CCPA issues notices to coaching centres for misleading ads; slaps penalty of Rs 54.6 lakh on 18 institutes for violating consumer rights

The CCPA has also directed these centres to discontinue misleading advertisements.

These measures are part of the CCPA's broader initiative to shield students and aspirants from deceptive practices that contravene the Consumer Protection Act, 2019.

CCPA Chief Commissioner and Consumer Affairs Secretary Nidhi Khare highlighted that most IAS coaching institutes fail to disclose specific courses taken by successful candidates.

In many cases examined by the CCPA, it was found that these institutes often provide online or offline interview guidance, sometimes at no cost, to candidates who clear the critical mains exam.

The Department of Consumer Affairs, through the National Consumer Helpline (NCH), has also been instrumental in resolving complaints from students preparing for competitive exams like the UPSC Civil Services and IIT entrance exams.

Student grievances increased significantly from 4,815 in 2021-2022 to 5,351 in 2022-2023 and to 16,276 in 2023-2024, indicating a rise in trust in NCH as a pre-litigation redressal body. In 2024 alone, 6,980 complaints have already been registered, said the ministry.

Following numerous complaints about unfair practices, particularly regarding non-refundable enrolment fees, the NCH conducted a drive from September 1, 2023, to August 31, 2024, resulting in Rs 1.15 crore in refunds for affected students.

All refunds were processed promptly with the department’s intervention at the pre-litigation stage.

Key guidelines for coaching centres prohibit false claims about courses, faculty, fees, and success rates, as well as promises of assured admissions or guaranteed selections.

Coaching centres must represent their facilities truthfully and may only use students' names, photos, or testimonials in advertisements with written consent obtained post-success.

Transparency is required in advertisements, including student rank, course information, and disclaimers, which must be clearly displayed to avoid misleading consumers.

The guidelines also ban tactics that create a false sense of urgency to prompt immediate enrolment.

Every coaching centre must partner with the National Consumer Helpline to facilitate complaints.

Unfair contracts that pressure students are disallowed, and violations of these guidelines will incur penalties under the Consumer Protection Act, 2019.

Explaining the coaching industry’s approach, Khare noted that the preliminary UPSC exam, which is the first stage, is attempted by 1.1-1.3 million candidates, while only about 3,000 of the 10,000 who pass this stage clear the mains exam.

"They do this because they know that at least one in three candidates is likely to be selected by the UPSC,” she was quoted as saying by Mint.

“If they had provided truthful information about the successful candidates and the courses they took, prospective consumers would not have been misled into spending money and time on their expensive, year-long classroom programs," she added.

According to the Mint report, the penalized institutes include Rau’s IAS Study Circle, IQRA IAS, Chahal Academy, Analog IAS, APTI PLUS Academy, and Unacademy, each fined Rs 1 lakh; Maluka IAS, EduTap Learning Solutions, Yojana and Plutus IAS, and Sriram’s IAS, each fined Rs 3 lakh; KSG - Khan Study Group IAS and Shankar IAS Academy, each fined Rs 5 lakh; and BYJU’s IAS, fined Rs 10 lakh. Seekers Education received a penalty of Rs 50,000, and Skyway Career Hub Rs 10,000.

The 45 coaching institutes issued notices for misleading ads include Vajirao & Reddy Institute, Vision IAS, Aakash Educational Services, Vajiram & Ravi, Narayan Medical Academy, IAS Baba, Allen Career Institute, Shubra Ranjan IAS, Abhimanu IAS, Anujjindal, ALS IAS, Sriram’s IAS, Dhishti IAS, NEXT IAS, IIT Prashikshan, Pune, and StudyIQ IAS, among others, according to Mint.

The guidelines apply to everyone involved in coaching, including both centres and endorsers or public figures promoting these centres in ads.

Endorsers must ensure that the claims they promote are accurate and truthful; they will also be held accountable for supporting false success rates or misleading guarantees along with the coaching centres.

Khare emphasised that the guidelines provide clarity for stakeholders and protect consumer interests by addressing misleading advertisements in the coaching sector.

The Guidelines for Prevention of Misleading Advertisement in Coaching Sector, 2024 aim to prevent the exploitation of students and safeguard them from deceptive promises or unfair contracts, benefiting consumers and the broader educational ecosystem. These guidelines supplement existing regulations, enhancing the regulatory framework governing advertisements in the coaching sector.