A Karnataka school may charge only the fees the 1995 Rules prescribe, and a professional college only the fee a committee determines

A recognised private unaided school in Karnataka may levy only the fees prescribed under section 48 of the Karnataka Education Act, 1983, and a school that charges more faces a penalty of up to INR 10 lakh and an order to refund the excess under section 124A, imposed by the District Education Regulatory Authority after giving it an opportunity of being heard. For a private unaided professional college, the Karnataka Professional Educational Institutions (Regulation of Admission and Determination of Fee) Act, 2006 gives the work to a Fee Regulatory Committee, headed by a retired Judge of the High Court of Karnataka, whose fee binds for three years. The Karnataka Educational Institutions (Prohibition of Capitation Fee) Act, 1984 treats any amount above the fee prescribed under its section 5 as capitation fee in medical and engineering institutions and any others the Government notifies, and section 12(2) of the Right of Children to Free and Compulsory Education Act, 2009 reimburses a school for its free seats only up to the lesser of the State's per-child expenditure and the fee actually charged.

How far can the State go in fixing a private school's fee?

Section 48(1) of the Karnataka Education Act, 1983 (the Education Act) bars the Governing Council of a recognised educational institution, subject to any other law, from levying or collecting any fees, charges, donations or other payments, by whatever name called, except at the rate and in the manner prescribed. Section 7(1)(f) lets the State Government specify by order the rates at which tuition and other fees may be charged. Section 145(2)(xviii) lets the State make rules regulating the rates of fees and their levy and collection. Section 48 speaks of any recognised educational institution, so it binds an unaided school as much as an aided one.

Clause (iiia) of section 1(3), as substituted with effect from 22 April 2017, takes schools affiliated to the Council for the Indian School Certificate Examinations or the Central Board of Secondary Education out of the Act, but sections 5A, 48, 112A and 124A continue to apply.

What do the 1995 Rules prescribe for each head of fee?

The Karnataka Educational Institutions (Classification, Regulation and Prescription of Curricula etc.,) Rules, 1995 (the 1995 Rules) carry the prescription. Rule 10 sorts fees into term, tuition and special development fees. Term fees are collected from upper primary classes upwards at the notified rate and only for the notified items. In a recognised private unaided school, rule 10(3)(b)(ii) says tuition fee may be collected from all students and shall be commensurate with the expenditure on staff salary and the quality of education. That is a standard and not a number. Special development fee may be collected up to a maximum that rule 10(3)(c)(ii), in the text consolidated on India Code to 5 July 2001, sets at INR 600 a year for an unaided institution.

Under rule 10(5) the specified fee shall not be varied to the disadvantage of parents in the middle of the academic year on any account.

Who hears a parent's complaint, and what can the authority order?

Rule 15 lets a parent aggrieved by a violation of the Rules on collection of fees petition the District Level Education Regulating Authority, which rule 16 constitutes in each district with the Deputy Commissioner as Chairman, and rule 15(2) lets the Authority also inquire suo motu or on a complaint by any person interested. The petition must cite evidence and carries a court fee stamp of INR 10. The Authority must give the management and the parent a sufficient opportunity, and its written decision is binding. Under rule 17 the institution or the parent may appeal to the Commissioner for Public Instruction, whose decision is final and binding.

Section 124A, inserted by Karnataka Act 25 of 2017, adds the penalty. Section 2(11A) defines the District Education Regulatory Authority as an authority under the Deputy Commissioner, with composition and powers to be prescribed by rules. An institution found, after an opportunity of being heard, by that Authority to have contravened section 48 suffers a penalty that may extend to INR 10 lakh and a direction to refund what it collected above the prescribed amount.

Where does capitation fee fit?

The Karnataka Educational Institutions (Prohibition of Capitation Fee) Act, 1984 (the 1984 Act) defines capitation fee in section 2(b) as any amount, by whatever name called, collected directly or indirectly in excess of the fee prescribed under section 5. Section 5 lets the Government regulate fees by notification, and section 7 punishes a contravention with imprisonment of three to seven years. The reach is narrower than the title suggests: section 2(c) covers only institutions imparting education in medicine or engineering leading to a university degree, and any other institution or class the Government notifies.

The Right of Children to Free and Compulsory Education Act, 2009 (the RTE Act) defines the word differently: section 2(b) makes it any payment other than the fee notified by the school, and section 13 bars it at admission, with a fine up to ten times the amount.

What does the Fee Regulatory Committee decide for professional colleges?

