IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated: 22.06.2006 Coram: The Honourable Mr. Justice P. SATHASIVAM & The Honourable Mr. Justice V. DHANAPALAN W.A. Nos. 635 & 636 of 2001 The Association of Educational Institutes for Hotel Management & Catering Technology Reg. No.135/97 represented by its President Mr. M.P. Purushothaman D-103 Aruna Complex Chennai – 600 102 .. Appellant in both the appeals/ Petitioner in both WPs. Vs. 1. The Government of Tamil Nadu represented by its Secretary Higher Education Department (J2) Secretariat Chennai – 600 009 2. The Director of Technical Education Chennai – 600 025 .. Respondents in both the appeals/ Respondent in both Wps. Writ Appeals filed under Clause 15 of the Letters Patent against the order dated 14.11.2000 passed in W.P. Nos. 10271 of 1999 and 4156 of 2000. WP 10271/99:Filed under Art.226 of the constitution of India praying for the issue of writ of certiorarified mandamus in the nature of writ calling for records of the first respondent in G.O. (Ms)No.154, Higher Education (J1) Department dt. 15.4.99 and quash the same in so far as it relates to the members of the petitioner association and direct the respondents to fix the fees atleast on par with the fees prescribed in the Catering Institutes run by the State Government and Central Institutes. WP 4156/2000: Filed under Art.226 of the constitution of India to issue a writ of Certiorarified Mandamus or any other appropriate writ, order or direction in the nature of writ, calling for the records of the respondents relating to the order of the 1st respondent in G.O.Ms.No.12,Higher Education Department dated 18.01.2000 and quash the same and directing the respondents to fix https://hcservices.ecourts.gov.in/hcservices/ the fees structure for Catering Technology and Hotel Management Institutes for 2000-2001 atleast at Rs.39,000/- for Free Seat and Rs.58,500/- for payment seat per annum in so far as the Members of the petitioner Association are concerned. For appellants Mr. Kandavadivel Doraisamy For respondents Mr. M. Dhandapani Additional Government Pleader - - - - COMMON JUDGMENT (Judgment of the Court was delivered by V. DHANAPALAN, J.) These two Writ Appeals are directed against the order dated 14.11.2000 of the learned Single Judge made in W.P. No.10271 of 1999 challenging the Government Order in G.O. Ms. No.154, Higher Education (J-1) Department dated 15.04.1999 and W.P. No. 4156 of 2000 challenging the Government Order in G.O. Ms. No.12, Higher Education Department dated 18.01.2000. Both these Government Orders were issued in respect of regulation of tuition fees in unaided self- financing polytechnics and revision of fees for diploma course in unaided Hotel Management and Catering Technology institutions. 2. In this judgement, for the sake of convenience, we shall refer the parties as per their rank before the learned single Judge. 3. The learned single Judge, after finding that the fixation of the fees cannot be on the basis of the admission made for each institution, held that it can be fixed only on the basis of sanctioned strength of the institutions. It was further held that merely because the petitioners could not fill up the payment seats, they cannot challenge the fixation of the fees which has been done, taking into consideration, the sanctioned strength of the institution and the materials furnished before them. Moreover, the Committee consisting of experts have given valid reasons to fix the quantum of fees as stated in the report which had been accepted by the Government and it is a well-settled principle that this Court cannot sit on appeal on those reasonings and nothing has been pointed out as to how the Committee has erred or omitted to consider the relevant portion of the objections while fixing the fee structure and in that view of the matter, the learned single Judge dismissed the writ petitions filed by the petitioner associations (hereinafter referred to as "the petitioners") as there were no merits. 4. The petitioner is an association of educational institutes for Hotel Management and Catering Technology and its registration no. is 135/97 and its Registered Office is at D-103, Aruna Complex, Chennai – 600 102. The self-financing Hotel Management and Catering https://hcservices.ecourts.gov.in/hcservices/ Institutes in Tamil Nadu have been functioning since early 1990s purely based on the fee structure prevailing in the State-run Food Craft Institute, now known as State Institute of Hotel Management and Catering Technology, Trichy and the Central Government-run Institute of Hotel Management and Catering Technology and Applied Nutrition, Adyar. Since its establishment, these self-financing catering institutes were not getting any grants from the Government or the Government Agencies unlike the State Institute of Hotel Management and Catering Technology, Trichy and Institute of Hotel Management and Catering Technology and Applied Nutrition, Tharamani. 