Page 1 REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4060 OF 2009
MODERN DENTAL COLLEGE AND
RESEARCH CENTRE & ORS. .....APPELLANT(S)
VERSUS
STATE OF MADHYA PRADESH & ORS. .....RESPONDENT(S)
W I T H
CIVIL APPEAL NO. 4061 OF 2009
CIVIL APPEAL NO 4062 OF 2009
CIVIL APPEAL NO 4063 OF 2009
CIVIL APPEAL NO 4064 OF 2009
A N D
CIVIL APPEAL NO 4065 OF 2009
J U D G M E N T
A.K. SIKRI, J.
In all these appeals, validity and correctness of the common
judgment dated May 15, 2009 passed by the High Court of Madhya
1
Page 2 Pradesh, Principal Bench at Jabalpur, has been questioned. The
appellants in these appeals had filed writ petitions challenging the
validity/vires of the provisions of the statute passed by the State
Legislature, which is known as 'Niji Vyavasayik Shikshan Sanstha
(Pravesh Ka Viniyaman Avam Shulk Ka Nirdharan) Adhiniyam, 2007'
(hereinafter referred to as the 'Act, 2007'). The appellants also challenged
vires of Admissions Rules, 2008 (for short, 'Rules, 2008') and the Madhya
Pradesh Private Medical and Dental Post Graduate Courses Entrance
Examination Rules, 2009 (for short, 'Rules, 2009') which have been
framed by the State Government in exercise of the power conferred upon it
vide Section 12 of the Act, 2007. The aforesaid Act and Rules regulate
primarily the admission of students in post graduate courses in private
professional educational institutions and the provisions are also made for
fixation of fee. In addition, the said Act and Rules also contain provisions
for reservation of seats. All the appellants are private medical and dental
colleges which are unaided, i.e. they are not receiving any Government aid
and are self financing institutions running from their own funds.
2)It is evident from the reading of the impugned judgment that challenge was
laid by the appellants to those provisions of the Act and Rules on four
grounds. The same are as under:
2
Page 3 (i) the challenge to the provisions relating to admission;
(ii) the challenge to the provisions relating to fixation of fee;
(iii) the challenge to the provisions for reservation; and
(iv) the challenge to the provisions relating to eligibility for admission.
3)Insofar as provisions relating to admission, eligibility for admission and
fixation of fee are concerned, the main contention of the appellants was
that these medical and dental colleges being private unaided colleges, it is
their fundamental right under Article 19(1)(g) of the Constitution of India to
lay down the eligibility criteria for admission and admit the students as well
as fix their fee. Relying upon the eleven Judge Bench decision of this
Court in T.M.A. Pai Foundation & Ors. v. State of Karnataka & Ors.
1
, it
was argued that right to administer educational institution is recognised as
an 'occupation' and is, thus, a fundamental right to carry on such an
occupation as stipulated in Article 19(1)(g). According to the appellants, the
provisions in the aforesaid Act and Rules impinge upon the fundamental
right guaranteed to these institutions under the Constitution and, therefore,
the said provisions are violative of Article 19(1)(g) of the Constitution.
Insofar as provision relating to reservation of seats to Scheduled Castes,
Scheduled Tribes, etc. is concerned, the emphasis of the appellants was
1(2002) 8 SCC 481
3
Page 4 two fold: First, it was argued that private educational institutions cannot be
foisted with the obligation to admit students of reserved class, which was
the obligation of the State. Secondly, the provisions of the Act, 2007 made
excessive reservations thereby leaving hardly any seats for unreserved
categories, which is not permissible in view of the judgment of this Court in
T. Devadasan v. Union of India & Anr.
2
and subsequent decisions
reiterating the dicta in T. Devadasan.
As would be noticed hereinafter, the basis of attack to the constitutional
validity of the provisions of the Act and Rules remains the same.
Additionally, however, the challenge to the said Act and Rules is laid before
us also on the ground of the competence of the State Legislature as,
according to the appellants, the subject matter falls in the domain that is
exclusively reserved for the Parliament.
4)The High Court has repelled the challenge on first three counts holding
that the judgment in T.M.A. Pai Foundation, as explained in P.A. Inamdar
& Ors. v. State of Maharashtra & Ors.
3
, permits the Government to
regulate the admissions as well as fee, even of the private unaided
educational institutions and that the impugned provisions are saved by
Article 19(6) of the Constitution as they amount to 'reasonable restrictions'
2(1964) 4 SCR 680
3(2005) 6 SCC 537
4
Page 5 imposed on the right of admission and fixation of fee, which otherwise
vests with the appellants.
5)Before we advert to the arguments of the appellants advanced before us in
detail, it would be apposite to give the gist of the provisions of the Act,
2007 as well as Rules, 2008 and Rules, 2009 and also the manner in
which the High Court has dealt with the issues at hand.
THE ACT, 2007:
6)The Preamble of the Act mentions that it is to provide for regulation of
admission and fixation of fee in private professional educational institutions
in the State of Madhya Pradesh and to provide for reservation of seats to
persons belonging to the Scheduled Castes, Scheduled Tribes and Other
Backward Classes in professional educational institutions. Thus, insofar
as the Preamble is concerned, it stipulates that the provisions are made to
provide for the 'regulation' of admission and fixation of fee. Further, the Act
encompasses private professional educational institutions of all disciplines
and is not confined to medical and dental professions. However, writ
petitions were filed raising the grievance against the aforesaid enactment
only by medical and dental educational institutions. Institutions imparting
other kind of professional education have not felt aggrieved.
5
Page 6 7)Be that as it may, for regulating the admission and fixation of fee under
Section 4 of the Act, a committee known as 'Admission and Fee
Regulatory Committee' (hereinafter referred to as the 'Committee') is
constituted for the supervision and guidance of the admission process and
for the fixation of fee to be charged from candidates seeking admission in
a private professional educational institution. This Section further provides
for composition, disqualification and functions of the Committee.
8)Chapter III which comprises of Sections 5 to 8 deals with 'Admission'. As
per Section 5, the eligibility for admission to such institutions shall be such
as may be notified by the appropriate authority. These eligibility conditions
are provided in Rules, 2008. Section 6 prescribes 'Common Entrance
Test' (for short, 'CET') on the basis of which admissions would be made
and the same reads as under:
“6. Common Entrance Test – In private unaided
professional educational institution, admission to sanctioned
intake shall be on the basis of the common entrance test in
such manner as may be prescribed by the State
Government.”
CET is defined in Section 3(d) of the Act, 2007 and reads as follows:
“(d) “Common entrance test” means an entrance test,
conducted for determination of merit of the candidates
followed by centralized counseling for the purpose of merit
based admission to professional colleges or institutions
through a single window procedure by the State Government
6
Page 7 or by any agency authorized by it;”
As per Section 7, any admission made contrary to the provisions of the Act
or Rules is to be treated as void. Section 8 deals with 'reservation of
seats'.
9)Insofar as fixation of fee is concerned, the facts which have to be taken
into consideration while fixing the fee are provided in Section 9, which is
under Chapter IV of the Act, and reads as follows:
“9. Factors – (1) Having regard to -
(i) the location of the private unaided professional
educational institution;
(ii) the nature of the professional course;
(iii) the cost of land and building;
(iv) the available infrastructure, teaching, non-teaching staff
and equipments;
(v) the expenditure on administration and maintenance;
(vi) a reasonable surplus required for growth and
development of the professional institution; and
(vii) any other relevant fact, the committee shall determine, in
the manner prescribed, the fee to be charged by a private
unaided professional educational institution.
(2) The Committee shall give the institution an opportunity of
being heard before fixing any fee:
Provided that no such fee, as may be fixed by the
Committee, shall amount to profiteering or commercialization
7
Page 8 of education.”
As pointed out above, the Government has framed Rules, 2009 creating
detailed provisions for fixation of fee, to which we shall be referring to at
the appropriate stage.
10)Another provision which needs to be mentioned at this stage is Section 10.
This provision provides for appeal that can be filed by a person or a
professional institution aggrieved by an order of the Committee. Such an
appeal can be filed within 30 days before the Appellate Authority
constituted under the said provision. Under Section 12, the State
Government may, by notification, make Rules for carrying out the purpose
of the Act. Section 13 empowers the State Government to make
Regulations consistent with the Act and the Rules made thereunder, inter
alia, relating to the eligibility of admission, manner of admission and
allocation of seats in a professional educational institution, including the
reservation of seats, as well as the manner or criteria for determination of
fee to be charged by professional educational institutions from the
students and the fee that is to be charged by the professional educational
institutions.
11)It may be mentioned that Circular/Notification dated February 28, 2009 and
8
Page 9 March 15, 2009 was issued by the State Government under Section 6 of
the Act, 2007 appointing the Professional Examination Board, Bhopal
(which is known as VYAPAM) as the agency to conduct the entrance
examination for the Post-graduate Entrance Examination of Private
Medical and Dental universities and under-graduate examination
respectively.
THE IMPUGNED JUDGMENT
12)As already mentioned above, the High Court classified the challenge to the
provisions of the aforesaid Act and Rules into four heads and then dealt
with each head separately. Insofar as challenge to the provision relating to
admission is concerned, the High Court has concluded that the provisions
of Section 6 read with Section 3(d) of the Act, 2007, which provide that
admissions to the sanctioned intake shall be on the basis of CET followed
by centralised counselling by the State Government or by an agency
authorised by the State Government, are in consonance with the judgment
of this Court in T.M.A. Pai Foundation and P.A. Inamdar. The High Court
reproduced paragraphs 58 and 59 of T.M.A. Pai Foundation wherein this
Court emphasised that the admission is to be made on the basis of merit,
which is usually determined either by marks that the student obtains at the
qualifying examination or school leaving certificate stage followed by the
9
Page 10 interview or by a CET conducted by the institution or in the case of
professional colleges, by Government agencies. From this, the High Court
concluded that since merit has to be the prime consideration and one of
the recognised mode of ascertaining the merit is through CET and insofar
as professional colleges are concerned, T.M.A. Pai Foundation itself
permitted such CET to be conducted by the Government agencies, there
was nothing wrong with the impugned provision. The High Court also held
that in paragraphs 67 and 68 of T.M.A. Pai Foundation this Court had
permitted framing of Regulations for unaided private professional
educational institutions for conducting such admission tests. The
contention of the educational institutions/ writ petitioners to the effect that
T.M.A. Pai Foundation never allowed the State to control admissions in
private unaided professional educational institutions so as to compel them
to give up a share of available seats to the candidates chosen by the State
has been repelled by the High Court by holding that the admission
procedure for unaided professional educational institutions, both minority
and non-minority, was spelled out in P.A. Inamdar in paragraphs 133 to
138 clearly holding that for achieving the objective of excellence in
admission and maintenance of high standards, the State can, and rather
must, in the national interest step in. This judgment, thereby, recognised
10
Page 11 the power of the State to hold such CETs in respect of private educational
institutions as well. The High Court, in the process, painfully remarked that
the admission procedure which was adopted by the private institutions had
failed to satisfy the triple test of transparency, fairness and non-
exploitativeness thereby compelling the State to substitute the same by its
own procedure and sufficient material was produced by the respondents
on record to show that prior to the enactment of the Act, 2007, there were
number of complaints of malpractices in admissions in the private
professional educational institutions which were found to be true.
In nutshell, the High Court took the opinion that having regard to the
larger interest of the welfare of the students community to promote merit,
achieve excellence, curb malpractices and to secure grant of merit based
admission in transparent manner, the Legislature in its wisdom had passed
the Act in question, also keeping in mind the prevailing conditions relating
to admissions in such institutions in the State of Madhya Pradesh. It, thus,
concluded on this aspect that Sections 3(d), 6 and 7 of the Act, 2007 do
not impinge on the fundamental right to carry on the 'occupation' of
establishing and administering professional educational institutions.
13)Dealing with the challenge to the provisions relating to fixation of fees, viz.
Sections 4(1), 4(8) and 9 of the Act in question, the High Court recognised
11
Page 12 the right of these educational institutions, as found in T.M.A. Pai
Foundation, that decision on the fee to be charged is to be left to private
educational institutions. Notwithstanding, the same judgment gives power
to the State to regulate the exercise of power of the educational institution
to ensure that there is no 'profiteering' and Sections 4 and 9 of the Act,
2007 were aimed at achieving that purpose only. In substance, these
provisions empower the Committee to satisfy itself that the fee proposed
by a private professional educational institution did not amount to
profiteering or commercialisation of education and was based on the
factors mentioned in Section 9(1) of the Act, 2007. The Court noted that
these factors which were mentioned in Section 9(1) were the relevant
factors for fixation of fee as they ensured fixation of such fee which would
take into consideration the nature of professional courses, the cost of land
and building, the available infrastructure, teaching, non-teaching staff and
equipment, the expenditure on administration and maintenance, as well as
a reasonable surplus required for growth and development of the
professional institutions. This was precisely the mandate of T.M.A. Pai
Foundation.
14)While dealing with the provisions in the Act, 2007, which pertained to
reservation, the High Court discussed the dictum laid down in M.R. Balaji
12
Page 13 & Ors. v. The State of Mysore & Ors.
4
wherein the Constitution Bench of
this Court, while interpreting Article 15(4) of the Constitution, held that the
said provision was made to subserve the interest of the society at large by
promoting advancement of weaker sections of the society and, thus, it
authorises the State to make special provision for such weaker sections.
The only exception was that such a special provision to be made by the
State should not completely exclude and ignore the rest of the society.
Further, while making such a provision, the State was supposed to
approach its task objectively and in a rationale manner and it has to take
reasonable and even generous steps to help the advancement of weaker
elements; the requirement of the community at large must be borne in
mind and a formula must be evolved which should strike a reasonable
balance between the several relevant considerations. Likewise, after the
insertion of clause (5) to Article 15 by the Constitution (Ninety-Third
Amendment) Act, 2005, another enabling provision was introduced
empowering the State to make any special provision by law for
advancement of any socially and educationally backward classes of
citizens or for the Scheduled Tribes or the Scheduled Castes insofar as
such special provision relates to admission to the educational institutions,
including the private professional educational institutions, whether aided or
4(1993) Supp. 1 SCR 439
13
Page 14 unaided. Thus, in terms of Article 15(5) of the Constitution, the State was
empowered to provide reservation to such weaker sections even in respect
of unaided institutions, including minority institutions. In that context, the
High Court went into the arithmetic of the seats that have been earmarked
under Rule 7 of Rules, 2009 for candidates belonging to different reserved
categories in different disciplines or subjects and on that basis came to the
conclusion that the distribution of seats to those categories clearly
demonstrates that sufficient number of seats have been allotted also for
unreserved categories in different disciplines or subjects of post graduate
medical and dental courses in Medical and Dental colleges in the State of
Madhya Pradesh. In the process, the High Court dispelled the fear of the
writ petitioners that the unreserved category candidates scoring high
marks than the reserved category candidates will not get seats in the
discipline or subjects of their choice.
15)Rule 10 of Rules, 2009 lays down the eligibility conditions for candidates
for taking the CET for admission to post graduate medical and dental
courses in private unaided medical and dental colleges in the State of
Madhya Pradesh. One of the eligibility conditions specified in Rule 10(2)
(iii) is that an eligible candidate must permanently be registered by
Madhya Pradesh Medical/ Dental Council (and/or MCI/DCI) on or before
14
Page 15 April 30, 2009. The validity of this Rule was challenged by some of the
writ petitioners on the ground that this Rule bars candidates who are
permanently registered with other State Medical/Dental Councils from
taking the CET. This contention of the writ petitioners has been accepted
declaring Rule 10(2)(iii) of the Rules, 2009 as ultra vires. The conclusion
of the High Court on this aspect has become final as the State has not filed
any appeal thereagainst.
16)In nutshell, the decision of the High Court on the three crucial aspects is
on the following premise:
(i)Re.: Admissions – Reading Section 6 with Section 3(d) of the Act, 2007,
which deals with the CETs, it is held that provisions prescribing a CET for the
purpose of admission to private unaided institutions are constitutional and valid
since the same are in consonance with the dictum of the Constitution Bench
judgment of this Court in the case of T.M.A. Pai Foundation, as per the law
specially laid down in paragraphs 58 and 59 of the said judgment. The High
Court has pointed out the manner in which the dictum of T.M.A. Pai Foundation
is explained in the Constitution Bench judgment of this Court in the case of P.A.
Inamdar, and applying the same the High Court had held that there is no
violation of the fundamental rights of the writ petitioners since the provisions
constituted reasonable restriction as accepted by and, therefore, saved under
15
Page 16 Article 19(6) of the Constitution. Quoting paragraphs 136 and 137 of P.A.
Inamdar, the High Court held that the CET prescribed under Section 6 of the
Act, 2007 will ensure that the merit is maintained. It is also concluded by the
High Court that sufficient material that was placed on record to establish that
prior to the enactment of the Act, 2007 clearly exhibited that private unaided
institutions were not able to ensure a fair, transparent and non-exploitative
admission procedure. As such, the High Court upheld the provisions of the Act,
2007 and the Rules, 2008 read with notifications issued thereunder to be
constitutionally valid.
(ii)Re.: Fee Regulation – With regard to the challenge to Sections 4(1), 4(8)
and 9 of the Act, 2007 read with Rule 10 of the Rules, 2008, it is held that the
power of the Fee Regulatory Committee under the provisions was only
'regulatory' and the purpose of which was to empower the Committee to be
satisfied that the fee proposed by the private professional institutions did not
amount to profiteering or commercialisation of education and was based on
intelligible factors mentioned in Section 9(1) of Act, 2007 providing a canalised
power which was not violative of the fundamental rights of the private
professional institutions to charge their own fee.
(iii)Re.: Reservation – The challenge to Section 8 of Act, 2007 and Rules 4 &
16
Page 17 7 of Rules, 2008 relating to reservations were not seriously pressed by the
appellants in view of the amendment to Article 15, whereby clause (5) was
inserted, by the Constitution (Ninety-Third Amendment), 2005. In any case, the
High Court has examined the said provisions and concluded that sufficient
number of seats were allotted for the unreserved category in different disciplines
and subjects, and that a reasonable balance had been struck between the rights
of the unreserved category candidates and the reserved category candidates.
17)The aforesaid background, as narrated by us, would make it clear that the
attack to the constitutional validity of the Act, 2007 read with Rules, 2008
and Rules, 2009 primarily touches upon the following three aspects:
(i) The impugned provisions usurp the rights of educational institutions to
conduct exam and admit the students. It is argued that this right has been
specifically recognised in T.M.A. Pai Foundation, which legal position is
reiterated in P.A. Inamdar. Therefore, right to admission of students in
unaided recognised educational institutions is to be exercised by these
institutions. Even if CET is to be held for this purpose, it is these
institutions which can join together and hold such a test. The only
obligation is that the selection process needs to be fair, transparent and
non-exploitative. The State can step in and oversee/supervise the process
17
Page 18 of admission, which is to be essentially taken by the educational institution
to ensure that the aforesaid triple test of fair, transparent and non-
exploitative selection process is followed. It is argued that the power given
to the State would be only regulatory in nature and under the garb of this
power the State cannot take away the right to admit the students which
vests with the educational institutions. In nutshell, the submission is that
holding of CET by the State under the provisions of the Act, 2007 read with
the Rules framed thereunder amounts to impinging upon the fundamental
right of the appellants to establish and manage professional educational
institutions, which is now brought at par with the rights of minority
institutions to establish such institution given to them under Article 30 of
the Constitution. It was further argued that whereas the power of
supervision on the part of the State may amount to reasonable restriction
and, therefore, that would satisfy the test laid down in Article 19(6) of the
Constitution, but taking away the power of admission entirely by
conducting CET and even counseling would fall foul of the fundamental
right to carry on occupation guaranteed under Article 19(6) of the
Constitution and such provisions cannot be saved under Article 19(6) of
the Constitution as well as they disturb the Doctrine of Proportionality. It
was submitted that the State's intervention, if at all, can only be with
18
Page 19 consensual arrangement and not otherwise.
(ii)Likewise, it is argued by the appellants that as a facet of Article 19(1)(g) of
the Constitution, right to fix the fee is conferred upon these educational
institutions which are unaided and, therefore, the State cannot assume
that power to itself. Here again, the power of the State was limited to that
of 'policing', viz., to ensure that the fee fixed by the educational institutions
does not amount to 'profiteering' and that it does not result in
'commercialisation' of the education. According to the appellants, to
ensure this, the only mechanism that can be provided is the 'Complaint
Mechanism' whereunder after the fee is fixed by the educational institution
and if there is grievance of the students or parents or even the authorities
against the same there can be a scrutiny by the appropriate committee (to
be set up for this purpose) to see that the fee fixed is not excessive and
meets the parameters laid down in T.M.A. Pai Foundation. It was
conceded that while doing so the State can also, as a watchdog, ensure
that no capitation fee is charged from the students by the educational
institutions. It was submitted that contrary to the above, in the instant
case, the provisions of Act, 2007, read with Rules thereunder, authorize
the Committee set up by the Government to fix the fee thereby denuding
the institutions of their right completely, which is anathema to the right of
19
Page 20 the educational institution to carry on their 'occupation' of running the
educational institutions, as a fundamental right.
(iii)Third challenge is to the provision of Section 8 of Act, 2007 and Rules 4
and 7 of Rules, 2008 dealing with the reservations.
18)Mr. K.K. Venugopal, learned senior counsel appearing for some of the
appellants, spearheaded the attack to the impugned judgment with his
usual fervor, panache and dexterity. Dr. Rajeev Dhawan was the other
senior counsel who made his own detailed submissions with a melange of
legal acumen, coupled with passion, thereby exacerbating the attack.
They were joined by Mr. Raval, Mr. Ajit Kumar Sinha and Mr. Rakesh
Dwivedi, learned senior counsel, who supported them in great measure.
Their forceful onslaught was bravely faced and defended by Ms. Vibha
Dutta Makhija, learned senior counsel who appeared for the State of
Madhya Pradesh. Others, who supported her in countering the
submissions of the appellants, depicting in the process the other side with
terse and astute aphorisms of the stark ground realities, were Ms. Pinky
Anand, learned Additional Solicitor General, Mr. Vikas Singh, learned
senior advocate and Mr. C.D. Singh, learned Additional Advocate General.
Whether the defence has been able to blunt the attack of the appellants
20
Page 21 and has emerged successful in its endeavor would be known at the final
stages of the judgment when the arguments of both sides are suitably
dealt with by this Court.
19)The central theme of the arguments of the learned counsel for the
appellants was that by the impugned legislation the State seeks to wipe
out the choice available with the appellants institutions to devise their own
admission procedure and the provisions of Section 6 read with Section
3(d) necessitate that the admission be carried out only on the basis of a
CET to be conducted by the State Government or any agency appointed
by it. Section 7 of the Act provides that the admission in violation of the
provisions of the Act (i.e. in a manner otherwise than by a CET conducted
by the State Government or the agency appointed by it) would be void. In
addition, Section 9 of the Act provides for the Committee defined under
Section 3(c) of the Act to 'determine' and 'fix' the fees to be charged by the
appellants and thereby completely trample the rights of the appellants to
determine and charge the fee. The Committee is not an independent
Committee but is manned by Government officials and, therefore,
effectively the State Government has devised the said mechanism to fix
the fees of the private colleges. Section 8 provides for reservation in
private institutions, including post-graduate courses, which the appellants
21
Page 22 submit is impermissible in light of the law laid down by this Court in the
case of Ashok Kumar Thakur v. Union of India & Ors.
5
.
20)It is their submission that right available to the appellants institutions is to
devise their own admission procedure, subject to the condition that the
procedure so devised ought to be 'fair', 'transparent' and 'non-exploitative'.
Thus, the rights available to the institutions under Article 19(1)(g) includes
a right to admit students on a fair basis and as such the appellants can
choose to admit students on the basis of the CET conducted by an
association of institutions coming together (as has been provided in P.A.
