Rule 43 of the Delhi School Education Act 1973 is only salutary in nature and is not a free license for Directorate to issue any order as it deems fit in public interest, without any basis thereof: The High Court of Delhi
Direction to postpone collection of Annual Charges and Development Fee from students until normal functioning of schools is resumed is illegal and ultra vires the powers of the Directorate of Education under the Delhi School Education Act, 1973 (in short ‘DSE Act’) and the Delhi School Education Rules, 1973 (in short ‘DSE Rules’). The aforementioned statement has laid down the premise followed by the Delhi High Court in the case of Directorate of Education and Others v. Action Committee Unaided Private School [LPA 179/2021, C.M. No. 18382/2021(for stay) &amp; C.M. No. 18385/2021(leave to file appeal)] which was passed by a two judge bench comprising Justice Rekha Palli and Justice Amit Bansal on 7th June 2021. The Action Committee Unaided Recognized Private Schools comprises of 450 private unaided schools in the National Capital Territory (NCT) of Delhi. Under the impugned order, the learned Single Judge had allowed the respondent Committee’s challenge to the circulars/orders issued by the Directorate of Education, GNCTD by stating that the direction to postpone collection of Annual Charges and Development Fee from students until normal functioning of schools is resumed is illegal and ultra vires their authority. Under the impugned order, the learned single judge had passed a few orders relying on the Supreme Court Judgement in the case of Indian School, Jodhpur &amp; Anr. v. State of Rajasthan &amp; Ors. (2021) SCC Online SC 359 which highlighted the fee collection structure to be followed by 36000 schools that included the collection of annual fees with a deduction of 15% on that amount. The arguments raised by the counsel for appellant were four fold. Mr. Singh submitted that the Ld. Single Judge had failed to consider the specific statements of the appellant in their affidavit that only 40-60% of the amounts collected by way of tuition fee, the collection whereof was not interdicted in any manner, was being used for discharging the liability of the schools towards staff salaries. He relied on the case of Naresh Kumar v. Director of Education &amp; Anr. W.P. (C) 2993/2020 and said that it was arbitrary for the learned single judge to interfere with the circular. Finally, Mr. Singh submitted that the learned Single Judge had failed to appreciate the wide scope of powers available with the Directorate of Education under Rule 43 of the DSE Rules which vest it with wide powers to issue any directions that it considers appropriate in public interest. On the other hand, it was submitted by the counsel for respondent that the Directorate of Education had no power, whatsoever, to interject or interfere in private contracts executed between the parents of the students and the schools, by directing the private, unaided schools to indefinitely postpone collection of Annual Charges and Development Fee. Mr Divan further submits that although the State is forcibly seeking to curtail the right of private unaided schools to collect Annual Charges and Development Fee, it has neither offered them any subsidy nor any concession in terms of tax payments during the pandemic period nor highlighted the costs incurred during the virtual classes as well.
5 8 Via Video Conferencing IN THE HIGH COURT OF DELHI AT NEW DELHI Date of Decision : 07.06.2021 LPA 179 2021 C.M. No. 18382 2021(for stay) & C.M. No. 18385 2021(leave to file appeal) MASTER YASHVIR SINGH CHAUHAN THROUGH HIS FATHER DALIP SINGH CHAUHAN AND ANR. ..... Appellants Through: Mr. K.B. Jha with Ms. Shikha Sharma Bagga Advocates. ACTION COMMITTEE UNAIDED RECOGNISED PRIVATE SCHOOLS & ANR. ..... Respondents Through: Mr. Shyam Divan Senior Advocate with Mr. Kamal Gupta Mr. Nipun Jain and Mr. Sparsh Aggarwal 180 2021 C.Ms. No. 18389 2021(leave to file appeal) stay) & MASTER VIPUL YADAV AND ANR. Appellants Through: Mr. K.B. Jha with Ms. Shikha Sharma Bagga Advocates. ACTION COMMITTEE OF UNAIDED PRIVATE RECOGNIZED Respondents SCHOOLS AND ANR. Through: Mr. Shyam Divan Senior Advocate with Mr. Kamal Gupta Mr. Nipun LPA No.179 2021 & conn.matters Jain and Mr. Sparsh Aggarwal LPA 184 2021 & C.M. No. 18510 2021(for stay) DIRECTORATE OF EDUCATION Appellant Through: Mr. Vikas Singh Senior Advocate with Mr. Santosh Kumar Tripathi SC GNCTD with Mr. Aditya P Khanna Mr. Shashank Tiwari and Mr. Rajiv Tanwar LA PSB DOE ACTION COMMITTEE UNAIDED PRIVATE Respondent Through: Mr. Shyam Divan Senior Advocate with Mr. Kamal Gupta Mr. Nipun Jain and Mr. Sparsh Aggarwal LPA 185 2021 C.Ms. No. 18557 2021 18560 2021(leave to file appeal) stay) & JUSTICE FOR ALL Appellant Through: Mr. K.B. Jha with Ms. Shikha Sharma Bagga Advocates. ACTION COMMITTEE UNAIDED RECOGNISED PRIVATE SCHOOLS & ANR. Respondents LPA No.179 2021 & conn.matters Through: Mr. Shyam Divan Senior Advocate with Mr. Kamal Gupta Mr. Nipun Jain and Mr. Sparsh Aggarwal HON BLE MS. JUSTICE REKHA PALLI HON BLE MR. JUSTICE AMIT BANSAL REKHA PALLI J.C.Ms. No. 18383 2021 & 18384 2021in LPA 179 2021 C.Ms. No. 18387 2021 & 18388 2021in LPA 180 2021 C.Ms. No. 18511 2021 & 18512 2021in LPA 184 2021 C.Ms. No. 18558 2021 & 1859 2021in LPA 185 2021 Exemptions allowed subject to all just exceptions. The applications stand disposed of. LPAs 179 2021 180 2021 184 2021 & 185 2021 The present batch of appeals under Clause X of the Letters Patent Appeal assails the order dated 31st May 2021 passed by the learned Single Judge in W.P.No. 7526 2020 filed by the Action Committee Unaided Recognized Private Schools that comprises of 450 private unaided schools in the National Capital Territoryof Delhi. Under the impugned order the learned Single Judge has allowed the respondent Committee’s challenge to the circulars orders issued by the Directorate of Education GNCTD on 18.04.2020 and 28.08.2020 by holding that the direction to postpone collection of Annual Charges and Development Fee from students until normal functioning of schools is resumed is illegal and ultra vires the LPA No.179 2021 & conn.matters powers of the Directorate of Education under the Delhi School Education Act 1973 and the Delhi School Education Rules 1973in LPA 179 2021 C.M. No. 18386in LPA 180 2021 C.M. No. 18510in LPA 184 2021 C.M. No. 18557in LPA 185 2021 These applications preferred by the Directorate of Education seek stay of the impugned order during the pendency of these appeals. Under the impugned order the learned Single Judge had passed the following “52. The fact remains as noted above that the schools are affecting some savings on account of the fact that the school are presently physically shut. The Supreme Court has already dealt with the stated issue. The directions as passed by the Supreme Court in the case of Indian School Jodhpur & Anr. vs. State of Rajasthan & Ors. would clearly apply to the present case mutatis mutandis. Relevant para of the said judgment reads as follows: LPA No.179 2021 & conn.matters in respect of the school Management due the parties before 128.Ordinarily we would have to relegate Regulatory Authority to refix the school fees for the academic year 2020 21 after taking into account all aspects of the matter including the advantage gained to unspent facilities not availed by the students. However that course can be obviated by the arrangement that we propose to direct in terms of this judgment. To avoid multiplicity of proceedings including uncertainty of legal processes by over 36 000 schools in determination of annual fee structure for the academic year 2020 21 as a one time measure to do complete justice between the parties we propose the issue following i) The appellants shall collect annual school fees from their students as fixed under the Act of 2016 for the academic year 2019 20 but by providing deduction of 15 per cent on that amount in lieu of unutilised facilities by the students during the relevant period of academic year 2020 21. ii) The amount so payable by the concerned students be paid in six equal monthly instalments before 05.08.2021 as noted in our order dated 08.02.2021. iii) Regardless of the above it will be open to the appellantsto give further concession to their students or to evolve a LPA No.179 2021 & conn.matters different pattern for giving concession over and above those noted in clausesandabove. iv) The school Management shall not debar any student from attending either online classes or physical classes on account of non payment of fees arrears outstanding fees including the instalments referred to above and shall not withhold the results of the examinations of any student on that account. v) If any individual request is made by the parent ward finding it difficult to remit annual fees for the academic year 2020 21 in the above terms the school Management to consider such sympathetically. case to case vi) The above arrangement will not affect collection of fees for the academic year 2021 22 as is payable by students of the concerned school as and when it becomes due and payable. The school Management shall not withhold the name of any student candidate for the ensuring Board examinations for Classes X and XII on the ground of non payment of fee arrears for the academic year 2020 21 if any on obtaining undertaking of the concerned parents students." 53. The above directions given in parastowill apply to the petitioner schools mutatis mutandis. However clause ii) has to be modified. The amount payable by concerned students will be paid in six monthly installments w.e.f. LPA No.179 2021 & conn.matters notice. 7. Issue notice. Learned counsel for the respondent Committee accept 8. With the consent of learned senior counsel for the parties we have taken up the interim application for disposal today itself. 