Private Schools Don't Need Prior Approval To Increase Fees At Start Of Academic Session: Delhi High Court

The Delhi High Court has held that private unaided schools are not required to obtain prior approval from the Directorate of Education (DoE) for increasing fees at the commencement of an academic session, provided they have filed their statement of fees with the DoE in terms of Section 17(3) of the Delhi School Education Act.

In its 120-page judgment, the Court said that prior approval would be necessary only if a school seeks to increase fees during an ongoing academic session beyond the fee structure already declared before the start of the session.

"Under section 17(3) of the DSE Act no prior permission or sanction is required by a private, un-aided, recognised school to increase its fee at the commencement of an academic session; and the only statutory obligation upon a school is that it must file its statement of proposed fee with the DoE prior to commencement of an academic session; under section 17(3) of the DSE Act however, a private, unaided, recognised school does require prior approval of the DoE if the school proposes to implement a fee-hike during an ongoing academic session."

Justice Anup Jairam Bhambhani made the observation while deciding a batch of petitions filed by several private unaided recognised schools challenging the DoE's rejection of their fee hike proposals and its regulatory framework governing fee fixation.

The Court observed that the DoE's role is limited to preventing “commercialisation” and “profiteering” and that schools enjoy substantial autonomy in financial and administrative matters under Article 19(1)(g) of the Constitution.

“In principle, the DoE has the power to impose upon a school a decision in relation to fee-hike…However, the DoE can only exercise this power provided – and this is a serious caveat – the DoE first makes a determination that the school has indulged in profiteering or commercialisation based on an audit to be conducted by the prescribed authority under section 18(5) of the DSE Act, but not on a presumption at the stage when the school submits its statement of fees for an ensuing academic session under section 17(3) of the DSE Act,” the Court clarified.

“Since the nominees of the DoE sit on the managing committee of every private, un-aided, recognised school, and have a voice in the decisions taken by the managing committee, a fee-hike decision taken unanimously by the managing committee or with the consent of the nominees should ordinarily be respected, since it is expected that the DoE's representatives on the managing committee would have applied their mind and given their consent,” it added.

The Court further laid down following timelines to be met by both the DoE and the schools, in case the latter proposes to hike its fee during an ongoing academic session:

(i) The school must submit its proposal for a mid-session fee-hike at least 02 months before the date from which the school proposes to implement its feehike;

(ii) the DoE must take a decision on the fee-hike proposal within the said period of 02 months, failing which, the fee-hike proposal must be deemed to have been approved.

In the present case however, the Court said, DoE's action reflected “plain refusal to obey the law as comprised in the statute” despite settled precedents on the issue.

It referred to Delhi Abhivabhavak Maha Sangh & Ors. vs. Union of India (1998) to note that Section 17(3) strikes a balance between a school's right to fix a reasonable fee structure and the DoE's regulatory powers.

As such, the Court directed that the fee increase last proposed by various schools in their respective statements of fee filed with the DoE would apply, but only from the next academic session beginning April 2027; and no school shall demand or recover from any parent or student any arrears of fee or other charges retrospectively for the past academic sessions.

Case title: DPS Vasant Kunj & Ors. v. GNCTD (and batch)

Case no.: W.P.(C) 7481/2017

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