Inamdar) or one conducted by the State and the choice also includes to a
right to admit students on the basis of the CET conducted by the Central
Government. The right to choose is the right that is available to the
individual institutions under Article 19(1)(g) and the impugned legislation
which abrogates the said right falls foul of Article 12 of the Constitution of
India.
21)The counsel for the appellants traced the history of judicial journey by
referring to the judgment in in Unni Krishnan, J.P. & Ors. v. State of
Andhra Pradesh & Ors.
6
In that case, this Court considered the
5(2007) 4 SCC 361
6(1993) 1 SCC 645
22
Page 23 conditions and regulations, if any, which the State could impose in the
running of private unaided/aided recognized or affiliated educational
institutions conducting professional courses. The extent to which the fee
could be charged by such institutions and the manner in which admissions
could be granted was also considered. The Court thereafter devised a
scheme of 'free seats' or the state quota seats and 'payment seats' or the
management quota seats, under which a higher fee could be charged
from the students taking admission against the 'payment seats' and a
lesser fee would be charged from students occupying the 'free seats'. This
Court held that a fee higher than that charged by the Government
institutions for similar courses for the 'payment seats' can be imposed, but
that such fee could not exceed the maximum limit fixed by the State. With
regard to private aided recognized/affiliated educational institutions, the
Court upheld the power of the Government to frame rules and regulations
in matters of admission and fees, as well as in matters such a recruitment
and conditions of service of teachers and staff.
22)The learned counsel emphasised that the aforesaid control mechanism
failed and the position was remedied by this Court in T.M.A. Pai
Foundation. It held that if the institutions are entirely self-financing, the
State shall have minimal interference and the interference can be made
23
Page 24 only for the purposes of Maintaining Academic Standards. Besides this, it
was held that the colleges enjoy the greatest autonomy and the same
ought to be protected. The Court has considered the scope of the
'reasonable restrictions' that can be provided by the State under Article
19(6) of the Constitution and held that the said power does not confer
upon the State to take over the control of the affairs of the institutions
which have been held to be reasonable restrictions. The appellants
referred to the observations made in paragraph 54 with great emphasis:
“54. The right to establish an educational institutional can be
regulated; but such regulatory measures must, in general, be
to ensure the maintenance of proper academic standards,
atmosphere and infrastructure (including qualified staff) and
the prevention of mal-administration by those in charge of
management. The fixing of a rigid fee structure, dictating the
formation and composition of a governing body, compulsory
nomination of teachers and staff for appointment or
nominating students for admissions would be unacceptable
restrictions.”
It was argued that this Court, by overruling Unni Krishnan, has
recognised the need and importance of private educational institutions and the
necessity of giving them the requisite autonomy in their functioning,
management and administration.
23)The submission was that this Court in T.M.A. Pai Foundation laid down
the following principles and the scope of the rights enjoyed by the private
24
Page 25 institutions imparting professional education:
(a)that the institutions have a fundamental right to establish, run and maintain
professional institutions and the rights flow from Article 30(1) in respect of
minority institutions and Article 19(1)(g) in respect of minority as well as non-
minority private unaided institution;
(b)the private institutions that do not receive any aid out of State funds enjoy
a greater autonomy in their day-to-day functioning and the autonomy includes:-
(i)a right to admit students;
(ii)a right to set up a reasonable fee structure;
(iii)a right to appoint staff (teaching and non-teaching);
and
(iv)a right to take action if there is dereliction of duty on
the part of any employees.
and
(c)the fixing of a rigid fee structure, dictating the formation and composition of
a governing body, compulsory nomination of teachers and staff for appointment
or nominating students for admissions would be unacceptable restrictions which
would not be protected under Article 19(6) of the Constitution.
24)Continuing the narration of judicial pronouncement, the appellants' counsel
submitted that in spite of the said observations and the law laid down by
this Court in T.M.A. Pai Foundation
defining the scope of the right of the
25
Page 26 private institutions to run and manage the professional colleges, some
States did not adhere to the same and issued Government Orders relying
on the observations made by this Court in paragraph 68 of the said
judgment. The said orders were challenged before this Court, which came
to be decided in the case of Islamic Academy or Education & Anr. v.
State of Karnataka & Ors.
7
, which laid down certain broad modalities and
creation of Committees for 'regulating' the admission procedure and the
fee structure. It was submitted that certain States enacted laws which
were again in violation of the fundamental rights and, therefore, the same
were challenged before this Court. The matter was referred to a larger
Bench, which answered the reference in the case of P.A. Inamdar,
wherein it was held as under:
“132. Our answer to the first question is that neither the
policy of reservation can be enforced by the State nor any
quota or percentage of admissions can be carved out to be
appropriated by the State in a minority or non-minority
unaided educational institution. Minority institutions are free
to admit students of their own choice including students of
non-minority community as also members of their own
community from other States, both to a limited extent only
and not in a manner and to such an extent that their minority
educational institution status is lost. If they do so, they lose
the protection of Article 30(1).
“There is nothing wrong in an entrance test being held
for one group of institution imparting same or similar
education. Such institutions situated in one State or in
7(2003) 6 SCC 697
26
Page 27 more than one State may join together and hold a
common entrance test......”
xx xx xx
141. Our answer to Question 3 is that every institution is
free to devise its own fee structure but the same can be
regulated in the interest of preventing profiteering. No
capitation fee can be charged.
xx xx xx
144. The two Committees for monitoring admission
procedure and determining fee structure in the judgment of
Islamic Academy
are in our view, permissible as regulatory
measures aimed at protecting the interest of the student
community as a whole as also the minorities themselves, in
maintaining required standards of professional education on
non-exploitative terms in their institutions. Legal provisions
made by the State Legislatures or the scheme evolved by
the Court for monitoring admission procedure and fee
fixation do not violate the right of minorities under Article
30(1) or the right of minorities and non-minorities under
Article 19(1)(g). They are reasonable restrictions in the
interest of minority institutions permissible under Article 30(1)
and in the interest of general public under Article 19(6) of the
Constitution.”
Explaining their understanding of T.M.A. Pai Foundation and P.A.
Inamdar in their own way, a passionate plea was made not to allow such
legislations to remain on statute books which were palpably
unconstitutional.
25)In addition to the aforesaid issues, which are founded on Article 19(1)(g) of
the Constitution, additional arguments raised in this Court touch upon the
27
Page 28 power of the State to enact such a legislation inasmuch as it is argued that
the matter of admission in higher educational institutional falls in Entry 66
of List I to the Seventh Schedule of the Constitution (Union List) and is not
covered by Entry 25 of List III of Seventh Schedule (Concurrent List).
26)Learned counsel appearing for the State of Madhya Pradesh put stiff
resistance to the aforesaid submissions of the learned counsel for the
appellants and submitted with all vehemence at her command that the
impugned judgment of the High Court was without blemish, which had
given due and adequate consideration to all the aforesaid submissions of
the appellants which were advanced before the High Court as well and
rightly negated these submissions by correctly reading the ratio of T.M.A.
Pai Foundation as explained in Islamic Academy of Education and put
beyond pale of controversy by P.A. Inamdar. She referred to and relied
upon the reasoning given in the impugned judgment by the High Court and
submitted that no interference therein was called for. In nutshell, her
submission was that Act, 2007 as well as Rules framed thereunder were
unconstitutional/violative of fundamental rights of the appellants
guaranteed under Article 19(1)(g) of the Constitution of India. Her
submission was that undoubtedly the Court recognised the right of the
citizens to establish and manage educational institutions, as fundamental
28
Page 29 right, by regarding the same as an 'occupation' under Article 19(1)(g) of the
Constitution in T.M.A. Pai Foundation and also bringing them at par with
the similar rights which were already conferred upon minorities to establish
and manage professional/technical institutions under Article 30(1) of the
Constitution. She, however, sought to highlight that analogously the Court
also made it clear that these were subject to reasonable restrictions which
can be imposed under Article 19(6) of the Constitution. She argued that
T.M.A. Pai Foundation, in this process, expounded on the nature and
extent of control on the basis of levels of education which has to be kept in
mind and cannot be glossed over. This was explained in paragraph 61 of
the judgment by observing that insofar as school level education is
concerned, unaided private schools must have maximum autonomy since
at the school level it is not possible to assess the merit of the students.
Therefore, admission at this stage cannot be granted on the basis of
selection based only on merit. Likewise, private unaided undergraduate
colleges which are imparting non-technical education would also enjoy
same kind of maximum autonomy similar to schools. However, whenever
it comes to the higher education, particularly in the field of professional
education, private unaided institutions imparting professional education
would not be extended the principle of maximum autonomy. Here, the
29
Page 30 Court categorically stated that maximum regulations could be framed with
regard to these institutions since the principle of maintaining merit was
inviolable and primary. The Court was categorical in clarifying that in the
field of professional education, the Government could enforce a regulation
for ensuring a merit based selection. Proceeding further in this direction,
she referred to certain paragraphs of T.M.A. Pai Foundation and more
focused discussion on this aspect of P.A. Inamdar and submitted that
these judgments clearly empower the State to regulate the admission to
ensure that the triple test ensured in T.M.A. Pai Foundation
is adhered to
and such regulation would encompass within its power of the State to hold
CET coupled with counseling of the students to be admitted in the
professional institutions. She further submitted that in P.A. Inamdar the
seven Judge Bench rather exhorted the States to come out with
legislations regulating admissions and fee in private unaided/aided
professional or technical institutions. She pointed out that after the
pronouncement of judgment in P.A. Inamdar, many States have enacted
laws regulating admissions and fee in such institutions. She submitted
that once such a law enacted by the Delhi State was considered by this
Court in the case of Indian Medical Association v. Union of India &
Ors.
8
, where the challenge was to the ACMS prescribing for granting
8(2011) 7 SCC 179
30
Page 31 admission to only wards of army personnel in colleges managed by ACMS,
while upholding the constitutional validity of the Delhi Professional
Colleges/Institutions (Prohibition of Capitation Fee, Regulation of
Administration, Fixation of Non-Exploitative Fee & Other Measures) Act,
2007, this Court struck down the ACMS notification holding that non-
minority private unaided professional colleges do not have a right to
choose their own 'source' from a general pool. It was held that 'neither the
minority nor non-minority institutions could mal-administer their
educational institutions, especially professional institutions, that affect the
quality of education, and by choosing students arbitrarily from within the
sources that they are entitled to choose from'. Insofar as provision
regarding fee regulations are concerned, her submission was that the
mechanism which was provided did not take away the power of the
educational institutions to fix the fee. On the contrary, even as per the
procedure laid down the fee which the appellants intend to charge had to
be placed before the Committee constituted under the Rules and the
Committee was to consider whether proposed fee is proper or not and on
that basis fix the fee keeping in view the parameters laid down in the Act
and Rules which were in consonance with the principles enunciated in
T.M.A. Pai Foundation and P.A. Inamdar as well as Modern School v.
31
Page 32 Union of India
9
. She, thus, argued that this was only a regulatory
mechanism. Ms. Makhija further submitted that principles of natural justice
were duly incorporated in the procedure established by incorporation of
sub-section (2) of Section 9 of the Act, 2007 and even provision of appeal
process was provided under Section 10 of the said Act.
27)Insofar as provision relating to reservation is concerned, she submitted
that the issue whether provisions of Article 15(5) of the Constitution apply
or not to the private unaided institutions was no longer res integra since
the same has already been upheld in the Constitution Bench judgment
rendered in Pramati Educational & Cultural Trust (Registered) & Ors. v.
Union of India & Ors.
10
She also pointed out that challenge to the said
provision relating to reservation had not been forcefully pressed by
appellants before the High Court.
Other counsel made their submissions on same lines.
28)The discussion of the case upto now fairly demonstrates that the two
cases on which strong reliance is placed by the appellants are T.M.A. Pai
Foundation
and P.A. Inamdar. In the process, judgment in the case of
Islamic Academy of Education is also referred to. Interestingly, even the
9(2004) 5 SCC 583
10(2014) 8 SCC 1
32
Page 33 respondents have taken sustenance from the law laid down in the
aforesaid judgments. Thus, interestingly, the stichomythia which went on
resulting into intense arguments, coupled with emotional exchange
between the two sides, had its foundation on the bedrock of same case
law. Therefore, in carrying out our analysis, while dealing with the
arguments of the counsel on both sides, we would be adverting to the
aforesaid judgments, as well as some other judgments which have a
bearing on the issue, to arrive at the desirable and just conclusions based
upon the foundation laid down therein. We may also observe that in
pondering over these arguments and submissions, we have endeavoured
to undertake the task sagaciously and with keen penetrative analysis using
the periscope of sound legal principles and doing a diagnostic of sorts.
ANALYSIS, REASONING & CONCLUSIONS:
29)The history of the dispute regarding Government control over the
functioning of private medical colleges is quite old now but the tug of war
continues. There seems to be some conflict of interest between the State
Government and the bodies that establish institutions and impart
professional medical education to the youth of this country. While on the
one hand the State Governments want to control the institutions for socio-
political considerations and on the other the people who invest, set up and
33
Page 34 establish the institutions have a genuine desire to run and exercise
functional control over the institution in the best interests of the students, it
cannot be disputed that the State does not enjoy monopoly in the field of
imparting medical education and the private medical colleges play a very
significant role in this regard. The State lacks funds that is imperative to
provide best infrastructure and latest facilities to the students so that they
emerge as the best in their respective fields.
30)In the modern age, therefore, particularly after the policy of liberalization
adopted by the State, educational institutions by private bodies are allowed
to be established. There is a paradigm shift over from the era of complete
Government control over education (like other economic and commercial
activities) to a situation where private players are allowed to mushroom.
But at the same time, regulatory mechanism is provided thereby ensuring
that such private institutions work within such regulatory regime. When it
comes to education, it is expected that unaided private institutions provide
quality education and at the same time they are given 'freedom in joints'
with minimal Government interference, except what comes under
regulatory regime. Though education is now treated as an 'occupation'
and, thus, has become a fundamental right guaranteed under Article 19(1)
(g) of the Constitution, at the same time shackles are put insofar as this
34
Page 35 particular occupation is concerned which is termed as 'noble'. Therefore,
profiteering and commercialisation are not permitted and no capitation fee
can be charged. The admission of students has to be on merit and not at
the whims and fancies of the educational institutions. Merit can be tested
by adopting some methodology and few such methods are suggested in
T.M.A. Pai Foundation, which includes holding of CET. It is to be ensured
that this admission process meets the triple test of transparency, fairness
and non-exploitativeness.
With these introductory remarks, we advert to issue-wise discussion
I.Re.: Provisions relating to CET to be conducted by the State
machinery under Act, 2007 as well as Rules.
31)The issue involved, which is of seminal nature, requires three tires of
judicial review. In the first instance, it is to be examined – whether the
right claimed by the appellants is a fundamental right guaranteed under
Article 19(1)(g) of the Constitution, and if so, what are the features it
encompasses? The second stage would be to find out – whether the
statute, which is impugned, imposes any restrictions on the right given to
the appellants? If there are restrictions, the third poser would be –
whether such restrictions are 'reasonable' and, therefore, protected under
clause (6) of Article 19 of the Constitution?
35
Page 36 32)Insofar as the first part of the question is concerned, it does not pose any
problem and the answer goes in favour of the appellants. We may
recapitulate here that Article 26 of the Constitution gives freedom to every
religious denomination or any section thereof by conferring certain rights
which include right to establish and maintain institutions for religious and
charitable purposes. Thus, insofar as religious denominations or any
section thereof are concerned, they were given right to establish and
maintain institutions for religious and charitable purposes making it a
fundamental right. Likewise, Article 30 confers upon minorities
fundamental right to establish and administer educational institutions.
Insofar as Article 26 is concerned, it comes under the caption 'Right to
Freedom of Religion'. As far as Article 30 is concerned, it is under the
heading 'Cultural and Educational Rights'. Thus, rights of the minorities to
establish and administer educational institutions was always recognised as
fundamental rights. Further, the right of private unaided professional
institutions to establish and manage educational institutions was not
clearly recognised as a fundamental right covered under Article 19(1)(g)
and categorically rejected by the Constitution Bench of this Court
comprising of five Judges in the case of Unni Krishnan. It was held in
paragraph 198 of the judgment that “(w)e are, therefore, of the opinion
36
Page 37 adopting the line of reasoning in State of Bombay v. RMD
Chamarbaugwala & Anr.
11
that imparting education cannot be treated as
trade or business. Education cannot be allowed to be converted into
commerce nor can petitioners seek to obtain the said result by relying on
the wider meaning of 'occupation'”. In that case, this Court also rejected
the argument that the said activity could be classified as a 'profession'.
However, the right of professional institutions to establish and manage
educational institutions was finally regarded as an 'occupation' befitting the
recognition of this right as a fundamental right under Article 19(1)(g) in
T.M.A. Pai Foundation in the following words:
“25. The establishment and running of an educational
institution where a large number of persons are employed as
teachers or administrative staff, and an activity is carried on
that results in the imparting of knowledge to the students,
must necessarily be regarded as an occupation, even if there
is no element of profit generation. It is difficult to comprehend
that education, per se, will not fall under any of the four
expressions in Article 19(1)(g). “Occupation” would be an
activity of a person undertaken as a means of livelihood or a
mission in life. The above-quoted observations in Sodan
Singh case, (1989) 4 SCC 155, correctly interpret the
expression “occupation” in Article 19(1)(g).”
33)Having recognised it as an 'occupation' and giving the status of a
fundamental right, the Court delineated four specific rights which
encompass right to occupation, namely, (i) a right to admit students; (ii) a
111957 SCR 874
37
Page 38 right to set up a reasonable fee structure; (iii) a right to appoint staff
(teaching and non-teaching); and (iv) a right to take action if there is
dereliction of duty on the part of any employees. In view of the aforesaid
recognition of the right to admit the students and a right to set up a
reasonable fee structure treating as part of occupation which is recognised
as fundamental right under Article 19(1)(g) of the Constitution, the
appellants have easily crossed the initial hurdle. Here comes the second
facet of this issue, viz. – what is the scope of this right of occupation?
34)It becomes necessary to point out that while treating the managing of
educational institution as an 'occupation', the Court was categorical that
this activity could not be treated as 'business' or 'profession'. This right to
carry on the occupation that the education is, the same is not put at par
with other occupations or business activities or even other professions. It
is a category apart which was carved out by this Court in T.M.A. Pai
Foundation. There was a specific purpose for not doing so. Education is
treated as a noble 'occupation' on 'no profit no loss' basis. Thus, those who
establish and are managing the educational institutions are not expected
to indulge in profiteering or commercialise this noble activity. Keeping this
objective in mind, the Court did not give complete freedom to the
educational institutions in respect of right to admit the students and also
38
Page 39 with regard to fixation of fee. As far as admission of students is
concerned, the Court was categorical that such admissions have to be on
the basis of merit when it comes to higher education, particularly in
professional institutions.
35)Ms. Vibha Datta Makhija is right in her submission that the significant
feature of T.M.A. Pai Foundation is that it expounded on the nature and
extent of its control on the basis of level of education. When it comes to
higher education, that too in professional institutions, merit has to be the
sole criteria. This is so explained in paragraph 58 of the judgment which
reads as under:
“58. For admission into any professional institution, merit
must play an important role. While it may not be normally
possible to judge the merit of the applicant who seeks
admission into a school, while seeking admission to a
professional institution and to become a competent
professional, it is necessary that meritorious candidates are
not unfairly treated or put at a disadvantage by preferences
shown to less meritorious but more influential applicants.
Excellence in professional education would require that
greater emphasis be laid on the merit of a student seeking
admission. Appropriate regulations for this purpose may be
made keeping in view the other observations made in this
judgment in the context of admissions to unaided
institutions.”
36)In order to see that merit is adjudged suitably and appropriately, the Court
candidly laid down that procedure for admission should be so devised
39
Page 40 which satisfies the triple test of being fair, transparent and non-exploitative.
The next question was as to how the aforesaid objective could be
achieved? For determining such merit, the Court showed the path in
paragraph 59 by observing that such merit should be determined either by
the marks that students obtained at qualifying examination or at the CET
conducted by the institutions or in the case of professional colleges, by
Government agencies. Paragraph 59 suggesting these modes reads as
under:
“59. Merit is usually determined, for admission to
professional and higher education colleges, by either the
marks that the student obtains at the qualifying examination
or school-leaving certificate stage followed by the interview,
or by a common entrance test conducted by the institution,
or in the case of professional colleges, by government
agencies.”
This paragraph very specifically authorises CET to be conducted by
Government agencies in the case of professional colleges.
37)In order to ensure that the said CET is fair, transparent and merit based,
T.M.A. Pai Foundation also permitted the Government to frame
Regulations for unaided private professional educational institutions.
Paragraphs 67 and 68 which permit framing of such regulations are
reproduced below:
40
Page 41 “67. We now come to the regulations that can be framed
relating to private unaided professional institutions.
68. It would be unfair to apply the same rules and
regulations regulating admission to both aided and unaided
professional institutions. It must be borne in mind that
unaided professional institutions are entitled to autonomy in
their administration while, at the same time, they do not
forego or discard the principle of merit. It would, therefore, be
permissible for the university or the Government, at the time
of granting recognition, to require a private unaided
institution to provide for merit-based selection while, at the
same time, giving the management sufficient discretion in
admitting students. This can be done through various
methods. For instance, a certain percentage of the seats can
be reserved for admission by the management out of those
students who have passed the common entrance test held
by itself or by the State/university and have applied to the
college concerned for admission, while the rest of the seats
may be filled up on the basis of counselling by the State
agency. This will incidentally take care of poorer and
backward sections of the society. The prescription of
percentage for this purpose has to be done by the
Government according to the local needs and different
percentages can be fixed for minority unaided and non-
minority unaided and professional colleges. The same
principles may be applied to other non-professional but
unaided educational institutions viz. graduation and post-
graduation non-professional colleges or institutes.”
38)A plea was raised by the appellants that by exercising the power to frame
Regulations, the State could not usurp the very function of conducting this
admission test by the educational institutions. It was argued that it only
meant that such a CET is to be conducted by the educational institutions
themselves and the Government could only frame the Regulations to
41
Page 42 regulate such admission tests to be conducted by the educational
institutions and could not take away the function of holding the CET.
39)This argument has to be rejected in view of the unambiguous and
categorical interpretation given by the Supreme Court in P.A. Inamdar with
respect to certain observations, particularly in paragraph 68 in T.M.A. Pai
Foundation. In this behalf, we would like to recapitulate that in T.M.A. Pai
Foundation, a Bench of eleven Judges dealt with the issues of scope of
right to set up educational institutions by private aided or unaided, minority
or non-minority institutions and the extent of Government regulation of the
said right. It was held that the right to establish and administer an
institution included the right to admit students and to set up a reasonable
fee structure. But the said right could be regulated to ensure maintenance
of proper academic standards, atmosphere and infrastructure. Fixing of
rigid fee structure, dictating the formation and composition of a governing
body, compulsory nomination of teachers and staff for appointment or
nominating students for admissions would be unacceptable restrictions.
However, occupation of education was not business but profession
involving charitable activity. The State can forbid charging of capitation fee
and profiteering. The object of setting up educational institution is not to
make profit. There could, however, be a reasonable revenue surplus for
42
Page 43 development of education. For admission, merit must play an important
role. The State or the University could require private unaided institution to
provide for merit based selection while giving sufficient discretion in
admitting students. Certain percentage of seats could be reserved for
admission by management out of students who have passed CET held by
the institution or by the State/University. Interpretation of certain
observations in paragraph 68 of the judgment in T.M.A. Pai Foundation
has been a matter of debate to which we advert to in detail hereinafter.
40)As pointed out above, immediately after the judgment in T.M.A. Pai
Foundation, a group of writ petitions were filed in this Court, which were
dealt with by a Bench of five judges in Islamic Academy of Education.
