CIVIL WRIT PETITION NO. 11223 of 2009 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CIVIL WRIT PETITION NO. 11223 of 2009 DATE OF DECISION: April 27, 2011 Haryana Progressive Schools' Conference (Regd.) .....Petitioner VERSUS The State of Haryana and others ....Respondents CORAM:- HON'BLE MR.JUSTICE RANJIT SINGH Whether Reporters of local papers may be allowed to see the judgement? 1. To be referred to the Reporters or not? 2. Whether the judgment should be reported in the Digest? PRESENT: Mr. Ashwani Kumar Chopra, Sr. Advocate with Mr. Aashish Chopra, Advocate, and Ms. Rupa Pathania, Advocate. Mr.H.L.Tikku, Senior Advocate with Mr.Sumeet Goel, Advocate & Ms.Yashmeet, Advocate. Ms. Sharuti Jain, AAG, Haryana, for the State. Mr.Raman Sharma, Advocate. Mr. D.D. Sharma, Advocate. Mr.Lokesh Sinhal, Advocate. **** RANJIT SINGH, J. CIVIL WRIT PETITION NO. 11223 of 2009 -2- This order will dispose of Civil Writ Petition Nos.11229 of 2009 (Appejay Education Society & another Versus The State of Haryana and others), 15039 of 2009 (Appejay Education Society & another Versus The State of Haryana and others), 17748 of 2009 (Bhagat Singh Bisht & another Versus The State of Haryana and others, 19311 of 2009 (West Academy Senior Secondary School Versus The State of Haryana and others, and COCP No.2200 of 2009 (Bhagat Singh Bisht & another Versus The State of Haryana and others). Unaided school either individually or through their organisation has filed these writ petitions for quashing order/memo No.7/4/-09-PS(2) dated July 6, 2009 issued by respondent No.2 in exercise of power, which is termed as illegal, without jurisdiction and violative of Articles 14 and 19 (1)(g) of the Constitution of India. It is further urged that the same is opposed to principles of natural justice, equity and fair play. Since the common question of law and fact arises in all these writ petitions, the same are being disposed of through this common order. The facts have been taken from CWP No.11223 of 2009. This writ petition is filed by Haryana Progressive Schools' Conference (Regd.) with a plea that most of the member schools of the petitioner Association are running schools in the State of Haryana for almost twenty to thirty years. All the schools are well established, enjoy a good reputation and a lot of goodwill. All the schools are engaged in providing education and have been established after obtaining a 'No Objection Certificate' from the CIVIL WRIT PETITION NO. 11223 of 2009 -3- State of Haryana. The schools are either affiliated with CBSE or ICSE and are duly recognised. Being an unaided institution, the schools are not in receipt of any grant from the State Government and the facilities, infrastructure etc. are being provided by the school authorities themselves. The Management is meeting all the requirements from its own resources. Each of the school has its own managing committee, which is functioning subject to the control of the rules of society/trust and exercise power to supervise the activities of the school, besides looking after the welfare of the teachers and employees. Managing Committee is also responsible for making appointment of teaching and non-teaching staff and is further responsible in regard to the tuition fee and other annual charges being levied by the schools. It is pleaded that the schools need lot of funds not only for providing State of Art infrastructure and facilities to the students but also for payment of salary to their teaching and non-teaching staff, for which these schools have to abide by the pay structure as fixed by the Government. These above noted acts are essentially required to be performed for establishing, administering and running private unaided schools. The petitioner would claim that looking at the standard of education and other facilities provided by such schools, the admission to such schools is coveted. To maintain this high standard, the unaided schools have to meet the requirement of funds from their own sources as they are not receiving any aid from the Government. It is, thus, pleaded that the schools have no other source but to CIVIL WRIT PETITION NO. 11223 of 2009 -4- charge adequate fee from the students. The petitioner would like to add that only just sufficient fee is charged to meet the cost of essentials and which is required for providing and maintaining standard of education. The petitioners then would plead that in order to meet the increasing cost and expenses every year and to maintain the high standard, the respective managing committees of the schools have taken a decision to increase the fee, which is done yearly. So far, the schools have been increasing the fee as per the requirement without any interference from any authorities much less by the respondents. However, with the advent of Haryana