| SooperKanoon Citation | sooperkanoon.com/53127 |
| Court | Monopolies and Restrictive Trade Practices Commission MRTPC |
| Decided On | Mar-23-1988 |
| Judge | G Luthra, H Gupta |
| Appellant | Director-general of |
| Respondent | National Institute of |
2. The, respondent is a fully owned unit of M/s Pace Education Pvt.
Ltd., a company registered under the Companies Act, 1956. It is imparting service in computer education, computer consultancy and related fields. The respondent released an advertisement in the Times of India, Bombay, dated August 31, 1987, and another advertisement in Indian Express (Madras Edition), dated January 7, 1988. Photostat copies of those advertisements are annexures I and III to the application under Section 36B(c) of the Monopolies and Restrictive Trade Practices Act. The respondent also issued a prospectus, photostat copy of the relevant extracts of which is annexure II.3. The Director-General received a complaint dated January 15, 1988, from Shri Jayanti Patel, B. Com., Financial Consultant, wherein he stated that the respondent was making false claims that it had entry level courses recognised by the American Universities under the College Credit Programme and that its courses had been rated by the University of Michigan, USA, as being at par with those offered by the American Universities and in that way it was inducing gullible students and other people to join its computer training courses. In that complaint, it was also stated that the respondent was describing itself as National Institute of Information Technology with a view to mislead the general public by giving the wrong impression that ft was a Government organisation while as a matter of fact, it was only a division of a private limited company, viz., Pace Education Private Ltd. Shri Jayanti Patel requested the Director-General to investigate the matter to take suitable action. The Director-General then investigated. He also addressed two letters dated September 22, 1987, and September 28, 1987, calling for the relevant material particulars and comments on various claims made by the respondent. The respondent replied by means of letters dated December 14, 1987, January 6, 1988, and February 8, 1988.
4. The Director-General submits that his investigation and correspondence with the respondent revealed that the respondent was making various false and tall claims. He points out that in the advertisement dated August 31, 1987, in the Times of India, Bombay Edition, it had made the following tall claims : 5. The Director-General also points out that in the prospectus issued by the respondent, false claims made by the respondent about the quality and standard of its course were as under: " (a) NIIT's entry-level courses are recognised by the American Universities under the College Credit Programme and NIIT students pursuing further studies in the American Universities can seek credit points against specific courses.
(b) NIIs executive development courses have been rated by the University of Michigan, USA, as being at par with those offered by the American Universities, " 6. The Director-General urges that in the advertisement dated January 7, 1988, under the caption " Sound Business Offer " and " Start a Profitable Computer Education Centre in your City " , the following tall and false claims have been made: (1) " With NIIT-India's premier, Internationally recognised Computer Institute.
(2) Internationally accepted Examination, Certificates and Grading.
" 7. The Director-General has explained as under as to how and why the aforesaid representations and claims made by the respondent were tall, false and misleading: (1) In reply to the letters of the Director-General, the version of the respondent in respect of its claims that learning methods were perfected at the University of Michigan, USA, that its entry-level courses were recognised by the American Universities under the College Credit Programme and that its Executive Development Courses had been rated by the University of Michigan, USA, as being at par with those offered by the American Universities, was that the faculty of the respondent had been,trained in the instruction design methodology developed at the University of Michigan, USA, at a training programme conducted in India by Professor Knudsvig of the University of Michigan. It was also stated by the respondent in its letter dated December 14, 1987, that Advanced Systems Incorporated (hereinafter called " the ASI "), which was one of the leading institutions in the USA in the field of instruction connected with computer technology and management, had standardised various courses, instruction packages or modules for international application and that as the respondent had adopted those courses, it could be said that the respondent had the same standard as the ASI. The respondent further stated that since the ASI was recognised by the American Council on Education to which over. 1600 American Universities were affiliated, the courses devised and prepared by ASI were to be taken as recognised by the American Universities. The respondent concluded that in that way its entry level courses were recognised by the American Universities. The respondent sent a copy of a letter dated May 23, 1984 (annexure X), to the Director-General from the University of Michigan addressed to Mr. Rajendra Pawar, Director of the respondent, which reads as under: We have reviewed the following courses developed and conducted under the auspices of the National Institute of Information Technology; We find these courses to be resonant with the current state-of-the-art of knowledge in the fields in which they are offered. The goals of the program, the standards by which these are achieved and the quality of the material are indeed equal to the level of programs offered by our University and others throughout the United States. The National Institute of Information Technology is to be commended for the fine array of courses in these areas.