Four of the Judges were the same who were party to the judgment in
T.M.A. Pai Foundation. The issue considered was the extent of
autonomy in fixing the fee structure and making admissions. This Court
held that while there was autonomy with the institutions to fix fee structure,
there could be no profiteering and no capitation fee could be charged as
imparting of education was essentially charitable in nature. This required
setting up of a Committee by each of the States to decide whether fee
structure proposed by an institute was justified and did not amount to
profiteering or charging of capitation fee. The fee so fixed shall be binding
43
Page 44 for three years at the end of which a revision could be sought.
41)With regard to the autonomy in admission, it was noted that the earlier
judgment kept in mind the 'the sad reality that there are a large number of
professional colleges which indulge in profiteering and/or charging
capitation fees'. For this reason, it was provided that admission must be
based on merit. It was impossible to control profiteering/charging of
capitation fee unless admission was on merit. It was further observed that
requiring a student to appear at more than one entrance test led to great
hardship as the students had to pay application fee for each institute,
arrange for and pay for the transport to appear in the individual tests.
Thus, management could select students either on the basis of CET
conducted by the State or association of all colleges for a particular type,
for example, medical, engineering or technical etc. Some of the
institutions have their own admission procedure since long against which
no finger had ever been raised and no complaint made regarding fairness
and transparency – which claim was disputed. Such institutions as had
been established for 25 years could apply for exemption to the Committee
directed by the Court to be constituted. This Court directed the State
Governments to appoint permanent Committees to ensure that the test
conducted by association of colleges was fair and transparent.
44
Page 45 42)The matter was then considered by a larger Bench of seven judges in P.A.
Inamdar. It was held that the two Committees for monitoring admission
procedure and determining fee structure as per the judgment in Islamic
Academy of Education were permissible as regulatory measures aimed
at protecting the students community as a whole as also the minority
themselves in maintaining required standards of professional education on
non-exploitative terms. This did not violate Article 30(1) or Article 19(1)(g).
It was observed that unless the admission procedure and fixation of fees is
regulated and controlled at the initial stage, the evil of unfair practice of
granting admission on available seats guided by the paying capacity of the
candidates would be impossible to curb (emphasis added). On this
ground, suggestion of the institutions to achieve the purpose for which
Committees had been set up by post-audit checks after the institutions
adopted their own admission procedure and fee structure were rejected.
The Committees were, thus, allowed to continue for regulating the
admissions and the fee structure until a suitable legislation or regulations
framed by the States. It was left to the Central Governments and the State
Governments to come out with a detailed well thought out legislation
setting up a suitable mechanism for regulating admission procedure and
fee structure. Paragraph 68 in T.M.A. Pai Foundation case was
45
Page 46 explained by stating that observations permitting the management to
reserve certain seats was meant for poorer and backward sections as per
local needs. It did not mean to ignore the merit. It was also held that CET
could be held, otherwise merit becomes casualty. There is, thus, no bar to
CET being held by a State agency when law so provides.
43)Thus, the contention raised on behalf of the appellants that the private
medical colleges had absolute right to make admissions or to fix fee is not
consistent with the earlier decisions of this Court. Neither merit could be
compromised in admissions to professional institutions nor capitation fee
could be permitted. To achieve these objects it is open to the State to
introduce regulatory measures. We are unable to accept the submissions
that the State could intervene only after proving that merit was
compromised or capitation fee was being charged. As observed in the
earlier decisions of this Court, post-audit measures would not meet the
regulatory requirements. Control was required at the initial stage itself.
Therefore, our answer to the first question is that though 'occupation' is a
fundamental right, which gives right to the educational institutions to admit
the students and also fix the fee, at the same time, scope of such rights
has been discussed and limitations imposed thereupon by the aforesaid
judgments themselves explaining the nature of limitations on these rights.
46
Page 47 44)Insofar as the second question is concerned, it again can be easily
answered by accepting that the impugned legislation and Rules impose
certain restrictions. Question is, whether these are in consonance with the
law laid down in the aforesaid judgments? This discussion relates to the
third stage of judicial review where we are called upon to decide as to
whether these restrictions are 'reasonable'.
45)We may note that while upholding the regulatory provision for admissions,
the High Court has observed:
“27. We are of the considered opinion that Section 6 read
with Section 3 (d) of the Act, 2007, which provide that
admissions to sanctioned intake shall be on the basis of
common entrance test followed by centralised counselling by
the State Government or by any agency authorised by the
State Government are in consonance with the judgments of
the Supreme Court in T.M.A. Pai Foundation v. Stale of
Karnataka (2002) 8 SCC 364 and PA. Inamdar and Ors. v.
State of Maharashtra and Ors. (2005) 6 SCC 535. Section 2
of the Act, 2007 makes it clear that it only applies to private
unaided educational institutions which impart professional
education. Hence, we will have to examine the judgments in
T.M.A. Pai Foundation and PA. Inamdar (supra), to find out
whether these judgments permit admission to professional
educational institutions on the basis of merit as determined
in a common entrance test followed by centralised
counselling by the State Government or its agencies.
xx xx xx
28.…..It is thus clear from Para 58 of the judgment that in
TMA Pai Foundation (supra), quoted above that the
Supreme Court has held that the applicant who seeks
47
Page 48 admission to a professional educational institution in order to
become a competent professional must be a meritorious
candidate and he cannot be put at a disadvantage by
preferences shown to less meritorious but more influential
applicants and, therefore, excellence in professional
education would require that greater emphasis be laid on the
merit of the students seeking admission. It will be further
clear from Para 59 of the judgment in TMA Pai Foundation
(supra), quoted above, that merit is usually determined for
admission to a professional educational institution either by
the marks that the students obtain at qualifying examination
or at a common entrance test conducted by the institution or
'in the case of professional colleges, by Government
agencies". In TMA Pai Foundation (supra), therefore, the
Supreme Court was of the view that merit for admission to a
professional institution could be determined by common
entrance test conducted by the Government agencies.”
46)Referring to paragraphs 67 and 68 in T.M.A. Pai Foundation, it was
observed:
“29.…..It will be clear from the aforesaid portion of the
judgment in TMA Pai Foundation (supra), that unaided
professional educational institutions are entitled to autonomy
in admissions but they cannot forego or discard the principle
of merit and it would therefore be permissible for the
Government to require the private unaided educational
institutions to provide for a merit based admission while at
the same time giving the management sufficient discretion in
admissions. In the aforesaid portion of the judgment in TMA
Pai Foundation (supra), the Supreme Court has further held
that this can be ensured through various methods and one
method is by providing that certain percentage of seats can
be reserved for admission by the management out of those
students who have passed the common entrance test held
by itself or by the State and have applied to the college
concerned for admission, while the rest of the seats may be
filled up on the basis of counselling by the State agency.
Here also, the judgment of the Supreme Court in TMA Pai
Foundation (supra), is clear that in the seats reserved for
48
Page 49 admissions by the management, only those students who
have passed the common entrance test held by the
management or by the State can be admitted.
xx xx xx
31. We are unable to accept the aforesaid submission of Mr.
Verma and Mr. Tankha. In PA. Inamdar (supra), the Supreme
Court dealt with the admission procedure of unaided
professional educational institutions, both minority and non-
minority, in Paragraphs 133 to 138 at Pages 603,604 and
605 of the SCC. In Paragraph 134 in P.A. Inamdar (supra),
the Supreme Court has held that for professional educational
institutions, excellence in admission and maintenance of
high standard are a must and to fulfil these objectives, the
State can and rather must in the national interest step in
because the education, knowledge and learning possessed
by individuals collectively constitute national wealth and in
Paragraph 135 of the judgment in PA. Inamdar (supra), the
Supreme Court has further held that in minority professional
educational institutions also, aided or unaided, admission
should be at the State Level and transparency and merit
have to be assured in admissions. In Paragraphs 136 and
137 in PA. Inamdar (supra), the Supreme Court has
observed that admissions in professional educational
institutions can be made on the basis of a common entrance
test either conducted by the institutions joined together or by
the State itself or an agency for holding such test.”
47)After referring to paragraphs 136 and 137 in P.A. Inamdar, it was
observed:
“It will be thus clear from the Paragraphs 136 and 137 of the
judgment in PA. Inamdar (supra), quoted above, that
admissions to private unaided professional educational
institutions can be made on the basis of merit of candidates
determined in the common entrance test followed by
centralised counseling by the institutions imparting same or
similar professional education together or by the State or by
an agency which must enjoy utmost credibility and expertise
and that the common entrance test followed by centralised
49
Page 50 counselling must satisfy the triple test of being fair,
transparent and non-exploitative. Thus, the judgments of the
Supreme Court in TMA Pai Foundation and PA. Inamdar
(supra), permit holding of a common entrance test for
determination of merit for admission to private unaided
professional educational institutions by the State as well as
any agency which enjoy utmost credibility and expertise in
the matter and which should ensure transparency in merit.
34. Sections 3(d), 6 and 7 of the Act, 2007 by providing that
the common entrance test for determining merit for
admissions in the private unaided professional educational
institutions by a common entrance test to be conducted by
the State or by an agency authorised by the State do not
interfere with the autonomy of private unaided professional
educational institutions, as such private professional
educational institutions are entitled to collect the fees from
the students admitted to the institutions on the basis of merit,
appoint their own staff (teaching and non-teaching),
discipline and remove the staff, provide infrastructure and
other facilities for students and do all such other things as
are necessary to impart professional education to the
students. Sections 3 (d), 6 and 7 of the Act, 2007, therefore,
do not impinge on the fundamental right to carry on the
occupation of establishing and administering professional
educational institutions as an occupation. The only purpose
of Sections 3 (d), 6 and 7 of the Act, 2007 is to ensure that
students of excellence are selected on the basis of a
common entrance test conducted by the State or an agency
authorised by the State and that students without excellence
and merit do not make entry into these professional
educational institutions through malpractices and influence.
As has been held both in the judgments in T.M.A. Pai
Foundation and PA. .Inamdar (supra), the right of private
unaided professional educational institutions to admit
students of their choice is subject to selection of students on
the basis of their merit through a transparent, fair and non-
exploitative procedure. In our considered opinion therefore,
Sections 3 (d), 6 and 7 of the Act, 2007 do not in any way
violate the fundamental right of citizens guaranteed under
Article 19(1)(g) of the Constitution. In view of this conclusion,
it is not necessary for us to decide whether the provisions of
Sections 3 (d), 6 and 7 of the Act, 2007 are saved by Article
50
Page 51 15(5) of the Constitution or by the second limb of Article
19(6) of the Constitution relating to the power of the State to
make a law for creation of monopoly in its favour in respect
of any service.”
We are broadly in agreement with the approach adopted by the High Court
having gone through the relied upon judgments which are discussed by us
as well as in the earlier part.
48)It would be necessary to clarify the position in respect of educational
institutions run by minorities. Having regard to the pronouncement in
T.M.A. Pai Foundation, with lucid clarifications to the said judgment given
by this Court in P.A. Inamdar, it becomes clear that insofar as such
regulatory measures are concerned, the same can be adopted by the
State in respect of minority run institutions as well. Reliance placed by the
appellants in the case of St. Stephen's College v. University of Delhi
12
may not be of much help as that case did not concern with professional
educational institutions.
49)At this juncture, we would like to deal with the arguments of the appellants
that the provisions contained in the Act and the Rules have the effect of
completely taking away the rights of these educational institutions to admit
the students.
12(1992) 1 SCC 558
51
Page 52 50)It is well settled that the right under Article 19(1)(g) is not absolute in terms
but is subject to reasonable restrictions under clause (6). Reasonableness
has to be determined having regard to the nature of right alleged to be
infringed, purpose of the restriction, extent of restriction and other relevant
factors. In applying these factors, one cannot lose sight of the Directive
Principles of State Policy. The Court has to try to strike a just balance
between the fundamental rights and the larger interest of the society.
Court interferes with a statute if it clearly violates the fundamental rights.
The Court proceeds on the footing that the Legislature understands the
needs of the people. The Constitution is primarily for the common man.
Larger interest and welfare of student community to promote merit,
achieve excellence and curb malpractices, fee and admissions can
certainly be regulated.
51)Let us carry out this discussion in some more detail as this is the central
issue raised by the appellants.
DOCTRINE OF PROPORTIONALITY EXPLAINED & APPLIED:
52)Undoubtedly, the right to establish and manage the educational institutions
is a fundamental right recognised under Article 19(1)(g) of the Act. It also
cannot be denied that this right is not 'absolute' and is subject to limitations
52
Page 53 i.e. 'reasonable restrictions' that can be imposed by law on the exercise of
the rights that are conferred under clause (1) of Article 19. Those
restrictions, however, have to be reasonable. Further, such restrictions
should be 'in the interest of general public', which conditions are stipulated
in clause (6) of Article 19, as under:
“(6) Nothing in sub clause (g) of the said clause shall affect
the operation of any existing law in so far as it imposes, or
prevent the State from making any law imposing, in the
interests of the general public, reasonable restrictions on the
exercise of the right conferred by the said sub clause, and, in
particular, nothing in the said sub clause shall affect the
operation of any existing law in so far as it relates to, or
prevent the State from making any law relating to,
(i) the professional or technical qualifications necessary for
practicing any profession or carrying on any occupation,
trade or business, or
(ii) the carrying on by the State, or by a corporation owned
or controlled by the State, of any trade, business, industry or
service, whether to the exclusion, complete or partial, of
citizens or otherwise.”
53)Another significant feature which can be noticed from the reading of the
aforesaid clause is that the State is empowered to make any law relating
to the professional or technical qualifications necessary for practicing any
profession or carrying on any occupation or trade or business. Thus, while
examining as to whether the impugned provisions of the statute and Rules
amount to reasonable restrictions and are brought out in the interest of the
53
Page 54 general public, the exercise that is required to be undertaken is the
balancing of fundamental right to carry on occupation on the one hand and
the restrictions imposed on the other hand. This is what is known as
'Doctrine of Proportionality'. Jurisprudentially, 'proportionality' can be
defined as the set of rules determining the necessary and sufficient
conditions for limitation of a constitutionally protected right by a law to be
constitutionally permissible. According to Aharon Barak (former Chief
Justice, Supreme Court of Israel), there are four sub-components of
proportionality which need to be satisfied
13
, a limitation of a constitutional
right will be constitutionally permissible if: (i) it is designated for a proper
purpose; (ii) the measures undertaken to effectuate such a limitation are
rationally connected to the fulfillment of that purpose; (iii) the measures
undertaken are necessary in that there are no alternative measures that
may similarly achieve that same purpose with a lesser degree of limitation;
and finally (iv) there needs to be a proper relation ('proportionality stricto
sensu' or 'balancing') between the importance of achieving the proper
purpose and the social importance of preventing the limitation on the
constitutional right.
54)Modern theory of constitutional rights draws a fundamental distinction
13Proportionality: Constitutional Rights and Their Limitation by Aharon Barak, Cambridge University Press
2012.
54
Page 55 between the scope of the constitutional rights, and the extent of its
protection. Insofar as the scope of constitutional rights is concerned, it
marks the outer boundaries of the said rights and defines its contents. The
extent of its protection prescribes the limitations on the exercises of the
rights within its scope. In that sense, it defines the justification for
limitations that can be imposed on such a right.
55)It is now almost accepted that there are no absolute constitutional rights
14
and all such rights are related. As per the analysis of Aharon Barak
15
, two
key elements in developing the modern constitutional theory of recognising
positive constitutional rights along with its limitations are the notions of
democracy and the rule of law. Thus, the requirement of proportional
limitations of constitutional rights by a sub-constitutional law, i.e. the
statute, is derived from an interpretation of the notion of democracy itself.
Insofar as Indian Constitution is concerned, democracy is treated as the
basic feature of the Constitution and is specifically accorded a
constitutional status that is recognised in the Preamble of the Constitution
itself. It is also unerringly accepted that this notion of democracy includes
14Though, debate on this vexed issue still continues and some constitutional experts claim that there are
certain rights, albeit very few, which can still be treated as 'absolute'. Examples given are:
(a) Right to human dignity which is inviolable,
(b) Right not to be subjected to torture or to be inhuman or degrading treatment or punishment.
Even in respect of such rights, there is a thinking that in larger public interest, the extent of their protection
can be diminished. However, so far such attempts of the States have been thwarted by the judiciary.
15Supra, note
55
Page 56 human rights which is the corner stone of Indian democracy. Once we
accept the aforesaid theory (and there cannot be any denial thereof), as a
fortiori, it has also to be accepted that democracy is based on a balance
between constitutional rights and the public interests. In fact, such a
provision in Article 19 itself on the one hand guarantees some certain
freedoms in clause (1) of Article 19 and at the same time empowers the
State to impose reasonable restrictions on those freedoms in public
interest. This notion accepts the modern constitutional theory that the
constitutional rights are related. This relativity means that a constitutional
license to limit those rights is granted where such a limitation will be
justified to protect public interest or the rights of other. This phenomenon –
of both the right and its limitation in the Constitution – exemplifies the
inherent tension between democracy's two fundamental elements. On the
one hand is the right's element, which constitutes a fundamental
component of substantive democracy; on the other hand is the people
element, limiting those very rights through their representatives. These
two constitute a fundamental component of the notion of democracy,
though this time in its formal aspect. How can this tension be resolved?
The answer is that this tension is not resolved by eliminating the 'losing'
facet from the Constitution. Rather, the tension is resolved by way of a
56
Page 57 proper balancing of the competing principles. This is one of the
expressions of the multi-faceted nature of democracy. Indeed, the
inherent tension between democracy's different facets is a 'constructive
tension'. It enables each facet to develop while harmoniously co-existing
with the others. The best way to achieve this peaceful co-existence is
through balancing between the competing interests. Such balancing
enables each facet to develop alongside the other facets, not in their
place. This tension between the two fundamental aspects – rights on the
one hand and its limitation on the other hand – is to be resolved by
balancing the two so that they harmoniously co-exist with each other. This
balancing is to be done keeping in mind the relative social values of each
competitive aspects when considered in proper context.
56)In this direction, the next question that arises is as to what criteria is to be
adopted for a proper balance between the two facets viz. the rights and
limitations imposed upon it by a statute. Here comes the concept of
'proportionality', which is a proper criterion. To put it pithily, when a law
limits a constitutional right, such a limitation is constitutional if it is
proportional. The law imposing restrictions will be treated as proportional if
it is meant to achieve a proper purpose, and if the measures taken to
achieve such a purpose are rationally connected to the purpose, and such
57
Page 58 measures are necessary.
This essence of Doctrine of Proportionality is beautifully captured by Chief
Justice Dickson of Canada in R. v. Oakes
16
, in the following words (at page
138):
“To establish that a limit is reasonable and demonstrably
justified in a free and democratic society, two central criteria
must be satisfied. First, the objective, which the measures,
responsible for a limit on a Charter right or freedom are
designed to serve, must be “of” sufficient importance to
warrant overriding a constitutional protected right or
freedom...Second … the party invoking Section 1 must show
that the means chosen are reasonable and demonstrably
justified. This involves “a form of proportionality test...”
Although the nature of the proportionality test will vary
depending on the circumstances, in each case courts will be
required to balance the interests of society with those of
individuals and groups. There are, in my view, three
important components of a proportionality test. First the
measures adopted must be ...rationally connected to the
objective. Second, the means ...should impair “as little as
possible” the right or freedom in question...Third, there must
be a proportionality between the effects of the measures
which are responsible for limiting the Charter right or
freedom, and the objective which has been identified as of
“sufficient importance”. The more severe the deleterious
effects of a measure, the more important the objective must
be if the measure is to be reasonable and demonstrably
justified in a free and democratic society.”
57)The exercise which, therefore, to be taken is to find out as to whether the
limitation of constitutional rights is for a purpose that is reasonable and
necessary in a democratic society and such an exercise involves the
16(1986) 1 SCR 103
58
Page 59 weighing up of competitive values, and ultimately an assessment based on
proportionality i.e. balancing of different interests.
58)We may unhesitatingly remark that this Doctrine of Proportionality,
explained hereinabove in brief, is enshrined in Article 19 itself when we
read clause (1) along with clause (6) thereof. While defining as to what
constitutes a reasonable restriction, this Court in plethora of judgments has
held that the expression 'reasonable restriction' seeks to strike a balance
between the freedom guaranteed by any of the sub-clauses of clause (1)
of Article 19 and the social control permitted by any of the clauses (2) to
(6). It is held that the expression 'reasonable' connotes that the limitation
imposed on a person in the enjoyment of the right should not be arbitrary
or of an excessive nature beyond what is required in the interests of public.
Further, in order to be reasonable, the restriction must have a reasonable
relation to the object which the legislation seeks to achieve, and must not
go in excess of that object {See P.P. Enterprises & Ors. v. Union of India
& Ors.
17
}. At the same time, reasonableness of a restriction has to be
determined in an objective manner and from the standpoint of the interests
of the general public and not from the point of view of the persons upon
whom the restrictions are imposed or upon abstract considerations {See
17(1982) 2 SCC 33
59
Page 60 Hanif Quareshi Mohd. v. State of Bihar
18
). In M.R.F. Ltd. v. Inspector
Kerala Govt.
19
, this Court held that in examining the reasonableness of a
statutory provision one has to keep in mind the following factors:
(1) The Directive Principles of State Policy.
(2) Restrictions must not be arbitrary or of an excessive nature so
as to go beyond the requirement of the interest of the general public.
(3) In order to judge the reasonableness of the restrictions, no
abstract or general pattern or a fixed principle can be laid down so
as to be of universal application and the same will vary from case to
case as also with regard to changing conditions, values of human
life, social philosophy of the Constitution, prevailing conditions and
the surrounding circumstances.
((4) A just balance has to be struck between the restrictions imposed
and the social control envisaged by Article 19(6).
(5) Prevailing social values as also social needs which are intended
to be satisfied by the restrictions.
(6) There must be a direct and proximate nexus or reasonable
connection between the restrictions imposed and the object sought
to be achieved. If there is a direct nexus between the restrictions,
181959 SCR 629
19(1998) 8 SCC 227
60
Page 61 and the object of the Act, then a strong presumption in favour the
constitutionality of the Act will naturally arise.
59)Keeping in mind the aforesaid principles, we have adjudged the issue in
our detailed discussion undertaken above. We may summarise the said
discussion as follows:
60)Undoubtedly, right to establish and administer educational institutions is
treated as a fundamental right as it is termed 'occupation', which is one of
the freedoms guaranteed under Article 19(1)(g). It was so recognised for
the first time in T.M.A. Pai Foundation. Even while doing so, this right
came with certain clutches and shackles. The Court made it clear that it is
a noble occupation which would not permit commercialisation or
profiteering and, therefore, such educational institutions are to be run on
'no profit no loss basis'. While explaining the scope of this right, right to
admit students and right to fix fee was accepted as facets of this right, the
Court again added caution thereto by mandating that admissions to the
educational institutions imparting higher education, and in particular
professional education, have to admit the students based on merit. For
judging the merit, the Court indicated that there can be a CET. While
doing so, it also specifically stated that in case of admission to professional
61
Page 62 courses such a CET can be conducted by the State. If such a power is
exercised by the State assuming the function of CET, this was so
recognised in T.M.A. Pai Foundation itself, as a measure of 'reasonable
restriction on the said right'. Islamic Academy of Education further
clarified the contour of such function of the State while interpreting T.M.A.
Pai Foundation itself wherein it was held that there can be Committees
constituted to supervise conducting of such CET. This process of
interpretative balancing and constitutional balancing was remarkably
achieved in P.A. Inamdar by not only giving its premature to deholding of
CET but it went further to hold that agency conducted the CET must be the
one which enjoys the utmost credibility and expertise in the matter to
achieve fulfillment of twin objectives of transparency and merit and for that
purpose it permitted the State to provide a procedure of holding a CET in
the interest of securing fair and merit based admissions and preventing
maladministration.
