Holding

No offence under Section 7 was established; the criminal proceedings were quashed and the Act’s application to unaided minority institutions is not ultra vires so long as no fee ceiling has been fixed.

Summary

The father of a student filed a criminal complaint under Section 7 of the Maharashtra Educational Institutions (Prohibition of Capitation Fee) Act, 1987, alleging that a minority‑run unaided school had collected amounts in excess of the prescribed fee rates. The Magistrate took cognizance, and the school authorities appealed up to the Supreme Court, simultaneously filing a writ petition under Article 32 seeking a declaration that the Act’s provisions, as applied to unaided minority institutions, violated Article 30(1) of the Constitution. The Court examined the definition of "capitation fee" and noted that for unaided schools the Act requires the State to approve fee rates, which had not been done in this case. Consequently, no offence under Section 7 could be established and the criminal proceedings were quashed. The Court held that the State may regulate fees to prevent commercialization, but such regulation must be based on an approved fee ceiling, which was absent; therefore the Act was not ultra vires to Article 30. The appeal and writ petition were disposed of, and the criminal complaint dismissed.

Issues considered

The complaint under Section 7 of the Maharashtra Educational Institutions (Prohibition of Capitation Fee) Act, 1987, establishes an offence of capitation fee collection.
Whether the provisions of the Act, as applied to unaided minority educational institutions, are ultra vires Article 30(1) of the Constitution.
Whether the State can fix a ceiling on fees for unaided minority institutions without infringing Article 30.

Legislation cited

Constitution of Indias. Article 30(1)
Maharashtra Educational Institutions (Prohibition of Capitation Fee) Act, 1987s. 2(a), s. 3, s. 4, s. 7

Subjects

capitation feeArticle 30unaided minority institutionfee regulationcommercialisation of educationcriminal procedureMaharashtra Educational Institutions Act

Judgment

A FATHER THOMAS SHINGARE AND ORS.
v.
STATE OF MAHARASHTRA AND ORS.

DECEMBER 14, 2001

B [K.T. THOMAS AND S.N. PHUKAN, JJ.] ...
Education :

Maharashtra Educational Institutions (Prohibition of Capitation Fee)
Act, 1987.
c
Sections 2(a), 3, 4 and 7-Capitation Fee-Minority unaided Educa-
tional institution-Amounts collected under the heads "School Maintenance"
and "Capitation Fee" -Complaint filed against Principal and six others alleg-
ing the said collection as demand or collection qf "Capitation Fees"-Held,
D State cannot impose any restriction on the right of minorities to administer
Educational institutions, unaided by State except to the limited extent.for ensur-
ing excellence in education-However, {f the institution indulges in ne.filrious
activities by collecting money.for making huge profit, legislature is empowered
to curb such activities-In the instant case, State having not.fixed any upper limit
E of fees for any unaided minority institution, no offence could be made out-
Criminal complaint quashed-Constitution qf India, 1950-Article 30.

Section 2(a)-Capitation Fee-What a'!'ounts to-Held, any demand or
collection of amount in cash or kind in excess of the pre.scribed rates of fees.

F Words and Phrases:

"Capitation Fee"; "Prescribed"-Meaning of-In the context of Section
2(a) of the Maharashtra Educational Institutions (Prohibition of Capitation
Fee) Act, 1987.

G Appellant, a minority unaided school, collected Rs. 120 in the month j ,.

of July, 1993 and Rs. 180 in the month of November, 1993 as "School
Maintenance'' and Rs. 600 in the account of "Computer Fees'' in the
month of July, 1993. Respondent No. 2, father of a student tiled a criminal
complaint under Section 7 of the Maharashtra Educational Institutions
H (Prohibition of Capitation Fee) Act, 1987 against the school. Magistrate
636
FATHER THOMAS SHINGARE v. STATE 637
took cognizance of the offence and ordered process to be issued against the A
Principal and six office bearers of the school. The accused persons
unsuccessfully filed appeals before the Sessions Court and the High Court.
Thereafter, they filed appeal before this Court. During the pendency of the
appeal, the Principal of the school alongwith other office bearers filed a
writ petition before this court for a declaration that the provisions of the B
Act in so far as they applied to the unaided educational institutions run by
religious minority were ultra vires to Article 30 of the Constitution.

