COLLEGE MANAGING COMMITTEE THROUGH REGIONAL DIRECTORversusLAXMINARAYAN MISHRA & ORS.

                             [2014] 8 S.C.R. 604


A     D.A.V. COLLEGE MANAGING COMMITIEE THROUGH
                   REGIONAL DIRECTOR
                                     v.
                  LAXMINARAYAN MISHRA & ORS.
                   (Civil Appeal No. 4556 of 2014)
B
                              APRIL 16, 2014
           [R.M. LODHA AND SHIVA KIRTI SINGH, JJ.]

         Education - Private unaided educational institutions -
C   Appellant I DAV Public Schools operating in the State of
    Odisha - Fees levied by such schools - Plea for revision in
    fee structure - Plea of appellant that existing fee structure
    required upward revision in view of their liability to implement
    higher pay scales as recommended by the 6th Central Pay
D   Commission - On directions of Supreme Court, report
    submitted by Fee Structure Committee, Odisha headed by
    retired Judge of High Court - Objections raised by some
    parents (respondents) against the report and
    recommendations of the Fee Structure Committee - Held: No
E   merit in objection, witf) regard to competence or expertise of
    the Fee .Structure Commitft:Je - No good reason to take
    exceptioi;J,·fQ tltt;Jf~e structure recommended by it - Supreme
    Court re~tJ8Sited by :the Committee's Report that appellant;
    and instffdtiO.ns represented by it have been allowed only'
F   reasonat>fe pro/if t9 which they are entitled under law - Further, ·
    th.e State :'!iJ.I; f)disha did not raise any objection to
    recommendatlOn.'$ of th.e Fee Structure Committee - Appellant.
    and· the ·cq@e(Jle<J educational institutions represented by it
    entitled to' 1J1vi5$. their fee ·structure with immediate ·effect as.
G   per recommendations of the Fee Structure Committee - :
    Orissa Educatl0t1 Act, 1969.
                         .                                              I
       Education - Private unaided educational institutions - ·
    Fees structure - Claim for revision of fees '- Need fori

H                                   604
     D.A.V. COLLEGE MAN. COMMITTEE THR. REG DIR. v.          605
                  LAXMINARAYAN MISHRA

   expeditious disposal - Held: If a private educational institution A
 . has met all the requirements of obtaining NOC and affiliation
,I 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 - If a claim for revision of fees s
   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.

     Vide the impugned judgment, the High Court held C
that the appellant I DAV Public Schools operating in the
State of Odisha, although private unaided educational
institutions, were covered by the provisions of the Orissa
Education Act, 1969 and hence the fees levied by such
schools were subject to policy decisions of the State D
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 E
appellant that revision of the fee structure could not be··
justified.

      This Court agreed with the cq_ntention of the
 appellant that existing fee structure required some F
 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
 issued direction to the appellant to make an application
 for fixation of fee structure of the school before the Fee G
 Structure Committee, Odisha headed by Justice K.P.
 Mahapatra, Retired Judge of High Court of Orissa. The
 Committee submitted its Report to this Court..

    On behalf of the respondents, who are some parents
 aggrieved by the proposal to revise the fees, various              H
    606     SUPREME COURT REPORTS               .[2014] 8 S.C.R.


A   objections were raised against the Report and
    recommendations of the Fee Structure Committee.
    According to them, such Committee had no statutory
    base and did not have the expertise or the competence
    to suggest fee structure for DAV schools in the State of
B   Odisha. It was also urged that the objections raised on
    behalf of parents before the Committee were not given
    due discussion and significance.

        Allowing the appeal and disposing of the petitions,
C   the Court
         HELD:1.1. The objections highlighted before the Fee
    Structure Committee were not at all substantial and they
    were dealt with appropriately by the Committee. There is
    also no merit in che objection with regard to competence
D   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 counsel for the parties
    and no one raised any objection. The facts and figures
    available on record and those considered by the
E   Committee make it clear that there is no good reason to
    take exception to the fee structure recommended by the
    Fee Structure Committee, Odisha through its Report
    dated 2.5.2013. [Paras 9] [613-B-C, G-HJ
         1.2. In the facts of the case, this Court ls re-assured
F   by the Committee's Report that the appellant and
    institutions represented by it have been allowed only
    reasonable profit to which they a.re entitled under law.
    Hence, it is directed that the appellant and the concerned
    educational institutions represented by ifshall be entitled
G   to revise their fee structure with immediate effect as per
    recommendations of the Fee Structure Committee,
    Odisha dated 2.5.2013. It is further clarified that the
    existing Managing Committee as constituted under the
    CBSE bye-laws shall continue to manage the concerned
H   schools. If the competent authority feels the necessity, it
   D.A.V. COLLEGE MAN. COMMITIEE THR. REG DIR. v.         607
                LAXMINARAYAN MISHRA

may proceed to make changes in the Managing A
Committee as per law and ·requirement$ of CBSE, after
giving due notice and opportunity of hearing to the
affected persons/Committee. [Para 12] [614-A-D]
      2. The concerned authorities are cautioned that if a
private educational institution has met all the 8
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. C
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. In the present case, only some individual parents D
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. E
However, 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. [Para 13] [614-E-H;
615-A.-B]                                                      F
     CIVIL APPELLATE JURISDICTION : Civil f.ppeal No.
4556 of 2014.
    From the Judgment and Order dated 06.09.2011 of the
High Court of Orissa at Cuttack in Writ Appeal No. 387 of 2011.   G
                               WITH
    Contempt. Petition. (C) Nos. 232 & 7 of 2013 in C.A. No.
4556 of 2014.
    Abhishek Manu Singhvi, Pallav Shishodia, Anand Varma,         H
    608      SUPREME COURT REPORTS                     [2014) 8 S.C.R.