9. In support of the prayer for interim stay Mr. Vikas Singh learned senior counsel for the Directorate of Education as also Mr. Jha for the appellants in LPA Nos. 179 2021 180 2021 and 185 2021 have raised the following four grounds the first being that the learned Single Judge has gravely erred in passing the same directions as issued by the Supreme Court in Indian School Jodhpur & Anr. Vs. State of Rajasthan SCC Online SC 359 by overlooking the fact that the said judgment pronounced on 03.05.2021 after the impugned judgment had been reserved but was yet to be pronounced pertains to an entirely different fact situation. In Indian School Jodhpurthe Supreme Court was dealing with two sets of appeals assailing the orders passed by the Jaipur and Jodhpur Benches of the Rajasthan High Court affirming the decision of the State government to direct reduction of school tuition fees on account of the pandemic. He submits that the learned Single judge also failed to appreciate that the decision of the Supreme Court in that case to overturn the directions of the Rajasthan High Court came after it had noticed that the affected schools had already been partially re opened for the students of Classes IX to XII which merited the collection of applicable fee. He submits that in the present case neither have these schools seen any kind of re opening nor are they concerned with the tuition fee the matter pertains to Annual Charges and Development Fee. LPA No.179 2021 & conn.matters He further submits that the decision of the Supreme Court in Indian School Jodhpur was made in exercise of jurisdiction under Article 142 of the Constitution of India which power was not available with the learned Single Judge while passing the impugned judgment. He therefore submits that the impugned judgment is liable to be set aside on this ground alone. 10. Mr. Singh then submits that the Ld. Single Judge has failed to consider the specific statements of the appellant in their affidavit that only 40 60% of the amounts collected by way of tuition fee the collection whereof was not interdicted in any manner was being used for liability of the schools towards staff salaries. Consequently there was enough funds available with the schools to bear the burden of any development charges or recurring charges payable by them which may possibly have been reduced after the schools had closed on account of the pandemic w.e.f. March 2021. 11. Mr. Singh further submits that the Ld. Single Judge has failed to appreciate that the impugned circular of 18.04.2020 had already been upheld by a Coordinate Bench of this Court on 24.04.2020 in Naresh Kumar Vs. Director of Education & Anr. W.P. 2993 2020 and therefore it was not open for the learned Single Judge to now intervene with the circular on any ground whatsoever. 12. Finally Mr. Singh submits that the learned Single Judge has failed to appreciate the wide scope of powers available with the Directorate of Education under Rule 43 of the DSE Rules which vest it with wide powers to issue any directions that it considers appropriate in public interest. He LPA No.179 2021 & conn.matters also seeks to place reliance on Section 24 of the DSE Act which permits the Directorate to pass any order as may be deemed appropriate after inspection of the schools. He therefore prays that the impugned order being wholly erroneous be stayed pending a final decision in these appellate proceedings. 13. Countering the submissions of Mr Singh Mr. Shyam Divan learned senior counsel appearing on behalf of the respondent Committee submits that the very premise on which these appeals have been filed is misplaced. He submits that the Directorate is erroneously urging that the learned Single Judge has simpliciter adopted the directions given by the Supreme Court in Indian School Jodhpur without noticing that the facts in the two cases are not pari materia. Even on this aspect LPA No.179 2021 & conn.matters we are prima facie unable to agree. It is an undisputed position that these schools have been reeling under the impact of the pandemic for over a year during which they were not only required to maintain the school premises and infrastructure but also remain ready for the eventual re opening of the schools besides incurring the expenditures of IT infrastructure and training for smooth functioning of online classes. Not to mention they continue to incur the expenditure of paying staff salaries. However a perusal of paras 39 to 51 of the impugned judgment leave no manner of doubt that the learned Single Judge has carefully combed through the facts of the present case by making detailed notes of the recurring capital and revenue expenditure of the schools during the pandemic when the students are not in physical attendance. While doing so the learned Single Judge has also noticed that some expenses like electricity and stationary charges would have undoubtedly reduced but has instead of setting down new parameters followed the basic principles laid down by the Supreme Court in Indian School Jodhpur supra). In this regard we may refer to paragraphs 45 to 48 of the impugned judgment which reads as under: “45. The break up of expenses related to Annual Charges have been elaborated above and the sub heads are not disputed. It broadly includes the following expenses: 1. Hostel running expenses 2. Administrative & General Expenses 3. Rents rates and taxes 4. Communication Expenses 5. Printing & Stationery 6. Electricity & Water charges 7. Travelling & Conveyance LPA No.179 2021 & conn.matters 8. Expenses of teaching & non teaching staff 9. Insurance charges 10. Promotional expenses 11. Remuneration of Auditors12. Repairs & maintenance of Building 13. Depreciation 14. Financial expenses such as interest on loans loss on sale of fixed assets & investments 15. 