61)We are of the view that the larger public interest warrants such a measure.
Having regard to the malpractices which are noticed in the CET conducted
by such private institutions themselves, for which plethora of material is
produced, it is, undoubtedly, in the larger interest and welfare of the
students community to promote merit, add excellence and curb
62
Page 63 malpractices. The extent of restriction has to be viewed keeping in view all
these factors and, therefore, we feel that the impugned provisions which
may amount to 'restrictions' on the right of the appellants to carry on their
'occupation', are clearly 'reasonable' and satisfied the test of
proportionality.
62)Apart from the material placed before the High Court, our attention has
also been drawn to a recent report of the Parliamentary Committee to
which we will refer in later part of this judgment. The report notes the
dismal picture of exploitation in making admissions by charging huge
capitation fee and compromising merit. This may not apply to all
institutions but if the Legislature which represents the people has come out
with a legislation to curb the menace which is generally prevalent, it cannot
be held that there is no need for any regulatory measure. “An enactment
is an organism in its environment”
20
. It is rightly said that the law is not an
Eden of concepts but rather an everyday life of needs, interests and the
values that a given society seeks to realise in a given time. The law is a
tool which is intended to provide solutions for the problems of human being
in a society.
63)The High Court in its judgment has analysed the provisions of the Act and
20Justice Frankfuter: 'A Symposium of Statutory Construction: Forward', 3, Vand L. Rev. 365, 367 (1950)
63
Page 64 found that provisions for merit based admissions and procedure for fee
fixation did not violate fundamental right of the private institutions to
conduct admissions and to fix fee. We are in agreement with the said view
and hold that provisions relating to admission as contained in the Act and
the Rules are not offensive of Article 19(1)(g) of the Constitution.
II.Re.: Provisions in the Act Rules relating to fixation of fee are
unconstitutional being violative of Article 19(1)(g) of the
Constitution?
64)We may again remind ourselves that though right to establish and manage
educational institution is treated as a right to carry on 'occupation', which is
the fundamental right under Article 19(1)(g), the Court in T.M.A. Pai
Foundation had also cautioned such educational institution not to indulge
in profiteering or commercialisation. That judgment also completely bars
these educational institutions from charging capitation fee. This is
considered by the appellants themselves that commercialisation and
exploitation is not permissible and the educational institutions are
supposed to run on 'no profit, no loss basis'. No doubt, it was also
recognised that cost of education may vary from institution to institution
and in this respect many variable factors may have to be taken into
account while fixing the fee. It is also recognized that the educational
institutions may charge the fee that would take care of various expenses
64
Page 65 incurred by these educational institutions plus provision for the expansion
of education for future generation. At the same time, unreasonable
demand cannot be made from the present students and their parents. For
this purpose, only a 'reasonable surplus' can be generated.
65)Thus, in T.M.A. Pai Foundation, P.A. Inamdar and Unni Krishnan,
profiteering and commercialisation of education has been abhorred. The
basic thread of reasoning in the above judgments is that educational
activity is essentially charitable in nature and that commercialisation or
profiteering through it is impermissible. The said activity subserves the
looming larger public interest of ensuring that the nation develops and
progresses on the strength of its highly educated citizenry. As such, this
Court has been of the view that while balancing the fundamental rights of
both minority and non-minority institutions, it is imperative that high
standard of education is available to all meritorious candidates. It has also
been felt that the only way to achieve this goal, recognising the private
participation in this welfare goal, is to ensure that there is no
commercialisation or profiteering by educational institutions.
66)In view of the said objectives, this Court had devised the means of setting
up regulatory committees to oversee the process of admissions and fee
65
Page 66 regulations in the case of Islamic Academy of Education. However,
while indirectly approving the concept of regulatory bodies, this Court in
P.A. Inamdar was of the view that the scheme should not be directed by
this Court exercising its powers under Article 142 of the Constitution, but
must be statutorily regulated by the Center or the State laws.
67)The principles enunciated in T.M.A. Pai Foundation and P.A. Inamdar
were applied in the case of Islamic Academy of Education where a
challenge was mounted against the directions issued by the Director of
Education to the recognised unaided schools under Section 24(3) read
with Section 18(4) and 18(5) of the Delhi School Education Act, 1973 inter
alia directing that no fees/funds collected from parents/students would be
transferred from the Recognised Unaided School Fund to a Society or
Trust or any other institution. After examining the directions and the
accounting principles in detail, this Court upheld the said directions on the
ground that it was open to the State to regulate the fee in such a manner
so as to ensure that no profiteering or commercialisation of education
takes place.
68)To put it in nutshell, though the fee can be fixed by the educational
institutions and it may vary from institution to institution depending upon
66
Page 67 the quality of education provided by each of such institution,
commercialisation is not permissible. In order to see that the educational
institutions are not indulging in commercialisation and exploitation, the
Government is equipped with necessary powers to take regulatory
measures and to ensure that these educational institutions keep playing
vital and pivotal role to spread education and not to make money. So
much so, the Court was categorical in holding that when it comes to the
notice of the Government that a particular institution was charging fee or
other charges which are excessive, it has a right to issue directions to such
an institution to reduce the same.
69)The next question that arises is as to how such a regulatory framework
that ensures no excessive fee is charged by the educational institutions
can be put in place. In the case of Modern School, this Court upheld the
direction of the Delhi High Court for setting up of a committee to examine
as to whether fee charged by the schools (that was a case of fixation of fee
by schools in Delhi which are governed by the Delhi School Education Act,
1973) is excessive or not. The ratio of judgments in T.M.A. Pai
Foundation and Islamic Academy of Education was discussed in the
following manner:
67
Page 68 “16. The judgment in T.M.A. Pai Foundation case was
delivered on 31-10-2002. The Union of India, State
Governments and educational institutions understood the
majority judgment in that case in different perspectives. It led
to litigations in several courts. Under the circumstances, a
Bench of five Judges was constituted in the case of Islamic
Academy of Education v. State of Karnataka so that
doubts/anomalies, if any, could be clarified. One of the
issues which arose for determination concerned
determination of the fee structure in private unaided
professional educational institutions. It was submitted on
behalf of the managements that such institutions had been
given complete autonomy not only as regards admission of
students but also as regards determination of their own fee
structure. It was submitted that these institutions were
entitled to fix their own fee structure which could include a
reasonable revenue surplus for the purpose of development
of education and expansion of the institution. It was
submitted that so long as there was no profiteering, there
could be no interference by the Government. As against this,
on behalf of the Union of India, State Governments and
some of the students, it was submitted, that the right to set
up and administer an educational institution is not an
absolute right and it is subject to reasonable restrictions. It
was submitted that such a right is subject to public and
national interests. It was contended that imparting education
was a State function but due to resource crunch, the States
were not in a position to establish sufficient number of
educational institutions and consequently the States were
permitting private educational institutions to perform State
functions. It was submitted that the Government had a
statutory right to fix the fees to ensure that there was no
profiteering. Both sides relied upon various passages from
the majority judgment in T.M.A. Pai Foundation case. In
view of rival submissions, four questions were
formulated. We are concerned with the first question,
namely, whether the educational institutions are entitled
to fix their own fee structure. It was held that there could
be no rigid fee structure. Each institute must have
freedom to fix its own fee structure, after taking into
account the need to generate funds to run the institution
and to provide facilities necessary for the benefit of the
students. They must be able to generate surplus which
68
Page 69 must be used for betterment and growth of that
educational institution. The fee structure must be fixed
keeping in mind the infrastructure and facilities
available, investment made, salaries paid to teachers
and staff, future plans for expansion and/or betterment
of institution subject to two restrictions, namely, non-
profiteering and non-charging of capitation fees. It was
held that surplus/profit can be generated but they shall be
used for the benefit of that educational institution. It was held
that profits/surplus cannot be diverted for any other use or
purposes and cannot be used for personal gains or for other
business or enterprise. The Court noticed that there were
various statutes/regulations which governed the fixation of
fee and, therefore, this Court directed the respective State
Governments to set up a committee headed by a retired
High Court Judge to be nominated by the Chief Justice of
that State to approve the fee structure or to propose some
other fee which could be charged by the institute.
(emphasis supplied)”
70)This Court also held that for fixing the fee structure, following
considerations are to be kept in mind:
(a)the infrastructure and facilities available;
(b)investment made, salaries paid to teachers and staff;
(c)future plans for expansion and/or betterment of institution
subject to two restrictions, viz. non-profiteering and non-
charging of capitation fees.”
We may hasten to add here itself that Section 9 of the Act, 2007 takes
care of the aforesaid parameter in abundance.
71)As can be seen in T.M.A. Pai Foundation case itself, this Court has
observed that the Government can provide regulations to control the
69
Page 70 charging of capitation fee and profiteering. Question No.3 before the Court
was as to whether there can be Government regulations, and if so, to what
extent in case of private institutions? What the Court has observed in
paragraph 57 of the judgment is instructive for our purposes and the same
is reproduced below:
“57. We, however, wish to emphasize one point, and that is
that inasmuch as the occupation of education is, in a sense,
regarded as charitable, the Government can provide
regulations that will ensure excellence in education, while
forbidding the charging of capitation fee and profiteering by
the institution. Since the object of setting up an educational
institution is by definition “charitable”, it is clear that an
educational institution cannot charge such a fee as is not
required for the purpose of fulfilling that object. To put it
differently, in the establishment of an educational institution,
the object should not be to make a profit, inasmuch as
education is essentially charitable in nature. There can,
however, be a reasonable revenue surplus, which may be
generated by the educational institution for the purpose of
development of education and expansion of the institution.”
In paragraph 69 of the judgment, while dealing with this issue, this Court
again observed that an appropriate machinery can be devised by the State
or University to ensure that no capitation fee is charged and that there is
no profiteering, though a reasonable surplus for the furtherance of
education is permissible. Although the Court overruled the earlier
judgment in Unni Krishnan, which was to the extent of the scheme
framed therein and the directions to impose the same, part of the judgment
70
Page 71 holding that primary education is a fundamental right was held to be valid.
Similarly, the principle that there should not be capitation fee or profiteering
was also held to be correct.
72)When we come to the judgment in Islamic Academy of Education, the
first question framed by this Court was whether the educational institutions
are entitled to fix their own fee structure. It is pertinent to note that this
judgment brought in a Committee to regulate the fee structure which was
to operate until the Government/appropriate authorities consider framing of
appropriate Regulations. It is also material to note that in paragraph 20
the Court has held that the direction to set up Committees in the States
was passed under Article 142 of the Constitution and was to remain in
force till appropriate legislation was enacted by the Parliament.
73)The judgment in P.A. Inamdar, though sought to review the judgment in
Islamic Academy of Education, left the mechanism of having the
Committees undisturbed. In paragraph 129 of the judgment in P.A.
Inamdar, this Court observed that the State regulation should be minimal
and only to maintain fairness in admission procedure and to check
exploitation by charging exorbitant money or capitation fees. In paragraph
140, it has been held that the charge of capital fee by unaided minority and
71
Page 72 non-minority institutions for professional courses is just not permissible.
Similarly, profiteering is also not permissible. This Court went on to
observe that it cannot shut its eyes to the hard realities of
commercialisation of education and evil practices being adopted by many
institutions to earn large amounts for their private or selfish ends. In
respect of Question No.3 framed thereunder, which was with respect to the
Government regulation in the case of private institutions, this Court, in
paragraph 141 of the judgment, answered that every institution is free to
device its own fee structure, but the same can be regulated in the interest
of preventing profiteering and no capitation fee can be charged. In
paragraph 145, the suggestion for post-audit or checks is rejected if the
institutions adopt their own admission procedure and fee structure since
this Court was of the view that fixation of fees should be regulated and
controlled at the initial stage itself.
74)It is in the aforesaid context that we have to determine the question as to
whether the provisions relating to fixation of fee are violative of Article
19(1)(g) of the Constitution or they are regulatory in nature, which is
permissible in view of clause (6) of Article 19 of the Constitution, keeping in
mind that the Government has the power to regulate the fixation of fee in
the interest of preventing profiteering and further that fixation of fee has to
72
Page 73 be regulated and controlled at the initial stage itself. When we scan
through Section 9 of the Act, 2007 from the aforesaid angle, we find that
the parameters which are laid down therein that has to be kept in mind
while fixing the fee are in fact the one which have been enunciated in the
judgments of this Court referred to above. It is also significant to note that
the Committee which is set up for this purpose, namely, Admission and
Fee Regulatory Committee, is discharging only regulatory function. The
fee which a particular educational institution seeks to charge from its
students has to be suggested by the said educational institution itself. The
Committee is empowered with a purpose to satisfy itself that the fee
proposed by the educational institution did not amount to profiteering or
commercialisation of education and was based on intelligible factors
mentioned in Section 9(1) of the Act, 2007. In our view, therefore, it is only
a regulatory measure and does not take away the powers of the
educational institution to fix their own fee. We, thus, find that the analysis
of these provisions by the High Court in the impugned judgment, contained
in paragraph 39, is perfectly in order, wherein it is observed as under:
“39. We are of the view that Sections 4 (1) and 4 (8) of the
Act, 2007 have to be read with Section 9 (1) of the Act, 2007,
which deals with factors which have to be taken into
consideration by the Committee while determining the fee to
be charged by a private unaided professional educational
73
Page 74 institution. A reading of Sub-section (1) of Section 9 of the
Act, 2007 would show that the location of private unaided
professional educational institution, the nature of the
professional course, the cost of land and building, the
available infrastructure, teaching, non-teaching staff and
equipment, the expenditure on administration and
maintenance, a reasonable surplus required for growth and
development of the professional institution and any other
relevant factor, have to be taken into consideration by the
Committee while determining the fees to be charged by a
private unaided professional educational institution. Thus, all
the cost components of the particular private unaided
professional educational institution as well as the reasonable
surplus required for growth and development of the
institution and all other factors relevant for imparting
professional education have to be considered by the
Committee while determining the fee. Section 4 (8) of the
Act, 2007 further provides that the Committee may require a
private aided or unaided professional educational institution
to furnish information that may be necessary for enabling the
Committee to determine the fees that may be charged by the
institution in respect of each professional course. Each
professional educational institution, therefore, can furnish
information with regard to the fees that it proposes to charge
from the candidates seeking admission taking into account
all the cost components, the reasonable surplus required for
growth and development and other factors relevant to impart
professional education as mentioned in Section 9 (1) of the
Act, 2007 and the function of the Committee is only to find
out, after giving due opportunity of being heard to the
institution as provided in Section 9 (2) of the Act, 2007
whether the fees proposed by the institution to be charged to
the student are based on the factors mentioned in Section 9
(1) of the Act, 2007 and did not amount to profiteering and
commercialisation of the education. The word
"determination" has been defined in Black's Law Dictionary,
Eighth Edition, to mean a final decision by the Court or an
administrative agency. The Committee, therefore, while
determining the fee only gives the final approval to the
proposed fee to be charged after being satisfied that it was
based on the factors mentioned in Section 9 (1) of the Act,
2007 and there was no profiteering or commercialisation of
education. The expression 'fixation of fees' in Section 4 (1) of
74
Page 75 the Act, 2007 means that the fee to be charged from
candidates seeking admission in the private professional
educational institution did not vary from student to student
and also remained fixed for a certain period as mentioned in
Section 4(8) of the Act, 2007. As has been held by the
Supreme Court in Peerless General Finance v. Reserve
Bank of India (supra), the Court has to examine the
substance of the provisions of the law to find out whether
provisions of the law impose reasonable restrictions in the
interest of the general public. The provisions in Sections 4
(1), 4 (8) and 9 of the Act, 2007 in substance empower the
Committee to be only satisfied that the fee proposed by a
private professional educational institution did not amount to
profiteering or commercialisation of education and was
based on the factors mentioned in Section 9 (1) of the Act,
2007. The provisions of the Act, 2007 do not therefore,
violate the right of private professional educational institution
to charge its own fee.”
Further reasons in support of Issue Nos. 1 & 2 which are common to
both Issues:
Provisions relating to admission of students through Government test to be
conducted by the State and the provision relating to fixation of fee by
setting up a Committee to oversee that institutions are not charging a fee
which amounts to capitation or profiteering are reasonable restrictions and
do not suffer from any constitutional vice.
75)The provision of the Act and the Rules are, therefore, in tune with the
sentiments and directions contained in P.A. Inamdar. The enactment in
question does not run foul of any of the existing central laws. As far as the
introduction of a CET at a national level is concerned, the same was not
75
Page 76 enforced during the period of operation of the State statute. In any event,
there being no regulations regarding fixation or determination of fees of
these institutions to ensure that the same does not allow
commercialisation or profiteering, the State Legislature was well
competent to enact provisions regarding the same.
76)At the time when the impugned legislations were enacted, the Association
of Private Colleges was already conducting its CET from the year 2005 till
2007. The private universities, however, had failed to comply the triple test
laid down in T.M.A. Pai Foundation and a large number of complaints
were received by the State authorities with regard to denial of admissions
to meritorious students. In paragraphs 32 to 39 of the Reply filed by the
State Government in the High Court of Madhya Pradesh, it was duly
mentioned that numerous complaints were being received with regard to
the CET being conducted by the Association of the Private Colleges. It is
worthwhile to note that even for the period after the coming in force of the
State laws, under the interim order dated May 27, 2009
21
passed by this
Court where the private colleges were allowed to continue holding their
examinations for 50% seats, excluding the NRI seats, a large number of
complaints were received by the State. If a particular law is necessitated
21(2009) 7 SCC 751
76
Page 77 to curb malpractices and/or ills that have prevailed in a system, Legislature
is fully competent to enact such laws, provided it meets the test of
constitutionality, which it does in the instant case.
77)No doubt, we have entered into an era of liberalization of economy,
famously termed as 'globalization' as well. In such an economy, private
players are undoubtedly given much more freedom in economic activities,
as the recognition has drawn to the realities that the economic activities,
including profession, business, occupation etc. are not normal forte of the
State and the State should have minimal role therein. It is for this reason,
many sectors which were hitherto State monopolies, like telecom, power,
insurance, civil aviation etc. have now opened up for private enterprise.
Even in the field of education State/ Government was playing a dominant
role inasmuch as it was thought desirable that in a welfare State it is the
fundamental duty, as a component of Directive Principles, to impart
education to the masses and commoners as well as weaker sections of
the society, at affordable rates. It was almost treated as solemn duty of the
Government to establish adequate number of educational institutions at all
levels, i.e., from primary level to higher education and in all fields including
technical, scientific and professional, to cater to the varied sections of the
society, particularly, when one-third of the population of the country is
77
Page 78 poverty stricken with large percentage as illiterate. With liberalization,
Government has encouraged establishments of privately managed
institutions. It is done with the hope that the private sector will play vital
role in the field of education with philanthropic approach/ideals in mind as
this activity is not to be taken for the purpose of profiteering, but more as a
societal welfare.
78)It is, therefore, to be borne in mind is that the occupation of education
cannot be treated at par with other economic activities. In this field, State
cannot remain a mute spectator and has to necessarily step in in order to
prevent exploitation, privatization and commercialisation by the private
sector. It would be pertinent to mention that even in respect of those
economic activities which are undertaken by the private sector essentially
with the objective of profit making (and there is nothing bad about it), while
throwing open such kind of business activities in the hands of private
sector, the State has introduced regulatory regime as well by providing
Regulations under the relevant statutes.
NEED FOR REGULATORY MECHANISM:
79)Regulatory mechanism, or what is called regulatory economics, is the
order of the day. In the last 60-70 years, economic policy of this country
78
Page 79 has travelled from laissez faire to mixed economy to the present era of
liberal economy with regulatory regime. With the advent of mixed
economy, there was mushroom of public sector and some of the key
industries like Aviation, Insurance, Railways, Electricity/Power,
Telecommunication, etc. were monopolized by the State. License/permit
raj prevailed during this period with strict control of the Government even
in respect of those industries where private sectors were allowed to
operate. However, Indian economy experienced major policy changes in
early 90s on LPG Model, i.e., Liberalization, Privatization and
Globalization. With the onset of reforms to liberalize the Indian economy, in
July 1991, a new chapter has dawned for India. This period of economic
transition has had a tremendous impact on the overall economic
development of almost all major sectors of the economy.
80)When we have liberal economy which is regulated by the market forces
(that is why it is also termed as market economy), prices of goods and
services in such an economy are determined in a free price system set up
by supply and demand. This is often contrasted with a planned economy in
which a Central Government determines the price of goods and services
using a fixed price system. Market economies are also contrasted with
mixed economy where the price system is not entirely free, but under
79
Page 80 some Government control or heavily regulated, which is sometimes
combined with State led economic planning that is not extensive enough to
constitute a planned economy.
81)With the advent of globalization and liberalization, though the market
economy is restored, at the same time, it is also felt that market economies
should not exist in pure form. Some regulation of the various industries is
required rather than allowing self-regulation by market forces. This
intervention through regulatory bodies, particularly in pricing, is considered
necessary for the welfare of the society and the economists point out that
such regulatory economy does not rob the character of a market economy
which still remains a market economy. Justification for regulatory bodies
even in such industries managed by private sector lies in the welfare of
people. Regulatory measures are felt necessary to promote basic well-
being for individuals in need. It is because of this reason that we find
Regulatory bodies in all vital industries like, Insurance, Electricity and
Power, Telecommunications, etc.
82)Thus, it is felt that in any welfare economy, even for private industries,
there is a need for regulatory body and such a regulatory framework for
education sector becomes all the more necessary. It would be more so
80
Page 81 when, unlike other industries, commercialisation of education is not
permitted as mandated by the Constitution of India, backed by various
judgments of this Court to the effect that profiteering in the education is to
be avoided.
83)Thus, when there can be Regulators which can fix the charges for telecom
companies in respect of various services that such companies provide to
the consumers; when Regulators can fix the premium and other charges
which the insurance companies are supposed to receive from the persons
who are insured, when Regulators can fix the rates at which the producer
of electricity is to supply the electricity to the distributors, we fail to
understand as to why there cannot be a regulatory mechanism when it
comes to education which is not treated as purely economic activity but
welfare activity aimed at achieving more egalitarian and prosperous
society by empowering the people of this country by educating them. In the
field of the education, therefore, this constitutional goal remains pivotal
which makes it distinct and special in contradistinction with other economic
activities as the purpose of education is to bring about social
transformation and thereby a better society as it aims at creating better
human resource which would contribute to the socie-economic and
political upliftment of the nation. The concept of welfare of the society
81
Page 82 would apply more vigorously in the field of education. Even otherwise, for
economist, education as an economic activity, favourably compared to
those of other economic concerns like agriculture and industry, has its own
inputs and outputs; and is thus analyzed in terms of the basic economic
tools like the laws of return, principle of equimarginal utility and the public
finance. Guided by these principles, the State is supposed to invest in
education up to a point where the socio-economic returns to education
equal to those from other State expenditures, whereas the individual is
guided in his decision to pay for a type of education by the possibility of
returns accruable to him. All these considerations make out a case for
setting up of a stable Regulatory mechanism.
84)In this sense, when imparting of quality education to cross-section of the
society, particularly, the weaker section and when such private educational
institutions are to rub shoulders with the state managed educational
institution to meet the challenge of the implementing ambitious
constitutional promises, the matter is to be examined in a different hue. It
is this spirit which we have kept in mind while balancing the right of these
educational institutions given to them under Article 19(1)(g) on the one
hand and reasonableness of the restrictions which have been imposed by
the impugned legislation. The right to admission or right to fix the fee
82
Page 83 guaranteed to these appellants is not taken away completely, as feared.
