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Orissa Education Act, 1969 – whether a fee increase needs to be allowed for the DAV schools in Odisha to meet their liability due to implementation of 6th Central Pay Commission pay scales which had been admittedly introduced in these schools w.e.f. 1.6.2012. – The fee structure revised by the concerned schools was not approved by the State Government and the High Court held against the appellant that revision of the fee structure could not be justified by the appellant that it is commensurate with the facilities provided to the students – Apex court appointed a committee – if a private educational institution has met all the requirements of obtaining No Objection Certificate and affiliation etc. then its claim for revision of fees should be considered expeditiously on permissible parameters.- the State of Odisha has not raised any objection to the recommendations of the Fee Structure Committee, Odisha and, therefore, there is no legal impediment of any substance in allowing this appeal. = D.A.V. College Managing Committee Through Regional Director …..Appellant Versus Laxminarayan Mishra & Ors. …..Respondents = 2014 ( April. Part ) http://judis.nic.in/supremecourt/filename=41417

Orissa Education Act, 1969 – whether a fee increase needs to be allowed for the  DAV schools in Odisha to meet their liability due to implementation of 6th Central Pay Commission pay scales which had been admittedly introduced in these schools w.e.f.  1.6.2012.   – The fee structure revised by the concerned schools was not approved by the State Government and the High Court  held  against the appellant  that  revision  of  the  fee  structure  could  not  be justified by the appellant that it is commensurate with the facilities provided to the students – Apex court appointed a committee – if a private educational institution has met all  the requirements of obtaining No  Objection  Certificate  and  affiliation etc. then  its  claim  for  revision  of  fees  should  be  considered expeditiously on permissible parameters.-  the  State  of  Odisha  has  not  raised  any objection to the  recommendations  of  the  Fee  Structure  Committee, Odisha and, therefore, there is no legal impediment of  any  substance  in  allowing  this  appeal.   =


The High Court has held that DAV Public

      Schools operating in the State of Odisha, are although private unaided

      educational institutions, but are covered by  the  provisions  of  the

      Orissa Education Act, 1969 [hereinafter referred to  as  ‘the  Act  of

      1969’] and 

hence the fees levied by such schools are subject to policy

      decisions of the State Government and their Managing Committee  should

      conform to the requirements of the Act  of  1969  read  with  relevant

      Rules of 1991.  

The fee structure revised by the concerned schools was

      not approved by the State Government and the High Court  held  against

      the appellant  that  revision  of  the  fee  structure  could  not  be

      justified by the appellant that it is commensurate with the facilities

      provided to the students.=

 whether such private unaided schools, as represented

      by the appellant, are to be governed by the Act of 1969 and Rules made

      thereunder or are required to follow  the  guidelines  issued  by  the

      Central  Board  of  Secondary  Education  (CBSE)  to  which  they  are

      affiliated.  

However, he prays to record that the said issue  is  left

      open to be decided in future, if occasion arises  for  the  same.   We

      record accordingly.  

Therefore, the only surviving issue  as  per  his

      submissions is 

whether a fee increase needs to be allowed for the  DAV

      schools in Odisha to meet their liability due to implementation of 6th

      Central Pay Commission pay scales which had been admittedly introduced

      in these schools w.e.f.  1.6.2012.   

The  corollary  requiring  answer

      would be if the fee is to be increased, what should be the quantum  or

      structure.=

 “4. Fees –



          i) Fees and charges should be  commensurate  with  the  facilities

             provided by the institution.  Fees should normally  be  charged

             under the heads prescribed by the Department of School and Mass

             Education.  No capitation fee or any  voluntary  donations  for

             gaining admission in the school or for any other purpose should

             be charged/collected in the name of the  school.   In  case  of

             such  malpractices  the  Government  may  take  drastic  action

             leading to  withdrawal  of  No  Objection  Certificate  of  the

             school.


         ii) In case a student leaves the  school  for  such  compulsion  as

             transfer of parents or for health reason or in case of death of

             the student before completion of the session prorate return  of

             quarterly / term / annual fees should be made.


        iii)  The   school   should   consult   parents   through   parents’

             representatives before revising the fees.  The fees should  not

             be revised during the midsession.”=

 

 Hence, it is directed that the appellant and the concerned educational

      institutions represented by it shall be entitled to revise  their  fee

      structure with immediate effect as  per  recommendations  of  the  Fee

      Structure Committee, Odisha dated 2.5.2013.  

We further  clarify  that

      the existing Managing Committee as constituted under the CBSE bye-laws

      shall continue to manage the  concerned  schools.   If  the  competent

      authority feels the necessity, it may proceed to make changes  in  the

      Managing Committee as per law and requirements of CBSE,  after  giving

      due   notice   and   opportunity   of   hearing   to   the    affected

      persons/Committee.

