Wasting time is anything that cannot make you in anyway productive. Anything you do that prevents you from doing things that you ought to do can produce a wasted time. So if you read novels and get addicted to it, thus neglecting your other duties as an individual, can definitely waste your time.

Reading novels is as important as it has ever been. Since we live in the age of sound bites and 24-hour news channels, people are reading newspapers less and there is an increasing urge to find news and knowledge in general as quickly as possible. There is nothing inherently wrong in seeking information quickly, but it establishes a pattern of short attention spans and skimming more than reading. Reading a novel requires time, patience, imagination, and usually, reflection. I would argue that reading novels (and other longer forms of texts - even newspapers) is vital because it impels people to contextualize information and relate that information to other disciplines such as sociology, psychology, etc. 

Reading extensive works (i.e. novels) will boost your vocabulary much more efficiently than if you were to sit and memorize words and their definitions because in reading, you are putting that knowledge (of learning new words) into practice. Although articles and coursebooks help, learning new concepts in the contexts of novels is more efficient than learning bits of information here and there. 

There are benefits to reading textbooks or coursebooks but a coursebook on literature is not the same as reading literature. For example, reading a coursebook on music is not the same as listening to that music. 

Here is a quote pertinent to this interesting discussion:

Ours is a world in which knowledge accumulates and wisdom decays. Inevitably so; for advancing science and technology require the services of specialists, to each of whom is assigned the job (and it is a whole-time, a more than whole-time job) of mastering the intricacies of his particular field and keeping up with the changes in theory and practice brought about by scientific discovery and technical invention. That such specialists may and often do become highly trained barbarians has been, for some years past, the growing concern of educators.--Aldous Huxley

Good novels are a part of culture, and culture is essential to civilization. Any educated person should know something about literature, good music, art, good drama, even poetry, in order to avoid being a "highly trained barbarian." Otherwise there is a serious danger of ours becoming a "Brave New World."

The number one way for students of any subject to improve their literacy (a complex and important thing) is to READ. The more you read, the better your literacy will become. So it doesn't matter what the topic is or whether it relates to your homework. Whatever you read will increase your skills in reading, writing, speaking, critical analysis; skills which are important for your entire education. So no, novels are by no means a waste of time. Even if you like to read bad novels, it will still contribute to your confidence with language. But obviously aim to read the good'uns!

I do not think it is a waste of time to read.  Reading "great literature" novels can be important to you because it can help cause you to think about issues faced by individuals and societies.  But even if you read novels that are just for fun it can be good for you.  It can stimulate your imagination.  It can help you to use language better because you will be exposed to different styles of writing.  I don't think reading is ever a waste of time.