Appellant. On that, the National Consumer Dispute Redressal Commission (NCDRC) ordered the Appellant to pay $12,000 apart from compensation and costs to the Respondent. Feeling aggrieved by the Order of the NCDRC, the Appellant invoked Section 27 A of the Consumer Protection 1986 and approached the Supreme Court.
The Counsel for the Appellant contended that the Appellant is merely a facilitator who has no control over the decisions of the Republic of the Philippines and as such cannot be held liable for the policy decisions made.
The Bench noted that – "Though the documents would indicate that the Appellant was acting on behalf of the Republic of Philippines also, it played no role in the policy decision made." The role of the Appellant stops with the admission being secured, which it did. The policy decision of the Republic of Philippines cannot be questioned before the Consumer Forum.
In this context, the Bench observed that – "As there is no vicarious liability that can be fastened on the appellant, the appellant's role cannot be stretched to the policy decision of the Republic of Philippines."
Consequently, the Apex Court set aside the order passed by the NCDRC and allowed the appeal.