Determination of School Fees during COVID-19: The hoopla of divergent pronouncements

The issue pertaining to the collection of tuition fee by private schools has lately been a nationwide concern. The limit of the constitutional permissibility of the role played by the state governments in determination of the fees charged by private schools has been a topic of widespread debate.

Consequently, litigation hovering upon this subject ensued before various High Courts across the country. The situation became a lot more critical with the onset of the COVID-19 pandemic and the nationwide lockdown, eventually leading to shutting down of almost all private and public organisations and establishments. Schools, without waiting for any formal direction from any authority, eventually opted for conducting classes via online platforms. However, along with this situation came up another question - the determination of the extent of the school fee to be collected amidst the pandemic.

In regard to the same, various state governments have issued orders/regulations/notifications/circulars defining the permissible limits on school fees by private unaided schools amidst the pandemic. Simultaneously, various High Courts across the country have also come to face the question pertaining to determination of school-fee amount as may reasonably be collected during the pandemic.

Some courts, while considering that private unaided schools have no source of funds apart from school fees, have adopted a liberal approach, holding that such fee amount shall not be waived/drastically reduced merely for the reason of classes being conducted online. Other courts have adopted a modestly stern viewpoint by eliminating such components of the school fee from the collectable amounts, which pertain mostly to heads that are impossible to be performed (such as extra-curricular activities) during the pandemic. Interestingly, the decisions of some of the High Courts in this regard have travelled up to the Supreme Court, which is yet to finally adjudicate upon the same.

Unanswered questions

Amidst the aforesaid situation, a reduction in the collectable fee amount has posed certain grave issues for private unaided schools across the country. Would a driver or a Class-IV worker contractually on the payroll of a school not be entitled to receiving the very salary responsible for running their households? Would the staff of private unaided schools not be deprived of their fundamental right to earn livelihood? Would such school teachers who rely on their remuneration for running their households and are themselves parents to school-going children not endure severe financial hardships on account of major salary reductions? Perhaps these and many other such concerns will persist until a succinct adjudication is delivered by the top court.

Divergent views and multiplicity of opinions

As far as the judicial viewpoint is concerned, the majority of High Courts in India have either stayed the notifications barring schools from hiking fees or dismissed petitions opposing collection of fees during the lockdown. These High Courts have banked upon the reason that such private schools have a fundamental right to fix and regulate their fee structure. Moreover, the majority of expenditures which such schools have to endure on account of maintenance, remuneration of staff etc. are entirely dependent upon the collection of school fees, and hence, prohibiting the schools from collecting a sound fee amount will be equivalent to compromising on these vital aspects.

However, a minor share of the High Courts have opined otherwise, by putting a cap/restriction, although realistic, on such fee amounts, thereby leaving the private schools no more at liberty to charge such amounts as were being charged until the pandemic started.

Notwithstanding the aforesaid position, the Rajasthan High Court at Jaipur, vide its judgment dated December 18, 2020, has stretched the latter of the aforesaid approaches a bit too far beyond what may be construed as prudent or reasonable. In regard to the same, the Rajasthan State government most recently passed an order dated October 28, by which private unaided schools in a nutshell were permitted to collect school fees to the extent of a mere 60% of the tuition fee element of the total fee amount for as long as the classes were being conducted online, and 70% of the tuition fee element of the total fee amount upon resumption of the classes physically.

Upon an objective examination of the abovementioned arrangement, it becomes apparent that on the whole, the fee amount permitted in terms of the Government Order was drastically lesser than what can ideally be termed as rational. As it is, the tuition fee element roughly amounts to around barely a 70% of the entire fee amount. A further demarcation of 60% on the same as referred to above leaves the private schools with merely 42% of the erstwhile/regular fee amount.

