IAS coaching centers face closure and license cancellation due to fake advertising

The Guidelines for the Prevention of Misleading Advertising in the Coaching Industry (2024) hold coaching centers responsible for false claims regarding course duration; This can mislead students into believing they can complete a program in an unrealistically short time frame.

Mint On November 28, 2023, IAS was the first to announce that coaching institutes will no longer be allowed to use photos of successful candidates to attract potential candidates.

Coaching institutions will have to issue refunds if they fail to deliver the services claimed in their advertisements. Additionally, coaching facilities will be empowered to sign agreements with candidates to use their credentials only after passing the prestigious exam, giving successful candidates greater bargaining power in advertising contracts.

Similarly, advertising free interview guidance programs without clear terms and conditions is also prohibited. Consumer affairs secretary Nidhi Khare, while issuing the new guidelines, said institutes must now accurately represent the additional services they offer to avoid creating false expectations.

The guidelines also put an end to exaggerated claims about the number of students achieving success in exams after attending a coaching centre. Coaching facilities must now ensure that their success rates are accurate and based on verifiable data.

Coaching institutions will need to disclose details such as rank secured, name and duration of the course, along with the candidate’s photograph. Disclaimers and important information should be displayed prominently, using the same font size as the claims made in the ad.

Coaching centers are also required to accurately represent their facilities, resources and infrastructure and indicate whether their courses have been approved by competent authorities such as the All India Council for Technical Education (AICTE) and the University Grants Commission (UGC).

“The new rulebook will serve as a testament of fairness to lakhs of aspirants who prepare for civil services and often find themselves cheated when they fail to get advertised services,” said Manish K Shubhay, partner, The Precept-Law Offices. .

The new guidelines have been issued by the Central Consumer Protection Authority (CCPA) under the Department of Consumer Affairs.

IAS coaching impact on business

The guidelines will have an impact on the IAS coaching business. ₹3,000 crore ₹58,000 crore coaching industry. Delhi is considered as the Union government’s coaching hub for civil services exams.

Recently, CCPA had notified 45 coaching institutions for violating consumer rights through misleading advertisements and unethical tactics. 15 of them were sentenced to a total fine. ₹38.60 lakhs.

UPSC civil services exam is conducted in three phases. The first stage is the preliminary test (PT), which is a screening test, and scores obtained in the PT do not count in the next two stages (main and personality test).

The scores obtained in both the main exams and the personality test are taken into account in the final selection. The total score of main exams and PT is 1750 and 275 respectively. This means that the contribution of the personality test is 13.5% of the total scores.