T.M.A. Pai Foundation gives autonomy to such institutions which remain
intact. Holding of CET under the control of the State does not impinge this
autonomy. Admission is still in the hands of these institutions. Once it is
even conceded by the appellants that in admission of students 'triple test'
is to be met, the impugned legislation aims at that. After all, the sole
purpose of holding CET is to adjudge merit and to ensure that admissions
which are done by the educational institutions, are strictly on merit. This is
again to ensure larger public interest. It is beyond comprehension that
merely by assuming the power to hold CET, fundamental right of the
appellants to admit the students is taken away. Likewise, when it comes to
fixation of fee, as already dealt with in detail, the main purpose is that
State acts as a regulator and satisfies itself that the fee which is proposed
by the educational institution does not have the element of profiteering and
also that no capitation fee etc. is charged. In fact, this dual function of
regulatory nature is going to advance the public interest inasmuch as
those students who are otherwise meritorious but are not in a position to
meet unreasonable demands of capitation fee etc. are not deprived of
getting admissions. The impugned provisions, therefore, are aimed at
seeking laudable objectives in larger public interest. Law is not static, it
83
Page 84 has to change with changing times and changing social/societal
conditions.
III.Re.: Reservation of seats for Scheduled Castes, Scheduled
Tribes and Other Backward Classes
85)The main arguments of the appellants, on this issue, is that reservation in
private sector is unknown to the constitutional scheme and the same has
been held to be by this Court in the case of P.A. Inamdar. It is their
submissions that to overrule the ratio of the judgment of this Court in P.A.
Inamdar, the Parliament amended the Constitution and introduced Article
15(5) . The said Article 15(5) reads as under:
“15(5) Nothing in this article or in sub-clause (g)of clause (1)
of Article 19 shall prevent the state from making any special
provision, by law, for the advancement of any socially and
educationally backward classes of citizens or for the
Scheduled Castes or the Scheduled Tribes in so far as such
special provisions relate to their admission to educational
institutions including private educational institutions, whether
aided or unaided by the State, other than the minority
educational institutions referred to in clause(1) of Article30.
86)It is submitted that the caste based reservation policy or a social
engineering policy of the State Government cannot be run on the
shoulders of the private institutions which enjoy fundamental rights under
Part III of the Constitution. It is submitted that the extent and the manner
in which the right can be regulated has been set out under Article 19(6) of
the Constitution. It is submitted that in P.A. Inamdar, this Court has held
84
Page 85 that the provision for reservation in private institutions would be an
'unreasonable' restriction and, therefore, would fall foul of 19(1)(g) and
would not be protected by 19(6) of the Constitution of India. It is, thus,
submitted that the reasoning on the basis of which reservations in private
institutions have been rejected is that this Court found that such
restrictions would be 'unreasonable' restrictions and, therefore, effectively
violate Articles 14 and 15(1) of the Constitution of India. It is submitted
that the provisions of Article 15(5) are not an exception to Article 14 and,
therefore, when the Court has held that the said reservations in private
institutions are unreasonable, the impugned provisions would be in
violation of Article 14 of the Constitution of India.
87)In any case, since this Court in P.A. Inamdar has held that there cannot be
any fixation of Quota or appropriation of seats by the State, reservation
which inheres setting aside Quotas, would not be permissible. It is, thus,
argued that the provisions seek to bring back the Unni Krishnan system
of setting up State Quotas which has been expressly held by this Court to
be impermissible. This argument is to be noted to be rejected. In fact, as
can be seen from the impugned judgment having regard to the provisions
of Clause (5) of Article 15 of the Constitution, there was no serious
challenge laid to Section 8 read with Rules 4(2), 7 and 15 of the Rules,
85
Page 86 2008. In fact, counsel for the appellants conceded that they had not
challenged 93
rd
Constitutional Amendment vide which Article 15(5) was
inserted into the Constitution. In any case, there is hardly any ground to
challenge the said constitutional amendment, which has already been
upheld by a Constitution Bench judgment in the case of Pramati
Educational and Cultural Trust. The only other argument raised was
that a reading of the reservation provisions in Rule 7 of Rules, 2009 would
show that it would be difficult to work out said percentage having regard to
the fact that number of seats in the post-graduate dental and medical
courses in different specialized disciplines are few. The High Court has
successfully dealt with this argument by appropriately demonstrating, by
means of charges, that not only it was possible to work out extent of
reservation provided for different categories, sufficient number of seats
were available for general categories as well. We, thus, do not find any
merit in the challenge to the reservation of seats for SC/ST and OBC etc.
which is in consonance with Article 15(5) of the Constitution.
88)As is evident from the facts mentioned by the State of Madhya Pradesh in
its reply filed in IA No. 83 of 2015, the Association of Private Colleges has
failed to hold their CETs in a fair, transparent and rational manner. The
accountability and transparency in State actions is much higher than in
86
Page 87 private actions. It is needless to say that the incidents of corruption in the
State machinery were brought in the public eye immediately and have
been addressed expeditiously. The same could never have been done in
case of private actions. Even on a keel of comparative efficiency, it is
more than evident that the State process is far more transparent and fair
than one that is devised by the private colleges which have no mechanism
of any checks and balances. The State agencies are subject to the Right
to Information Act, Audit, State Legislature, Anti-Corruption agencies,
Lokayukta, etc.
89)The very object of setting up institutions for the State is a welfare function,
for the purpose of excelling in educational standards. On the other hand,
the primary motivation for private parties is profit motive or philanthropy.
When the primary motivation for institutions is profit motive, it is natural
that many means to achieve the same shall be adopted by the private
institutions which leads to a large degree of secrecy and corruption. As
such, the mechanism of regulations as envisaged under the impugned
laws is legal, constitutional, fair, transparent and uphold the primary criteria
of merit. The same does not infringe on the fundamental rights of either
the minorities or the non-minorities to establish and administer educational
institutions and must as such be upheld as valid.
87
Page 88 IV.Whether the impugned legislation is beyond the legislative
competence of the State of Madhya Pradesh?
90)The next issue to be considered is whether the subject matter of
admissions was covered exclusively by Entry 66 of List I, thereby the
States having no legislative competence whatsoever to deal with the
subject of admissions or determination of fee to be charged by
professional educational institutions.
91)Main reliance placed on behalf of the appellants is on Bharti Vidyapeeth
(Deemed University) & Ors. v. State of Maharashtra & Anr.
22
Heavy
reliance was also placed by the appellants on Gujarat University & Anr.
v. Shri Krishna Ranganath Mudholkar & Ors.
23
and the judgment of the
Constitution Bench in the case of Dr. Preeti Srivastava & Anr. v. State of
M.P. & Ors.
24
92)The competing Entries are: List I, Entry 66 and List III, Entry 25. In the
process, List II, Entry 32 also needs a glance. Thus, for proper analysis,
we reproduce these Entries below:
“List I
66. Co-ordination and determination of standards in
institutions for higher education or research and scientific
22(2004) 11 SCC 755
231964 (Supp.) 1 SCR 112
24(1999) 7 SCC 120
88
Page 89 and technical institutions.
List II
32. Incorporation, regulation and winding up of corporation,
other than those specified in List I, and universities;
unincorporated trading, literacy, scientific, religious and other
societies and associations; co-operative societies.
List III
25. Education, including technical education, medical
education and universities, subject to the provisions of
entries 63, 64, 65 and 66 of List I; vocational and technical
training of labour.”
93)To our mind, Entry 66 in List I is a specific Entry having a very specific and
limited scope. It deals with co-ordination and determination of standards in
institution of higher education or research as well as scientific and
technical institutions. The words 'co-ordination and determination of
standards' would mean laying down the said standards. Thus, when it
comes to prescribing the standards for such institutions of higher learning,
exclusive domain is given to the Union. However, that would not include
conducting of examination, etc. and admission of students to such
institutions or prescribing the fee in these institutions of higher education,
etc. In fact, such co-ordination and determination of standards, insofar as
medical education is concerned, is achieved by Parliamentary legislation in
the form of Medical Council of India Act, 1956 and by creating the statutory
89
Page 90 body like Medical Council of India (for short, 'MCI') therein. The functions
that are assigned to MCI include within its sweep determination of
standards in a medical institution as well as co-ordination of standards and
that of educational institutions. When it comes to regulating 'education' as
such, which includes even medical education as well as universities (which
are imparting higher education), that is prescribed in Entry 25 of List III,
thereby giving concurrent powers to both Union as well as States. It is
significant to note that earlier education, including universities, was the
subject matter of Entry 11 in List II
25
. Thus, power to this extent was given
to the State Legislatures. However, this Entry was omitted by the
Constitution (Forty-Second Amendment) Act, 1976 with effect from July 03,
1977 and at the same time Entry 25 in List II was amended
26
. Education,
including university education, was thus transferred to Concurrent List and
in the process technical and medical education was also added. Thus, if
the argument of the appellants is accepted, it may render Entry 25
completely otiose. When two Entries relating to education, one in the
Union List and the other in the Concurrent List, co-exist, they have to be
read harmoniously. Reading in this manner, it would become manifest that
when it comes to co-ordination and laying down of standards in the higher
25Entry 11: 'Education' including universities, subject to provisions of Entries 63, 64, 65 and 66 of List I and
Entry 25 of List III
26Unamended Entry 25 in List III read as: 'Occasional and Technical Training of Labour'
90
Page 91 education or research and scientific and technical institutions, power rests
with the Union/Parliament to the exclusion of the State Legislatures.
However, other facets of education, including technical and medical
education, as well as governance of universities is concerned, even State
Legislatures are given power by virtue of Entry 25. The field covered by
Entry 25 of List III is wide enough and as circumscribed to the limited
extent of it being subject to Entries 63, 64, 65 and 66 of List I.
94)Most educational activities, including admissions, have two aspects: The
first deals with the adoption and setting up the minimum standards of
education. The objective in prescribing minimum standards is to provide a
benchmark of the caliber and quality of education being imparted by
various educational institutions in the entire country. Additionally, the
coordination of the standards of education determined nationwide is
ancillary to the very determination of standards. Realising the vast
diversity of the nation wherein levels of education fluctuated from lack of
even basic primary education, to institutions of high excellence, it was
though desirable to determine and prescribe basic minimum standards of
education at various levels, particularly at the level of research institutions,
higher education and technical education institutions. As such, while
balancing the needs of States to impart education as per the needs and
91
Page 92 requirements of local and regional levels, it was essential to lay down a
uniform minimum standard for the nation. Consequently, the Constitution
makers provided for Entry 66 in List I with the objective of maintaining
uniform standards of education in fields of research, higher education and
technical education.
95)The second/other aspect of Education is with regard to the implementation
of the standards of education determined by the Parliament, and the
regulation of the complete activity of Education. This activity necessarily
entails the application of the standards determined by the Parliament in all
educational institutions in accordance with the local and regional needs.
Thus, while Entry 66 List I dealt with determination and coordination of
standards, on the other hand, the original Entry 11 of List II granted the
States the exclusive power to legislate with respect to all other aspects of
education, except the determination of minimum standards and
coordination which was in national interest. Subsequently, vide the
Constitution (Forty-second Amendment) Act, 1976, the exclusive legislative
field of the State Legislature with regard to Education was removed and
deleted, and the same was replaced by amending Entry 25, List III,
granting concurrent powers to both Parliament and State Legislature the
power to legislate with respect to all other aspects of Education, except
92
Page 93 that which was specifically covered by Entry 63 to 66 of the List I.
96)No doubt, in Bharti Vidyapeeth it has been observed that the entire gamut
of admission falls under Entry 66 of List I. The said judgment by a Bench
of two Judges is, however, contrary to law laid down in earlier larger Bench
decisions. In Gujarat University, a Bench of five Judges examined the
scope of Entry 2 of List II (which is now Entry 25 of List III) with reference
to Entry 66 of List I. It was held that the power of the State to legislate in
respect of education to the extent it is entrusted to the Parliament, is
deemed to be restricted. Coordination and determination of standards was
in the purview of List I and power of the State was subject to power of the
Union on the said subject. It was held that the two entries overlapped to
some extent and to the extent of overlapping the power conferred by Entry
66 of List I must prevail over power of the State. Validity of a state
legislation depends upon whether it prejudicially affects ‘coordination or
determination of standards’, even in absence of a union legislation. In R.
Chitralekha v. State of Mysore
27
, the same issue was again considered.
It was observed that if the impact of State law is heavy or devastating as to
wipe out or abridge the central field, it may be struck down. In State of
T.N. & Anr. v. Adhiyaman Educational & Research Institute & Ors.
28
, it
27(1964) 6 SCR 368
28(1995) 4 SCC 104
93
Page 94 was observed that to the extent that State legislation is in conflict with the
Central legislation under Entry 25, it would be void and inoperative. To the
same effect is the view taken in Dr. Preeti Srivastava and State of
Maharashtra v. Sant Dnyaneshwar Shikshan Shastra Mahavidalaya &
Ors.
29
Though the view taken in State of Madhya Pradesh v. Kumari
Nivedita Jain & Ors.
30
and Ajay Kumar Singh & Ors. v. State of Bihar
& Ors.
31
to the effect that admission standards covered by Entry 66 of List
I could apply only post admissions was overruled in Dr. Preeti Srivastava,
it was not held that the entire gamut of admissions was covered by List I
as wrongly assumed in Bharti Vidyapeeth.
97)We do not find any ground for holding that Dr. Preeti Srivastava excludes
the role of states altogether from admissions. Thus, observations in
Bharti Vidyapeeth that entire gamut of admissions was covered by Entry
66 of List I cannot be upheld and overruled to that extent. No doubt, Entry
25 of List III is subject to Entry 66 List I, it is not possible to exclude the
entire gamut of admissions from Entry 25 of List III. However, exercise of
any power under Entry 25 of List III has to be subject to a central law
referable to Entry 25.
29(2006) 9 SCC 1
30(1981) 4 SCC 296
31(1994) 4 SCC 401
94
Page 95 98)In view of the above, there was no violation of right of autonomy of the
educational institutions in the CET being conducted by the State or an
agency nominated by the State or in fixing fee. The right of a State to do
so is subject to a central law. Once the notifications under the Central
statutes for conducting the CET called 'NEET' become operative, it will be
a matter between the States and the Union, which will have to be sorted
out on the touchstone of Article 254 artof the Constitution. We need not
dilate on this aspect any further.
EPILOGUE:
99)Before parting with the matter, we may observe that we have decided the
lis between the parties, but that by itself does not cure all the ills with which
the system suffers and something more needs to be done on that front as
well. It would be necessary to refer to the grievance voiced on behalf of
the appellants that admissions conducted even by an agency nominated
by the State, under a state law or a central law may lack credibility. This
concern has also been noticed by this Court in P.A. Inamdar. An astute
and segacious approach is also necessary to deal with the ground
realities. This Court had earlier appointed committees headed by the
retired High Court Judges in all the States to regulate the admissions and
95
Page 96 fee structure. This was a stopgap arrangement till suitable legislation was
framed and once the admission process under a statutory law becomes
operative, the grievance of all concerned on the subject of proper
functioning of the regulatory mechanism will need to be properly
addressed. It was brought to our notice that the Central Government itself
had appointed a group of experts headed by Dr. Ranjit Roy Chaudhury
vide notification dated July 07, 2014 to study the Indian Medical Council
Act, 1956 and to make recommendations. The said Committee gave its
report on September 25, 2014 suggesting reforms in the regulatory
oversight of the medical profession by the Medical Council. The
recommendations covered the subject of overseeing under graduate and
post graduate medical education as well as other related issues. It was
also pointed out that even the Parliamentary Standing Committee on
Health and Family Welfare in its 92
nd
report on 'The functioning of Medical
Council of India' presented to the Rajya Sabha and the Lok Sabha on
March 08, 2016 has gone into the matter. There is perhaps urgent need
to review the regulatory mechanism for other service oriented professions
also. We do hope this issue will receive attention of concerned authorities,
including the Law Commission, in due course.
100)The Committee examined the existing architecture of the regulatory
96
Page 97 oversight of the medical profession, that is the MCI. It was observed that
the MCI was repeatedly found short of fulfilling its mandated
responsibilities. Qualify of medical education was at its lowest ebb, the
right type of health professionals were not able to meet the basic health
need of the country. Products coming out of medical colleges are ill-
prepared to serve in poor resource settings like Primary Health Centre and
even at the district level. The medical graduates lacked competence in
performing basic health care tasks. Instances of unethical practices
continued to grow. The MCI was not able to spearhead any serious
reforms in medical education. The MCI neither represented the
professional excellence nor its ethos. Nominees of Central Government
and State Governments were also from corporate private hospitals which
are highly commercialized. They were also found to be violating value
framework and indulging in unethical practices such as carrying out
unnecessary diagnostics tests and surgical procedures in order to extract
money from hapless patients. The electoral processes brought about a lot
of compromises and tend to attract professionals who may not be best
fitted for the regulatory body. Regulators of highest standards of
professional integrity and excellence could be appointed through an
independent selection process. The Committee concurred with
97
Page 98 recommendation of the Ranjit Roy Chaudhury Committee Report that
regulatory structure should be run by persons selected through transparent
mechanism rather than by election or nomination. The Central
Government had no power to disagree with the MCI though the
Government was the main stakeholder in shaping the health schemes.
The Government should have power to give policy directives to the
regulatory body. The existing system of graduate medical education was
required to be re-invented. The admission process was not satisfactory as
majority of seats in private medical colleges were being allotted for
capitation fee. The system keeps out most meritorious and
underprivileged students. The unitary CET will tackle the capitation fee and
bring about transparency. The post graduate seats were being sold in
absence of transparent and streamlined process of admission. It also
noted deficiency in the teaching faculty and in regulation of professional
conduct of doctors. Taking note of corruption in the MCI it was
recommended that expeditious action should be taken to amend the
statute and enact a new legislation. Current system of inspections was
found to be unsatisfactory. The conclusions of the Committee are:
“The Committee observes that the Medical Council of India
as the regulator of medical education in the country has
repeatedly failed on all it mandates over the decades. The
Committee in the earlier part of this Report has dealt with
98
Page 99 these failures in some details. In this section, the Committee
before suggesting remedy to the problem, would like to
briefly touch upon the following prominent failures of MCI in
order to put things into proper perspective:-
(i) failure to create a curriculum that produces doctors suited
to working in Indian context especially in the rural health
services and poor urban areas; this has created a
disconnect between medical education system and health
system;
(ii) failure to maintain uniform standards of medical
education, both undergraduate and post-graduate;
(iii) development of merit in admission, particularly in private
medical institutions due to prevalence of capitation fees,
which make medical education available only to the rich and
not necessarily to the most deserving;
(iv) failure to produce a competent basic doctor;
(v) non-involvement of the MCI in any standardized
summative evaluation of the medical graduates and post-
graduates;
(vi) failure to put in place a robust quality assurance
mechanism when a fresh graduate enters the system and
starts practicing;
(vii) very little oversight to PG medical education leading to
huge variations in standards;
(viii) heavy focus on nitty-gritty of infrastructure and human
staff during inspections but no substantial evaluation of
quality of teaching, training and imparting of skills;
(ix) abysmal doctor-population ratio;
(x) failure to create a transparent system of medical college
inspections and grant of recognition or de-recognition;
(xi) failure to guide setting up of medical college in the
country as per need, resulting in geographical mal-
99
Page 100 distribution of medical colleges with clustering in some states
and absence in several other states and the disparity in
healthcare services across states;
(xii) acute shortage of medical teachers;
(xiii) failure to oversee and guide the Continuing Medical
Education in the country, leaving this important task in the
hands of the commercial private industry;
(xiv) failure to instill respect for a professional code of ethics
in the medical professional and take disciplinary action
against doctors found violating the code of Ethics, etc. (Para
13.1)
The Committee simultaneously observes that the
onus of failure of medical education system cannot be laid
exclusively on the Medical Council of India. The successive
Governments have also their share in it. The fact that there
is imbalance in the distribution of medical college across
States is not so much MCI’s fault; it is the fault of the
successive Governments that they have not pushed the MCI
in that direction. There is also failure on the part of the State
Government. (Para 13.2)
The need for radical reforms in the regulatory
framework of the medical profession has been on the
agenda for several years now. The National Commission for
Human Resources for Heal Bill, 2011 which was introduced
in the Rajya Sabha on the 22
nd
December, 2011 was
reported upon by this Committee and the 60
th
Report thereon
presented to Parliament on the 23
rd
November, 2012. In its
60
th
Report, the Committee had recommended to the
Ministry of Health and Family Welfare to re-examine the
concerns expressed by it and bring forward a fresh Bill.
Rather than seizing the opportunity to come up with a better
Bill, the Ministry remained apathetic to the state of affairs
and did not respond with vigorous corrective measures.
(Para 13.3)
Due to massive failures of the MCI and lack of
initiatives on the part of the Government in unleashing
reforms, there is total system failure due to which the
100
Page 101 medical education system is fast sliding downwards and
quality has been hugely side-lined in the context of
increasing commercialization of medical education and
practice. The situation has gone far beyond the point where
incremental tweaking of the existing system or piecemeal
approach can give the contemplated dividends. That is why
the Committee is convinced that the MCI cannot be
remedied according to the existing provisions of the Indian
Medical Council Act, 1956 which is certainly outdated. If we
try to amend or modify the existing Act, ten years down the
line we will still be grappling with the same problems that we
are facing today. Nowhere in the world is there an
educational process oversight, especially, of medical
education done by an elected body of the kind that MCI is.
Managing everything of more than 400 medical colleges is
too humongous a task to be done by the MCI alone because
the challenges facing medical education of the 21
st
Century
are truly gigantic and cannot be addressed with an ossified
and opaque body like MCI. Transformation will happen only
if we change the innards of the system. (Para 13.4)
Game changer reforms of transformational nature are
therefore the need of the hour and they need to be carried
out urgently and immediately. Because, if revamping of the
regulatory structure is delayed any further on any grounds
including political expediency, it will be too late as too much
momentum will have been built to offset attempts at
reversing the direction later, with the result that our medical
education system will fall into a bottomless pit and the
country will have to suffer great social, political and financial
costs. (Para 13.5)
Keeping all these facts in mind, the Committee is
convinced that the much needed reforms will have to be led
by the Central Government. The MCI can no longer be
entrusted with that responsibility in view of its massive
failures. The people of India will not be well-served by letting
the modus operandi of MCI continue unaltered to the
detriment of medical education and decay of health system.
The Government must therefore fulfill its commitment to
preserve, protect and promote the health of all Indians by
leading the way for a radical reform which cleanses the
101
Page 102 present ills and elevates medical education to contemporary
global pedagogy and practices while retaining focus on
national relevance. (Para 13.6)
The expert committee led by (late) Prof. Ranit Roy
Chaudhury constituted by the Government in July, 2014 to
suggest reforms in the regulatory framework of medical
profession has submitted its report in February, 2015, a copy
of which has been supplied to this Parliamentary Committee.
The expert committee has recommended major changes in
the ethos of the regulatory body and major structural
reconfiguration of its functions. The expert committee has
suggested the formation of a National Medical Commission
(NMC) through a new Act. The NMC will have four verticals
(i) UG Board of Medical Education and Training, (ii) PG
Board of Medical Education and Training (iii) National
Assessment and Accreditation Board and (iv) National Board
for Medical Registration. Besides these vertical heads, the
expert committee has also recommended the formation f a
National Advisory Council which will consist of members
from the State Governments, Union Territories, State Medical
Councils, Medical Universities and members of NMC. The
Committee has been informed that the creation of National
Medical Commission and the structure (at Appendix)
envisaged has been endorsed by a group of eminent
medical educationists, experts and pubic health persons.