For professional courses, the Karnataka Professional Educational Institutions (Regulation of Admission and Determination of Fee) Act, 2006 (the 2006 Act) replaces notification with a committee. Section 6(1) constitutes a Fee Regulatory Committee for private unaided institutions, with a retired Judge of the High Court of Karnataka nominated by the Chief Justice as Chairperson, a representative of the Medical Council of India or the All India Council for Technical Education, as the course requires (the text is unamended since the National Medical Commission Act, 2019 replaced the Medical Council of India), two nominees of the Chairperson and a Secretary to Government as Member Secretary.

Under section 6(2) each institution places its proposed fees, with books of account, before the Committee by 31 December of the previous academic year, and the Committee verifies that the fee is not profiteering or capitation fee and approves it or determines another. Section 7(1) lists the factors, including a reasonable surplus not more than eight per cent, and section 7(2) bars collection above the Committee's fee together with the university's.

Under section 6(4) the determined fee binds for three years, after which the institution may apply for revision; it applies to a candidate admitted that year until the course is complete, and collecting more than one year's fee from a candidate is capitation fee. Under section 7(4) the Committee inquires into a complaint and forwards recommendations to the university or the State Government, and the State Government may direct the university to levy a fine of up to INR 10 lakh or double the amount collected over and above the fee fixed by the Government, whichever is higher, and the university may refuse to approve admissions or withdraw affiliation. Section 4A lets the State and an association of unaided institutions agree the fee for shared seats.

What does reimbursement for free seats add?

Section 12(1)(c) of the RTE Act requires an unaided school to admit in class I at least 25 per cent of that class's strength from the weaker section and disadvantaged groups in the neighbourhood, free. Section 12(2) reimburses the school up to the State's per-child expenditure or the amount actually charged, whichever is less. The reimbursement may not exceed the per-child expenditure of a government school, and a school already bound to give free places because it received land or facilities on concession is not reimbursed to that extent.

What does the arithmetic look like?

An illustration. The institutions, fees and figures below are hypothetical and show which provision applies.

A recognised private unaided school has 400 pupils and 80 seats in
class I. Published fees: tuition INR 60,000 and
special development fee INR 4,000, each a year per pupil.

Special development fee (rule 10(3)(c)(ii), text to 2001)
  Charged INR 4,000 less the INR 600 limit      excess INR 3,400
  400 pupils                                    INR 13.6 lakh to refund
  Penalty under section 124A, in addition       up to INR 10 lakh

Tuition fee: no numerical limit; the test is salary expenditure and
quality. A rise to INR 72,000 announced in November for the current year
is barred by rule 10(5). The same rise in the next year's brochure is not
caught by rule 10(5), though it remains subject to rule 10(3)(b)(ii).

Forum under the Rules: petition to the District Level Education Regulating Authority
(rule 15), appeal to the Commissioner for Public Instruction (rule 17).

Free seats (section 12(1)(c)): 25 per cent of 80 is 20 children.
State per-child expenditure, illustrative figure INR 30,000; fee INR 60,000.
Reimbursement is the lesser, INR 30,000 per child a year, INR 6 lakh for
the class I intake.

A private unaided engineering college has a Committee-determined fee of
INR 1,50,000 a year, binding for three years, taken as the fee fixed by
the Government, and collects INR 2,00,000, excluding any fee the
university prescribes (section 7(2)), from 100 first-year students.

  Excess per student                          INR 50,000
  Excess across 100 students                  INR 50 lakh
  Double the excess                           INR 1 crore
  Fine ceiling, section 7(4): higher of
  INR 10 lakh and double the excess           INR 1 crore

What remains unsettled?

The 1995 Rules set no number for tuition fee in an unaided school, only the standard that it be commensurate with salary expenditure and quality. They give the work to the District Level Education Regulating Authority of rule 16, constituted in 1999. The Act, since 2017, speaks of a District Education Regulatory Authority whose composition and powers are to be prescribed by rules. The texts on India Code contain no rule made after 2017 for that body, and do not say whether the rule 16 authority is the one section 124A empowers.

Rule 17 gives an appeal against a decision of the Regulating Authority under the Rules. Section 124A provides a penalty and a refund but no appeal, and neither text says whether an order under it is within rule 17.

Section 7(1)(e) of the 2006 Act does not say eight per cent of what. Section 7(4) measures the double fine against the fee fixed by the Government, while sections 6 and 7 have the fee determined by the Committee, and the Act does not say whether they are the same figure. Section 6(4) allows revision only at the end of three years, and the Act provides no appeal or review against a determination, so a challenge within that period rests on Article 226 of the Constitution.

Section 10 of the 1984 Act yields to Article 30 for minority institutions, and section 4A of the 2006 Act reaches them by agreement. The statutes do not say how far the fee provisions bind a minority institution without one.