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to report your confession.Breaking your immigration conditions
If your sponsor has any suspicions that you are breaking the conditions of your permission to stay, for example, by working more hours than you are allowed to, then they are obliged to inform the Home Office. This could result in your current immigration permission being curtailed or future applications being refused.
How is your performance in the course? Have you been missing lectures or failing/having bad grades?
It's up to the university, and they alone. As advised above, in a way they did the right thing, so it is not unfair, but it is for sure harsh and unusual. It is rare for a sponsor to take such action only based on a single breach of the work conditions. IMHO it is also rather out of proportion, and not in line with the Home Office's own approach to such minor breaches of conditions. Paragraph 9.8.3 of the immigration rules says they "may" (not "must") refuse an application "where a person has previously failed to comply with the conditions of their permission". In my experience, they usually exercise discretion and ignore a single small breach of the work condition, if it is disclosed and explained in the application with an apology.
Based on the information provided, it appears the university withdrew your student visa sponsorship without following a due process. They should have investigated this matter before reporting you to the Home Office.
I doubt it.