(Para 13.7)
The Committee has done a rigorous analysis of the
suggested new regulatory structure and found that several of
its concerns have been addressed in the suggested new
model of regulation of medical education and practice. The
Committee is therefore in general agreement with the
suggested regulatory structure, and recommends to the
government to examine the structure proposed by the Ranjit
Roy Chaudhury Committee subject to the recommendations
made by this Committee in this report. (Para 13.8)
To sum up, the Committee observes, even at the risk
of sounding repetitive, that the need for major institutional
changes in the regulatory oversight of the medical profession
in the country is so urgent that it cannot be deferred any
longer. The Committee is, however, aware that any attempt
102
Page 103 at overhauling the regulatory framework will face huge
challenges from the deeply entrenched vested interests who
will try to stall ad derail the entire exercise. But if the medical
education system has to be saved from total collapse, the
Government can no longer look the other way and has to
exercise its constitutional authority and take decisive and
exemplary action to restructure and revamp India’s
regulatory system of medical education and practice. The
Committee, therefore, exhorts the Ministry of Health, and
Family Welfare to implement the recommendations made by
it in this report immediately and bring a new comprehensive
Bill in Parliament for this purpose at the earliest. (Para
13.9) ”
101)In view of the above, while the Expert Committee Report mentioned above
is yet to be acted upon by the Government, we do not express any view on
its contents. We direct the Central Government to consider and take
further appropriate action in the matter at the earliest.
102)At the same time, we do feel that pending consideration at appropriate
executive or legislature level, an Oversight Committee needs to be set in
place in exercise of powers of this Court under Article 142 of the
Constitution to oversee the functioning of the MCI and all other matters
considered by the Parliamentary Committee.
103)In view of the above, while we do not find any error in the view taken by
the High Court and dismiss these appeals, we direct the constitution of an
Oversight Committee consisting of the following members:
103
Page 104 1.Justice R.M. Lodha
(former Chief Justice of India)
2.Prof. (Dr.) Shiv Sareen
(Director, Institute of Liver and Biliary Sciences)
3.Shri Vinod Rai
(former Comptroller & Auditor General of India)
104)A Notification with respect to constitution of the said Committee be issued
within two weeks from today. The Committee be given all facilities to
function. The remuneration of the Members of the Committee may be
fixed in consultation with them.
105)The said Committee will have the authority to oversee all statutory
functions under the MCI Act. All policy decisions of the MCI will require
approval of the Oversight Committee. The Committee will be free to issue
appropriate remedial directions. The Committee will function till the
Central Government puts in place any other appropriate mechanism after
due consideration of the Expert Committee Report. Initially the Committee
will function for a period of one year, unless suitable mechanism is brought
in place earlier which will substitute the said Committee. We do hope that
within the said period the Central Government will come out with an
appropriate mechanism.
106)List the matter after one year for such further directions as may become
104
Page 105 necessary.
.............................................J.
(ANIL R. DAVE)
.............................................J.
(A.K. SIKRI)
.............................................J.
(R.K. AGRAWAL)
.............................................J.
(ADARSH KUMAR GOEL)
.............................................J.
(R. BANUMATHI)
NEW DELHI;
MAY 02, 2016.
105
Page 106 REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4060 OF 2009
MODERN DENTAL COLLEGE AND
RESEARCH CENTRE & ORS. ..Appellants
Versus
STATE OF MADHYA PRADESH & ORS. …Respondents
With
C.A. No.4061 of 2009, C.A. No.4062 of 2009, C.A. No.4063 of 2009, C.A.
No.4064 of 2009 and C.A. No.4065 of 2009
J U D G M E N T
R. BANUMATHI, J .
I have had the advantage of going through the draft
judgment proposed by my esteemed brother Hon’ble Justice A.K. Sikri.
I entirely agree with the conclusions which my erudite brother has
drawn, based on a remarkable process of reasoning. I would all the
same like to add some of my own reasonings, not because the judgment
requires any further elaboration but because the substantial questions
of law that arise for determination are of considerable importance.
2. In compliance with the directions of this Court in T.M.A. Pai
106
Page 107 Foundation and Ors. v. State of Karnataka and Ors. (2002) 8 SCC 481,
Islamic Academy of Education and Anr. v. State of Karnataka and Ors.
(2003) 6 SCC 697 and P.A. Inamdar and Ors. v. State of Maharashtra
and Ors. (2005) 6 SCC 537, the State of Madhya Pradesh has enacted
M.P. Niji Vyavasayik Shikshan Sanstha (Pravesh Ka Viniyaman Avam
Shulk Ka Nirdharan) Adhiniyam, 2007 (M.P. Act No.21 of 2007 ).
Association of Private Dental and Medical Colleges of State of Madhya
Pradesh has filed Writ Petition No.1975 of 2008 challenging the
provisions of Act 2007 as unconstitutional beyond legislative
competence of the State Legislature and therefore without jurisdiction.
In W.P. No.9496 of 2008, the association has also challenged the
Admission Rule 2008 framed under Act 2007 as ultra vires the
Constitution and M.P. Act 2007. The State Government issued orders
on 28.02.2009 that the State Government shall conduct the Common
Entrance Test (CET) for admission to the post-graduate medical and
dental courses for the academic session 2008-2009 through Madhya
Pradesh Professional Examination Board (VYAPAM). The Association has
challenged the order dated 28.02.2009 authorizing VYAPAM to conduct
the CET for admission to post-graduate medical and dental courses as
arbitrary and contrary to the law laid down in T.M.A. Pai Foundation and
P.A. Inamdar cases in W.P. No.2764 of 2009. Madhya Pradesh High
107
Page 108 Court by the common impugned judgment upheld the validity of the
provisions of the Act and also the Rules and dismissed all the Writ
Petitions. Rule 10(2)(iii) of 2009 Rules which prescribed that the
candidate should have obtained permanent registration with the State
Medical Council of Madhya Pradesh and not from State Medical
Councils of other States for securing admission to post-graduate
medical courses in any of the medical institution in the State of Madhya
Pradesh was held to be ultra vires.
3. Contentions: Though in the pleadings and submissions,
appellants have raised various contentions, in essence, substance of
their contentions are:-
·Madhya Pradesh Act of 2007 is not referable to entry 25
in the concurrent list and common entrance test for
admission is an important facet of the standards of
higher education falling within entry 66 of Union List and
State Legislature was not competent to legislate on the
subject covered in the Union List.
·In para (50) of T.M.A. Pai Foundation it was held that the
right to establish and administer the educational
institution includes interalia the rights to (a) admit
students; (b) to set up a reasonable fee structure; and (c)
to constitute a governing body…..; while so, Section 3(d)
and Section 6 of the M.P. Act 2007 stipulating that
admission shall be on the basis of common entrance test
in such manner as may be prescribed by the State
infringes the fundamental right of unaided private
educational institutions and the rights of the institutions
as laid down in T.M.A. Pai Foundation case and the same
would be an unreasonable restrictions as held in T.M.A.
Pai Foundation case.
108
Page 109 ·Section 9 read with Section 4(1) of Act 2007 empowering
the committee to determine the fee structure to be
charged by the unaided private educational institutions
infringes the autonomy of the institutions who have a
right to determine their own fee structure in terms of
Article 19(1)(g) of the Constitution of India. In terms of
Section 4 and Regulation 5 Committee is given unbridled
power to determine the fees that may be charged by the
institution and the Committee can scrutinize the
stipulated amounts in various heads which is not in
accordance with the right of the unaided private
educational institutions as laid down in T.M.A. Pai
Foundation case.
·Section 8 of the Act 2007 providing for reservation in
unaided private educational institutions is unknown to
the constitutional scheme and it would be an
unreasonable restriction which would run afoul of Article
19(1)(g) of the Constitution of India and such
unreasonable restriction in effect violates Articles 14 and
15(1) of the Constitution of India.
4. Challenge to Section 8 providing for reservation: Section 8 of
Act 2007 provides for reservation of seats in admission in private
unaided professional educational institutions for the persons belonging
to Scheduled Castes and Scheduled Tribes and other backward classes
as may be prescribed by the State Government. This reservation is
pursuant to the Ninety Third Constitution Amendment inserting Article
15(5) of the Constitution. In para (41) of the impugned judgment, it is
observed that Ninety Third Constitution Amendment inserting Article
15(5) of the Constitution has been challenged by some of the petitioners
in separate writ petitions and therefore no arguments was advanced in
the writ petitions challenging the views of Act 2007. It is, therefore, not
109
Page 110 necessary to go into the vires of Section 8 of Act 2007.
5. Re-contention: Lack of legislative competence of the State to
enact Act 2007 as the field is occupied by entry 66 of Union List: It is to
be pointed out that the issue of legislative competence was neither
raised nor argued before the High Court as is apparent from the lack of
discussion on this issue of constitutional importance in the impugned
judgment. Be that as it may, to appreciate the contentions, it would be
advantageous to have a glimpse into the relevant constitutional
provisions on the distribution of legislative fields between the Centre
and the States. The legislative powers of the Central and State
Governments are governed by the relevant entries in the three Lists
given in Seventh Schedule. Entry 66 in Union List provides for ‘co-
ordination and determination of standards in institutions for higher
education or research and scientific and technical institutions’. Prior to
Constitution Forty-Second Amendment, “education including universities
subject to the provisions of the entries 63, 64, 65, 66 of Union List and
entry 25 of Concurrent List” was shown in entry 11 of the State List. By
the Constitution (Forty-second Amendment) Act 1976 with effect from
03.01.1977, entry 11 was deleted from the State List and amalgamated
with entry 25 of the Concurrent List.
Entry 66 of List I-Union List reads as under:-
110
Page 111 Entry 66. Co-ordination and determination of standards in
institutions for higher education or research and scientific and
technical institutions.
Entry 25 of List III-Concurrent List is as under:-
Entry 25. Education, including technical education, medical
education and universities, subject to the provisions of entries
63, 64, 65 and 66 of List I; vocational and technical training of
labour.
Under entry 66 of the Union List, Government of India is required to co-
ordinate and maintain standards in institutions for higher education or
research and scientific and technical institution. Union of India has the
right to make policy decisions to maintain standards in higher
education and these will be binding upon State Governments. Entry 25
of the Concurrent List is subject to the provisions of entries 63, 64, 65
and 66 of List 1 and the State cannot have a policy contrary to the
Central Act. Under Article 257(1), the executive power of the State
Government shall be so exercised as not to impede or prejudice the
exercise of the executive power of the Union.
6. While ‘education’ is a concurrent subject under entry 25 of
concurrent list as substituted by Constitution (Forty-second
Amendment) Act 1976, entries 65 and 66 of Union List give Union the
power to ensure that the standards of research etc. is not lowered at the
hands of particular State or States to the detriment of national progress
and that the power of the State Legislature must be so exercised as not
111
Page 112 to directly encroach upon the power of Union under the present entry.
Though the field of legislation available to the Parliament and the States
has been definite as stated above, more often, a certain amount of
overlapping might become unavoidable; the legislation which thus
overlaps would not however be rendered invalid, if, in ‘pith and
substance’ the legislation is on the subject reserved in favour of that
Legislature. In order to enable smooth functioning of federal structure of
our Constitution, ‘incidental encroachment’ into or ‘overlapping’ of the
field covered by one of the entries in the other Lists is permissible so
long as it does not transgress the limit of legislation earmarked for the
legislature making the law, judged by the standards fixed by the
doctrine of ‘pith and substance’.
7. In Dr. Preeti Srivastava and Anr. v. State of M.P. and Ors.
(1999) 7 SCC 120, it was held that the word ‘education’ under entry 25
of Schedule VII List III is of wide import. It would include in its fold the
taught, the teacher, the textbook and also training as practical training
is required to be imparted to students pursuing the course of post-
graduate medical education. Curricula is also covered by the term
‘education’.
8. While elaborating the concept of ‘education’ after referring to
the dictionary meaning and ‘India Vision-2020’, in P.A. Inamdar case, in
112
Page 113 paras (88) to (90), it was held as under:-
“88. Education is:
“… continual growth of personality, steady development of
character, and the qualitative improvement of life. A trained
mind has the capacity to draw spiritual nourishment from
every experience, be it defeat or victory, sorrow or joy.
Education is training the mind and not stuffing the brain.”
(See Eternal Values for A Changing Society, Vol. III— Education for
Human Excellence, published by Bharatiya Vidya Bhavan, Bombay,
at p. 19.)
“We want that education by which character is formed,
strength of mind is increased, the intellect is expanded, and
by which one can stand on one’s own feet. … The end of all
education, all training, should be man-making. The end
and aim of all training is to make the man grow. The
training by which the current and expression of will are
brought under control and become fruitful is called
education.” (Swami Vivekanand as quoted ibid., at p. 20.)
89. Education, accepted as a useful activity, whether for charity or
for profit, is an occupation. Nevertheless, it does not cease to be a
service to society. And even though an occupation, it cannot be
equated to a trade or a business.
90. In short, education is national wealth essential for the nation’s
progress and prosperity.”
9. By virtue of entry 66 of Union List “ Co-ordination and
determination of standards in institutions for higher education or
research, scientific and technical institutions” is reserved with Union of
India. Power to co-ordinate is not merely power to evaluate but to
harmonise or secure relationship for concerted action.
Oxford Concise Dictionary (7
th
Edn.) defines ‘co-ordinate’ as:-
“make co-ordinate; bring (parts, movements etc.) into proper
relation, cause to function together or in proper order”.
113
Page 114 Black’s Law Dictionary (10
th
Edn.) defines ‘determinate’ as:-
“Having defined limits; fixed; definite” and ‘determination’ is
defined as, “The act of deciding something officially; esp., a final
decision by a court or administrative agency”.
From these definitions, it flows that ‘determination’ is the official
characterization of an expression and ‘co-ordination’ means through
which determined norms or standards are kept in harmony with each
other.
10. In Concise Oxford English Dictionary (Tenth Edition, Revised)
the meaning of the word ‘standard’ is given as:-
“a level of quality or attainment, a required or agreed level of
quality or attainment (in elementary schools) a grade of
proficiency tested by examination, something used as a measure,
norm or model in comparative evaluations.”
Black’s Law Dictionary (10
th
Edn) defines ‘standard’ as:-
“a model accepted as correct by custom, consent, or authority; a
criterion for measuring acceptability, quality or accuracy.”
Ramanatha Aiyar’s Law Lexicon 3
rd
Edn. also defines ‘standard’ as:-
“something that is established by authority, customs or general
consent as a model or example to be followed [s.18(4), expln,
Beedi and Cigar Workers (Conditions of Employment) Act (32 of
1966)]
Specifications approved and prescribed by a recognized body for
repeated and continuous application. Standard usually prescribe
a basic though higher than average level of quality.”
11. The legislative history of entry 66, Union List might lay down
a better picture in this regard. Profitably, we may refer to the history of
‘education’ as a subject of legislation in the Indian perspective must be
114
Page 115 ascertained. The Government of India Act, 1935 laid down the
legislative lists in the Seventh Schedule. Entry 17 of List II therein i.e.
the Provincial State List reads as under:-
“Education including universities other than those specified in
paragraph 13 of List I”
Paragraph 13 of List I i.e. the federal legislative list reads as under:
“The Benaras Hindu University and the Aligarh Muslim University”
Evidently, ‘education’ as a field of legislation including universities was
available to the Provinces except the two Universities i.e. the Benaras
Hindu University and Aligarh Muslim University which lay in the
domain of the federal legislative competence. Even when the
constitution was being drafted, the idea of ‘education’ being a State
subject and the role of Union to be limited only to co-ordinate
educational institution was very firm in the minds of our constitution
framers.
12. If we refer to volume IX of the Constituent Assembly Debates
held on Wednesday, the 31st August 1949, it transpires that while
introducing entry 66 of List I (as it stands in its present form), Dr. B.R.
Ambedkar proposed nothing more than empowering the Union to set
mere standards for higher education and to co-ordinate between the
institutions. Relevant excerpts from the debate is quoted below:-
115
Page 116 “The Honourable Dr. B.R. Ambedkar: Sir, I move:
"That after entry 57 of List I, the following new entry be inserted:-
'57(A) Co-ordination and maintenance of standards in
institutions for higher education, scientific and technical
institutions and institutions for research'."
This entry is merely complementary to the earlier entry No. 57. In
dealing with institutions maintained by the provinces, entry 57A
proposes to give power to the Centre to the limited extent of coordinating
the research institutions and of maintaining the standards in those
institutions to prevent their being lowered.
13. Sir, I also move:-
"That in amendment No. 28 of List I (Sixth Week) in the proposed
new entry 57A of List I, for the word 'maintenance' the word
'determination be substituted."
The said proposal of Dr. Ambedkar was opposed by Shri V.S.
Sarwate (Madhya Bharat) by suggesting that only “ Promotion by
financial assistance or otherwise of standards in institutions for higher
education, scientific and technical institutions and institutions for
research" be left in the domain of the Union, so as to avoid unnecessary
interference with the State’s power to legislate in relation to ‘education’.
While highlighting the importance of ‘education’ being a State subject,
Shri V.S. Sarwate observed as under:-
“The modern trend in education is that education should be
adapted to each individual so that the personality of each
individual might be developed to its fullest extent, of course
consistently with the personalities of other individuals. If this is
116
Page 117 the desideratum in education, then there must be full scope for
variety. There should not be any uniformity in education as
uniformity would kill the growth of the individual. Nobody can
say that there should be a standard of intellectual weights and
measures for human beings. Therefore I think that education
should be left entirely to the provinces.”
Shri V.S. Sarwate went to oppose introduction of entry 66 of List I (in
the present form) by observing that the Union would not be competent
enough to lay down standards for technical education such as that of
medical education. His observation is quoted as under:-
“One word more, Sir, I think that it will be difficult for Parliament
or the Central Government to fix standards of higher education,
for example in higher medical education. Would it be possible for
the Parliament to find out what are the standards for medical
education?”
In order to answer the concern of other constitution framers, Dr.
Ambedkar went on to clarify the limited scope of entry 66 of List I (as in
the present form), as proposed by him in the following words:-
“Entry 57A merely deals with the maintenance of certain
standards in certain classes of institutions, namely, institutions
imparting higher education, scientific and technical institutions,
institutions for research, etc. You may ask, “why this entry?” I
shall show why it is necessary. Take for instance the B.A. Degree
examination which is conducted by the different universities in
India. Now, most provinces and the Centre, when advertising for
candidates, merely say that the candidate should be a graduate
of a university. Now, suppose the Madras University says that a
candidate at the B.A. Examination, if he obtained 15 per cent of
the total marks shall be deemed to have passed that
examination; and suppose the Bihar University says that a
candidate who has obtained 20 per cent. of marks shall be
deemed to have passed the B.A. Degree examination; and some
other university fixes some other standard, then it would be quite
a chaotic condition, and the expression that is usually used, that
the candidate should be a graduate, I think, would be
117
Page 118 meaningless. Similarly, there are certain research institutes, on
the results of which so many activities of the Central and
Provincial Governments depend. Obviously you cannot permit the
results of these technical and scientific institutes to deteriorate
from the normal standard and yet allow them to be recognized
either for the Central purposes, for all-India purposes or the
purposes of the State.”
14. The intent of our constitution framers while introducing
entry 66 of the Union List was thus limited only to empowering the
Union to lay down a uniform standard of higher education throughout
the country and not to bereft the State Legislature of its entire power to
legislate in relation to ‘education’ and organizing its own common
entrance examination.
15. If we consider the ambit of the present entry 66 of the Union
List; no doubt the field of legislation is of very wide import and
determination of standards in institutions for higher education. In the
federal structure of India, as there are many States, it is for the Union to
co-ordinate between the States to cause them to work in the field of
higher education in their respective States as per the standards
determined by the Union. Entry 25 in the Concurrent List is available
both to the Centre and the States. However, power of the State is
subject to the provisions of entries 63, 64, 65, and 66 of Union List;
while the State is competent to legislate on the education including
technical education, medical education and universities, it should be as
per the standards set by the Union.
118
Page 119 16. The words ‘co-ordination’ and ‘determination of the standards
in higher education’ are the preserve of the Parliament and are
exclusively covered by entry 66 of Union List. The word ‘co-ordination’
means harmonisation with a view to forge a uniform pattern for
concerted action. The term ‘fixing of standards of institutions for higher
education’ is for the purpose of harmonising co-ordination of the various
institutions for higher education across the country. Looking at the
present distribution of legislative powers between the Union and the
States with regard to the field of ‘education’, that State’s power to
legislate in relation to “education, including technical education, medical
education and universities” is analogous to that of the Union. However,
such power is subject to entries 63, 64, 65 and 66 of Union List, as laid
down in entry 25 of Concurrent List. It is the responsibility of the
Central Government to determine the standards of higher education and
the same should not be lowered at the hands of any particular State.
17. Even the National Educational Policy recognised that the
Union shall take the larger responsibility of setting the standards. The
Policy of 1986 states:-
“3.13 …While the role and responsibility of the States in regard to
education will remain essentially unchanged, the Union
Government would accept a larger responsibility to reinforce the
national and integrative character of education, to maintain
quality and standards (including those of the teaching profession
at all levels), to study and monitor the educational requirements
of the country as a whole in regard to manpower for
119
Page 120 development, to cater to the needs of research and advanced
study, to look after the international aspects of education, culture
and Human Resource Development and, in general, to promote
excellence at all levels of the educational pyramid throughout the
country. Concurrency signifies a partnership, which is at once
meaningful and challenging; the National Policy will be oriented
towards giving effect to it in letter and spirit.
5.30 State level planning and co-ordination of higher education
will be done through Councils of Higher Education. The UGC and
these Councils will develop coordinative methods to keep a watch
on standards.
XXX
10.4 State Government may establish State Advisory Boards of
Education on the lines of CABE. Effective measures should be
taken to integrate mechanisms in the various State departments
concerned with Human Resource Development.
10.5 Special attention will be paid to the training of educational
planners, administrators and heads of institutions. Institutional
arrangements for this purpose should be set up in stages.”
(mhrd.gov.in/sites/upload_files/mhrd/files/upload_document/N
PE86-mod92.pdf)
The policy clearly recognised that the State would continue to fulfill its
responsibilities. This is also discernible from the amendment to entry
25 of Concurrent List. Had the intention been to keep higher education
solely in the hands of the Union, only the omission of entry 11 from
State List would have sufficed. The legislative intent was to allow the
Union to set the standards through its organs, which the States would
facilitate.
18. Thus, what emerges is that under List I, responsibility of the
Union is with respect to formulation and co-ordination of standards for
higher education institutions. “Determination of Standard in Higher
120
Page 121 Education” implies that the Parliament is empowered to prescribe such
norms to maintain quality in the institutions for higher education. The
expression ‘co-ordination and determination of standards in higher
education’ means that it is for the Parliament to take concerted action
towards maintaining the standards. The reason for empowering the
Central Legislature with entry 66 was to ensure that the standards of
higher education were not lowered at the hands of a particular State to
the detriment of the national progress and that the power exercised by
the State did not directly encroach upon power of the Union entry 66.
19. An elucidation of the connotation, “ co-ordination” as it
appears in entry 66 of list I, is contained in the discussion by Shah J.,
while expressing the majority view in The Gujarat University & Anr. v.
Shri Krishna Ranganath Mudholkar & Ors. [1963] Supp.1 SCR 112. In
this case, the Constitution Bench of this Court considered whether the
State Legislature could impose Gujarati and/or Hindi in Devnagari
script as exclusive medium of instruction and examination in
institutions affiliated to the university and constituent colleges. It was
held that:-
“if a legislation imposing a regional language or Hindi as the
exclusive medium of instruction is likely to result in lowering of
standards, it must necessarily fall within Item 66 of List I and
be excluded to that extent from Item 11 of List II”
Medium of instruction was held to have an important bearing on the
121
Page 122 effectiveness of instruction and resultant standards achieved thereby. It
was further held as under:
“If adequate textbooks are not available or competent
instructors in the medium, through which instruction is
directed to be imparted, are not available, or the students are
not able to receive or imbibe instructions through the medium
in which it is imparted, standards must of necessity fall, and
legislation for coordination of standards in such matters would
include legislation relating to medium of instruction.
