Summary
The Court upheld Rajasthan’s school-fee regulation legislation and rules, subject to reading down committee-membership provisions to preserve representative and informed regulation. Private unaided schools retain initial fee-setting autonomy, including reasonable developmental surplus, subject to checks against profiteering. Separately, the Director’s pandemic fee-reduction order lacked legal authority. As a one-time measure for 2020–21, the Court directed collection at the 2019–20 level less 15% for unutilised facilities, instalment payments and protection against exclusion for non-payment.
Issues
- Whether the statutory fee-regulation framework infringed private unaided schools’ autonomy under Article 19(1)(g).
- Whether committee composition and fee scrutiny required safeguards or conflicted with the RTE Act.
- Whether statutory, disaster-management, epidemic or executive powers authorized the State’s pandemic fee-reduction order.
- What one-time fee adjustment and student protections were appropriate for 2020–21.
Provisions considered
- Articles 13(2), 19(1)(g) and 19(6), Constitution of IndiaUpheld reasonable regulation to prevent profiteering while preserving management’s initial fee determination and reasonable surplus. (¶¶ 16-19, 25-27, 33-36, 50-52)
- Sections 4, 6, 7, 8, 9 and 18, Rajasthan Schools (Regulation of Fee) Act, 2016Sustained consultative and adjudicatory fee scrutiny, read down representative eligibility, and rejected Section 18 as authority to override binding fees already fixed under the Act. (¶¶ 23-43, 52, 91-93)
- Rules 4, 6, 7, 8, 10 and 11, Rajasthan Schools (Regulation of Fee) Rules, 2017Approved stakeholder participation, procedure, objective fee factors and accounts needed for meaningful scrutiny of profiteering. (¶¶ 24-25, 47-50)
- Article 162, Constitution of IndiaExecutive policy could not contradict the statutory fee-fixation scheme or impose the impugned private-school fee reduction. (¶ 94-100)
- Sections 2(b), 2(d), 2(e), 2(i), 18, 22, 23, 38, 39 and 72, Disaster Management Act, 2005Disaster-management duties and overriding effect did not authorize interference with school fees fixed under the 2016 Act on the grounds advanced. (¶ 101-111)
- Section 4, Rajasthan Epidemic Diseases Act, 2020Power to regulate institutional functioning to prevent disease spread did not extend to fixing or reducing private-school fees. (¶ 112-113)
Held
- Management may determine institution-specific fees, including reasonable surplus for development, but cannot claim immunity from initial regulation against profiteering and commercialisation. SLFC consultation and independent adjudication preserve rather than extinguish that prerogative; SLFC disagreement is not itself binding on management. (¶¶ 16-19, 25-27, 33-36, 39-43)
- The Court upheld the statute with prospective reading down of Sections 4, 7 and 10. Parent representatives were to be selected from those whose wards were outside the free-education quota, with suitable knowledge for meaningful participation; eligibility depended on the ward remaining in school. Regulatory nominees must not already sit on an SLFC, and at least one private-school representative should come from a minority school. Corresponding safeguards applied to the Revision Committee. (¶¶ 28-30, 37-38, 42, 52)
- The RTE Act’s free-and-compulsory-education purpose and capitation-fee prohibition did not occupy the distinct field of regulating notified school fees to prevent profiteering. (¶ 51-52)
- Section 18 authorized only directions consistent with the 2016 Act. The State could not unilaterally reduce fees fixed through its statutory process and binding for three academic years. Article 162 could not cure that conflict, nor could later governmental ratification or the High Court’s expressed hope supply missing power. (¶ 88-100)
- Neither the Disaster Management Act’s mitigation and capacity-building powers nor its overriding clause supplied authority for this fee-reduction order. The Epidemic Diseases Act addressed prevention of disease spread through regulation of functioning, rather than the economic fee terms at issue. (¶ 101-113)
- Schools could not charge for facilities and activities not provided or availed during closure. Without precise school-wise empirical data, the Court assumed 15% savings and adopted that deduction as a one-time complete-justice arrangement to avoid extensive individual proceedings. This was not a permanent uniform fee rule. (¶ 114-118)
- For 2020–21, appellants were to collect annual fees fixed for 2019–20 less 15%, payable in six equal monthly instalments before 5 August 2021, with liberty to grant greater concessions. Students could not be excluded from online or physical classes or have results withheld for non-payment; hardship requests required sympathetic individual consideration. Board-examination candidature was protected on an undertaking. The arrangement did not affect 2021–22 fee collection. (¶ 117-118)
- Rajasthan’s request to recall payment of outstanding unit-cost dues was rejected. Time for calculation and disbursement of dues up to 2020–21 was extended to the end of July 2021. Connected contempt proceedings based on the overturned judgment were disposed of. (¶¶ 119-120, Order (c))
Result
First set of appeals disposed of: fee-regulation Act and Rules upheld with Sections 4, 7 and 10 read down. Second set allowed; High Court judgment of 18 December 2020 set aside and matters disposed of under the one-time 2020–21 fee directions. Connected contempt proceedings and pending applications disposed of; no costs.