In a major reprieve for students, the Bombay high court on Friday held that the state government can regulate the fee structure of private unaided schools to some extent. The condition being that no unusual and unreasonable expenditure is recovered by way of fees.
The high court acknowledged the discretion of private unaided schools to fix their own fee structure, but observed that the state government had the power to correct them if they took on the character of capitation fee.
“Education, whether for charity or for profit, is an occupation,” the division bench of justice AM Khanwilkar and justice Mridula Bhatkar observed, adding, “It cannot be equated with a trade or a business.”
The court disposed of petitions filed by Goregaon-based Vibgyor High School challenging the decision of the deputy director of education, Mumbai region, excluding expenditure of Rs. 2.50 crore incurred by the school towards annual school building rent – from the list of items to be recovered through fees.
Parents like Avisha Gopalkrishnan, who opposed the school’s move to hike fees from the 2009-10 academic year, alleged that the amount was being siphoned off by school trustees. Rent was being paid to a private company, Kare Edumin Pvt Ltd, that had the same three trustees as its directors.
The school and the trust had challenged the decision contending that private unaided schools can fix their own fees and the deputy director had no authority to interfere.
The court has said Vibgyor High School would be required to refund the portion of fees constituting expenses towards building rent and has warned if the school continues to collect any fee under that head it would attract provisions of the Capital Fee Act, for which the school and its management would face legal action.
The high court, however, held that the right for schools to fix their own fee structure was not an absolute right and was subject to the assessment by state authorities, who are duty-bound to ensure that fees collected are not for commercialisation or profiteering.