*Indian School, Jodhpur & Another Vs State of Rajasthan & Ors **
*Forum-Supreme court of India*
*Date-3rd May 2021*
*Sub-Whether Rajasthan Schools (Regulation of Fee) Act, 2016 is ultra vires and whether order passed by the State authorities for reducing the school fees for private unaided school is a valid order?*

The Supreme Court in this case was called upon to decide the fate of 36000 unaided private schools and 220 minority unaided private school regarding the manner of fixation of the school fees in pursuance of the 2016 Act as above where primarily the responsibility of fixing the school fees rested on the School Level Fees committee(SLFC) consisting of five representatives from school and five from parents. Simultaneously even though the Act was there dealing with fixation of fees, executive orders were passed directing reduction of fees which was also under challenge. While rejecting the challenge to the vires of 2016 Act, the apex court though held that *It is well­settled that the State Government cannot go against the provisions of the Constitution or any law. **The determination of fees including reduction thereof is the exclusive prerogative of the management of the private unaided school. The State can provide independent mechanism only to regulate that decision of the school Management to the extent that it does not result in profiteering and commercialisation. *As such, it is not open to the State Government to issue directions in respect of commercial or economic aspects of legitimate subsisting contracts/transactions between two private parties with which the State has no direct causal connection, in the guise of management of pandemic situation or to provide “mitigation to one” of the two private parties “at the cost of the other”. *This is akin to – rob Peter to pay Paul. **It is a different matter, if as a policy, the State Government takes the responsibility to subsidise the school fees of students of private unaided schools, but cannot arrogate power to itself much less under Article 162 of the Constitution to issue impugned directions (to school Management to collect reduced school fee for the concerned academic year). We have no hesitation in observing that the asservation of the State Government of existence of power to issue directions even in respect of economic aspects of legitimate subsisting contracts/transactions between two private parties, if accepted in respect of fee structure of private unaided schools, is fraught with undefined infinite risk and uncertainty for the State
For, applying the same logic the State Government may have to assuage similar concerns in respect of other contractual matters or transactions between two private individuals in every aspect of life which may have bearing on right to life guaranteed under the Constitution. That would not only open pandora’s box, but also push the State Government to entertain demands including to grant subsidy, from different quarters and sections of the society in the name of mitigating measures making it financially impossible and unwieldy for the State and eventually burden the honest tax payers ­ who also deserve similar indulgence. Selective intervention of the State in response to such demands may also suffer from the vice of discrimination and also likely to impinge upon the rights of private individual(s) — the supplier of goods or service provider, as the case may be. The State cannot exercise executive power under Article 162 of the Constitution to denude the person offering service(s) or goods of his just claim to get fair compensation/cost from the recipient of such service(s) or goods, whence the State has no direct causal relationship therewith. Finally, the court held that Disaster Management Act 2005 is not a panacea for all difficulties much less not concerning disaster management and directed the schools to collect reduced fees by 15% in six equal instalments. Simultaneously the schools were given liberty to collect lower fees if they wanted but not to strike down the name of any student for non payment of fees

This judgement though in relation to schools of Rajasthan can be of aid to schools throughout the country and it also sets an important principle regarding the right of State governments to interfere in the manner of fixation of fees of private unaided schools

Ramesh Patodia
04-05-2021.