Minority School Not Entitled To State Grant Towards Salary For Employee Retained Beyond Retirement Age : Supreme Court

The Supreme Court, on Tuesday, held that if an employee is continued in service by the management of any registered minority Secondary School receiving Grant-in-Aid from the State-Government, then such school would not be entitled to receive any grant in respect of the expenditure incurred for continuing such employee beyond the stipulated superannuation age.

A Bench comprising Justice Dinesh Maheshwari and Justice Bela M. Trivedi set aside the order of Division Bench of the Gujarat High Court, which granted relief to a minority-run government-aided educational institution regarding non-receipt of grant from the Government.

Factual Background

A Jain Minority Institution, was running a government aided school in the State of Gujarat. In 1999, when the Principal of the school attained the age of 58 years, the institution sought permission from the State Government to let him continue his tenure. The District Educational Officer (DEO) granted permission to the Principal to continue till he attains the age of 60 years, but on the condition that the institution should pay the salary. In 2001, the Institution again wrote to the DEO seeking extension of the Principal’s tenure beyond the age of 60 years. Upon the DEO rejecting the request, the institution challenged the decisions before the Gujarat High Court, primarily, on the ground of violation of Article 30(1) of the Constitution of India, which pertains to the right of minorities to establish and administer educational institutions. The Single Judge allowed the petition and directed the State authorities to pay the arrears of grant to the management of the school within a period of 3 months. The Division Bench upheld the order of the Single Judge.

Issue before the Supreme Court

Whether the decision of the appellants in not providing the aid to the respondents towards the salary of the principal on his attaining the age of superannuation as per the Grant-in-aid Code, could be said to be arbitrary or violative of Article 30(1) of the Constitution of India?

Analysis by the Supreme Court

The Court noted that the Gujarat Secondary Education Act, 1972 was enacted to provide regulation of Secondary Education in the State and to establish a Board. The Board framed the Secondary Education Regulations which, inter alia, deals with superannuation. There is another Grant-in-Aid Code published in 1964, which laid down conditions for retirement. However Regulation 42 clearly states that the Regulations framed under the 1972 Act would prevail over the Gode. The Court observed that Regulation 36, which talks about superannuation, is not applicable to educational institutions established and administered by minorities. It noted that since the provision pertaining to superannuation in the Regulation is not applicable to minority educational institutions, the Grant-in-Aid Code pertaining to the age of superannuation would be made applicable to such minority institutions availing grants from the State Government. The Code does not permit the extension of tenure of the Principal of such an institution beyond the age of 60. Ordinarily, the retirement age is 58 years, but an extension can be granted by the management upto 60 years. Moreover, if an employee is continued in service by the management of any registered minority Secondary School receiving Grant-in-Aid from the State-Government, then such school would not be entitled to receive any grant in respect of the expenditure incurred for continuing such employee beyond the age of 60 years. In view of the same, it held that the State Government's refusal to pay the Grant-in-Aid to the concerned institution upon the Principal having reached the age of superannuation, is not in violation of Article 30(1) of the Constitution. Placing reliance on the judgment in T.M.A. Pai Foundation And Ors. v. State of Karnataka And Ors. (2002) 8 SCC 481, the Court noted that -

“...the right under Article 30(1) is not an absolute right above the law, and that the provisions for the grant or non-grant in aid to the educational institutions, whether it is majority-run institution or a minority-run institution, have to be uniformly applied.”

Further, it was taken note of that the institution did not place any material on record to show that it was discriminated against on the ground that it was managed by a minority, attracting Article 30(2) of the Constitution of India.

Case details

State of Gujarat And Ors. v. H.B. Kapadia Education Trust And Anr. Civil Appeal No. 2837 of 2022 | LiveLaw 2023 (SC) 127 | 21st February, 2023 | Justice Dinesh Maheshwari and Justice Bela M. Trivedi

For Appellant(s) Ms. Archana Pathak Dave, Adv. Ms. Swati Ghildiyal, AOR Ms. Devyani Bhatt, Adv.

For Respondent(s) Mr. P. K. Manohar, AOR

Constitution of India -Article 30-If an employee is continued in service by the management of any registered minority Secondary School receiving Grant-in-Aid from the State-Government, then such school would not be entitled to receive any grant in respect of the expenditure incurred for continuing such employee beyond the stipulated superannuation age.