Education Code enacted on 4.6.1999, the things have undergone a change. It may be noted that the State of Haryana for the purpose of regulating the functioning of the schools in the State had initially formulated Haryana Education Code and later enacted Haryana School Education Act, 1995 (for short “the Act”) which was published in official gazette on 4.6.1999. Section 24 of this Act confers power on the State to make rules for carrying out the purposes of the Act. In exercise of power conferred under Section 24, the State has framed Haryana School Education Rules, 2003 (for short “2003 Rules”) which are published in the official gazette on 30.4.2003. The provisions of the Act and the Rules so framed were challenged by Haryana Progressive Schools' Conference (Regd.) through CWP No.13433 of 2003 on the ground that these enactments had sought to curtail the rights of unaided privately managed schools/institutions in the State. However, this court was CIVIL WRIT PETITION NO. 11223 of 2009 -5- pleased to dispose of the said writ petition by observing that schools would continue to run till a final decision is taken by the State Government. Consequent upon the receipt of the report of the committee constituted under the Chairmanship of respondent No.3 and the right of the petitioners to challenge the decision was kept intact. It is averred that no report till date has been prepared by the committee but instead 2003 Rules have been amended in the year 2007, which have come into force with effect from April 1, 2007. Aggrieved against this amendment, the petitioner Association once again approached this Court through CWP No.5047 of 2007 with a prayer that the respondents be directed not to interfere in the working of unaided privately managed member schools. This court while issuing notice of motion was pleased to stay the operation of notice dated 3.3.2007, whereby the recognised/unrecognised private schools in the State of Haryana were directed to apply for recognition under the amended rules within 15 days of the publication of notice. This writ petition stands admitted and is pending final adjudication. During this time, the managing committee of the respective member schools had been increasing the fee from time to time without any interference or protest from any quarter. Now the schools took a decision to increase the tuition fee ranging from 15% to 40% for the academic session 2009-2010 keeping in view all the factors which are relevant for determining such a fee. The petitioners would claim that this decision is taken keeping in view not only the increasing expenses incurred for providing better CIVIL WRIT PETITION NO. 11223 of 2009 -6- facilities and infrastructure but primarily is to meet the requirement of additional expenditure which they would have to meet in view of the recommendation of 6th Pay Commission report. It is pleaded that in certain cases, the fee which is being charged is hardly sufficient even to meet the salary expenses and it is accordingly urged that to maintain strength of the students and to pay the salary as per the recommendation of the 6th Pay Commission report, substantial hike in tuition fee was inevitable. Respondent No.2, however, vide a general order on 6.7.2009 purportedly in exercise of powers conferred under Sections 16 (3), 21(3) read with Sections 4 and 5 of Section 17 of 1995 Act and rules framed in the year 2003 has issued directions to all unaided private schools to regulate the fees to be charged from the students w.e.f. academic session 2009- 2010. Respondent No.2, inter-alia, has directed the schools that if they are to enhance the salary of staff in view of 6th Pay Commission report, then the schools may first explore the possibility of utilizing the existing reserves to meet the shortfall, if any. If the short fall cannot be so met, then direction is to increase the tuition fee only to the extent of shortfall to meet the increased expenditure. Not only that, it is further directed that tuition fee to be charged shall not be increased from 20% of the last year's tuition fee under any circumstances. A justification for the increase had also been sought for in form VI and it is further provided as a condition that only those schools which have submitted information in Form VI as per provisions of Rule 158 of the 2003 Rules within a stipulated period shall be allowed to enhance the fee. The schools CIVIL WRIT PETITION NO. 11223 of 2009 -7- which had not submitted their information for the academic year 2009-2010 were given additional 15 days to comply with the directions. The increase of fee, if any, was to be effective from 1.4.2009. The petitioners accordingly have approached this court to challenge this direction on the ground that respondent No.2 has no authority or jurisdiction to pass such an