 Before parting with the matter, we would like to caution the concerned

      authorities that if a private educational institution has met all  the

      requirements of obtaining No  Objection  Certificate  and  affiliation

      etc. then  its  claim  for  revision  of  fees  should  be  considered

      expeditiously on permissible parameters.  

Objections, if  any,  should

      be entertained only from the parents’  representatives  and  not  from

      individual parents.  An individual may at times be  reckless  and  may

      harm the educational prospects of all the students of the school.   

If

      a claim for revision of fees is stalled  for  long  due  to  meritless

      objections, it can affect academic standards on account of disgruntled

      staff and teachers who may even  quit  the  institution  for  want  of

      appropriate salary and perks.  

Such state of affairs  with  regard  to

      the concerned schools has been highlighted on behalf of the appellant.

       

The  selected  parents’  representatives,  on  the  other  hand,  are

      expected to be more responsible as a body.  In the present case,  only

      some individual parents have  prevented  the  schools  from  realising

      revised fees since 2009.  

It is not  possible  to  assess  the  injury

      caused to the schools nor is it possible to award any compensation  by

      allowing revised fees to be realised from any  earlier  date  such  as

      1.6.2012 as prayed  on  behalf  of  the  appellant.   

However,  it  is

      satisfying to note that  the  State  of  Odisha  has  not  raised  any

      objection to the  recommendations  of  the  Fee  Structure  Committee,

      Odisha and, therefore, there is no legal impediment of  any  substance

      in  allowing  this  appeal.   

Contempt  petitions  and  other  pending

      petitions shall stand disposed of.  The appeal is allowed as indicated

      above.  No costs.


 2014 ( April. Part ) http://judis.nic.in/supremecourt/filename=41417   

    R.M. LODHA, SHIVA KIRTI SINGH

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 4556 OF 2014
[Arising out of S.L.P.(C)No.31659 of 2011]

D.A.V. College Managing Committee
Through Regional Director …..Appellant

Versus

Laxminarayan Mishra & Ors. …..Respondents

W I T H

Contempt Petition(C)No.232 of 2013
In
C.A.No. 4556 of 2014
[Arising out of S.L.P.(C)No.31659 of 2011]
AND
Contempt Petition(C)No.7 of 2013
In
C.A.No. 4556 of 2014
[Arising out of S.L.P.(C)No.31659 of 2011]

 

J U D G M E N T

 

SHIVA KIRTI SINGH, J.