A   Tarun Patnaik, Ashis Goel, Shekhar Kumar, Rajesh Prasad
    Singh, Ajit Pudussery, A. Deb Kumar, M. K. Sahoo, P. K. Dhal;
    Subhasis Pattnaik, Y. Lokesh, R. Pathak, Sudharsh Menon,'
    Rana Mukherjee, Merusagar Samantaray, Anand, Rajshree N.
    Reddy, Kasturika Kaumud:, Shibashish Misra, Sudarsh Menon
B   for the appearing parties.
          The Judgment of the Court was delivered by

          SHIVA KIRTI SINGH, J. 1. Leave granted.

C        2. This Appeal is directed against judgment and order
    dated 6.9.2011 whereby the Orissa H~gh Court dismissed,
    amongst other appeals, Writ Appeal No.387 of 2011 preferred
    by the appellant herein and uph~ld 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
D   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
E   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 appell~nt that revision of the fee stl\,lcture could
F   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
G revision in view of appellant'.s case that it had decided to
  implement the higher pay ~ca.les 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:
H
   D.A.V. COLLEGE MAN. COMMITTEE THR. REG DIR. v.         609
      LAXMINARAYAN MISHRA [SHIVA KIRTI SINGH, J.]

    "                                                             A
    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,
                                                                  8
    following pro tern 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
                                                                  c
    2 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 0
    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 E
    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       F
    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 ......... ."                      G

     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       H
    610     SUPREME COURT REPORTS                   [2014] 8 S.C.R.


A   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 ,
B   appellant to make an application for fixation of fee structure of·
    the school before Fee Structure Committee, Odisha he~ded
    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
c   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.

D         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
E   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
F   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
G   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
H   to be increased, what should be the quantum or structure.        t
   D.A.V. COLLEGE MAN. CGMMITIEE THR. REG DIR. v.               611
      LAXMINARAYAN MISHRA [S_HIVA KIRTI SINGH, J.]

      6. We have
               .      •,                              .
                     been taken through the No Objection
Certificate issued from the Office of the Director of Secondary
                                                                        A

Education, Orissa, Bhubaneshwar to one of the DAV schools,
which is an annexure to the Special Le.ave Petition. Inter alia,
it provides that the Managing Committee should allow scale of
pay to the teachers at par with the Government schooi teachers          B
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 S9hool and Mass Education dated 23.9.1996.                c
The Resolution contains guidelines to 15e followed before
according No Objection Certificate I recommendation to private
educational institutions. Paragraph 4 of that Resolution relates
to fees and reads thus :

    "4. Fees -                                                          D

      (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           E
              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             F
              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     G
              I term I 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."             H
    612    SUPREME COURT REPORTS                 [2014) 8 S.C.R.


A        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
8 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 ~dequate opportunity of hearing to both
  the sides and on a proper f!!"~!ysis of the relevant facts which
C 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 ~ell as proceedings of
  the sub-committee headed by a chartered accountant and
D annexed as Annexure I to the Report it was shown that the
  Committee took note of the·principles governing fee structure
  of private unaideQ 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
E of Kamataka & Ors. (2002) 8 SCC 481, to· allow only 10% profit
  above the ach1al expenses over per child as a reasonabl~ return
  to the institution and the parents' representatives were also
  associated with such exercise of fee fixation.

F      8. On behalf bf respondents, who are some parents
  aggrieved by Jhe .proposal to revise the fees, Mr. Pallav
  Shi$hodi~. Sr,; Advocate raised various objections to the Report
  and· re.commentlations of the Fee Structure Com.mittae.
  According to him, such Committee had no statutory base and
G the State   ofOdisha 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 struct.ure for DAV. schools in the
  State of Odisha. He also urged that the objections raised on
H behalf of parents before the Committee were not given due
   D.A.V. COLLEGE MAN. COMMITTEE THR. REG DIR. v.          613
      LAXMINARAYAN MISHRA [SHIVA KIRTI SINGH, J.]

discussion and significance and the recommended fees are          A
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
                                                                   8
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 C
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 D
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 2_00%.
                                                                   E
      10. ln the aforesaid context it w~s 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 F
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.
                                                                   G
    . 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.                                         H
    614       SUPRl:tME COURT REPORTS                 [2014]_ 8 S.C.R.


A          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
· 8 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
  C 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/
  0 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
E 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
F 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
G 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.
H It is not possible to assess the injury caused to the schools nor
   D.A.V. COLLEGE MAN. COMMITTEE THR. REG DIR. v.            615
      LAXMINARAYAN MISHRA [SHIVA KIRTI SINGH, J.]

is it possible to awatd any compensation by allowing revised A
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 B
in allowing this appeal. Contempt petitions and other pending
petitions shall stand disposed of. The appeal is allowed as
indicated above. No costs.

Bibhuti Bhushan Bose          Appeal allowed & Petitions disposed.