The Government Order also provided an alternative mechanism, should the parents or the management of any particular private unaided school not wish to conform to the above-narrated arrangement. They can determine a ‘special fee amount’ by adhering to the Rajasthan (Schools) Regulation of Fee Act, 2016, which, however, is itself facing a rigorous challenge to its Constitutional validity. Not unexpectedly, the order came to be challenged before the Rajasthan High Court. Eventually, a Division Bench of the Rajasthan High Court came to uphold the Government Order vide its judgment dated December 18, 2020.

Judgment dated December 18, 2020

The judgment, inter alia, makes an observation about having perused the Association of Indian School & Anr. v. State of Maharashtra & Ors before the Bombay High Court. Here it may be noted that vide the order dated June 26, 2020 in the aforementioned case, the Bombay High Court clearly observes that the Epidemic Diseases Act, 1897 and the Epidemic Diseases (Amendment) Ordinance, 2020 do not contain any provision so as to enable the State government to pass a regulation restraining private schools from collecting fees. In addition to the same, the Bombay High Court observes that the Disaster Management Act, 2005 does not provide any power to the State government to issue any resolution interfering with the fee structure of private unaided schools. However, the judgment simultaneously observed the following:

"...The legal position as expounded in the above cited judgments cannot be questioned but in none of the judgments it has been held that the Central Government or the State Government have no power to issue necessary directions to mitigate the plight of the citizens in such an unprecedented crisis..."

Clearly, the aforementioned discrepancy highlights a severe lapse of both reasoning and accuracy on the part of the Rajasthan High Court. In any case, as per Section 22 of the Disaster Management Act, 2005, all orders under the Act are to be necessarily issued by the Executive Committee and if such orders are issued by the authority other than the Executive Committee, the same should essentially be authenticated by the State Executive Committee headed by the Chief Secretary to the State government under Section 68.

However, the Government Order had been issued by the Director, Education and not by the State Executive Committee as prescribed under Section 22 of the Disaster Management Act, 2005. Despite the same, the judgment explicitly overlooked the requirement of the aforesaid criterion, and held the Government Order valid, nonetheless. At this juncture itself it is apparent that significant procedural lapses were overlooked in the judgment.

Yet another error contained within the judgment pertains to application of Article 162 of the Constitution. As such, the order dated June 26, 2020 also opined that the State did not have executive power under Article 162 to prohibit/restrict private unaided schools from collecting fees. Overlooking this settled position of law, the judgment has also erred in opining that Article 162 permitted the State to issue the Government Order. In addition to the same, the judgment has failed to draw a reasonable nexus as to how and on what grounds is the drastically reduced fee amount as permitted by the Government Order just and rational, despite having unavoidable nearly-fatal consequences.

It defies logic as to how a mere 42% (approx.) component of the regular fee amount would enable a private school to meet endless expenses, administrative and otherwise, which it must incur. Needless to say, the repercussions of the judgment would be too dire to render the circumstances reasonable, and would result in undesirable outcomes ranging from undue unemployment to severe financial distress amongst the personnel employed across such institutions, ultimately strangulating the regular functioning of private schools. Surprisingly, none of the abovementioned aspects are discussed in the judgment; leave aside being considered and adjudicated upon.

All in all, the judgment has miserably failed in striking a balance while keeping in consideration numerous factors that every private unaided educational institution must endure - salaries/remuneration, right to livelihood, right to freedom of trade/profession, employment statistics, operation/management of institutions, and multiple others. As such, the judgment, apart from being riddled from severe errors of law, also is entirely devoid of a reasonable basis and foundation.

The path ahead

In the ongoing battle between man and microbe, in which every individual is a participant, willingly or unwillingly, it would not be right to shift the entire burden upon the shoulders of one. Indubitably, the hoopla that has occurred pursuant to the divergent pronouncements of various High Courts of the country can only be untangled by the Supreme Court.

Prateek Kasliwal is the founder and proprietor of 'The Law Desk'. Prakhar Sharma and Samarth Acharya are Associates at the firm.

Disclaimer: The views and opinions expressed in this article are those of the author's and do not necessarily reflect the views of Bar & Bench.