People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 23

June 06, 2004



Govt Must Now Act Against Arbitrary Fee Hikes

 Ashok Agarwal


THE Supreme Court judgement of April 27, 2004 in the Modern School case is a historic judgement having far reaching effects in the field of school education --- not only for Delhi schools but also for schools all over the country. The Supreme Court was primarily dealing with the menace of commercialisation of education and exploitation of hapless parents by unaided recognised private schools in Delhi through arbitrary fee hikes every year.


Incidentally, the Supreme Court also looked into the aspect of violation of the conditions of public land allotments by these unaided recognised private schools, particularly in regard to the condition of providing admission to the extent of 25 per cent to the children of weaker sections and granting them freeships. This judgement is being seen as a radical step to make education in private schools affordable to common man and to encourage integration of children belonging to weaker sections in the schools that were hitherto known as elite schools.



Let us see what was the background of this judgement. There are in Delhi around 1,500 unaided recognised private schools that impart education from Lower KG to Class XII, to around one million children (1/3 of the school going child population of Delhi). Majority of the children studying in these schools belong to the upper and middle class, and also lower middle class, while a small percentage belongs to the poor classes. One of the major reasons of sending children to these schools is that the standard of education in government schools is so poor that even a poor parent does not wish to send his child to a government school. It is not that all the government schools are bad. Though these private schools had been increasing fee and other charges every year, the increases in April 1997 ranged between 40 and 400 per cent and were effected on the pretext of liability to pay higher salary to the staff in anticipation of the fifth Pay Commission recommendations.


This sudden arbitrary and exorbitant fee hike caused great unrest among the hapless and unorganised parents of Delhi. They manifested their unrest by gathering in large numbers outside school gates, submitting representations to the schools and the government, holding meetings and demonstrations etc. The compelling situation brought them together under the banner of ‘Delhi Abibhavak Mahasangh’ that resolved to fight against exploitation of parents by these schools. Faced with the parents’ agitation, the Delhi government in May 1997 ordered inspection of the accounts of 16 private schools. Though these inspections revealed that schools were indulging in commercialisation of education and exploiting the parents, the government did not take any action against them and left the hapless parents to be exploited by these greedy managements. Failing to get any justice from the government, the parents ultimately decided to take the issue to the Delhi High Court through a public interest litigation (PIL).


The first hearing on this PIL by Delhi Abibhavak Mahasangh took place on September 8, 1997, by a division bench of the High Court and the learned judges on the bench issued notices to the government of India, government of Delhi, CBSE, Municipal Corporation of Delhi and 32 unaided recognised private schools named in the petition.


After the High Court issued notices to the respondents in the PIL on September 8, 1997, the government of Delhi promptly issued an order on September 10, 1997, fixing the maximum limits of registration fee, admission fee, caution money, etc, and also directing the schools to utilise their accumulated reserves first to meet the salary increases. It said if the reserves were not found sufficient, the fee could be increased to the extent required after consultation with the representatives of parent teacher associations. Perceiving this government order as a threat to their monopoly to loot the parents, however, the schools moved the High Court seeking the quashing of this order. The High Court heard the PIL of the parents and the petitions of the schools together and finally delivered a landmark judgement on October 31, 1998. It accepted the plea of the parents and rejected the challenge of the schools.




The High Court in the judgement concluded:

  1. It is the obligation of the administrator and/or director of education to prevent commercialisation and exploitation in private unaided schools, including the schools run by minorities.

  2. The tuition fee and other charges need to be fixed in a validly constituted meeting, giving an opportunity to the representatives of parent teacher associations and a nominee of the director of education to place their viewpoints.

  3.  No permission from director of education is necessary before or after fixing tuition fee. In case, however, such fixing is found to be irrational and arbitrary, there are ample powers under the act and rules to issue directives to schools to rectify it before resorting to harsh measures. The question of commercialisation of education and exploitation of parents by each school can be authoritatively determined on a thorough examination of its accounts and other records.