0ther expenses Write offs and provisions 16. Miscellaneous expenses 17. Legal Expenses. the break up of expenses related 46. Similarly Development Fees have been stated above and relate to the following expenditure: 1. Furniture Benches 2. Chairs Wall panelling Green Black Boards 3. Computers 4. Projectors 5. Smart Boards Touch Panels in classes 6. Water Coolers 7. Air conditioners 8. RO water treatment plant 9. Overhauling of electrical 10. Panels switches MCB s 11. Fire safety equipments 12. Fans and lights 13. Changing I repairing of doors and windows 14. Tiles Lift 47. The issue that arises is that the schools are not physically open can it be said that the expenses under the above heads are not being incurred by the private unaided recognized schools In my opinion a bare perusal of the heads of expenses clearly demonstrates and shows that most of the expenses are not correlated or connected with the actual LPA No.179 2021 & conn.matters taxes travelling conveyance physical opening of the schools for the students. Expenses like rents insurance charges remuneration of auditors repair and maintenance of building and maintenance of equipment furniture and fixture are all expenses which will continue to be incurred by the schools irrespective of the physical shut down. In case the said repairs and expenses are not done it is bound to cause damage to the building infrastructure and functioning of the schools. Further it cannot be said that the school building is completely shut. The building would remain functional for administrative reasons and even depending on facts and circumstances of the case for conducting online classes etc. 48. No doubt the expenses under some of the heads will drop in the absence of actual full physical opening of the schools namely expenses like electricity water stationery etc.” 24. Finally insofar as the appellant’s contention is concerned that these schools are barely using 40 60% of the tuition fee collected by them for payment towards salaries which sums are lying with them for their disposal we find that there was absolutely no material produced in support of this bald claim either before the learned Single Judge or before us. In any event in case this allegation had any truth the appellant would have instituted appropriate proceedings for profiteering against the erring schools. 25. Now in Naresh Kumarthe Court was considering a prayer for exemption from payment of tuition fee for all students during the pandemic in addition to the exemptions that were already accruing on account of the circular dated 17.04.2020 issued by the Directorate of Education. Although that petition was rejected by the Court we may note LPA No.179 2021 & conn.matters that it involved a completely different order passed by the Directorate and was markedly different from the orders circulars that we are concerned with today. Not to mention a significant question decided under the judgment impugned herein is the power of the Directorate to issue order circulars of such nature under the scheme of the DSE Act and Rules which was not in issue before the Coordinate Bench in Naresh Kumarwas passed at a time when the pandemic had just set in and no one had thought that it would continue for this long. Therefore the decision of the Court in that case cannot be compared to the present one where we are a year into the pandemic and have had some time to settle into our new reality. Ultimately the managements of these unaided private schools in the city which do not receive any aid from the GNCTD and are solely dependent on the fee collected by them would also need funds to sustain their operations and premises and continue imparting education online. Given the terrible exigencies of the pandemic we have been forced to embrace new models for our institutions and virtual classes are our sole way of ensuring that the nation’s children are being educated. Thus one cannot gainsay the importance of these virtual classes and staying the impugned decision today without a deeper examination of the facts would only compromise with the ability of these schools to continue serving this critical function. That being said insofar as the difficulties that may be encountered by the parents of the students are concerned learned counsel for the respondents have already assured this Court that they would ensure that all Annual Charges and Development LPA No.179 2021 & conn.matters Fee levied for the year 2021 22 would be recovered on the same principles applicable to the academic year 2020 21 under the impugned 27. Needless to say these observations are prima facie in nature and the respondent Committee shall remain bound by the undertakings recorded in Paragraphs 18 and 19 above. The application is dismissed in the aforesaid terms. JUNE 7 2021 VACATION JUDGE VACATION JUDGE LPA No.179 2021 & conn.matters 