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SUPREME COURT OF INDIA
ADARSH KUMAR GOEL, UDAY UMESH LALIT, JJ.
Rustom Kerawalla Foundation – Appellant
Versus
State of Maharashtra & Others – Respondents
Civil Appeal Nos. 3696, 3698 of 2017 with Transfer Petition (Civil) Nos. 89, 90 of 2013
Decided On : 03-08-2017
(1993)1 SCC 645; (2002) 8 SCC 481; (2004) 5 SCC 583 – Relied upon
(b) Maharashtra Educational Institutions (Prohibition of Capitation Fee) Act, 1987 – Sections 2(a), 3(1) and 4 – Capitation fee u/s 2(a) – To be ‘prescribed’ for aided institutions and ‘approved’ for unaided institutions u/s 4. (Para 18)
(c) Maharashtra Educational Institutions (Prohibition of Capitation Fee) Act, 1987 – Sections 4(2) and (3) – Fee structure of unaided school – Any expenditure on lands and buildings to be excluded, as may be notified by the Government. (Para 19)
(d) Maharashtra Educational Institutions (Prohibition of Capitation Fee) Act, 1987 – Section 4(3) – Fee structure of unaided school – Lease and subsequent sub-lease on non-competitive basis and purely under the discretionary quota of the State Government – Expenditure on lands to the tune of Rs. 35.02 lakhs – Appellants entitled to recover only that amount which represents reasonable return on such investment and the facilities therein, or the rent as claimed, whichever is lower. (Para 22)
(2003) 6 SCC 697 – Relied upon
Facts of the case:
These writ petitions challenged the orders dated 03.07.2009 and 04.09.2009 passed by the Deputy Director of Education, i.e. Respondent No.2 who had disallowed the expenses incurred by the School towards rent in respect of school building in the sum of Rs. 2.50 crores per annum. While so disapproving, the amounts towards other expenses claimed by the school were accepted by Respondent No.2 as usual expenditure and the fees prescribed by the school to the extent of Rs. 54,598/- for Primary Section and Rs. 61,149/- for Secondary Section from the years 2008-2009 were approved.
The High Court disposed of the writ petition filed by the appellant holding that there was no approval of State government for the fee enhancement.
Finding of the Court:
Matter remanded to the State Government for fresh consideration.
Result: Appeals and transfer petitions disposed of.
JUDGMENT
Uday Umesh Lalit, J.
Rustom Kerawalla Foundation (appellant in Civil Appeal No.3696 of 2017 and hereinafter referred to as the Foundation), runs a school named Vibgyor High School (appellant in Civil Appeal No.3698 of 2017 and hereinafter referred to as the School) in Mumbai. These appellants are questioning correctness of the common Judgment and Order dated 16.09.2011 passed by the High Court of Bombay in Writ Petition Nos. 1925 of 2009 and 1919 of 2009 preferred by them. Along with these appeals, two transfer petitions, namely T.P.(C) Nos. 89 and 90 of 2013 preferred by the Appellants are also listed before us.
These writ petitions challenged the orders dated 03.07.2009 and 04.09.2009 passed by the Deputy Director of Education, i.e. Respondent No.2 who had disallowed the expenses incurred by the School towards rent in respect of school building in the sum of Rs. 2.50 crores per annum. While so disapproving, the amounts towards other expenses claimed by the school were accepted by Respondent No.2 as usual expenditure and the fees prescribed by the school to the extent of Rs. 54,598/- for Primary Section and Rs. 61,149/- for Secondary Section from the years 2008-2009 were approved.
2. The Maharashtra Educational Institutions (Prohibition of Capitation Fee) Act, 1987 (hereinafter referred to as the Act) prohibits collection of capitation fee for admission of students to, and prosecution of any course of study, or for promotion to a higher standard or class. "Capitation Fee" is defined in the Act as, "any amount by whatever name called, whether in cash or kind, in excess of the prescribed or, as the case may be approved rates of fees regulated under Section 4". Sections 3, 4, 6 and 7 of the Act are as under:-
"3 Demand or Collection of capitation fee prohibited-
(1) Notwithstanding anything contained in any law for the time being in force, no capitation fee shall be demanded or collected by or on behalf of any educational institution or by any person who is in charge of or is responsible for, the management of such institution.
(2) Notwithstanding anything contained in sub-section (1), the management may in good faith, demand or, collect or accept donations in cash or kind in prescribed manner, from benevolent persons or organisations or public trusts or any other association of persons, for opening of new educational institution or for development or expansion of educational facilities in the existing educational institutions or for creation of endowment fund for award of scholarships, prizes or the like, but while collecting or accepting such donations the management shall not reserve any seats in any educational institution run by it in consideration of such donations. All money and articles received in donation shall be accounted for in the institution and the money shall be deposited in the name of the institution in any scheduled or co-operative bank and shall be applied or expended for the purpose for which such donations are collected or accepted or shall be applied towards the objects of the institution :
Provided that, where in consideration of accepting such donations any seat is reserved for admission to any student in such institution such acceptance of donation shall be deemed to be collection of capitation fee.
(3) Where the State Government, on receipt of any complaint or otherwise, is satisfied that the management of any institution or any person who is in-charge of or is responsible for the management of such institution, has contravened the provisions of this Act or the rules made thereunder, the State Government may, in addition to any prosecution that may be instituted under this Act, after giving a reasonable opportunity of being heard, direct such institution or person responsible that the capitation fee collected in contravention of this Act shall be refunded to the person from whom it was collected
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