If legislation relating to imposition of an exclusive medium of
instruction in a regional language or in Hindi, having regard to
the absence of textbooks and journals, competent teachers and
incapacity of the students to understand the subjects, is likely
to result in the lowering of standards, that legislation would, in
our judgment, necessarily fall within Item 66 of List I and would
be deemed to be excluded to that extent from the amplitude of
the power conferred by Item 11 of List II.”
20. Subba Rao, J. in Gujarat University case, in his dissenting
view stated that no authority had gone so far as to hold that even if the
pith and substance of an Act fell squarely within the ambit of a
particular entry, it should be struck down on the speculative and
anticipatory ground that it might come into conflict with a law made by
a co-ordinated legislature by virtue of another entry; if the impact of a
State law on a Central Legislation was so heavy and devastating as to
wipe out or appreciably abridge the central field, then it might be a
ground for holding that the State law was a colourable exercise of power
and in pith and substance it fell not under the State entry, but under
the Union entry.
122
Page 123 21. In R. Chitralekha & Anr. v. State of Mysore & Ors. (1964) 6
SCR 368, State Government informed the Director of Technical
Education that it had been decided to fix 25% of the maximum marks
for the examination in optional subjects as interview marks and on that
basis, selections were made for admission to Engineering and Medical
Colleges. Considering the impact of State law providing for such
standards it was held that the State law prescribing a higher percentage
of marks for extra-curricular activities in the matter of admission to
colleges cannot be said to be encroaching on the field covered by entry
66 of Union List and that the State Government would be within its
rights to prescribe qualifications for admission to colleges so long as its
action does not contravene any other law.
22. It was observed in the case of Government of Andhra Pradesh
& Anr. v. Medwin Educational Society & Ors. (2004) 1 SCC 86, that
“keeping in view the practical difficulties faced by the Central
Government or the statutory bodies like MCI or UGC, some power is
sought to be delegated to the State so as to make the Parliamentary
statute workable. Such ‘play in joint’ is also desirable having regard to
the federal structure of our Constitution”.
23. In State of T.N. and Anr. v. Adhiyaman Educational and
Research Institute and Ors., (1995) 4 SCC 104, the question involved
123
Page 124 was whether after coming into force of the Central Act, All India Council
Technical Education Act, 1987, the State Government had the power to
grant and withdraw permission to start educational institution. It was
held that to that extent after coming into operation of the Central Act
under entry 66 of Union List, to co-ordinate and determine the
standards of technical institutions as in entry 25 of Concurrent List, the
provisions of the University Act will be deemed to have become
unenforceable in case of technical colleges like engineering colleges. In
para (41), this Court summarized the principles as under:-
“41. What emerges from the above discussion is as follows:
(i) The expression ‘coordination’ used in Entry 66 of the
Union List of the Seventh Schedule to the Constitution does not
merely mean evaluation. It means harmonisation with a view to
forge a uniform pattern for a concerted action according to a
certain design, scheme or plan of development. It, therefore,
includes action not only for removal of disparities in standards
but also for preventing the occurrence of such disparities. It
would, therefore, also include power to do all things which are
necessary to prevent what would make ‘coordination’ either
impossible or difficult. This power is absolute and unconditional
and in the absence of any valid compelling reasons, it must be
given its full effect according to its plain and express intention.
(ii) To the extent that the State legislation is in conflict
with the Central legislation though the former is purported to
have been made under Entry 25 of the Concurrent List but in
effect encroaches upon legislation including subordinate
legislation made by the Centre under Entry 25 of the
Concurrent List or to give effect to Entry 66 of the Union List, it
would be void and inoperative.
(iii) If there is a conflict between the two legislations,
unless the State legislation is saved by the provisions of the
main part of clause (2) of Article 254, the State legislation being
repugnant to the Central legislation, the same would be
inoperative.
(iv) Whether the State law encroaches upon Entry 66 of
124
Page 125 the Union List or is repugnant to the law made by the Centre
under Entry 25 of the Concurrent List, will have to be
determined by the examination of the two laws and will depend
upon the facts of each case.
(v) When there are more applicants than the available
situations/seats, the State authority is not prevented from
laying down higher standards or qualifications than those laid
down by the Centre or the Central authority to short-list the
applicants. When the State authority does so, it does not
encroach upon Entry 66 of the Union List or make a law which
is repugnant to the Central law.
(vi) However, when the situations/seats are available and
the State authorities deny an applicant the same on the ground
that the applicant is not qualified according to its standards or
qualifications, as the case may be, although the applicant
satisfies the standards or qualifications laid down by the
Central law, they act unconstitutionally. So also when the State
authorities de-recognise or disaffiliate an institution for not
satisfying the standards or requirement laid down by them,
although it satisfied the norms and requirements laid down by
the Central authority, the State authorities act illegally.”
24. In Dr. Preeti Srivastava case, this Court considered the
question whether it was open to the State to prescribe different
admission criteria, in the sense of prescribing different minimum
qualifying marks, for special category candidates seeking admission to
the post-graduate medical courses under the reserved seats category as
compared to the general category candidates. While considering the
question whether norms for admission have any connection with the
standards of education, observing that norms for admission have a
nexus with standards of education or rules of admission which are
covered under entry 25 of concurrent list, it was held that the minimum
standards as laid down by the Central Statute have to be complied with
125
Page 126 by the States. In paras (35) and (36) it was held as under:-
“35. ….Both the Union as well as the States have the power to
legislate on education including medical education, subject,
inter alia, to Entry 66 of List I which deals with laying down
standards in institutions for higher education or research and
scientific and technical institutions as also coordination of such
standards. A State has, therefore, the right to control education
including medical education so long as the field is not occupied
by any Union legislation. Secondly, the State cannot, while
controlling education in the State, impinge on standards in
institutions for higher education. Because this is exclusively
within the purview of the Union Government. Therefore, while
prescribing the criteria for admission to the institutions for
higher education including higher medical education, the State
cannot adversely affect the standards laid down by the Union of
India under Entry 66 of List I. Secondly, while considering the
cases on the subject it is also necessary to remember that from
1977, education, including, inter alia, medical and university
education, is now in the Concurrent List so that the Union can
legislate on admission criteria also. If it does so, the State will
not be able to legislate in this field, except as provided in Article
254.
36. It would not be correct to say that the norms for admission
have no connection with the standard of education, or that the
rules for admission are covered only by Entry 25 of List III.
Norms of admission can have a direct impact on the standards
of education. Of course, there can be rules for admission which
are consistent with or do not affect adversely the standards of
education prescribed by the Union in exercise of powers under
Entry 66 of List I. For example, a State may, for admission to
the postgraduate medical courses, lay down qualifications in
addition to those prescribed under Entry 66 of List I. This would
be consistent with promoting higher standards for admission to
the higher educational courses. But any lowering of the norms
laid down can and does have an adverse effect on the standards
of education in the institutes of higher education. Standards of
education in an institution or college depend on various factors.
Some of these are:
(1) the calibre of the teaching staff;
(2) a proper syllabus designed to achieve a high level of
education in the given span of time;
(3)the student-teacher ratio;
(4) the ratio between the students and the hospital
126
Page 127 beds available to each student;
(5) the calibre of the students admitted to the
institution;
(6) equipment and laboratory facilities, or hospital
facilities for training in the case of medical colleges;
(7) adequate accommodation for the college and the
attached hospital; and
(8) the standard of examinations held including the
manner in which the papers are set and examined
and the clinical performance is judged.”
25. As laid down in the decision in Preeti Srivastava, it is within
the legislative competence of the State Legislature, in exercise of power
under entry 25 of concurrent list to prescribe higher educational
qualifications and higher marks for admission in addition to the one
fixed by the Indian Medical Council in order to bring out the higher
qualitative output from the students who pursue medical course.
Following the above dictum, in paragraphs (13) and (14) of the decision
of this Court in Visveswaraiah Technological University & Anr. v.
Krishnendu Halder & Ors., reported in (2011) 4 SCC 606, held as
under:-
“13. The object of the State or University fixing eligibility criteria
higher than those fixed by AICTE, is twofold. The first and
foremost is to maintain excellence in higher education and
ensure that there is no deterioration in the quality of candidates
participating in professional engineering courses. The second is
to enable the State to shortlist the applicants for admission in
an effective manner, when there are more applicants than
available seats. Once the power of the State and the examining
body, to fix higher qualifications is recognised, the rules and
regulations made by them prescribing qualifications higher than
the minimum suggested by AICTE, will be binding and will be
applicable in the respective State, unless AICTE itself
subsequently modifies its norms by increasing the eligibility
127
Page 128 criteria beyond those fixed by the University and the State. It
should be noted that the eligibility criteria fixed by the State and
the University increased the standards only marginally, that is,
5% over the percentage fixed by AICTE. It cannot be said that
the higher standards fixed by the State or University are
abnormally high or unattainable by normal students, so as to
require a downward revision, when there are unfilled seats.
During the hearing it was mentioned that AICTE itself has
revised the eligibility criteria. Be that as it may.
14. The respondents (colleges and the students) submitted that
in that particular year (2007-2008) nearly 5000 engineering
seats remained unfilled. They contended that whenever a large
number of seats remained unfilled, on account of non-
availability of adequate candidates, paras 41(v) and (vi) of
Adhiyaman (1995) 4 SCC 104 would come into play and
automatically the lower minimum standards prescribed by
AICTE alone would apply. This contention is liable to be rejected
in view of the principles laid down in the Constitution Bench
decision in Preeti Srivastava (Dr.)(1999) 7 SCC 120 and the
decision of the larger Bench in S.V. Bratheep (2004) 4 SCC 513
which explains the observations in Adhiyaman (1995) 4 SCC
104 in the correct perspective. We summarise below the
position, emerging from these decisions:
(i) While prescribing the eligibility criteria for
admission to institutions of higher education, the
State/University cannot adversely affect the standards laid
down by the central body/AICTE. The term “adversely affect
the standards” refers to lowering of the norms laid down by
the central body/AICTE. Prescribing higher standards for
admission by laying down qualifications in addition to or
higher than those prescribed by AICTE, consistent with the
object of promoting higher standards and excellence in higher
education, will not be considered as adversely affecting the
standards laid down by the central body/AICTE.
(ii) The observation in para 41(vi) of Adhiyaman (1995)
4 SCC 104 to the effect that where seats remain unfilled, the
State authorities cannot deny admission to any student
satisfying the minimum standards laid down by AICTE, even
though he is not qualified according to its standards, is not
good law.
(iii) The fact that there are unfilled seats in a particular
year, does not mean that in that year, the eligibility criteria
fixed by the State/University would cease to apply or that the
minimum eligibility criteria suggested by AICTE alone would
apply. Unless and until the State or the University chooses to
128
Page 129 modify the eligibility criteria fixed by them, they will continue
to apply in spite of the fact that there are vacancies or unfilled
seats in any year. The main object of prescribing eligibility
criteria is not to ensure that all seats in colleges are filled, but
to ensure that excellence in standards of higher education is
maintained.
(iv) The State/University (as also AICTE) should
periodically (at such intervals as they deem fit) review the
prescription of eligibility criteria for admissions, keeping in
balance, the need to maintain excellence and high standard in
higher education on the one hand, and the need to maintain a
healthy ratio between the total number of seats available in
the State and the number of students seeking admission, on
the other. If necessary, they may revise the eligibility criteria
so as to continue excellence in education and at the same time
being realistic about the attainable standards of marks in the
qualifying examinations.”
It is clear from the above decision that the State legislation fixing higher
qualification than the one prescribed by the AICTE is not outside the
legislative competence of the State.
26. In Ambesh Kumar (Dr) v. Principal, L.L.R.M. Medical College,
Meerut and Ors., (1986) Supp SCC 543, the State prescribed 55% as
minimum marks for admission to post-graduate medical courses. The
Court considered the question whether the State can impose
qualifications in addition to those laid down by the Medical Council of
India and the regulations framed by the Central Government. This
Court held that the State Government laying down eligibility
qualification, namely, obtaining of certain minimum marks in the
examination by candidates is neither an encroachment upon regulation
made under the Medical Council Act nor any infringement of Union’s
129
Page 130 power provided in entry 66 of Union List. It was held as under:-
“…The State Government by laying down the eligibility
qualification namely the obtaining of certain minimum marks in
the MBBS Examination by the candidates has not in any way
encroached upon the regulations made under the Indian
Medical Council Act nor does it infringe the Central power
provided in Entry 66 of List I of the Seventh Schedule to the
Constitution. The order merely provides an additional eligibility
qualification.”
27. Observing that the scope of the relevant entries in the
Seventh Schedule of the Constitution has to be understood in the
manner as stated in Dr. Preeti Srivastava case, in State of T.N. and Anr.
v. S.V. Bratheep (minor) and Ors. (2004) 4 SCC 513, this Court held as
under:-
9. Entry 25 of List III and Entry 66 of List I have to be read
together and it cannot be read in such a manner as to form an
exclusivity in the matter of admission but if certain prescription
of standards have been made pursuant to Entry 66 of List I,
then those standards will prevail over the standards fixed by the
State in exercise of powers under Entry 25 of List III insofar as
they adversely affect the standards laid down by the Union of
India or any other authority functioning under it. Therefore,
what is to be seen in the present case is whether the
prescription of the standards made by the State Government is
in any way adverse to, or lower than, the standards fixed by
AICTE. It is no doubt true that AICTE prescribed two modes of
admission — one is merely dependent on the qualifying
examination and the other, dependent upon the marks obtained
at the common entrance test. The appellant in the present case
prescribed the qualification of having secured certain percentage
of marks in the related subjects which is higher than the
minimum in the qualifying examination in order to be eligible
for admission. If higher minimum is prescribed by the State
Government than what had been prescribed by AICTE, can it be
said that it is in any manner adverse to the standards fixed by
AICTE or reduces the standard fixed by it? In our opinion, it
does not. On the other hand, if we proceed on the basis that the
130
Page 131 norms fixed by AICTE would allow admission only on the basis
of the marks obtained in the qualifying examination, the
additional test made applicable is the common entrance test by
the State Government. If we proceed to take the standard fixed
by AICTE to be the common entrance test then the prescription
made by the State Government of having obtained certain
marks higher than the minimum in the qualifying examination
in order to be eligible to participate in the common entrance test
is in addition to the common entrance test. In either event, the
streams proposed by AICTE are not belittled in any manner. The
manner in which the High Court has proceeded is that what has
been prescribed by AICTE is inexorable and that that minimum
alone should be taken into consideration and no other standard
could be fixed even the higher as stated by this Court in Dr
Preeti Srivastava case (1999) 7 SCC 120. It is no doubt true, as
noticed by this Court in Adhiyaman case (1995) 4 SCC 104 that
there may be situations when a large number of seats may fall
vacant on account of the higher standards fixed. The standards
fixed should always be realistic which are attainable and are
within the reach of the candidates. It cannot be said that the
prescriptions by the State Government in addition to those of
AICTE in the present case are such which are not attainable or
which are not within the reach of the candidates who seek
admission for engineering colleges. It is not a very high
percentage of marks that has been prescribed as minimum of
60% downwards, but definitely higher than the mere pass
marks. Excellence in higher education is always insisted upon
by a series of decisions of this Court including Dr Preeti
Srivastava case (1999) 7 SCC 120. If higher minimum marks
have been prescribed, it would certainly add to the excellence in
the matter of admission of the students in higher education.
28. Another argument that has been putforth is that the power
to enact laws laying down process of admission in universities etc. vests
in both Central and State Governments under entry 25 of the
concurrent list only. Under entry 25 of concurrent list and erstwhile
entry 11 of State List, the State Government has enacted various
legislations that inter alia regulate admission process in various
institutions. For instance, Jawaharlal Nehru Krishi Vishwavidyalaya
131
Page 132 Adhiniyam, Rajiv Gandhi Prodyogiki Vishwavidyalaya Adhiniyam,
Rashtriya Vidhi Sansathan Vishwavidyalaya Adhiniyam etc. were
established by the State Government in exercise of power under entry
25 of concurrent list. Similarly, the Central Government has also
enacted various legislations relating to higher education under entry 25
of concurrent list pertaining to centrally funded universities such as
Babasaheb Bhimrao Ambedkar University Act 1994, Maulana Azad
National Urdu University Act, 1996, Indira Gandhi National Tribal
University Act, 2007 etc. Central Government may have the power to
regulate the admission process for centrally funded institutions like
IITs, NIT, JIPMER etc. but not in respect of other institutions running in
the State.
29. In view of the above discussion, it can be clearly laid down
power of Union under entry 66 of Union List is limited to prescribing
standards of higher education to bring about uniformity in the level of
education imparted throughout the country. Thus, the scope of entry
66 must be construed limited to its actual sense of ‘determining the
standards of higher education’ and not of laying down admission
process. In no case is the State denuded of its power to legislate under
Entry 25 of List III. More so, pertaining to the admission process in
universities imparting higher education.
132
Page 133 30. I have no hesitation in upholding the vires of the impugned
legislation which empowers the state government to regulate admission
process in institutions imparting higher education within the state. In
fact, the State being responsible for welfare and development of the
people of the State, ought to take necessary steps for welfare of its
student community. The field of ‘higher education’ being one such field
which directly affects the growth and development of the state, it
becomes prerogative of the State to take such steps which further the
welfare of the people and in particular pursuing higher education. In
fact, the State Government should be the sole entity to lay down the
procedure for admission and fee etc. governing the institutions running
in that particular state except the centrally funded institutions like IIT,
NIT etc. because no one can be a better judge of the requirements and
inequalities-in-opportunity of the people of a particular state than that
state itself. Only the State legislation can create equal level playing field
for the students who are coming out from the State Board and other
streams.
31. Whether the impugned legislation imposes reasonable
restriction under Article 19(6) of the Constitution of India on the
fundamental rights of the Unaided Private Educational Institutions in its
“Right to Occupation” under Article 19(1) (g): In T.M.A. Pai case, eleven-
133
Page 134 Judge Bench in paras (20) and (25) held that running of an educational
institution was an occupation within the meaning of Article 19(1)(g) and
that the right to establish and administer an educational institution is
guaranteed to all the citizens under Article 19(1)(g) of the Constitution of
India and to minorities specifically under Articles 26 and 30 of the
Constitution of India. These rights to establish an educational
institution also stand affirmed in P.A. Inamdar.
32. Object of the Act 2007 is “…to provide for the regulation of
admission and fixation of fee in private professional educational
institutions in the State of Madhya Pradesh…”. Section 6 of the Act 2007
provides that admission to sanctioned intake in private unaided
professional educational institution shall be on the basis of common
entrance test in such manner as may be prescribed by the State
Government. In Section 3(d) ‘common entrance test’ has been defined to
mean an entrance test conducted for determination of the merit of the
candidates followed by centralized counselling based on merit to
professional colleges or institutions through a single window procedure
by the State Government or by any agency authorized by it.
33. Contention of the appellants is that Section 6 read with
Section 3(d) of the Act, 2007 creates a monopoly in favour of the State in
the matter of conducting common entrance test and that it directly
134
Page 135 encroaches upon the fundamental right of private unaided educational
institutions under Article 19(1)(g) of the Constitution of India. It is
further submitted that as held in para (137) of P.A. Inamdar case only if
the admission procedure adopted by the private institutions or a group
of institutions fails to satisfy the triple test of fairness, transparency and
non-exploitativeness, can the State take over the admission procedure
by substituting its own procedure; but by the impugned provision in
Section 6 and Section 3(d) of the Act, 2007 even in the absence of any
material to show that the entrance test conducted by the private
unaided institution failed to satisfy the triple test, the State had taken
over the admission procedure. Much emphasis was also laid upon para
(65) of T.M.A. Pai case to contend that private educational institutions
have the right to select students and a common entrance test by the
State decimates the right of autonomy of the private educational
institutions which amounts to an unreasonable restriction and the same
is liable to be struck down.
34. The claim of absolute ‘right to occupation’ which the
appellants have raised on the basis of T.M.A. Pai, P.A. Inamdar cases is
not sustainable. In T.M.A. Pai and P.A. Inamdar, no unfettered right was
granted to private unaided educational institutions to carry on trade
and business without being restricted by statutory regulations enacted
135
Page 136 by the competent legislature. A fundamental right is not without
measure of control and it will always be subject to reasonable restriction
which the State is duty bound to impose in the larger public interest. In
Sreenivasa General Traders and Ors. v. State of Andhra Pradesh and
Ors. (1983) 4 SCC 353, it was held as under:-
“17. The fundamental right of all citizens to practise any
profession or to carry on any occupation or trade or business
guaranteed under Article 19(1)(g) has its own limitations. The
liberty of an individual to do as he pleases is not absolute. It
must yield to the common good. Absolute or unrestricted
individual rights do not and cannot exist in any modern State.
There is no protection of the rights themselves unless there is a
measure of control and regulation of the rights of each
individual in the interests of all.”
35. M.P. Act 2007 was enacted for “the regulation of admission
and fixation of fee in private professional educational institutions in the
State of Madhya Pradesh and to provide for reservation of seats to
persons belonging to the Scheduled Castes, the Scheduled Tribes and
Other Backward Classes”. Act 2007 is thus in furtherance of the
constitutional obligation imposed upon the State to ensure equality of
opportunity in admission to meritorious candidates who seek to pursue
the medical education. Act 2007 enables the State to conduct common
entrance test in the interest of securing higher standards of medical
education so that quality doctors are trained leading to advancement in
health sector of the nation. Point to be considered is whether the
common entrance test to be conducted by the State Government or any
136
Page 137 agency authorized by it amounts to a reasonable restriction.
36. From time to time, it has been held that ‘in the interests of
the general public’, the State would be justified in imposing reasonable
restriction, even if it affects the interests of particular individuals, or
even causes hardship to particular individuals owing to the peculiar
conditions in which they are placed. Reference can be made to the
decision of this Court in Narendra Kumar & Ors. v. Union of India & Ors.
AIR 1960 SC 430, wherein it was held as under:-
“15. It is clear that in the following three cases viz. Chintaman
Rao (1950) 1 SCR 759, Cooverjee AIR 1954 SC 220 and Madhya
Bharat Association Ltd. AIR 1954 SC 634, the Court considered
the real question to be whether the interference with the
fundamental right was “reasonable” or not in the interests of the
general public and that if the answer to the question was in the
affirmative, the law would be valid and it would be invalid if the
test of reasonableness was not passed. Prohibition was in all
these cases treated as only a kind of “restriction”.
……..
18. In applying the test of reasonableness, the Court has to
consider the question in the background of the facts and
circumstances under which the order was made, taking into
account the nature of the evil that was sought to be remedied by
such law, the ratio of the harm caused to individual citizens by
the proposed remedy, to the beneficial effect reasonably
expected to result to the general public. It will also be necessary
to consider in that connection whether the restraint caused by
the law is more than was necessary in the interests of the
general public.”
37. While determining the reasonableness of the restrictions
imposed by the State on the ‘freedom of occupation’ guaranteed by
Article 19(1)(g), the principles which can be taken into account were
137
Page 138 summed up by this Court in M.R.F. Ltd. v. Inspector, Kerala Government
and Ors., (1998) 8 SCC 227, in the following relevant extraction:-
“On a conspectus of various decisions of this Court, the
following principles are clearly discernible:
(1) While considering the reasonableness of the
restrictions, the court has to keep in mind the Directive
Principles of State Policy.
(2) Restrictions must not be arbitrary or of an
excessive nature so as to go beyond the requirement of the
interest of the general public.
(3) In order to judge the reasonableness of the
restrictions, no abstract or general pattern or a fixed
principle can be laid down so as to be of universal
application and the same will vary from case to case as also
with regard to changing conditions, values of human life,
social philosophy of the Constitution, prevailing conditions
and the surrounding circumstances.
(4) A just balance has to be struck between the
restrictions imposed and the social control envisaged by
clause (6) of Article 19.
(5) Prevailing social values as also social needs which
are intended to be satisfied by restrictions have to be borne
in mind. (See: State of U.P. v. Kaushailiya AIR 1964 SC
416.)