On behalf of the appellants it was contended that no restriction can
be imposed by the Government on the strength of any statutory provision
on the functions of unaided minority educational institutions because any C
such restriction would be violative of Article 30(1) of the Constitution of
India; fee being one of the approved means for raising funds to meet the
expenses of the educational institutions including payment of salary to the
teaching and non-teaching staff of the school, fixation of any ceiling re-
garding the amount of fees to be collected from students can amount to D
scuttling the right envisaged in Article 30(1) of the Constitution which
itself was a fundamental right.

Disposing of the appeal and writ petition, the Court

HELD : 1. The complaint instituted by respondent No. 2 cannot be E
sustained as no offence under Section 7 of the Maharashtra Educational
Institutions (Prohibition of Capitation Fees) Act, 1987 could be estab-
lished. Thus, the criminal proceedings lodged against the accused persons
are quashed. [646-CJ
F
2. The State cannot impose any restriction on the right of the minori-
ties to administer educational institutions so long as such institutions are
unaided by the State, except to the limited extent that regulations can be
made for ensuring excellence in education. It is a question of fact in each
case whether the limit imposed by the Government regarding approved
fees would hamper the right under Article .30(1) of the Constitution in so G
far as they apply to any unaided educational institution established and
administered by the minorities. If the legislature feels that the nefarious
practice of misusing school administration for making huge profit by
collecting exorbitant sums from parents by calling such sums either as fees
or donations, should be curbed, the legislature would be within its powers H
638 SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A to enact measures for that purpose. Similarly, if the management of an
educational institution collects money from persons as quid pro quo for
giving them appointments on the teaching or non-teaching staff of such
institution, the legislature would be acting within the ambit of its authority
by bringing measures to arrest such unethical practices. No minority can
B legitimately claim immunity to carry on such practices under the cover of
Article 30(1) of the Constitution. [644-C; 645-E-G]

Unni Krishnan, J.P. and Ors. v. State of Andhra Pradesh and Ors.,
[1993] 1 sec 645, followed.

C in Re The Kera/a Education Bill 1957, AIR (1958) SC 956; State of
Kera/a etc. v. Very Rev. Mother Provincial, etc., (1971] 1 SCR 734 and
Ahmedabad St. Xaviers College Society & Anr. v. State ~f Gujarat & Anr.,
(1975] 1 SCR 173, relied on.

3.1. The prescribed rates of fees prescribed under Section 4 of the
D Act applied to the aided institutions only. So far as unaided schools are
concerned the statute conferred an option on the State Government to
approve the rates of fees. Such rates need not be uniform and it can be
different for different institutions, different classes (or standard), different
courses of studies and even different for different areas. This means that
E the State Government should have approved a rate of fees in respect of
different standards applicable to the appellant school before the school
authorities are made liable for collecting capitation fees. Such a fixation of
rates of fees is hence sine qua non for holding that the authoritie~ of the
school have contravened Section 3(1) of the Act. The complainant has not
F even averred anywhere in the complaint that the State Government has
fixed any such rates of fees for any class or standard for any unaided
school, much less for the appellant school. (642-A·DJ

3.2. It would not be necessary to make any final pronouncement on
the right of the legislature in fixing an upper limit regarding the fees to be
G collected from the students by such institutions because the State
Government has not fixed any such upper limit of approved rates of fees as
for the unaided schools established and administered by the minorities in
the State of Maharashtra. That question can be considered only if any
such upper limit is fixed by the State in exercise of the powers under the
H Act. [646-A; BJ
FATHER THOMAS SHINGARE v. STATE [THOMAS, J.] 639
CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 1291 A
of 2001.

From the Judgment and Order dated 20.8.99 of the Bombay High Court
·•
'
in Crl. R.A. No. 1815 of 1998.

WITH B

W.P. (C) No. 474 of 2001.

R.K. Jain, H. W. Dhabe, Manoj Swarup, Hiren Dasan, Ajay Gupta, Manish
Khandelwal, A.H. Joshi, S.S. Shinde, S.V. Deshpande and Shakil Ahmed Syed
for the appearing parties. c
The Judgment of the Court was delivered by

THOMAS, J, Leave granted.

