COVID-19 And College Fee Conundrum: Why Students Can Demand Refund

COVID-19 has completely disrupted our environment. Everyone is struggling to cope with the challenges the pandemic has brought. While there isn’t a single sector which hasn’t felt the impact, the education sector, in particular, has been hit hard as it had to immediately shift its way of operating.

Several colleges and universities are now conducting online classes for the remainder of the semester. However, since the cost of college education in India has been rapidly rising, students now feel that they are at the raw end of the deal. Students have been demanding a partial fee refund. However, the question of legal backing to such demand remains unanswered.

The relationship between a student and a college has two unique aspects. First, colleges do not provide a traditional service for profit as defined under commercial laws.The Supreme Court has previously held that education is a distinct constitutional goal and therefore, is a public good. Second, students do not have the same bargaining power as a college and thus the college has certain leverage over students. Recognising this unique relationship, the University Grants Commission (UGC) acts as a regulator of higher education in India with the responsibility of protecting the students. The UGC Act, 1956, crystallises the responsibility of UGC to maintain the standards of teaching, examination and research. Further, Section 12A of the Act provides explicit power to the UGC to provided regulation and scale the fee to be charged by colleges and universities in public interest.

Therefore, even though a student has a remedy against the college he studies in, a stronger alternate case lies against the UGC as it has not provided any regulation for refund of fees. The UGC has failed to protect the students and its inaction has violated their right to access education.

The Supreme Court, in Modern Dental College v. State of Madhya Pradeshwhile examining the constitutionality of an act introduced in the state of Madhya Pradesh to regulate the admission process and fee has reiterated that a college cannot charge a fee that is beyond the purpose of fulfilling the object of education. In simpler terms, a college is not allowed to profit from running an educational institution. The court has regularly reiterated that education is not a business but a charity. Having such a moral outlook towards education has further allowed the Supreme Court to limit the scope of fees of colleges only to the extent of cost of running an institution and a reasonable surplus. Any income beyond this standard would be considered as profiteering which has been explicitly held to be illegal.

The prohibition of profiteering in the field of education gives foundation to our first argument that shifting classes online changes the costs of running an institution and thus can create instances of profiteering. Change in cost is institution specific depending on the obligations of each college and in some cases, there would be no reduction. However, a regulation still has to be in place to protect the students in case there is any reduction of cost. One such reduction that UGC may deal with is change in cost of the variables such as expenditure on electricity and cost of running any kind of accommodation service. The regulation should provide that if there is any reduction of cost, there should also be a reduction in the fees. If the benefit of reduction is not shifted to the students, it would lead to colleges earning beyond the standard set by the Supreme Court and thus, would be considered illegal.

Admittedly, there is a case against a need for regulation that the change in cost is temporary and would not change the cost of running an institution in the larger scheme of things and this reduction in cost would only be an addition in the surplus. However, both these defences should not be considered. A degree is broken into semesters, each semester has a definitive goal that has to be reached by the end of that particular semester. Further, a student is also expected to pay the fee per semester, thus arguing that while deciding the need for regulation,the larger course of the degree should be considered goes against usual practices adopted by colleges themselves. The argument of creating a surplus also fails because the initial surplus is already calculated based on certain future plans; an additional surplus would only be a façade which would create a surplus which is more than required and permitted.

Beyond the cost of running a college one should also look at how one defines college education. Once we say that students pay a fee to study in a college, do we only consider it as the pedagogy or is it something beyond that we demand from the college. Every college tries to differentiate itself and tries to offer something beyond the classes. A college aims to offer the experience of studying in that particular college, it tries to differentiate itself based on its facilities and what all can be achieved by just being in that college. The whole atmosphere of the campus and of networking and learning from peers beyond the classes is also what a student pays for. Shifting classes online leads to a situation where these opportunities cease to exist, and the student is only able to access a fraction of what he was offered initially. It strips the student the access to opportunities that a college had previously made available. Thus, if only a fraction of what was initially offered is available now, then logically, only a fraction of the agreed upon fee should be paid. In this instance as well, one might also argue that the shift to online is temporary and there should be no refund of fees. However, the case remains for the particular period the student does not have access to everything the college could potentially offer.

In 2019, UGC proposed draft regulations to scale the fees of colleges, however, no further action was taken with respect to it. Now, among other things,COVID-19 has highlighted such gaps in our education regulatory system and how it has negatively impacted the rights of students. This should be considered as an opportunity to arrive at regulations to ensure that there is a balance between a student’s right to access education and a college’s right to run an institution.

(The author is a practising advocate based out of Chandigarh. Views expressed are personal.)