1. Leave granted.
2. This Appeal is directed against judgment and order dated 6.9.2011
whereby the Orissa High Court dismissed, amongst other appeals, Writ
Appeal No.387 of 2011 preferred by the appellant herein and upheld
judgment and order of a learned Single Judge in W.P.(C)No.5326 of 2009
etc. pronounced on 27.6.2011. The High Court has held that DAV Public
Schools operating in the State of Odisha, are although private unaided
educational institutions, but are covered by the provisions of the
Orissa Education Act, 1969 [hereinafter referred to as ‘the Act of
1969’] and hence the fees levied by such schools are subject to policy
decisions of the State Government and their Managing Committee should
conform to the requirements of the Act of 1969 read with relevant
Rules of 1991. The fee structure revised by the concerned schools was
not approved by the State Government and the High Court held against
the appellant that revision of the fee structure could not be
justified by the appellant that it is commensurate with the facilities
provided to the students.
3. Apparently, this Court agreed with the contention of the Appellant
that existing fee structure required some upward revision in view of
appellant’s case that it had decided to implement the higher pay
scales as recommended by the 6th Central Pay Commission and hence
after notice upon the respondents, this Court passed the following
interim order on 11.5.2012 :
“…………
Subject to the petitioner’s filing an undertaking in the
Registry of this Court within one week from today that from the month
of June, 2012, the petitioner shall implement the pay-scales as
recommended by the 6th Pay Commission, following pro tem ad hoc
arrangement is made subject to the final outcome in the Special Leave
Petition.
(i) The petitioner shall submit its complete account of income
and expenditure with detailed figures to the Interim Committee
constituted under the impugned judgment within two weeks from
today.
(ii) Within three weeks of receipt of the accounts from the
petitioner, the Interim Committee will examine and evaluate the
impact on the financial burden on the petitioner’s schools by
implementation of the recommendations of the 6th Pay Commission.
The Interim Committee shall, accordingly allow the rise in the fee.
Needless to say that the determination of rise in fee by the
Interim Committee shall be uninfluenced by the impugned judgment and
also without prejudice to the contentions of the petitioner in the
Special Leave Petition.
Before taking any decision, the Interim Committee shall hear the
representatives of the petitioner and parents’ association (respondent
Nos.1 to 5 herein).
We also direct that until further orders, the existing Managing
Committee, as constituted under the CBSE bye-laws, shall continue.
………”
4. After extending the time granted to the Interim Committee for taking
the required decision, this Court was ultimately informed by learned
counsel for the State of Odisha that the Interim Committee was not in
a position to analyse properly the financial implications/financial
statements and other documents submitted by the DAV authorities and,
therefore, this Court, by order dated 22.3.2013, deprecated the
changing stand of the State of Odisha but accepted its prayer made in
I.A. No.9 of 2013 and issued a fresh direction to the appellant to
make an application for fixation of fee structure of the school before
Fee Structure Committee, Odisha headed by Justice K.P. Mohapatra,
Retired Judge of High Court of Orissa and the Committee was requested
to submit its Report to this Court within a time frame. The Committee
was allowed further time on 22.4.2013. The receipt of the Report from
the Committee was noted by this Court on 8.5.2013 and order was passed
to make available copy of the said Report to the Advocates on Record
on both the sides.
5. Before adverting to the submissions of the parties with regard to
Report of the Fee Structure Committee dated 2.5.2013, the decks must
be cleared by noting, at the outset the submission of Mr. Abhishek
Manu Singhvi, Sr. Advocate for the appellant that since the appellant
is in dire and urgent need of obtaining a judgment at the earliest in
respect of revised fee structure which the schools could adopt even as
per recommendation of the Fee Structure Committee, it was prepared to
give up the issue whether such private unaided schools, as represented
by the appellant, are to be governed by the Act of 1969 and Rules made
thereunder or are required to follow the guidelines issued by the
Central Board of Secondary Education (CBSE) to which they are
affiliated. However, he prays to record that the said issue is left
open to be decided in future, if occasion arises for the same. We
record accordingly. Therefore, the only surviving issue as per his
submissions is whether a fee increase needs to be allowed for the DAV
schools in Odisha to meet their liability due to implementation of 6th
Central Pay Commission pay scales which had been admittedly introduced
in these schools w.e.f. 1.6.2012. The corollary requiring answer
would be if the fee is to be increased, what should be the quantum or
structure.
6. We have been taken through the No Objection Certificate issued from
the Office of the Director of Secondary Education, Orissa,
Bhubaneshwar to one of the DAV schools, which is an annexure to the
Special Leave Petition. Inter alia, it provides that the Managing
Committee should allow scale of pay to the teachers at par with the
Government school teachers and it should follow the regulation/bye law
of the CBSE New Delhi prescribed from time to time. Three other
conditions are not relevant to the issue at hand. We have also been
taken through a Resolution of 1996 by the Government of Odisha,
Department of School and Mass Education dated 23.9.1996. The
Resolution contains guidelines to be followed before according No
Objection Certificate / recommendation to private educational
institutions. Paragraph 4 of that Resolution relates to fees and
reads thus :
“4. Fees –
i) Fees and charges should be commensurate with the facilities
provided by the institution. Fees should normally be charged
under the heads prescribed by the Department of School and Mass
Education. No capitation fee or any voluntary donations for
gaining admission in the school or for any other purpose should
be charged/collected in the name of the school. In case of
such malpractices the Government may take drastic action
leading to withdrawal of No Objection Certificate of the
school.

ii) In case a student leaves the school for such compulsion as
transfer of parents or for health reason or in case of death of
the student before completion of the session prorate return of
quarterly / term / annual fees should be made.

iii) The school should consult parents through parents’
representatives before revising the fees. The fees should not
be revised during the midsession.”