A female child, by name Shalmali, was admitted in a school run by a D
religious minority at Aurangabad. Her father, an advocate by profession, filed
a criminal complaint before the local Judicial Magistrate against the Principal
and six office bearers of the school alleging that they have committed the
offence under Section 7 of the Maharashtra E<'ucational Institutions (Prohibi-
tion of Capitation Fee) Act, 1987, (for short 'the Act'). The Magistrate took
congizance of the offence and ordered process to be issued against all the seven
E
accused who are arraigned in the complaint. Those accused challenged the said
order first before the Magistrate himself and later before the Sessions Court and
still later before the High Court. At all those levels they failed to get the order
quashed. The impugned judgment passed by a single Judge of the High Court
of Bombay has upheld the order passed by the Magistrate. F

When the special leave petition, in challenge of the said judgment of the
High Court, was pending in this Court the Principal of the school along with
three other office bearers filed the writ petition in this Court under Article 32
of the Constitution for a declaration that the provisions of the Act, in so far as
G
they apply to unaided educational institutions run by a religious minority, are
ultra vires to Article 30 of the Constitution. Alternately, it is prayed that this
Court may declare that the provision of the Act would not apply to "unaided
minority institutions".

As we thought it convenient to hear arguments in the appeal as well as H
640 SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A in the writ petition together Shri R.K. Jain, learned senior counsel for the
appellants and Shri H.W. Dhabe, learned senior counsel for the state of
Maharashtra and Shri Shakil Ahmed Syed, learned counsel for the complain-
ants addressed arguments. The school in which the daughter of the complainant

B
was admitted as a student is described as "Little Flower School" at Aurangabad.
Though the complainant did not specifically state in the complaint that the
·-
school is an unaided minority school learned counsel for the State of Maharashtra
conceded fairly that it is an unaided school run by a religious minority.

The facts alleged in the complaint in brief are the following : The school
authorities collected from the complainant a sum of Rs. 120 in the month of
C July 1993, and another sum of Rs. 180 in the month of November 1993 in the
account of "School Maintenance" and on 13th July 1993 they collected another
amount of Rs. 600 in the account of "Computer Fees". The said collection is
in contravention of the provisions of the Act as the fees prescribed by the
Government under the Act could not exceed Rs. 15 per month. As the com-
D plainant did not want his daughter to continue to study in the same school
presumably on account of his opposition to the amount of fees collected, he
wanted the Principal to issue transfer certificate to his daughter. When that was
not given complainant filed a writ petition in the High Court and a direction
was issued by the High Court for granting transfer certificate. After the child
was taken away from the school her father - the complainant launched the
E
prosecution by filing the complaint before the Magistrate.

We shall first consider whether the complaint has disclosed the offence
under Section 7 of the Act. For that purpose we have to assume that the facts
averred in the complaint are true. The offence said to have been committed is
F under Section 7 read with Section 3(1) or the Act. Section 7 reads thus :

"Whoever contravenes any provision of the Act, or the rule made
thereunder, shall, on conviction, be punished with imprisonment for
a term which shall not be less than one year but which may extend to
three years and with fine which may extend to five thousand rupees:
G
Provided that any person who is accused of having committed the
offence under sub-section ( 1) of section 3 of demanding capitation fee
shall, on conviction, be punished with imprisonment for a term which
shall not be less than one year but which may extend to two years and
H with fine which may extend to five thousand rupees."
FATHER THOMAS SHINGARE v. STATE [THOMAS, J.] 641
As the offence alleged is on the premise that capitation fee was de- A
manded and collected by the accused we have to see Section 3(1) of the Act
which prohibits collection of capitation fee. That sub-section reads thus :

•' "3. Demand or collection or capitation fee prohibited.

(!)Notwithstanding anything contained in any law for the time being B
in force, no capitation fee shall be demanded or collected by or on
behalf of any educational institution or by any person who is in charge
of, or is responsible for, the management of such institution, from or
in relation to, any stu_dent in consideration of his admission to, and
prosecution of any course of study, or his promotion to a higher C
standard or class in, such institution."

The expression "capitation fee" is defined in Section 2(a) of the Act.
Capitation fee means "any amount, by whatever name called, whether in cash
or kind, in excess of the _prescribed or as the case may be approved, rates of
fees regulated under Section 4." The word "pre.scribed'' in that clause refers to D
the rates fixed as for aided schools. So far as unaided schools are concerned,
the question of capitation fee would arise only if there is any "approved" rate
of fees. Section 4 of the Act regulates the prescribed as well as approved rates
of fees. Sub-section (I) of Section 4 empowers the Government to regulate the
tuition fee or any other fee that may be received or collected by any educational E
institution. Sub-section (2) of Section 4 is important in this context and hence
it is extracted below :

"(2) The fees to be regulated under sub-section (I) shall-

(a) in the case of the aided institutions, be such as may be prescribed F
by a university under the relevant University Law for the time
being in force in the State or, as the case may be, by State
Government, and

(b) in the case of the un-aided institutions, having regard to the usual
G
expenditure excluding any expenditure on lands and buildings or
on any such other items as the State Government may notify, be
such as the State Government may approve :

Provided that, different fees may be approved under clause (b)
in relation to different constitutions or different classes or differ- H
642 SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A ent standards or different courses of studies or different areas.

