Coaching Fee Harassment: Cancel and Claim Refund

One of my clients recently had a case which I am explaining below and if you are stuck in such similar situation, here is what to do.

Note: Due to attorney-client privilege, I cannot disclose complete case details or identify the actual parties involved. However, I am sharing the essential facts and legal approach so that if you find yourself in a similar situation, you can understand the available solutions and legal remedies.

TL;DR: A coaching institute cannot keep billing you for classes you never attended, and it cannot insist on a physical visit to cancel a registration that was made online, unless the terms you accepted say so in writing. If the terms don't, that demand has no legal force and the persistent recovery calls amount to a deficiency in service you can take to the consumer commission. But do not ignore a cheque-dishonour notice. That one runs on a hard statutory clock.

The calls started in March 2025. Karan Deshmukh, a first-year student in Nagpur, had already told the counsellor at Unacademy's city centre that he would not be joining. Fine, he was told. The cancellation would be processed.

That "fine" never made it into an email. Within a fortnight the calls came back with a new script. A cheque had bounced, they said, and he still owed fees for classes he had never attended. If he wanted the registration cancelled, he had to come to the centre and sign the papers in person.

He had paid ₹10,000 as a registration fee. Nobody quoted that figure to him upfront, and he says he never agreed to it. He had attended nothing. What he did have was a payment receipt, a call log, and growing worry about his credit score.

Emails to the institute went nowhere. The client then approached the Chamber of Advocate Sudhir Rao, and the office sent a single written notice setting out the cancellation request, the refund claim and the position on the disputed cheque. The recovery calls stopped and the matter closed in the client's favour. Advocate Sudhir Rao's experience with consumer fee disputes and cheque-dishonour procedure is what moved it, along with the decision to put everything in writing before the institute could build a record of its own.

We only have the client's side of this. That caveat matters in a matter that turns almost entirely on what was said on the telephone.

Key Facts of the Case

• The client registered with an online coaching platform and paid a ₹10,000 registration fee.
• He attended no classes and informed the centre, in a phone call, that he would not be joining.
• Cancellation was verbally acknowledged. Nothing was confirmed in writing.
• The institute later claimed a cheque had bounced and demanded fees for classes not attended.
• It also insisted that cancellation was possible only through a physical visit to the centre.
• The client was told his credit record would be affected if he did not comply.
• No written terms were produced to show that an in-person visit is mandatory for cancellation.
• A single advocate's notice resolved the calls and the refund claim in the client's favour.

The Direct Legal Answer

Can they keep calling me for classes I never attended?

No, not lawfully. A trader can only recover consideration for a service actually rendered, or for a contractual obligation you genuinely accepted. If you never attended and you cancelled, there is no service to charge for. Repeated recovery calls for a disputed, unrendered service can amount to a deficiency in service and an unfair trade practice under the Consumer Protection Act, 2019.

Do I have to visit the centre in person to cancel?

Only if the terms you accepted say so. If registration was done online, cancellation cannot be forced offline unless that condition was clearly disclosed and agreed to. A condition that exists only in a phone script is not a contract term. Ask for the terms in writing. If none exist, you can cancel by written communication and the institute is bound to act on it.

Can they damage my credit score?

It depends on how the fee was financed. If you paid directly, there is no credit facility, so no lender exists to report a default. If the fee was routed through an NBFC as an EMI, that is a loan and it is reported. Find out which it was before you panic.

What about the bounced cheque notice?

This is the one part of the story where the clock is against you and not the institute. If you signed a cheque for the fee and the bank returned it unpaid, the institute's remedy sits in Section 138 of the Negotiable Instruments Act, 1881. The sequence is fixed and unforgiving: a bank return memo, a written demand within thirty days of receiving that memo, then fifteen days for you to pay, and if you do not, a complaint filed within the month that follows.

What you must not do is treat it the way you treat the recovery calls. Silence on a Section 138 notice produces a criminal complaint, a summons, and a court appearance. Paying inside the fifteen days ends it cleanly. Paying after that does not automatically end it — the case can still be compounded, and offences under this chapter are compoundable, but by then you are negotiating from the wrong side of a filed case.

Two things are worth knowing before you assume the worst. First, a Section 138 case needs a legally enforceable debt. If the fee itself was never due, the cheque does not create the debt by existing. Second, even a cheque handed over as security can attract Section 138 if a real liability exists when it is presented — so "it was only security" is not by itself a defence. It turns on whether anything was owed.