The instructions of CBSE are also to the effect that the school should
consult the parents’ representatives before revising the fees.
7. Objections have been raised against the said Report dated 2.5.2013 by
other respondents but not the State of Odisha. Learned senior counsel
for the appellant Dr. Singhvi has taken us through the said Report to
point out that the Committee has given adequate opportunity of hearing
to both the sides and on a proper analysis of the relevant facts which
included academic standards of the schools, quality of performance of
the students in the CBSE examination and the financial statistics, it
has calculated and recommend average fee per child per month for the
concerned DAV schools in the State of Odisha. From the Report as well
as proceedings of the sub-committee headed by a chartered accountant
and annexed as Annexure I to the Report it was shown that the
Committee took note of the principles governing fee structure of
private unaided educational institutions as emerging from different
judgments of this Court including 11-Judge Bench judgment in the case
of T.M.A. Pai Foundation & Ors. V. State of Karnataka & Ors. (2002) 8
SCC 481, to allow only 10% profit above the actual expenses over per
child as a reasonable return to the institution and the parents’
representatives were also associated with such exercise of fee
fixation.
8. On behalf of respondents, who are some parents aggrieved by the
proposal to revise the fees, Mr. Pallav Shishodia, Sr. Advocate raised
various objections to the Report and recommendations of the Fee
Structure Committee. According to him, such Committee had no
statutory base and the State of Odisha had constituted the Committee
only for recommending fee structure in technical educational
institutions and, therefore, the Committee could not have the
expertise or the competence to suggest fee structure for DAV schools
in the State of Odisha. He also urged that the objections raised on
behalf of parents before the Committee were not given due discussion
and significance and the recommended fees are much higher than what
was suggested or claimed by the schools themselves in the year 2009
for the purpose of implementing recommendations of the 6th Central Pay
Commission.
9. On a careful perusal of the various objections highlighted before the
Fee Structure Committee, we find that the objections were not at all
substantial and they have been dealt with appropriately by the
Committee. We also find no merit in the objection with regard to
competence or expertise of the Fee Structure Committee, Odisha. This
Court entrusted the task in question to the Committee out of necessity
in the presence of learned counsel for the parties and no one raised
any objection. The only objection which required some thought was
that in 2009 the proposed fee hike was of 50-57% based upon
requirement for payment of salaries as per recommendations of 6th
Central Pay Commission whereas on the basis of income and expenditure
figures and relevant information for the year 2012-2013, the Committee
has recommended revised fees which for some schools are alleged to be
in the vicinity of increase of about 200%.
10. In the aforesaid context it was successfully explained on behalf of
the appellant that in 2009 the fee increase was calculated on the
basis of 22% D.A. prevalent at that time but the average D.A. in 2012-
13 had increased to 72.25%. Further, due to lapse of three years, the
annual increments of 3% would add to a total of 9%. The combined
effect would be an increase of more than 200% of the original 2009
fees. It was also pointed out that increase in fees, as recommended
by the Committee, ranges only from 46% to 119% for different schools
over and above the present unrevised fee structure.
11. On carefully going through the facts and figures available on record
and those considered by the Committee, we find no good reason to take
exception to the fee structure recommended by the Fee Structure
Committee, Odisha through its Report dated 2.5.2013.
12. Since the larger issue of law has been given up by the appellant and
the same has been left open, we are not required to go into the same.
In the facts of the case, we are re-assured by the Committee’s Report
that the appellant and institutions represented by it have been
allowed only reasonable profit to which they are entitled under law.
Hence, it is directed that the appellant and the concerned educational
institutions represented by it shall be entitled to revise their fee
structure with immediate effect as per recommendations of the Fee
Structure Committee, Odisha dated 2.5.2013. We further clarify that
the existing Managing Committee as constituted under the CBSE bye-laws
shall continue to manage the concerned schools. If the competent
authority feels the necessity, it may proceed to make changes in the
Managing Committee as per law and requirements of CBSE, after giving
due notice and opportunity of hearing to the affected
persons/Committee.
13. Before parting with the matter, we would like to caution the concerned
authorities that if a private educational institution has met all the
requirements of obtaining No Objection Certificate and affiliation
etc. then its claim for revision of fees should be considered
expeditiously on permissible parameters. Objections, if any, should
be entertained only from the parents’ representatives and not from
individual parents. An individual may at times be reckless and may
harm the educational prospects of all the students of the school. If
a claim for revision of fees is stalled for long due to meritless
objections, it can affect academic standards on account of disgruntled
staff and teachers who may even quit the institution for want of
appropriate salary and perks. Such state of affairs with regard to
the concerned schools has been highlighted on behalf of the appellant.
The selected parents’ representatives, on the other hand, are
expected to be more responsible as a body. In the present case, only
some individual parents have prevented the schools from realising
revised fees since 2009. It is not possible to assess the injury
caused to the schools nor is it possible to award any compensation by
allowing revised fees to be realised from any earlier date such as
1.6.2012 as prayed on behalf of the appellant. However, it is
satisfying to note that the State of Odisha has not raised any
objection to the recommendations of the Fee Structure Committee,
Odisha and, therefore, there is no legal impediment of any substance
in allowing this appeal. Contempt petitions and other pending
petitions shall stand disposed of. The appeal is allowed as indicated
above. No costs.
……………………………….J.
[R.M. LODHA]

 

 
………………………………..J.
[SHIVA KIRTI SINGH]

New Delhi.
April 16, 2014.

———————–
8

 

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