5. The Hotel Management and Catering Technology Institute at Tharamani is being run by Tamil Nadu Tourism and Development Department as a self-financing Institute. This Institute was under the Board of Tamil Nadu Tourism & Development Corporation – a Government body in which the Director of Technical Education is also a member in the Governing Body, was charging Rs.35,000/- per year for the year 1998-99. Based on the above fees only, the petitioners have invested huge sum of money and started the Institutes. 6. The Government of Tamil Nadu, has issued G.O.Ms. No.154, Higher Education (J1) Department dated 15.04.1999, in which it was ordered that the levying of tuition fees in unaided self-financing polytechnic and catering institutes can issue notification. In exercise of powers conferred by sub-section (1) of Section 4 of the Tamil Nadu Educational Institutions (Prohibition of Collection of Capitation Fee) Act, 1992 (Tamil Nadu Act 57 of 1992) and in supersession of the Higher Education Department Notification S.R.O. No.lI(2)issued notification fixing certain fee structure for unaided self-financing polytechnic and catering technology. Further, in the Government Order issued in G.O. Ms. No.12 dated 18.01.2000 wherein orders have been issued for collection of tuition fees for diploma courses in unaided Hotel Management and Catering Technology institution. The revision of fees was ordered in that in order to regulate the fees under two heads namely tuition fees and development fees as stipulated in the policy guidelines of the Ministry of Human Resources Development, Government of India. Accordingly, the revised fee structure has been issued in the above order. Aggrieved by two Government Orders, the petitioners have filed the above two writ petitions. 7. The main grievance of the petitioners is that the fee fixed by the Government is not on par with the fee fixed by the Government Institutes and the ratio in which the fee structure between the free seat and that of the payment categories is irrational arbitrary, unconstitutional and contrary to the guidelines issued by the Supreme Court. Taking into account the expenses incurred by the Institutes, the Committee has not fixed the fees. The schemes, plans and budget of individual institution for the purpose of finding out what would be https://hcservices.ecourts.gov.in/hcservices/ an ideal and reasonable fee structure for that institution based on the Committee's decision since the Committee has not fixed the fees and the fee fixed in the Government Order dated 18.01.2000 cannot be sustained in law. 8. It was also contended by the petitioners that the orders of the Government are void since the objection of the petitioners was not at all considered and therefore, there is a violation of principles of natural justice. The respondents have failed to take note of the fee structure prevailing in the Central Government Catering Institutes as well as the Catering Institutes of the State Government and also the ratio of 1:1 is not maintainable by the respondent in allotting payment seat category and free seat category students in the window system. 9. The respondents have filed their counter contending that the Government, after examining the objections and suggestions received with respect to the draft notification, have fixed the fees. According to the respondents, the self-financing catering institutes should get approval of AICTE for its establishment. The institution permitted to be established without aid from the Government must follow the rules and norms prescribed by the Government from time to time. The Government, in order to prohibit the collection of capitation fee for admission to educational institutions in the State of Tamil Nadu and to provide for matters relating thereto, promulgated an ordinance called "the Tamil Nadu Educational Institutions (Prohibition of Collection of Capitation Fees) Ordinance 1992 which was later on enacted as Tamil Nadu Act 57/92. Exercising powers under the said Act, the Government issued a draft notification in G.O. Ms. No.727, Higher Education (J2) Department dated 29.02.1993 prescribing the tuition fee to be collected from the students. The Government, after examining the objections and suggestions received with regard to the draft notification, confirmed the draft notification with respect to the fees to be collected with effect from the academic year 1994- 95. The fees fixed by the Government for free seat and payment seat in self-financing institutions have not been challenged till 1998. Further, it is provided that the Government may regulate tuition fee or any other fee and no educational institution shall receive or collect any fee or accept deposit in excess of the amount notified and every educational institution shall issue an official receipt for the fee or deposit received or collected by it. 10. In order to regulate fee structure, the Government of Tamil Nadu constituted a Committee as per the policy guidelines in fee fixation in private unaided educational institutions imparting higher education and technical education including the Management Education by Ministry of Human Resource Development. The Committee was constituted under the Chairmanship of Dr. B. Ilango, Vice Chancellor, Bharathiar University with other members in its Government Order in