{"id":247852,"date":"2021-05-05T16:28:06","date_gmt":"2021-05-05T10:58:06","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=247852"},"modified":"2021-05-08T21:34:15","modified_gmt":"2021-05-08T16:04:15","slug":"covid-19-schools-cant-profit-from-unutilised-facilities-rajasthan-schools-to-provide-15-deduction-of-annual-fees-for-academic-year-2020-21-supreme-court","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2021\/05\/05\/covid-19-schools-cant-profit-from-unutilised-facilities-rajasthan-schools-to-provide-15-deduction-of-annual-fees-for-academic-year-2020-21-supreme-court\/","title":{"rendered":"COVID-19| Schools can’t profit from unutilised facilities; Rajasthan Schools to provide 15% deduction of annual fees for academic year 2020-21: Supreme Court"},"content":{"rendered":"

Supreme Court<\/strong>: The division bench of AM Khanwilkar*<\/strong> and Dinesh Maheshwari, JJ has issued\u00a0\u201cgeneral uniform direction\u201d of deduction of 15 per cent of the annual school fees for the academic year 2020-2021 in lieu of unutilised facilities\/activities and not on the basis of actual data school-wise.<\/p>\n

The said direction was issued in order to obviate avoidable litigation by\u00a0over\u00a036,000\u00a0schools<\/strong>\u00a0and to give finality to the issue of determination and collection of school fees for the academic year 2020\u00ac21, as a one-time measure.<\/p>\n

On 09.04.2020, an order was issued by the Director, Secondary Education, in the wake of COVID\u00ac19 pandemic, directing the private schools recognised by the Primary and Secondary Education Departments to defer collection of school fees for a period of three months.<\/p>\n

Before expiry of the period noted in the aforementioned order, the Director, Secondary Education issued another order on 07.07.2020 which read as<\/p>\n

\u201cThe fee chargeable by non\u00acgovernment schools from the students\/guardians after 15th March, the applicable fees at present\u00a0\u00a0 and\u00a0\u00a0 payment\u00a0\u00a0 of\u00a0\u00a0 advance\u00a0\u00a0 fee\u00a0\u00a0 was\u00a0\u00a0 deferred\u00a0\u00a0 for\u00a0\u00a0 3 months, as per the direction of the State Government the said deferment is extended till the reopening of the schools. In case of non-deposition\u00a0 of fees\u00a0 during the\u00a0 said\u00a0 period, name of such student will not be struck off from the rolls of the school.\u201d<\/em><\/p>\n

On 07.09.2020, Rajasthan High Court directed the school Authorities to allow the students to continue their studies online and also to deposit only 70 per cent of the tuition fees element from the total fees chargeable for the period from March 2020 in three instalments.<\/p>\n

On 28.10.2020, the Director of Secondary Education , Rajasthan issued an order stating that the\u00a0\u00a0 schools which were\/which are imparting online teaching then capacity building fees can be charged from such students which will be 60% of the tuition fees.<\/p>\n

The Supreme Court noticed that the Director, Secondary Education had no authority whatsoever to issue direction in respect of fee structure determined under the Rajasthan Schools (Regulation of Fee) Act, 2016 including to reduce the same for the academic year 2020\u00ac21 in respect of private unaided schools. However, this does not give licence to the School Management to be rigid and not be sensitive about aftermath of pandemic.<\/p>\n

\n

\u201cUndeniably, an unprecedented situation has had evolved on account of complete lockdown due to pandemic. It had serious effect on the individuals, entrepreneurs, industries and the nation as a whole including in the matter of economy and purchasing capacity of one and all. A large number of people have lost their jobs and livelihood as aftermath of such economic upheaval. The parents who were under severe stress and even unable to manage their day\u00acto-day affairs and the basic need of their family made fervent representation to the school Management(s) across the State.\u201d\u00a0<\/em><\/p>\n<\/blockquote>\n

The Court explained that, in law, the school Management cannot be heard to collect fees in respect of activities and facilities which are, in fact, not provided to or availed by its students due to circumstances beyond their control<\/em><\/strong>. Demanding fees even in respect of overheads on such activities would be nothing short of indulging in profiteering and commercialisation.<\/p>\n

Further, due to complete lockdown the schools were not allowed to open for substantially long period during the academic year 2020-21. Resultantly, the school Management must have saved\u00a0\u00a0 overheads and recurring cost on various items such as petrol\/diesel, electricity, maintenance cost, water charges, stationery charges, etc.<\/p>\n

\n

\u201cIndeed, overheads and operational cost so saved would be nothing, but an amount undeservedly earned by the school without offering such facilities to the students during the relevant period.\u00a0 Being fee, the principle of quid pro quo must come into play.\u201d<\/em><\/p>\n<\/blockquote>\n

However, no accurate (factual) empirical data has been furnished by either side about the extent to which such saving has been or could have been made or benefit derived by the school Management.\u00a0\u00a0\u00a0 \u00a0The Court, hence, assumed that the school Management(s) must have saved around 15 per cent of the annual school fees fixed by the school\/adjudicated by the Statutory Regulatory Authorities for the relevant period.<\/em><\/p>\n

\n

\u201c\u2026 we would assume that at least 15 per cent of the annual school fees would be towards overheads\/expenses saved by the school Management. Arguendo, this assumption is on the higher side than the actual savings by the school Management of private unaided schools, yet we are inclined to fix that percentage because the educational institutions are engaged in doing charitable activity of imparting and spreading education and not make money. That they must willingly and proactively do. Hence, collection of commensurate amount (15 per cent of the annual school fees for academic year 2020\u00ac2021), would be a case of profiteering and commercialisation by the school Management.\u201d<\/strong><\/em><\/p>\n<\/blockquote>\n

DIRECTIONS <\/strong><\/p>\n

(i) The school Management of the concerned private unaided school 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\u00ac21.<\/p>\n

(ii) The amount so payable by the concerned students be paid in six equal monthly instalments before 05.08.2021.<\/p>\n

(iii) Regardless of the above, it will be open to the concerned School Managements to give further concession to their students or to evolve a different pattern for giving concession over and above those noted in clauses (i) and (ii) above.<\/p>\n

(iv) The school Management shall not debar any student from attending either online classes or physical classes on account of non\u00acpayment of fees, arrears\/outstanding\u00a0\u00a0 fees\u00a0\u00a0 including\u00a0\u00a0 the\u00a0\u00a0 installments, referred to above, and shall not withhold the results of the examinations of any student on that account.<\/p>\n

(v) If any individual request is made by the parent\/ward finding it difficult to remit annual fees for the academic year 2020\u00ac21 in the above terms, the school Management to consider such representation on case\u00acto\u00accase basis sympathetically.<\/p>\n

(vi) The above arrangement will not affect collection of fees for the academic year 2021-22, as is payable by the students of the concerned school as and when it becomes due and payable.<\/p>\n

(vii) The school Management shall not withhold the name of any student\/candidate for the ensuing Board examinations for Classes X and XII on the ground of non-payment\u00a0\u00a0 of\u00a0\u00a0 fee\/arrears\u00a0\u00a0 for\u00a0\u00a0 the\u00a0\u00a0 academic year 2020-21, if any, on obtaining undertaking of the concerned parents\/students.<\/p>\n

[Indian School, Jodhpur v. State of Rajasthan, 2021 SCC OnLine SC 359<\/b><\/a>, decided on 03.05.2021]<\/p>\n

\n

*Judgment by: Justice AM Khanwilkar\u00a0<\/strong><\/p>\n

Know Thy Judge| Justice AM Khanwilkar<\/a><\/p><\/blockquote>\n