The Director-General has pointed out that the mere fact that one of the professors of Michigan University, viz., Kundsvig, conducted a training programme in India for the benefit of the respondent does not mean that the respondent had the same learning methods as were perfected by the University of Michigan, USA, or that it had recognition of that University. It is further pointed out that the letter purported to have been issued from the Michigan University did not make the courses conducted by the respondent at par with the ones conducted by the University of Michigan, USA, and there was nothing to indicate in the said letter that the learning methods followed by the respondent were perfected by the University of Michigan. According to the Director-General, there was nothing to show that the respondent was following the courses standardised by ASI or that there was recognition of the courses of ASI by the American Council on Education or that the said Council had affiliation of 1,600 American Universities. The Director-General narrated as to how the respondent was asked to furnish documentary proof in that respect but it had failed to do so in spite of getting a lot of opportunities. The Director-General also stated that the respondent was called upon to give documents showing that its students pursuing further studies in the American Universities could seek credit points against specific courses, but none was supplied.
In respect of the claim of the respondent regarding " Project Internship with Unique Guaranteed Placement Scheme ", its version given to the Director-General was that a guarantee was given to all the students who obtain " A " grade in the " Career " and " Professional " courses that they would be given " placement " , i.e., job. The Director-General relied upon the advertisement dated August 31, J987, in the Times of India which shows that the courses being conducted by the respondent were four in number, viz., (1) Foundation Series, (2) Career oriented Series, (3) Professional Series, and (4) Skills Upgrade Series. The Director-General stated that the aforesaid advertisement led to a belief that a student by completing any of those aforesaid courses would avail himself of the guarantee of the respondent for getting job, while according to the version of the respondent as given in its letter written to the Director-General, the aforesaid guarantee was confined only to two courses, viz., " Career " and " Professional " , series and that too to students getting " A " Grade. The Director-General concludes that in that way the respondent had indulged in unfair trade practices within the meaning of Section 36A(1)(ii), (iv), (vi) and (viii)(i) of the Monopolies and Restrictive Trade Practices Act.
(3) In respect of the claim of the respondent that it was an internationally recognised computer institute, its version as given to the Director-General in its letter dated January 6, 1988, was as under: "Your query: Substantiation for usage of the term ' Internationally recognised." By the term 'Internationally recognised' we did not mean to imply formal certification by an international authority authorised to make such certification. The statement was based on the feed back provided by some internationally renowned personalities, on the quality of NIIT's education. For example, two such prominent personalities were Dr. Dimitris Chorafas and Mrs. Shaku Atre, who are acknowledged experts in their respective fields in the area of Information Technology. We would be glad to solicit letters from them, to this effect, if desired by you. " 8. The Director-General submits that the aforesaid version is absolutely wrong because the term "internationally recognised" as commonly understood by the general public and students is that recognition has been given by universities and institutes in other countries and not as recognition given by individuals as stated by the respondent.
9. In respect of the claim of the respondent that it had "internationally accepted examinations, certificates and grading" , the version of the respondent as given in its letter dated December 14, 1987, is as follows: "As earlier explained, NIIT acts as the outlet in India for the dissemination of courses devised and prepared by the ASI which is recognised by the American Council on Education to which over 1,600 American Universities are affiliated. NIIT has also developed its own courses which have been evaluated by the University of Michigan as being at par with courses offered by the American Universities. " 10. The Director-General pointed out that the aforesaid version does not spell out acceptance of the examinations, certificates and gradings by any of the Institutions or Universities of the foreign countries and, secondly, the said claim is not supported by any document. The Director-General concluded that in that way the respondent had indulged in unfair trade practices within the meaning of Section 36A(1)(ii), (iv) and (vi) of the Monopolies and Restrictive Trade Practices Act.