G.O. Ms. No.215, Higher Education Department dated 01.06.1998. Before https://hcservices.ecourts.gov.in/hcservices/ the Committee could submit its report, the Association of self- financing institutions filed writ petitions in W.P. Nos. 9502 of 1998, etc. to fix the tuition fees. This Court by its order dated 05.10.1998, in the above writ petitions, passed an order inter-alia stating that the petitioner institute and also other institutes which are similarly situated are permitted to collect development fees at Rs.1,000/- for free seats and Rs.3,500/- for payment seats and for NRI seats for the academic year 1998-99 and it is for the institute to decide whether they should collect the same in one instalment or in any instalments. Further, this Court, by order dated 03.11.1998 made in the above writ petitions, directed the Government to issue copies of the report to the management and further directed that before taking final decision, the Management is also to be heard. As per the direction, the Committee's report was given to the petitioners, objections and suggestions were received from association, institutes, students and parents and were carefully considered by the Government. The Government, after careful consideration, issued the order in G.O. Ms. No.154 dated 15.04.1999 fixing the tuition fee to be levied by the unaided self-financing polytechnic and catering institutes. 11. According to the respondents, while replying to the averments made in W.P. No.4156 of 2000, it was contended that as per the direction of the High Court in W.P. No.10271 of 1999, the Government appointed a fresh Committee and after getting the report from the Committee, the Government accepted the recommendations and notified the same. It is stated that the State Government have power to fix the fees with respect to the professional colleges in view of the decision of the Apex Court in Unnikrishnan J.P. Vs. State of Andhra Pradesh reported in (1993) 1 SCC 645 (hereinafter referred to as "Unni Krishnan case") in which it is declared that no institution shall receive capitation fee and a draft scheme was prepared on the basis of which admission was regulated in various professional colleges. The Supreme Court, in the said judgment, has evolved a scheme in the nature of guidelines which the appropriate Governments and recognising and affiliating authorities shall impose and implement in addition to such other conditions and stipulations as they may think appropriate as conditions for grant of permission, grant of of recognition or grant of affiliation, as the case may be. Precisely, for our reference, in paragraph 210, sub-paragraph (6)(a), it was held as follows: "Every State Government shall forthwith constitute a Committee to fix the ceiling on the fees chargeable by a professional college or class of professional colleges, as the case may be. The Committee shall consist of a Vice-Chancellor, Secretary for Education (or such Joint Secretary, as he may nominate) and Director, Medical Education/Director, Technical Education. The Committee shall make such enquiry as it thinks appropriate. It shall, however, give opportunity https://hcservices.ecourts.gov.in/hcservices/ to the professional colleges [or their association (s), if any] to place such material, as they think fit. It shall, however, not be bound to give any personal hearing to anyone or follow any technical rules of law. The Committee shall fix the fee once every three years or at such longer intervals, as it may think appropriate. 12. In view of the above-said decision, the State Government appointed an expert Committee and on the basis of the report regarding fee structure to be followed in professional course in the institutions, the Government have issued notification fixing the fees with respect to the Colleges in question to be paid by the students to the unaided self-financing polytechnics and catering institutes. Thereafter, as per the directions of P. Shanmugam, J., vide his order dated 13.08.1999 in W.P.M.P. No.16474 of 1999 in W.P. No.10271 of 1999, the State Government, by order dated 07.09.1999, directed the Director of Technical Education to re-constitute the existing Committee constituted in G.O. Ms. No.215, Higher Education, dated 01.06.1998 with the same officials under the leadership of Dr. B. Ilango, Vice-Chancellor, Bharathiar University, Coimbatore to consider the representation of the petitioners and private catering institutes, including the Government institutions and submit its report to enable the Government to pass final orders within the time stipulated by the High Court. The Committee heard the suggestions made by the Management and Catering Technology Institutes and made recommendations to the Government. 13. Based on the above recommendations, the Government issued a draft notification in G.O. Ms. No.478, Higher Education, dated 06.12.1999 fixing the fees in respect of self-financing Hotel Management and Catering Technology institutions for the academic year 1999-2000 to be in force till 2001-2002. The said draft notification was published in the Gazette and objections and suggestions were invited from many persons with respect to the same. After the receipt of the said objections and considering the same, the Government have regularised the fees in the impugned G.O.Ms.No.12, Higher Education Department dated 18.01.2000. 