  4. The act and the rules prohibit transfer of funds from a school to its society or from one school to another.

  5. The tuition fee cannot be fixed to recover capital expenditure that is incurred on the society’s properties.

  6.  Inspections of schools, audits of accounts and compliance of the provisions of the act and rules by private recognised unaided schools could have prevented the present state of affairs.

  7.  The authorities and the director of education have failed in their obligation to get the accounts of private recognised unaided schools audited from time to time.

  8. The schools or societies can take voluntary donations provided these are not connected with the admission of wards.

  9. On the peculiar facts of these petitions, there was per se no illegality in the issue of the impugned circular dated September 10, 1997.

  10. An independent statutory committee, by an amendment of law if necessary, deserves to be constituted to go into the factual position and adjudicate disputes which may arise in future in the matter of fixation of tuition fee and other charges.

  11. The government should consider extending the act and rules, with or without modifications, to all schools --- from nursery onward.

By the same judgement, the High Court also appointed a committee with Ms Justice Santosh Duggal as chairperson. The committee was to decide whether or not the increase in tuition fee and other charges effected by each school --- during the period since the order dated September 10, 1997 up to the start of academic session in 1999 --- was justified. It had to decide the question by eliminating the element of commercialisation and in the light of observations made by the High Court.



The school moved the Supreme Court against this judgement of the High Court. In its judgement of April 27, 2004, the Supreme Court rejected the schools’ appeal and upheld the High Court judgement.


It may be noted that, pursuant to the High Court judgement, the government of Delhi had constituted the Justice Duggal committee on December 7, 1998. But the committee could not complete the task given by the High Court due to non-cooperation by the government and schools. Had the committee completed its task, the parents would have got the refund of an estimated Rs 800 crore from the schools which they had charged extra from the parents during 1997-98 and 1998-99 under the High Court’s interim order dated December 11, 1997. This order had permitted all these schools to increase the tuition fee by up to 40 per cent.


Yet the committee submitted a report to the government on July 31, 1999, making various factual observations on the devices being used by the schools to exploit the parents and charge unwarranted hefty fees and other charges. The committee also made various recommendations. Interestingly, the committee observed that, out of 142 schools examined, there were only two schools whose fee hikes in 1997-98 were justified; fee hikes in the remaining 140 schools were either not justified at all or were justified only partially.


Following the committee’s recommendations, the government issued an order on December 15, 1999, prescribing among others things the manner of calculating the amount of tuition fee and other charges under the specified heads only. But before the Supreme Court the schools raised serious objections to this order as well, seeking a free hand to charge from parents any amount without limit, in the name of quality education and expansion of education, and without interference by the authorities. The Supreme Court rejected this plea also.



The most significant aspect of the Supreme Court judgement is that it has finally laid to rest the controversy whether the government has the authority to regulate the fee and other charges of unaided recognised private schools and thus to prevent commercialisation of education. The Supreme Court has categorically held that the government has the authority to regulate the fee in unaided schools.


The Supreme Court went even further to direct the director of education to ensure that the schools to whom public lands were allotted at throwaway prices, comply with the terms of land allotment. The two significant conditions pointed out by the Supreme Court are: (a) a school shall not increase the rates of tuition fee without the prior sanction of the directorate of education, and (b) the school shall admit to students belonging to the weaker sections to the extent of 25 per cent and grant them freeships.


Now it has to be seen what action the government is going to take against the erring schools to ensure that they roll back the hikes in fee and other charges to a level that is just, reasonable and devoid of an element of commercialisation. The government needs to constitute another committee, with another retired High Court judge as chairperson, to complete the task entrusted to the Justice Duggal committee but left by it because of non-cooperation by interested parties. This is a must as the cheated parents are eagerly awaiting a refund of the excess amounts charged from them by the schools under the interim order of the High Court. It is estimated that if the Supreme Court judgement is implemented, the present fee level will come down by 60 per cent. It is also estimated that since 1997-98 till this year, the schools have unjustly charged an excess amount to the extent of Rs 3,000 crore from the hapless parents of Delhi, which amount the parents are entitled to get back immediately. The ball is now in the government’s court.


(The author, a Supreme Court advocate, represented the parents before the High Court as well as the Supreme Court.)