Education Not A "General Occupation" Under Article 19(1)(g); Profiteering Not Allowed: Petitioners Tell Delhi HC In Private School Fees Case

The Delhi High Court on Friday continued hearing a batch of pleas filed by Delhi Government and students challenging the single judge bench decision which quashed two orders issued by the Delhi Government dated 18th April and 28th August 2020 restraining private schools from collecting Annual Charges and Development Fees from students amid Covid-19 lockdown.

Today, Advocate Khagesh Jha advanced his submissions on behalf of Justice For All NGO and other private appellants. He stated that the TMA Pai Foundation v. State of Karnataka judgment which restricted the scope of regulating school fees did not intend to permit exploitation of students/ their parents.

He highlighted that the judgment itself contemplates a "reasonable" fee structure and empowers the DoE to regulate the fees for the purpose of "prevention of commercialization" of education by private recognized unaided schools. 

The matter was being heard by a division bench comprising of Chief Justice DN Patel and Justice Jyoti Singh.

Jha, continuing his arguments, relied on the case of Modern Dental College v. State Of Madhya Pradesh & Ors.

He informed the Court that a Constitution Bench of the Supreme Court had in this case categorically held that when it comes to notice of the Government that a particular institution is charging fee or other charges which are excessive, it has a right to issue directions to such an institution to even reduce the same. "So the power is not just to regulate. The power is to reduce excessive fees," he said.

"Though the fee can be fixed by the educational institutions and it may vary from institution to institution depending upon the quality of education provided by each of such institution, commercialisation is not permissible. In order to see that the educational institutions are not indulging in commercialisation and exploitation, the Government is equipped with necessary powers to take regulatory measures and to ensure that these educational institutions keep playing vital and pivotal role to spread education and not to make money," he quoted the judgment.

Similarly, in the case of PA Inamdar v. State Of Maharashtra, it was held,

"this Court cannot shut its eyes to the hard realities of commercialization of education and evil practices being adopted by many institutions to earn large amounts for their private or selfish ends. If capitation fee and profiteering is to be checked, the method of admission has to be regulated so that the admissions are based on merit and transparency and the students are not exploited. It is permissible to regulate admission and fee structure for achieving the purpose just stated."

In this backdrop, Jha insisted that education may be an "occupation" under Article 19(1)(g) of the Constitution. However, it cannot be said to be a "general occupation" and it is rather a "special occupation" which is primarily charitable in nature.

Senior Advocate Vikas Singh appeared for Directorate of Education, Delhi Government.

During the previous course of hearing, the Delhi Government submitted that the single judge had gone into a completely forbidden territory while allowing private schools from collecting Annual Charges and Development Fees from students in lockdown. It was stated that single judge had no jurisdiction to overlook the orders passed by the Division Bench of the High Court as well as the Supreme Court while dealing with the matter.

Earlier, a vacation bench comprising of Justice Rekha Palli and Justice Amit Bansal issued notice in the appeals while rejecting the interim plea praying for stay of the aforesaid judgment.

The clutch of pleas were filed assailing the order passed by the single judge bench comprising of Justice Jayant Nath wherein the bench had held thus:

"The impugned acts are prejudicial to the said Schools and would cause an unreasonable restriction in their functioning. In the above facts and circumstances, clearly the impugned orders dated 18.04.2020 and 28.08.2020 issued by the respondent to the extent that they forbid the petitioner/postpone collection of Annual Charges and Development Fees are illegal and ultra vires the powers of the respondent stipulated under the DSE Act and the Rules. The orders to that extent are quashed."

The Court observed that the department of education has the power to fix and collect fees by such unaided educational institutions only for the purpose to prevent commercialization of education by them. Observing that there was no finding recorded by the impugned orders that the collection of Annual Charges and Development Fees tantamounts to profiteering or collection of capitation fees by private unaided recognized schools.

Case Title: Directorate of Education v. Action Committee Unaided Recognized Private Schools