order fixing the fee to be charged by recognised unaided private schools from the students. It is stated that there is no provision either in the act or in the rules that would entitle respondent No.2 to pass such an order. No provision in this regard is mentioned in the impugned order and hence prayer is made to quash this Annexure permitting the petitioners to raise the tuition fee. Initially, a short written statement was filed on behalf of respondent Nos.1 to 3. Later, detailed pleas were raised in the written statement so filed. Respondents would justify the action in passing the impugned order and would contend that same is well within the jurisdiction of respondent No.2. Reference is made to Section 16(3) of the Act which provides that before commencement of academic session, the schools are required to file with the Director, a full statement of fee to be levied by all such schools during the ensuing academic session. It is accordingly pleaded that no school can charge any fee specified in the said statement. Such fee has to commensurate with the facilities provided by the schools. As per the respondents, Section 16(3) is a regulatory in nature and so the unaided recognised schools cannot claim absolute freedom to lay down the fee structure. It is accordingly pleaded that Section CIVIL WRIT PETITION NO. 11223 of 2009 -8- 16(3) of the Act is in the form of reasonable restriction on the right of petitioner-institution under Article 19 of the Constitution of India to run the unaided schools. In the short reply, mention is made to proceedings of a meeting of all the schools affiliated with CBSE held on 11.12.2006 where some decisions were taken to the effect that all the schools shall follow the provisions of the School Education Act, 1995 and the provisions of 2003 Rules. As per this decision, it was agreed that a detailed comparative assessment of the fee charged and the facilities provided could not be made, but the management was to submit their proposal of fee structure in the coming academic session before the PTA meeting and the change was to be made, if any, jointly by the managing committee and the PTA. It is accordingly stated that it would be open to the schools with the PTA to work out the fee structure, whereas department was to deal with the anomalies/discrepancies as per law. This is termed as a balanced approach which would provide freedom to the schools to work out fee structure and on the other hand to iron out the differences, if any, in accordance with law. The respondents accordingly would plead that the recognised private schools cannot claim absolute freedom to lay down any fee structure of its own choice. As per the respondents, the schools cannot be left on to themselves to safe guard their commercial interest in absolute terms. State claims to be under bounden duty to ensure a proper fee structure, which cannot be permitted to be exploitative. It is pointed out that the school education is neither purely a business or CIVIL WRIT PETITION NO. 11223 of 2009 -9- commercial activity nor a profit making business. To an extent, it is a social obligation. As per the respondents, the school education is a public purpose and public duty and since the State cannot monopolies facilities for school education, private unaided schools are allowed to set up schools. These schools may be unaided but they are partners with the State in discharging the public duty. Respondents would further plead that both private and Government schools have to ensure that school education reaches to all those, who are in need of the same. It is, thus, stated that the State can always impose reasonable restrictions as running of school is not purely a commercial or a business activity. The respondents would urge that order, Annexure P-1, has been passed in exercise of specific powers conferred in the Act and Rules. The instructions/restrictions, if any, are reasonable, just and fair. It is pointed out that the schools have been given liberty to increase tuition fee upto 20% of the last year tuition fee, which is substantial increase. The schools, thus, cannot make any grievance. Reference is also made to that part of the order where schools have been asked to explore all possibilities of utilising the existing reserves to meet the shortfall. it is pointed out that the schools have been revising the fee structure frequently from time to time and the pay structures have now been increased after a gap of ten years. To justify their action, the respondents would plead that it would be reasonable for the schools to first utilise the existing reserves, which would be a balanced approach. As per the respondents, the judgment in the case of T.M.A. Pai Foundation CIVIL WRIT PETITION NO. 11223 of 2009 -10- relied upon by the petitioners does not give right