14. As per the said Government Order, the following free structure was framed aggrieved by which, the petitioners filed these two writ petitions. https://hcservices.ecourts.gov.in/hcservices/ UNAIDED HOTEL MANAGEMENT AND CATERING TECHNOLOGY Courses Proposed tuition fees including special fees Development fees Total Hotel Management & Catering Technology 1. Free seat 10800 1000 11800 2. Payment Seat 43200 3500 46700 3. NRI Student 43200 3500 46700 Tuition fees shall include special fees and laboratory fees and shall be inclusive of library expenditure, maintenance expenditure, training cost and contingent expenditure such as stationery, sports, water and any other recurring expenditure. 15. Aggrieved by the above fee structure, the present appeals. 16. Heard Mr. Kandavadivel Doraisamy, learned counsel for the appellants and Mr. M. Dandapani, learned Additional Government Pleader for the respondents. 17. It is not in dispute that the Government of Tamil Nadu, in order to prohibit the collection of capitation fee for admission to educational institutions in the State of Tamil Nadu and to provide the matters relating thereto, promulgated an ordinance called "the Tamil Nadu Educational Institutions (Prohibition of Collection of Capitation Fees) Ordinance 1992 which was later on enacted as Tamil Nadu Act 57/92 and exercising powers under the said Act, the Government issued a draft notification in G.O. Ms.No.727, Higher Education (J2) Department dated 29.02.1993, prescribing the tuition fee to be collected from the students. It is also not in dispute that in view of the decision of the Apex Court in Unni Krishnan case, the State Government appointed an expert Committee on the basis of the report regarding the fee structure to be followed in professional courses in the institutions and the Government have issued notification. 18. It is also seen that pursuant to the direction of the Supreme Court in Unni Krishnan case (supra), as an interim measure, fee was fixed in various States for private engineering colleges at the rates that were found to be acceptable to Courts. The A.I.C.T.E. framed regulations with respect to the engineering colleges incorporating the scheme laid down by the Supreme Court. Likewise, https://hcservices.ecourts.gov.in/hcservices/ the University Grants Commission also prepared a draft regulation in this regard. While considering the status of implementation of the scheme in Unni Krishnan's case, the Apex Court in its order dated 09.08.1996, directed the Central Government, including the Ministry of Education, to take steps to convene a meeting of all the concerned authorities for evolving a proper fee structure for Medical, Engineering and Dental colleges throughout the country within three months. As per the said direction, meetings were held on 30.08.1996 and 08.10.1996. In the said meetings, it was decided that self- contained policy directions could be issued applicable to all sectors of education falling within the purview of the Ministry of Human Resource Development, namely, higher and technical education. The policy decision taken was placed before the President of India, who granted approval for the same. Clause 6.6 of the Resolution provides for fee determination, which reads as follows: "6.6 Fee determination: a Fee will have two broad categories – Tuition fee and Development fee. Besides, the management of the institutions may realise the actual cost of boarding and messing from the above students subject to the relevant Committee being satisfied about the reasonableness of such costs. b Tuition Fee will seek to recover the actual cost of imparting education. While assessing a fair tuition fee, the Committee will take into account the following: i Salary and allowances including bonus, if admissible, to teaching and non-teaching employees; ii Expenditure on administrative services iii Cost of maintenance of laboratories including consumables iv contingent expenditure including statutory requirements like adult fee, etc. v Cost of acquisition of books and journals for libraries and vi Maintenance of buildings and other assets including rents and tariffs. Keeping the above parameters in view, suitable rates will be fixed for holders of "free", "payment" and "NRI/Foreigh Students" categories. c. The UGC and AICTE will forthwith prepare norms relating to staffing and scales of expenditure for other https://hcservices.ecourts.gov.in/hcservices/ items wherever such norms have not so far been worked out, to the extent feasible, in cases where it is difficult to lay down specific quantified norms, the relevant Committee shall satisfy themselves about the adequacy and reasonableness of the expenditure involved. Care will be taken to ensure that the projected expenditure does not become a source of profit to the sponsors. d As the scheme in UNNIKRISHNAN prohibits commercialisation and profit-making, it will not be open to the institutions