And if the institute cannot produce a return memo? Then there is no dishonour, and the story about your cheque is just a line on a phone call.

Can they damage my credit score?

Only through a lender, and only if there is one. If you paid the institute directly, no credit facility was created and no default can be reported anywhere. If the fee was routed through an NBFC as an EMI, that is a loan in your name and it gets reported monthly. Find out which one happened before you lose sleep. If something incorrect is being reported, you can dispute it with the credit information company, and if that goes nowhere, escalate to the RBI Ombudsman under the Integrated Ombudsman Scheme, 2021.

What To Do First, In Order

• Stop talking on the phone. Ask for everything in writing, from a named email address. Say the words "please confirm this in writing" and then wait.
• Same day, pull the paper. Payment receipt, enrolment form, the terms page you ticked, screenshots of every call, emails, and any cheque or notice.
• Ask for the return memo. If a cheque allegedly bounced, the bank memo is a document, not an allegation. No memo, no dishonour.
• Reply to any Section 138 notice. Do it in writing, within the fifteen days, and do not let the deadline slide because the demand feels unfair.
• Send one notice of your own. A written notice that sets out your cancellation request, the refund claim and your position on the cheque does more work than a year of phone arguments, because it creates a record while the other side has none.
• Decide on the forum. Consumer commission, or civil suit, or both — that depends on the amount and what the institute has already filed.

Where Do I File A Coaching Institute Refund Complaint?

The Consumer Protection Act, 2019 covers this. A service that was contracted for and not delivered, or a fee retained without any service being rendered, can be a deficiency in service under Section 2(11). Repeated recovery demands for a disputed, unrendered service can also be an unfair trade practice under Section 2(47).

A complaint is filed under Section 35 before the District Commission. Where it is filed depends on the value of the claim, and the present limits place District Commission matters up to ₹50 lakh, State Commission matters above that up to ₹2 crore, and anything larger before the National Commission. For a ₹10,000 refund claim, the District Commission is the only relevant forum.

Two practical points. Limitation is two years from the date the cause of action arose, under Section 69 — so the clock started running somewhere around the first refusal to refund, not the last phone call. And consumer complaints can now be filed online through the e-Daakhil portal, which means you are not required to physically appear at a commission in another city to begin.

If you enrolled through an online platform, the Consumer Protection (E-Commerce) Rules, 2020 add another layer: the platform is expected to display its terms, name a grievance officer and respond to complaints in a defined period. A refusal to accept cancellation by email is exactly the kind of thing those rules address.

Where The Institute Is Usually Weak

Almost always, the same three points.

No written terms. If the institute cannot show you a document you accepted that makes an in-person visit mandatory for cancellation, that requirement has no contractual basis. A condition that exists only in a counsellor's script is not a term of the contract.

No service rendered. Fees are consideration for something. If nothing was taught, nothing was provided, and the registration was withdrawn before the course began, the retention of the registration fee is hard to justify. Where a contract is rescinded, Section 64 of the Indian Contract Act, 1872 requires a person who rescinds it to restore any benefit received — and that principle cuts in your favour when the institute holds your money for nothing.

Pressure instead of process. Threats about credit scores, repeated calls at odd hours, demands delivered verbally and never in writing — that pattern is what converts a fee dispute into a consumer complaint with a compensation claim attached.

The Uncomfortable Part

On facts like these, a full consumer trial is often not worth the money. The refund is ₹10,000. A contested complaint can run for months, and the cost of chasing it can exceed what you recover. That is worth saying plainly, because a lawyer who tells you everything is winnable is telling you something about himself.

What is worth doing, in almost every case, is the notice. One written communication, sent properly, that states the cancellation, the refund and the response to the cheque allegation. In the matter described above it ended the calls and settled the refund. It is also the document that becomes the first exhibit if the matter has to go further.

The exception is the cheque notice. If a Section 138 notice has landed, the calculation changes completely, because that is a criminal case and the exposure is not a refund. That is the file you do not sit on.

Documents That Decide These Cases

• The payment receipt or bank statement showing the ₹10,000, with the date.
• The enrolment confirmation and any terms page, screenshot or email you actually accepted.
• The call log showing dates, times and frequency of the recovery calls.
• Written requests for cancellation and the institute's replies, or proof that there were none.
• If a cheque is involved: the cheque details, the bank return memo, and the Section 138 notice with the date you received it.
• Any communication referring to your credit record.

Frequently Asked Questions