11. Shri Jayanti Patel in his complaint stated that he had written a letter to the Michigan University, USA, inquiring if the said University had rated the courses of the respondent as its equal and in the reply, the said University denied the claim of the respondent.
12. Prima facie, the contentions of the Director-General in respect of the false, misleading and tall nature of the claims of the respondent have force. In that way, there is an unfair trade practice within the meaning of Section 36A(1)(ii), (iv) and (vi) of the Monopolies and Restrictive Trade Practices Act. Clause (ii) of Sub-section (1) of Section 36A applies because there are false representations about the services of imparting education being of particular standard, quality or grade by the respondent. Clause (iv) applies because there is a representation by the respondent that its services have such uses or benefits (being equal to and recognised by the American Univerities, etc.), which such services actually do not have. Clause (vi) applies because there is a false and misleading representation of the respondent concerning the usefulness of its services relating to learning methods having been perfected by the University of Michigan, carrying guarantee of getting a job and recognised by the American Universities as well as internationally recognised, etc., as mentioned already. False guarantee about the placements, i.e., getting of jobs, is covered by Section 36(1)(viii)(i).
13. Imparting of education is a trade within the meaning of Section 2(s) of the Monopolies and Restrictive Trade Practices Act. The definition of "trade", given in Section 2(s), says that it includes "the provision of any services". The word " service " is defined in Section 2(r) of the Monopolies and Restrictive Trade Practices Act and the same says that " service " means " service of any description which is made available to potential user's, but does not include the rendering of any service free of charge or under a contract of personal service ". In the present case, imparting of education is a service to the students by charging fees and it is not a contract of personal service but is a service by the institution.
14. There is also a trade practice in the present case. The word " trade practice " is defined in Section 2(u) of the Monopolies and Restrictive Trade Practices Act which means any practice relating to the carrying on of any trade. Obviously, the practice of running an institution for the trade of imparting education is a trade practice.
15. In view of the above facts, issuing of an injunction is necessary in the interest of the public at large and the student community as well as their parents in order to save them from being deprived of their good money having been allured by the tall claims and false representations of the respondent.
16. The Director-General prays for issue of an ex parte temporary injunction. In view of Rule 3 of Order XXXIX, Civil Procedure Code, which is applicable on account of Section 12A(2) of the Monopolies and Restrictive Trade Practices Act, an ex parte injunction can be issued if delay in issuing the same will defeat the very purpose. In this case, the delay in issuing the injunction will defeat its purpose because in the meantime, many students or their parents might be deprived of their good money under tbe lure of tall and misleading claims made by. the respondent.
17. We, therefore, issue an ex parte temporary injunction restraining the respondent till further orders from making any representation or claims as mentioned in this order, particularly in paragraphs 1, 2, 4 and 5 in any manner whether in the media or otherwise. A copy of this injunction order along with a copy of the application for issue of an injunction and a copy of the application under Section 36B(c) of the Monopolies and Restrictive Trade Practices Act be sent to the respondent for showing cause on April 7, 1988, as to why the injunction be not made absolute till the decision of the enquiry which has already been smarted on the basis of an application under Section 36B(c) of the Monopolies and Restrictive Trade Practices Act.
18. As required by Rule 3, Order XXXIX, Civil Procedure Code, a copy, of the application under Section 12A, a copy of the affidavit of the Director-General and copies of the annexures and copy of the application under Section 36B(d) shall be sent by registered post with acknowledgment due by the Director-General or any of his officers to the respondent by the next working day and affidavit of compliance in this respect shall be filed.
19. It is made clear that this order shall not prejudice the ultimate decision of the application under Section 12A of the Monopolies and Restrictive Trade Practices Act and the final decision of the enquiry.