Government cannot regulate the fees of private unaided schools: Karnataka High Court

The Karnataka High court has said under Justice ES Indiresh in Rashmi Education Trust Vidyaniketan School & Others v. State of Karnataka & Others(Writ Petition No. 6313 of 2017) that the cost of private, unassisted educational establishments cannot be regulated by the state government. Section 48 of the Karnataka Education Act 1983, which forbids private unaided schools from collecting fees in any way other than as authorised by the State government, was thus deemed to be out of bounds.


Petitioners in Writ petition No.6313 of 2017 are educational institutions, of which, some of the educational institutions receive grant-in-aid by the respondent-Government; and petitioner No.4 is an unaided educational institution. In this writ petition, petitioners have challenged Section 48 of the Karnataka Education Act, 1983 so also, seeking declaration that Rule 10 of the Karnataka Educational Institutions (Classification, Regulation, Prescription of Curricula etc.) Rules, 1995 (for brevity hereinafter referred to as ‘Rules 1995’); and Rule 4 of the Karnataka Educational Institutions (Regulation of Certain Fees and Donations) Rules, 1999 as unconstitutional and sought for holding that they are ultra vires the Constitution of India. It is the case of petitioners that these institutions are run by private management and some of them are unaided educational institutions, and have availed loan from Banks to run the institution. It is the case of petitioner-Institutions that these institutions depend upon the revenue generated from the fees collected. It is the categorical assertion of petitioner-institutions that the private unaided educational institutions are different from the aided educational institutions insofar as financial aspects and therefore, the fee structure of these private unaided educational institutions should be distinct and cannot be controlled by the Fee structure imposed by the respondent-State. It is the grievance of the petitioner that that frequent interference by the respondent Department in relation to charging of fees, matters of admissions of students and other related issues, in terms of the aforementioned Rules, are contrary to the spirit of the judgment of T.M.A. PAI FOUNDATION case and such interference is arbitrary and therefore, contended that it is the prerogative of private unaided educational institutions to have their own fee structure and as such, Karnataka Education (Amendment Act), 2017. It is stated that any such interference made by the State-Government with the functioning and managing of the private unaided educational Institutions, would violate Articles 14 and 19(1)(g) of the Constitution of India.


By relying on the , the Division Bench of this Court held that Sections 5, 7(5)(b), 7(1)(e) and 38(1)(a) of the Act and Rule 18(2 & 3), Rule 19(3) of the Rules 1995, and Rule 4 of Rules 1999 as ultra vires the Constitution of India and contrary to the decision of Hon’ble Supreme Court in the case of T.M.A. PAI FOUNDATION, the same is binding on the petitioners, for in some of these writ petitions those provisions are impugned, and same have to be disposed of in terms of the judgment of the Division Bench in Writ Petition No.27432 of 1995. The bench pointed out that the state government has not provided any documentation to convince the court that the challenged Notification/Amendment/Rules to the Education Act were approved by the President and the Governor. The bench said “I am of the view that Section 5-A of the Act suffers from infirmity under Article 14 of the Constitution of India. In view of the fact that Section 5-A is 155 contrary to Article 14 of the Constitution of India, hence the corresponding penal provision provided under Section 112-A of the Act, is also unconstitutional and is liable to be set aside.”

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