to the private schools to lay down the fee structure which may be arbitrary and violative of Article 14 of the Constitution. The plea further is that the Hon'ble Supreme Court has not granted any freedom to work out fee structure. In the detailed written statement filed by the respondents, preliminary objection is raised about the maintainability of the writ petition. It is urged that the petitioner schools could very well challenge the impugned order before the Financial Commissioner and Principal Secretary, Government of Haryana under 2(b) of Haryana School Education Rules, 2003. Reliance is placed on Sections 16(3) & (4) of the Act and the provisions of the rules, which, as per the respondents would empower them to formulate and regulate the fee structure and other funds to be charged from the students. It is accordingly stated that these legal provisions clearly establish that the fee structure of unaided private recognised schools is always subject to the approval of the prescribed appropriate authority, i.e., Director Secondary Education, Haryana and without his concurrence, fee structure cannot be changed. The requirement of submitting Form- VI as per the rules is highlighted, besides making reference to such forms submitted by various petitioners. These forms were statedly under process as per the reply. Reference is made to the case of Action Committee, Unaided Private Schools & Others Vs. Director of Education, New Delhi, 2009(11) SCALE 77, where it is held that “to set up a reasonable fee structure is also a component of right to CIVIL WRIT PETITION NO. 11223 of 2009 -11- establish and administer an institution within the meaning of Article 30(1) of the Constitution, as per the law declared in Pai Foundation. Every institution is free to devise its own fee structure subject to limitation that there can be no profiteering and no capitation fee charged directly or indirectly”. As per the respondents, it is obligation of the Administrator or the Director of Education to prevent commercialization and exploitation in private unaided schools. Reference is made to notices and reminders issued to parents for payment of hike dues, which is termed as inhuman. There was accordingly a resentment against the fee hike in charging of funds and arrears of salaries of teaching and non- teaching staff due to revision in salary, which was voiced through various representations received from Millennium Parents' Association, Gurgaon and some other associations. It was then found that the aforesaid institutions were committing violation of act and rules and had hiked the fee structure without concurrence of the competent authority. In order to regulate the fee structure the impugned order was issued, which is stated to be legal, valid and binding on the petitioners. The counsel for the parties have made detailed submissions spanning over few days and have referred to large number of precedents mostly of the Hon'ble Supreme Court. The gist of the submissions made on behalf of the petitioners to make a challenge to the impugned order is on the ground that hike is justified due to increase of cost of providing facilities and infrastructure. As per the petitioners, there has been increase of CIVIL WRIT PETITION NO. 11223 of 2009 -12- 75% in the salary as per the 6th Pay Commission from 2006-2009. The Bank rates of interest have increased. There has been substantial increase in the electricity charges and usage. The cost of training teachers in getting them certified for imparting quality education has also statedly increased by 100% from 2006-09. The cost of purchasing/replacing computers/software which have become old and obsolete have also increased and there has been tremendous increase of cost in the repairs and maintenance. The petitioners would accordingly plead that respondents are not justified at all in ignoring all these factors while issuing the impugned order and certainly had gone beyond its jurisdiction to direct the petitioners to use their reserves to meet the expenditure on account of increase in salaries. As per the petitioners, there is no authority or jurisdiction with the respondents to put a cap of 20% for increasing the salary as has been directed. The petitioners would also urge that no increase order where Form-VI is not submitted, is also highly arbitrary. The counsel for the petitioners have mainly urged that order is totally without jurisdiction and is illegal because there is no power with the respondents to issue such direction. As per the petitioners, Sections 16(3), 21(3) and 17(4) and (5) of the Act and Rules 30(XVI), (XVII), 158, 159 and 160 of the Rules do not provide any such power and as such the impugned order is without jurisdiction. The petitioners would place heavy reliance on the case of T.M.A.Pai Foundation Versus