‘Schools do not need government approval to increase fees’, Delhi High Court’s big decision

Delhi High Court has given an important decision regarding the increase in fees of private unaided (Unaided) recognized schools. The court has said that if a school wants to increase its proposed fees before the start of the new academic session, then it is not required to take prior permission from the Directorate of Education (DoE) to increase the fees.

However, the court clarified that if any school wants to increase the fees during the ongoing academic session, then prior approval of DoE will be required. Justice Anup Jairam Bhambani has said in his judgment that under Section 17(3) of the Delhi School Education Act (DSE Act), the only obligation on private unaided schools is to file details of their proposed fees with the DoE before the start of the new academic session.

‘No prior permission required to increase fees’

Under the decision, the court said that under Section 17(3), a private unaided recognized school does not require any prior permission or approval to increase the fees at the beginning of the academic session. Its only statutory responsibility is to submit details of its proposed fees to the DoE before the commencement of the session.

Many private schools including DPS Vasant Kunj had given petition

This decision has been given on the petitions filed by many private schools including DPS Vasant Kunj. In which these schools had challenged the decision of DoE to reject the fee increase proposals. In the judgment, the High Court made a sharp comment on the functioning of DoE, saying that it continued to take action in such cases with ambiguity, ignoring the law and judicial orders.

DoE’s powers limited- HC

The court said, “The role of DoE is only regulatory and its authority is limited.” The department can only ensure that schools do not indulge in commercialisation, profiteering or capitation fees of education. The court said that DoE cannot micro-manage the financial affairs of schools.

Having surplus amount cannot be considered profiteering – HC

The court also held that schools have the right to keep reasonable surplus for development and expansion and mere existence of surplus amount cannot in itself be considered profiteering. The Court said that the mere fact that a school has large surplus funds is not sufficient to conclude that it is engaged in commercialization or profiteering. Such a conclusion can be drawn only after a detailed financial audit.

‘Allegations of profiteering were made without any concrete conclusion’

The High Court said that in many cases the DoE accused schools of profiteering without any concrete conclusion. The court described these comments as “Gratuitous Rhetoric” and said that they were based on a misunderstanding of the audit of schools. The schools had also said in their plea that the development fund is meant for students to develop school infrastructure and cannot be used for general expenses.

The High Court said that the Land Clause is only a contractual condition and it cannot add to the statutory powers of DoE. The court said that such rules will also be read in accordance with the DSE Act and rules.

High Court also gave relief to parents

However, giving great relief to the parents, the High Court did not allow recovery of outstanding fees of the old academic sessions. The High Court said that many proposals were pending since 2016-17 and now collecting the fees of the previous period from the parents would be unfair and unacceptable burden. The court directed that the final fee increase proposed by the schools will be applicable from the next academic session starting from April 2027. No school will be able to recover the outstanding fees of the previous period.

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