Thus, what is meant by prescribed rates of fees can only apply to aided
educational institutions. So far as unaided schools are concerne the statute
conferred an option on the State Government to approved the rates of fees.
Such rates need not be uniform as for different institutions. It can as well be
B
different rates for different institutions and also for different classes (or stand-
ard) and even for different courses of studies. It could be different rates in
different areas also. This means that the State Government should have ap-
proved a rate of fees in respect of different standards applicable to Little Flower
School before the school authorities are made liable for collecting capitation
C fees. Such a fixation of rates of fees is hence sine qua non for holding that the
authorities of Little Flower School have contravened Section 3(1} of the Act.

It must be pointed out that the complainant has not even averred any-
where in the complaint that the State Government has fixed any such rates of
D fees for any class or standard for any unaided school, much Jess for Little
Flower School, Aurangabad. Hence we asked learned counsel for the State of
Maharashtra whether the State Government has fixed any such rate applicable
to this particular school. The answer was in the negative.

In such a situation there is no usefulness for the complaint to proceed
E further. In our view any further step with this complaint, in the present set up,
is only an exercise in futility.

Shri R.K. Jain, learned senior counsel contended that no hurdle can be
imposed by the Government even on the strength of any statutory provision,
as for unaided minority educational institutions because any such hurdle would
F
be violative of Article 30(1) of the Constitution of India. By fixing up the rates
of fees to be collected from students of such unaided minority schools the
legislature cannot restrict the right to administer such schools, according to the
learned senior counsel. Fee is one of the approved means for raising funds to
meet the expenses of the educational institutions including payment of salary
G to the teaching and non-teaching staff of the school. Hence fixation of any
ceiling regarding the amount of fees to be collected from students can amount
to scuttling the right envisaged in the said Article which itself is a fundamental
right, contended the learned counsel.

H Article 30( I) of the Constitution reads thus :
FATHER THOMAS SHINGARE v. STATE [THOMAS, J.] 643
"All minorities, whether based on religion or language, shall have the A
right to establish and administer educational institutions of their choice."

.. , The earliest pronouncement of this Court regarding the amplitude of
Article 30(1) came out when the President of India sought the advice of this
Court under Article 143 of the Constitution regarding certain provisions of the
B
Kerala Education Bill, 1957-A Bench of seven Judges headed by S.R. Das, CJ,
examined the relevant clauses o the bill vis-a-vis Article 30(1) of the Consti-
tution. The only hurdle of the minorities in administering ·such educational
institutions which could be permissible is such regulations as would ensure the
excellence of the educational standards. The right to administer cannot encom-
pass the right to mal-administer. While considering the issues learned Judges c
of the larger Bench vivisected such minority educational institutions into two
categories, one consisting of institutions receiving aid from the State and the
other consisting of institutions without seeking any aid from the State. What
has been considered in respect of former category need not be adverted to now
because the Little Flower School, Aurangabad, is admittedly an unaided edu- D
cational institution. While dealing with the right to administer educational
institution by minorities of their choice S.R. Das, CJ, speaking for the majority
view, in re The Kera/a Education Bill, 1957, AIR (1958) SC 956 has observed
thus :
E
"Without recognition, therefore, the educational institutions estab-
lished or to be established by the minority communities cannot fulfil
the real objects of their choice and the rights under Art. 30(1) cannot
be effectively exercised. The right to establish educational institutions
of their choice must, therefore, mean the right to establish real insti-
tutions which will effectively serve the needs of their community and F
the scholars who resort to their educational institutions. There is, no
doubt, no such thing as fundamental right to recognition by the State
but to deny recognition to the educational institutions except upon
terms tantamount to the surrender of their constitutional right of
' ' administration of the educational institutions of their choice is in truth
and in effect to deprive them of their rights under Art. 30(1). We repeat
G

that the legislative power is subject to the fundamental rights and the
legislature cannot indirectly take away or abridge the fundamental
rights which it could not do directly and yet that will be the result if
the said bill containing any offending clause becomes law." H
644 SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A Clause 20 of the Kerala Education Bill proposed that no fee shall be
payable by any pupil for any tuition in primary classes in any private school.
Dealing with the question whether the s'aid clause would offend Article 30(1)
of the Constitution vis-a-vis the unaided minority schools the advice given by
their Lordship was that the said clause would offend the fundamental right
B albeit Article 45 of the Constitution.