State of Karnataka, AIR 2003 SC 355=(2002) 8 SCC 481 to urge that essence of private unaided CIVIL WRIT PETITION NO. 11223 of 2009 -13- institution is autonomy and maximum autonomy is in fixing the fee. The submission is that the decision of fixing fee is to be left with the schools and fixing rigid fee structure is an unacceptable restriction as per the view expressed in the T.M.A.Pai's case (supra). Reliance is placed on the case of Islamic Academy of Education and another Vs. State of Karnataka and others, AIR 2003 SC 3724=(2003) 6 SCC 697, where T.M.A. Pai's judgment has been followed. Reference is also made to the case of P.A.Inamdar and others Versus State of Maharashtra and others, (2005) 6 SCC 537, where it is observed by the court that every institution is free to devise its own fee structure subject to the limitation that no capitation fee can be charged and that there can be no profiteering. The petitioners would refer to the case of Unni Krishnan, J.P. And others Versus State of Andhra Pradesh and others, AIR 1993 SC 2178= (1993) 1 SCC 645, where the court had emphasized the important role being played by private unaided educational institutions and the need for private funding. On the basis of rule of law in the case of Cochin University of Sciences and Technology and Anr.Vs. Thomas P. John and Ors. (2008) 8 SCC 82 it is urged that an educational institution must be left to its own devices in the matter of fixation of fees. Number of other judgments were also referred and relied upon by the counsel, reference to which would be made at relevant place while dealing with the issues. On the contrary, the counsel appearing for the respondents alongwith some of the parents' association would CIVIL WRIT PETITION NO. 11223 of 2009 -14- seriously join issue with the line of submissions made on behalf of the petitioners. It may be noticed here that misc.applications were filed by some of the Parents' Associations, like Faridabad Model School Parents' Association, Dynasty Parents Association, Faridabad and Eicher Parents Association for being impleaded as party respondents. This court, however, was of the view that the issue can conveniently and affectively be adjudicated even without allowing the associations aforesaid to become a party. However, in the interest of justice, these institutions were allowed to intervene but without filing any pleadings. The counsel representing such parent associations have accordingly been heard, though, prima- facie I am of the view that they have no locus. During the pendency of the case, the court had issued some interim direction for the respondent-State not to take any coercive measures against the petitioners and the petitioners were directed not to charge any enhanced fee more than permitted till the next date of hearing. This order was passed on 12.10.2009. The interim order was subsequently continued. A contempt petition also was filed which was kept for hearing alongwith these writ petitions. The counsel for the respondents have relied upon directive principle contained in Article 41 of the Constitution, whereby the State is to make effective provision for securing right to education. Reliance is placed on the judgment of Government of A.P. Vs. Medwin Educational Society, AIR 2004 SC 613 to submit that the right to establish and administer educational institutions although available to all citizens as a fundamental right CIVIL WRIT PETITION NO. 11223 of 2009 -15- under Article 19(1)(g) and to manage religious affairs under Article 26 and that of minorities under Article 30 of the Constitution, but the same is subject to reasonable restrictions. The plea accordingly is that court is to see whether the restriction imposed by the State of Haryana through the impugned circular is reasonable or not. Reference is then made to the provisions of the Education Act and also to the requirement for every recognised school to file statement of fee to be charged before the commencement of academic session. Accordingly, it is submitted that Government can regulate education. To justify the circular, the State counsel would plead that they are to utilise the existing reserves to meet the shortfall, if any, due to enhanced salary and this could be so issued in terms of Section 16(3). The counsel, thus, would justify the direction not to enhance the fee beyond 20% of the prevailing fee, which would be in consonance with terms of Section 16(3) and Rule 158. The counsel would further submit that question of justification of enhancing fee beyond 20% can be answered in favour of the schools, if they show that despite utilisation of reserve, they would not be able to meet the enhanced pay of the teachers. Conceding that even if there is no direct provision in the Statute authorizing the respondent-Government to put a