Delhi HC Rules in Favour of Action Committee Unaided Recognized Private Schools

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This batch of appeals was filed against the Order allowing Action Committee Unaided Recognized Private Schools’ challenge to a circular that directed them “to postpone collection of Annual Charges and Development Fee from students until normal functioning of schools was resumed” by the Directorate of Education.

Facts of the case 

The Directorate of Education, GNCTD had issued a circular/order to postpone collection of Annual Charges and Development Fee from students until normal functioning of schools was resumed. This circular/order was challenged by Action Committee Unaided Recognized Private Schools (hereinafter Respondent Committee) which consisted of 450 private unaided schools in NCT Delhi.

On 31 May 2021, the learned Single Judge had allowed the Respondent Committee’s challenge to the circulars/orders issued by the Directorate of Education because it was illegal and was beyond their authority to do so, which was derived from the Directorate of Education under the Delhi School Education Act, 1973 (hereinafter ‘DSE Act’) and the Delhi School Education Rules, 1973 (hereinafter ‘DSE Rules’). This batch of appeals had been filed under Clause X of the Letters Patent Appeal, assailing the order of 31 May 2021.

Submission of the Counsel for the Appellants 

The Counsel on behalf of the Directorate of Education sought to wholly stay the impugned order because- i. The learned Single Judge erred in applying the directions issued in Indian School, Jodhpur & Anr. Vs. State of Rajasthan (2021) without noticing that the facts in the two cases were not in pari materia; ii. Did not have the jurisdiction to pass the impugned judgment; iii. The court failed to acknowledge that only 40%-60% of the collected amount was used to discharge the school’s liabilities towards their staff. iv. Impugned circular of 18.04.2020 had already been upheld by a Coordinate Bench of this Court in Naresh Kumar Vs. Director of Education & Anr and; v. The court failed to appreciate the wide scope of powers available with the Directorate of Education under Rule 43 of the DSE Rules keeping in view the public interest.

Submission of Counsel for the Respondents

The Respondents submitted that no Interim Order for stay was warranted. It was only after proper examination of the DSE Acts and Rules, it was concluded that the Directorate of Education did not have the authority to enter in private contracts between parents and schools in respect of fee structure/development charges, etc.

The only exception to this being the schools were found to be engaging in profiteering or commercialization. It was submitted that the learned Single Judge rightly referred to the principles adopted in Indian School, Jodhpur case. It was further averred that the State was forcibly seeking to curtail the right of private unaided schools to collect Annual Charges and Development Fee. The learned counsel had also stated that all Annual Charges and Development Fee levied for the year 2021-22 would be recovered on the same principles applicable to the academic year 2020-21 under the impugned judgment.

Decision

The orders passed by the Appellant restraining the Respondent from Annual Charges and Development Fee till resumption of physical functioning of schools was not only contrary to the contractual terms of the agreement between the schools and students’ parents but was also beyond the scope and ambit of the Appellant’s powers under the scheme of the DSE Act and Rules.

Analysis 

The DSE Act and Rules vested the Directorate with supervisory power to make sure that the private unaided schools in NCT Delhi did not indulge in commercialization and profiteering. However, it did not provide authorization to pass directions that it perceived would be in the public interest.

The learned Single Judge had critically studied the facts of the present case, by keeping in mind the recurring capital and revenue expenditure of the schools during the pandemic. While doing so, the learned Single Judge had also noticed that some expenses would have undoubtedly reduced however in the light of the new parameters owing to the unprecedented circumstances, made it necessary to follow the principles laid down by the Supreme Court in Indian School, Jodhpur case.

The Naresh Kumar case revolved around different orders of the Directorate, which was passed during the very onset of a pandemic, thus it could not be compared to the present case where it had been a year into the pandemic and had some time to settle into our new reality.

Click here for Judgement


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