The position remains unchanged till now and hence the legal position is
that the State cannot impose any restriction on the right of the minorlrtes to
administer educational institutions so long as such institutions are unaided by
the State, except to the limited extent that regulations can be made for ensuring
c excellence in education.

The said position was reiterated by a six Judge Bench of this Court in
State of Kera/a etc. v. Very Rev. Mother Provincial, etc., [1971] 1 SCR 734.
This was again affirmed by a nine Judge Bench of this Court in Ahmedabad
D St. Xaviers College Society and Anr. v. State of Gujarat andAnr., [1975] 1 SCR
173.

Shri H.W. Dhabe, learned senior counsel for the State of Maharashtra
contended that it is the look out of the State including the legislature to prevent
E "commercialisation of education" and that prohibition of collecting capitation
fee has been envisaged by the Act for the purpose of preventing such malady.
He invited our attention to the decision of a Constitution Bench of this Court
in Unni Krishnan, J.P. and Ors. v. State of Andhra Pradesh and Ors., [1993]
1 SCC 645. The judgment authored by Jeevan Reddy, J., was concurred. by
majority of the Judges of the Bench. While dealing with unaided minority
F institutions learned Judge said that they cannot be compelled to charge the
same fees as is charged in the Government institutions, for the simple reason
that they have to meet the cost of imparting education from their own resources
and the main source can only be the fees collected from the students. None-
theless learned Judges deprecated any kind of commercialisation of education, ',/ ,
G and pointed to the reason of collected exorbitant amount in the name of '
capitation fees or even other fees. Following passage in the said judgment is
worth to be noticed in this context :

"Even so, some questions do arise- whether cost-based education only
H means running charges or can it take in capital outlay? Who pays or
FATHER THOMAS SHINGARE v. STATE [THOMAS, J.) 645
who can be made to pay for establishment, expansion and improve- A
ment/diversification of private educational institutions? Can an indi-
vidual or body of persons first collect amounts (by whatever name
called) from the intending students and with those monies establish an
institution - an activity similar to builders of apartments in the cities?
How much should the students coming in later years pay? Who should B
work out the economics of each institution? Any solution evolved has
to take into account all these variable factors. But one thing is clear:
Commercialisation ~f education cannot and should not be pennitted.
The Parliament as well as State Legislatures have expressed this
intention in unmistakable terms. Both in the light of our tradition and
from the standpoint of interest of general public, commercialisation is
c
positively harmful; it is opposed to public policy. As we shall presently
point out, this is one of the reasons for holding that imparting education
cannot be trade, business or profession. The question is how to encour-
age private educational institutions without allowing them to commer-
cialise the education? This is the troublesome question facing the D
society, the Government and the courts today."

(Emphasis supplied)

It is a question of fact in each case whether the limit imposed by the
E
Government regarding approved fees would hamper the right under Article
30(1) of the Constitution in so far as they apply to any unaided educational
institution established and administered by the minorities. If the legislature
feels that the nefarious practice of misusing school administration for making
huge profit by collecting exorbitant sums from parents by calling such sums
either as fees or donations, should be curbed, the legislature would be within F
its powers to enact measures for that purpose. Similarly, if the management of
an educational institution collects money from persons as quid pro quo for
giving them appointments on the teaching or non-teaching staff of such insti-
tution, the legislature would be acting within the ambit of its authority by
bringing measures to arrest such unethical practices. Such pursuits are detest- G
able whether done by minorities or majorities. No minority can legitimately
claim immunity to carry on such practices under the cover of Article 30(1) of
the Constitution. The protection envisaged therein is not for shielding such
commercialised activities intended to reap rich dividends by holding education
as a facade. H
646 SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A We do not think it necessary to make any final pronouncement on the
right of the legislature in fixing an upper limit regarding the fees to be collected
from the students by such institutions because the State Government has not
fixed any such upper limit of approved rates of fees as for the unaided schools
established and administered by the minorities in the State of Maharashtra. That
....
B question can be considered only if any such upper limit is fixed by the State
in exercise of the powers under Act.

Nonetheless, the complaint instituted by respondent No. 2 cannot be
sustained so long as no offence under Section 7 of the Act could be established
by him. We therefore quash the criminal proceedings launched by him with the
C said complaint. This appeal and the writ petition are disposed of in the above
terms.

S.V.K. Appeal and Petition disposed of.