concerned to claim any return on investments. This should, however, not come in the way of the institutions in mobilising resources for replacement and upgradation of assets. Further, while earning, return on investment would not be permissible the Court had, in the Unni Krishnan judgment left the question of recovering investment on the Central Government and the statutory bodies therefore considered desirable that the Development Fee could provide for an element of partial capital cost recovery to the management but not a return on investment and to serve as a resource for upkeep and replacement. e Development Fee may be at flat rates to be determined every three years by the AICTE and UGC as the case may be. Different rate may be prescribed for "payment" and "free/merit", and "foreign/NRI" seat holders. These bodies could also classify institutions in different categories for the purposes of prescribing different slabs provided such categorisation is based on intelligible and objective criteria. f In the first ten years, it would be open to the managements to appropriate upto half of the proceeds of the Development Fee or the actual capital cost, whichever be lower. The remaining half will have to be utilised for upgradation and replacements in the first ten years and thereafter, the entire proceeds will have to be so utilised. g As the fee chargeable will be notified by the relevant Committee, it will be the duty of the statutory body concerned to communicate the rate of Development Fee to such bodies well in advance to enable the appropriate Committees to suitably incorporate such rates in their Notification. The UGC/AICTE will take into account the views and suggestions of the private institutions, the State Government and interested members of public while determining these rates" 19. On that basis, the Government also appointed a Committee earlier and the petitioners were not satisfied with the same and the learned single Judge, as stated above, directed the Government to https://hcservices.ecourts.gov.in/hcservices/ refer the fee structure and accordingly, the Committee was reconstituted under the Chairmanship of Dr. B. Ilango, Vice- Chancellor, Bharathiar University, Coimbatore with other members. 20. The said Committee submitted a report in which Table-A contained a working sheet for fixation for Tuition and other fees for the institutions in question. In Table-B of the report, the Committee has recommended the ceiling rate of Tuition Fees and Development Fees, after taking into account, the various aspects placed before it. 21. The learned single Judge, after analysing all aspects and after finding that the fixation of the fees cannot be on the basis of the admission made for each institution, held that it can be fixed only on the basis of sanctioned strength of the institutions. Merely because the petitioner could not fill up the payment seats, the petitioner cannot challenge the fixation of the fees which has been done, taking into consideration the sanctioned strength of the institution and the materials furnished before them. Moreover, the Committee consisting of experts have given valid reasons to fix the quantum of fees as stated in the report which had been accepted by the Government and it is a well-settled principle that this Court cannot sit on appeal on those reasonings and nothing has been pointed out as to how the Committee has erred or omitted to consider the relevant portion of the objections while fixing the fee structure and the learned single Judge dismissed the writ petitions filed by the petitioner associations (hereinafter referred to as "the petitioners") as there were no merits. 22. The learned counsel for the appellants has strenuously contended that the impugned order is vitiated by arbitrariness and the learned single Judge has failed to see that the prayer of the appellants that the fee structure should be fixed on par with the fees collected by similar institutions run by the State Government and the Central Government is a reasonable one and the same is sustainable. Further, he has assailed the decision of the learned single Judge on the ground that the impugned order is not in accordance with the understanding arrived at in the meetings held within the members of the appellant association as the learned single Judge has failed to see that the report of the Committee would establish the case of the appellant and failure to furnish the copy of the report would vitiate the impugned orders and the appellant made out a case for re-fixing the fee structure on par with the fee structure prevalent in the institutions run by the State Government and the Central Government. It is his further contention that the conclusion of the learned single Judge that merely because the petitioner could not fill up the payment seats, the petitioner cannot challenge the fixation of fees which has been done taking into consideration the sanctioned strength of the institution and the materials furnished before them, is not correct. 23. The learned counsel for the appellants has brought to the https://hcservices.ecourts.gov.in/hcservices/ notice of this