(6) There must be a direct and proximate nexus or a
reasonable connection between the restrictions imposed
and the object sought to be achieved. If there is a direct
nexus between the restrictions and the object of the Act,
then a strong presumption in favour of the constitutionality
of the Act will naturally arise. (See: Kavalappara Kottarathil
Kochuni v. States of Madras and Kerala AIR 1960 SC 1080;
O.K. Ghosh v. E.X. Joseph AIR 1963 SC 812.)”
A similar view was also expressed in State of Madras v. V.G. Row, AIR
1952 SC 196 and K.K. Kochuni v. State of Madras and Kerala, AIR 1960
SC 1080.
38. In T.M.A. Pai, while this Court acknowledged ‘right to
occupation’ of private educational institutions as guaranteed under
138
Page 139 Article 19(1)(g) of the Constitution of India, in para (54), this Court laid
down general law pertaining to the authority of State Government to
impose regulatory means in respect of private aided and unaided
educational institutions, which reads as under:-
“54. The right to establish an educational institution can be
regulated; but such regulatory measures must, in general, be
to ensure the maintenance of proper academic standards,
atmosphere and infrastructure (including qualified staff) and
the prevention of maladministration by those in charge of
management. The fixing of a rigid fee structure, dictating the
formation and composition of a governing body, compulsory
nomination of teachers and staff for appointment or
nominating students for admissions would be unacceptable
restrictions.”
39. In T.M.A. Pai, in paras (58) and (59), the Constitution Bench
reiterated that for seeking admission into the professional educational
institutions, merit plays an important role and held as under:-
“58. For admission into any professional institution, merit
must play an important role. While it may not be normally
possible to judge the merit of the applicant who seeks
admission into a school, while seeking admission to a
professional institution and to become a competent
professional, it is necessary that meritorious candidates are
not unfairly treated or put at a disadvantage by preferences
shown to less meritorious but more influential applicants.
Excellence in professional education would require that
greater emphasis be laid on the merit of a student seeking
admission. Appropriate regulations for this purpose may be
made keeping in view the other observations made in this
judgment in the context of admissions to unaided
institutions.
59. Merit is usually determined, for admission to professional
and higher education colleges, by either the marks that the
student obtains at the qualifying examination or school-
leaving certificate stage followed by the interview, or by a
139
Page 140 common entrance test conducted by the institution, or in the
case of professional colleges, by government agencies.”
40. In order to clarify the doubts/anomalies in T.M.A. Pai,
Constitution Bench was constituted in Islamic Academy of Education
wherein this Court reiterated that admission to professional colleges
should be based on merit by a common entrance test conducted by
government agencies. Furthermore, in exercise of power under Article
142, this Court directed setting up of two committees headed by a
retired High Court Judge nominated by the Chief Justice of the State to
oversee the entrance test conducted by the association and also to
approve the fee structure proposed by the institute. In paras (19) and
(20) of the said judgment, it was held as under:-
“19. We now direct that the respective State Governments do
appoint a permanent Committee which will ensure that the tests
conducted by the association of colleges is fair and transparent.
For each State a separate Committee shall be formed. The
Committee would be headed by a retired Judge of the High
Court. The Judge is to be nominated by the Chief Justice of that
State.….The Committee shall have powers to oversee the tests to
be conducted by the association. This would include the power
to call for the proposed question paper(s), to know the names of
the paper-setters and examiners and to check the method
adopted to ensure papers are not leaked. The Committee shall
supervise and ensure that the test is conducted in a fair and
transparent manner. The Committee shall have the power to
permit an institution, which has been established and which
has been permitted to adopt its own admission procedure for the
last, at least, 25 years, to adopt its own admission procedure
and if the Committee feels that the needs of such an institute
are genuine, to admit, students of their community, in excess of
the quota allotted to them by the State Government…..It is also
clarified that no institute, which has not been established and
which has not followed its own admission procedure for the last,
140
Page 141 at least, 25 years, shall be permitted to apply for or be granted
exemption from admitting students in the manner set out
hereinabove.
20. Our direction for setting up two sets of Committees in the
States has been passed under Article 142 of the Constitution of
India which shall remain in force till appropriate legislation is
enacted by Parliament. The expenses incurred on the setting up
of such Committees shall be borne by each State. The
infrastructural needs and provision for allowance and
remuneration of the Chairman and other members of the
Committee shall also be borne by the respective State
Government.”
41. In P.A. Inamdar, this Court observed that there has to be one
common entrance examination to be conducted by the State
Government or by the competent authority appointed by the State
Government in case more than one university exist in the State and in
para (136) of the judgment held as under:-
“136. Whether minority or non-minority institutions, there may
be more than one similarly situated institutions imparting
education in any one discipline, in any State. The same
aspirant seeking admission to take education in any one
discipline of education shall have to purchase admission forms
from several institutions and appear at several admission tests
conducted at different places on the same or different dates and
there may be a clash of dates. If the same candidate is required
to appear in several tests, he would be subjected to
unnecessary and avoidable expenditure and inconvenience.
There is nothing wrong in an entrance test being held for one
group of institutions imparting same or similar education. Such
institutions situated in one State or in more than one State
may join together and hold a common entrance test or the
State may itself or through an agency arrange for holding of
such test. Out of such common merit list the successful
candidates can be identified and chosen for being allotted to
different institutions depending on the courses of study offered,
the number of seats, the kind of minority to which the
institution belongs and other relevant factors. Such an agency
conducting the common entrance test (“CET” for short) must be
141
Page 142 one enjoying utmost credibility and expertise in the matter.
This would better ensure the fulfilment of twin objects of
transparency and merit. CET is necessary in the interest of
achieving the said objectives and also for saving the student
community from harassment and exploitation. Holding of such
common entrance test followed by centralised counselling or, in
other words, single-window system regulating admissions does
not cause any dent in the right of minority unaided educational
institutions to admit students of their choice. Such choice can
be exercised from out of the list of successful candidates
prepared at CET without altering the order of merit inter se of
the students so chosen.”
42. In para (138), it was further held that having regard to the
larger interest and welfare of the student community, it would be
permissible to regulate the admissions by providing a centralized and
single-window procedure. Para (138) reads as under:-
“138. It needs to be specifically stated that having regard to the
larger interest and welfare of the student community to
promote merit, achieve excellence and curb malpractices, it
would be permissible to regulate admissions by providing a
centralised and single-window procedure. Such a procedure, to
a large extent, can secure grant of merit-based admissions on a
transparent basis. Till regulations are framed, the Admission
Committees can oversee admissions so as to ensure that merit
is not the casualty.”
43. Affirming the view taken in Islamic Academy on constitution
of two committees and the responsibilities of the State Governments to
come out with a well-thought out legislation on the subject, it was held
in P.A. Inamdar in paras (144) and (155) as under:-
“144. The two Committees for monitoring admission procedure
and determining fee structure in the judgment of Islamic
Academy (2003) 6 SCC 697, are in our view, permissible as
regulatory measures aimed at protecting the interest of the
student community as a whole as also the minorities
142
Page 143 themselves, in maintaining required standards of professional
education on non-exploitative terms in their institutions. Legal
provisions made by the State Legislatures or the scheme evolved
by the Court for monitoring admission procedure and fee
fixation do not violate the right of minorities under Article 30(1)
or the right of minorities and non-minorities under Article 19(1)
(g). They are reasonable restrictions in the interest of minority
institutions permissible under Article 30(1) and in the interest of
general public under Article 19(6) of the Constitution.
155. It is for the Central Government, or for the State
Governments, in the absence of a Central legislation, to come
out with a detailed well-thought-out legislation on the subject.
Such a legislation is long awaited. The States must act towards
this direction. The judicial wing of the State is called upon to act
when the other two wings, the legislature and the executive, do
not act. The earlier the Union of India and the State
Governments act, the better it would be. The Committees
regulating admission procedure and fee structure shall continue
to exist, but only as a temporary measure and an inevitable
passing phase until the Central Government or the State
Governments are able to devise a suitable mechanism and
appoint a competent authority in consonance with the
observations made hereinabove. Needless to say, any decision
taken by such Committees and by the Central or the State
Governments, shall be open to judicial review in accordance
with the settled parameters for the exercise of such jurisdiction.”
44. In para (155) of P.A. Inamdar, as quoted above, State
Governments have been directed to frame a detailed well-thought out
legislation on the subject with a further observation that any decision
taken by the Committees and by the Central or State Governments shall
be open to judicial review in accordance with the settled parameters for
the exercise of such jurisdiction. The impugned legislation-Act 2007
has thus been enacted in compliance with the directions issued by this
Court in T.M.A. Pai, Islamic Academy and P.A. Inamdar with a view to
143
Page 144 ensure fairness and transparency in the admissions process.
45. Common entrance test-single window system which regulates
admission to unaided private professional educational institutions does
not cause any dent in the fundamental rights of those institutions: In
T.M.A. Pai and P.A. Inamdar, this Court categorically held that
admission to professional courses must be on the basis of merit. The
word ‘merit’ is word of Latin origin, deriving roots from meritum,
meaning ‘due reward’ and mereri meaning ‘earn, deserve’. Concise
Oxford English Dictionary (11
th
Edn) defines ‘merit’ as ‘excellence;
worth’. P. Ramanatha Aiyar’s Advanced Law Lexicon (3
rd
Edn.) on the
topic of merit makes mention of Guman Singh v. State of Rajasthan
(1971) 2 SCC 452, wherein it was observed as under:-
“…merit is a sum total of various qualities and attributes of an
employee such as his academic qualifications, his distinction in
the university, his character, integrity, devotion to duty and the
manner in which he discharges his official duties. Allied to this
may be various other matters, or factors, such as his
punctuality in work, the quality and out-turn of work done by
him and the manner of his dealings with his superiors and
subordinates officers and the general public, his rank in the
service and annual confidential report. All these and other
factors may have to be taken into account in assessing the
merit.”
Additionally, in Dr. Pradeep Jain and Ors. v. Union of India and Ors.,
(1984) 3 SCC 654, it was held as under:-
“…Merit consists of a high degree of intelligence coupled with a
keen and incisive mind, sound knowledge of the basic subjects
and infinite capacity for hard work and also calls for a sense of
144
Page 145 social commitment and dedication to the cause of the poor.”
46. It is well known that study of medicine is much sought after
by students in India. Due to the high demand for admission in Medical
Colleges and limited number of seats, selection and/or screening
methods have evolved to select the crème de la crème. Given the surfeit
of academically well-qualified applicants, the selection method ought to
become highly competitive by placing exceptionally high academic
thresholds. It is in this context that ‘merit’ comes into play in
determining the parameters for admissions in institutions of higher
education.
47. Merit is the cumulative assessment of worth of any individual
based on different screening methods. Ideally, there should be one
common entrance test conducted by the State both for government
colleges and for private unaided educational institutions to ensure
efficacy, fairness and public confidence. As rightly contended by Mr.
Purushaindra Kaurav, Addl. Advocate General for the State of Madhya
Pradesh appearing for AFRC, a common entrance test conducted by the
State is more advantageous viz.:- (i) having adhered to the time schedule
as laid down in Mridul Dhar case (2005) 2 SCC 65; (ii) multiple centres of
examination and counselling throughout the State and a single window
system for admission; (iii) standard question papers, preservation of
145
Page 146 question papers and answer books, prevention of leakage of question
papers and fair evaluation and (iv) minimal litigation. That apart,
procedure for preparation of merit list, counselling and allotments to
various colleges is subject to Right to Information Act and thus ensures
fairness and transparency in the entire process.
48. Having regard to the prevailing conditions relating to
admissions in private professional educational institutions in the State
of Madhya Pradesh, the Legislature in its wisdom has taken the view
that merit based admissions can be ensured only through a common
entrance test followed by centralized counselling either by the State or
by an agency authorized by the State. In order to ensure rights of the
applicants aspiring for medical courses under Articles 14, 15 and 16 of
the Constitution of India, legislature by the impugned legislation
introduced the system of Common Entrance Test (CET) to secure merit
based admission on a transparent basis. If private unaided educational
institutions are given unfettered right to devise their own admission
procedure and fee structure, it would lead to situation where it would
impinge upon the “right to equality” of the students who aspire to take
admissions in such educational institutions. Common Entrance Test by
State or its agency will ensure equal opportunity to all meritorious and
suitable candidates and meritorious candidates can be identified for
146
Page 147 being allotted to different institutions depending on the courses of
study, the number of seats and other relevant factors. This would
ensure twin objects:- (i) fairness and transparency and (ii) merit apart
from preventing mal-administration. Thus, having regard to the larger
interest and welfare of the student community to promote merit and
achieve excellence and curb mal-practices, it would be permissible for
the State to regulate admissions by providing a centralized and single
window procedure. Holding such CET followed by centralized
counselling or single window system regulating admissions does not
cause any dent on the fundamental rights of the institutions in running
the institution. While private educational institutions have a ‘right of
occupation’ in running the educational institutions, equally they have
the responsibility of selecting meritorious and suitable candidates, in
order to bring out professionals with excellence. Rights of private
educational institutions have to yield to the larger interest of the
community.
49. By holding common entrance test and identifying meritorious
candidates, the State is merely providing the merit list of the candidates
prepared on the basis of a fair common entrance test. If the screening
test is conducted on merit basis, no loss will be caused to the private
educational institutions. There is neither restriction on the entry of the
147
Page 148 students in the sanctioned intake of the institutions nor on their right to
collect fees from the students. The freedom of private educational
institutions to establish and run institution, impart education, recruit
staff, take disciplinary action, admit students, participate in fixation of
fees is in no way being abridged by the impugned legislation; it remains
intact.
50. While considering the reasonableness of the restriction, the
court has to keep in mind the Directive Principles of State Policy: For
deciding the constitutional validity of any statute or executive order or
considering the reasonableness of a restriction cast by the law on the
exercise of any fundamental right, the court has to keep in mind the
Directive Principles of State Policy. A law or measure designed for
promoting or having the effect of advancing directive principles is per se
reasonable and in public interest. The State has a duty to balance the
direct impact on the fundamental right of individuals as against the
greater public or social interest. In State of Bombay and Anr. v. F.N.
Balsara [1951] SCR 682, a Constitution Bench of this Court held that in
judging the reasonableness of the restriction imposed on the
fundamental right, one has to bear in mind the Directive Principles of
State Policy set forth in Part IV of the Constitution, while examining the
challenge to the constitutional validity of law by reference to Article
148
Page 149 19(1)(g) of the Constitution. In State of Gujarat v. Mirzapur Moti Kureshi
Kassab Jamat and Ors. (2005) 8 SCC 534, this Court held that ban on
slaughter of cow progeny is not a prohibition but only a reasonable
restriction. A seven-Judge Bench of this Court in para (41) held as
under:-
“41. The message of Kesavananda Bharati (1973) 4 SCC 225 is
clear. The interest of a citizen or section of a community,
howsoever important, is secondary to the interest of the country
or community as a whole. For judging the reasonability of
restrictions imposed on fundamental rights the relevant
considerations are not only those as stated in Article 19 itself or
in Part III of the Constitution: the directive principles stated in
Part IV are also relevant. Changing factual conditions and State
policy, including the one reflected in the impugned enactment,
have to be considered and given weightage to by the courts
while deciding the constitutional validity of legislative
enactments. A restriction placed on any fundamental right,
aimed at securing directive principles will be held as reasonable
and hence intra vires subject to two limitations: first, that it
does not run in clear conflict with the fundamental right, and
secondly, that it has been enacted within the legislative
competence of the enacting legislature under Part XI Chapter I
of the Constitution.”
51. It is the obligation of the State under the Constitution to
ensure the creation of conditions necessary for good health including
provisions for basic curative and preventive health services and
assurance of healthy living and working conditions. Under Articles
39(e), 39(f) and 42 of the Constitution, obligations are cast on the State
to ensure health and strength of workers, men and women; ensure
children are given opportunities & facilities to develop in a healthy
149
Page 150 manner and to secure just & humane conditions of work and for
maternity relief, respectively. Article 47 of the Constitution makes
improvement of public health a primary duty of the State. However,
right to health is no longer in the sole domain of Part IV of the
Constitution. In Kirloskar Brothers Ltd. v. Employees’ State Insurance
Corp. (1996) 2 SCC 682, it was held that right to health is a
fundamental right of workers and the maintenance of health is most
imperative constitutional goal whose realization requires interaction of
many social and economic factors. In Rajasthan Pradesh Vaidya Samiti,
Sardarshahar and another v. Union of India and others (2010) 12 SCC
609, this Court held that the citizens of this country have a right under
Article 21 of the Constitution of India which includes the protection and
safeguarding the health and life of public from mal-medical treatment.
More recently in Centre for Public Interest Litigation v. Union of India
(2013) 9 SCR 1103, again this Court has recognized that right to life
under Article 21 includes right to health.
52. Maintenance and improvement of public health and to
provide health care and medical services is the constitutional obligation
of the State. To discharge this constitutional obligation, the State must
have the doctors with professional excellence and commitment who are
ready to give medical advice and services to the public at large. State
150
Page 151 can satisfactorily discharge its constitutional obligation only when the
aspiring students enter into the profession based on merit. None of
these lofty ideals can be achieved without having good and committed
medical professionals.
53. Fundamental Rights of private unaided professional colleges
must yield to public interest and rights of the students at large: Right to
be treated fairly and to get admission through a non-arbitrary, non-
discriminatory, fair and transparent procedure is a fundamental right of
the students under Article 14. Any law which creates an artificial
classification between private unaided institutions and other
institutions and creates a disparity in the matter of admission whereby
a meritorious student could be denied admission to pursue higher
education in a private unaided institution solely because such
institution has an unfettered right to choose its own students without
following a uniform and transparent admission procedure would be
violative of the rights of the aspiring students guaranteed under Article
14. Right of the students to admission in private unaided medical
colleges is a right of equality in opportunity. On many occasions, this
has led to a conflict between fundamental rights of private educational
institutions on the one hand and the rights of students and public at
large on the other. However, the law is now settled. In such cases where
151
Page 152 there is a conflict between fundamental right of two parties, this Court
in para (59) in Sharda v. Dharmpal (2003) 4 SCC 493 held that only that
right which would advance public morality or public interest would
prevail. In para (39) in Kureshi Kassab case (supra), this Court held
that when a fundamental right clashes with the larger interest of
society, it must yield to the latter. The interest of citizens or section of
community, howsoever important, is secondary to the interest of the
nation public at large and of the right of the students to avail
opportunity of merit-based admission in professional unaided
educational institutions would advance the public interest and as such
the rights of the students would prevail over the rights of the private
unaided professional educational institutions.
54. Re-contention: No material to show that the private unaided
professional educational institutions failed in triple test-fairness,
transparency and non-exploitativeness: In para (137) of the judgment in
P.A. Inamdar, this Court has observed that if the admission procedure
adopted by private institutions fails to satisfy all or any of the triple test,
then admission procedure can be taken over by the State substituting
its own procedure and not otherwise. Contention of the appellants is
that there is absolutely no material to show that private educational
institutions were not able to ensure a fair, transparent and non-
152
Page 153 exploitative admission procedure and that the impugned legislation
empowering the State or agency nominated by it to conduct common
entrance test is in violation of the directions of this Court. In so far as
this contention, High Court has observed thus:-
“…Sufficient materials have been filed before us by the
respondents to show that prior to the enactment of the Act
2007, this Court as well as the committee constituted as per the
orders of the Supreme Court in Islamic Academy of Education
(supra) had to enquire into complaints of mal-practice in
admissions in private professional educational institutions and
after finding the complaints to be true, directed the institutions
to give admission to the aggrieved students in the next academic
sessions and this would show that the private professional
educational institutions were not able to ensure a fair,
transparent and non-exploitative admission procedure before
Act, 2007 was enacted….”
55. Our attention was drawn to the advertisement of DMAT 2006
for admission in MBBS/BDS course in the private colleges in Madhya
Pradesh scheduled to be conducted on 16.07.2006 and number of writ
petitions filed by the students pertaining to DMAT 2006. It was
submitted that in W.P. (C) No. 1796 of 2006, High Court stayed DMAT
2006 and directed the State to appoint a committee as per Islamic
Academy of Education and the committee managing DMAT cancelled
DMAT 2006. Having regard to the number of complaints and litigations,
High Court was right in observing that sufficient materials had been
placed before it to show that prior to enactment of Act 2007, the High
Court as well as the committee had to enquire into the complaints of
153
Page 154 mal-practice in admissions. It is not a case of no materials, where state
would not be justified in taking over the admission procedure.
56. Learned Senior Counsel for the respondents submitted that
the State Government had filed complaints before the AFRC against
some of private colleges and criminal proceedings had also been
initiated against unaided private professional institutions at the behest
of the students alleging irregularities and mal-practices. Our attention
is drawn to the alleged violation of the order of this Court in Priya Gupta
v. State of Chhattisgarh and Ors. (2012) 7 SCC 433, as per which it was
made mandatory for each college and university to inform the State and
the competent authority of the seats which are lying vacant after each
counselling and they shall furnish the complete details, list of seats fell
vacant in the respective States immediately after each counselling. Ms.
Vibha Dutta Makhija, learned Senior Counsel appearing for the State of
Madhya Pradesh and Mr. Purushaindra Kaurav learned AAG appearing
for AFRC have submitted that inspite of requests, the private colleges
deliberately did not report vacant seats under the State quota after each
round of counselling even after the admission procedure was complete
and in this context have relied on a number of letters (Annexure A-14 to
I.A. 83/2015) addressed to the private colleges by Director of Medical
Education, Madhya Pradesh. It was submitted that in the year 2013-
154
Page 155 2014 there were about 300 irregular admissions in MBBS course by
private medical colleges on the State quota and on the alleged violation,
AFRC imposed a fine of Rs.13.10 crores on various private colleges.
This was later affirmed by the appellate authority (Annexure A-17 to I.A.
83/2015). The order affirming the fine is the subject matter of writ
petitions pending before the High Court and I do not propose to go into
the merits of this aspect. Suffice it to note that there are prima facie
materials to indicate that the private unaided professional educational
institutions have not passed triple test as laid down in P.A. Inamdar. In
this factual background, it does not seem inappropriate on the part of
the State to come up with the Act 2007 which lays down a mechanism
for conducting common entrance test in order to ensure merit based
admission in the private institutions.
57. Whether the provisions of Act 2007 regarding determination
of fees are violative of ‘right to occupation’ of private educational
institutions: As stated earlier, the object of Madhya Pradesh Act 2007 is
to “provide for the regulation of admission and fixation of fee in private
professional educational institutions in the State of Madhya Pradesh and
to provide for reservation of seats to persons belonging to Scheduled
Castes, the Scheduled Tribes and Other Backward Classes in
professional educational institutions and the matters connected therewith
155
Page 156 or incidental thereto”. The Act authorizes the State to fix the fees to be
charged by the private educational institutions, while taking relevant
factors into consideration and also after ensuring an opportunity of
being heard to the private educational institutions.
58. As per Section 3(e), ‘fee’ means all fees including tuition fee
and development charges. Section 4 of the Act deals with constitution
and functions of the Committee. As per Section 4(1), Committee is
constituted for supervision and guidance of the admission process and
for the fixation of the fees to be charged by private educational
institutions. Section 9 deals with factors to be taken into consideration
by the Committee for determination of fee that may be charged by
private educational institutions. Section 9 reads as under:-
9. Factors:
(1) Having regard to:
(i) the location of the private unaided professional
educational institution;
(ii) the nature of the professional course;
(iii)the cost of land and building;
(iv)the available infrastructure, teaching, non-teaching staff
and equipment;
(v)the expenditure on administration and maintenance;
(vi) a reasonable surplus required for growth and development
of the professional institution;
(vii)any other relevant factor,
the committee shall determine, in the manner prescribed, the
fee to be charged by a private unaided professional
educational institution.
(2) The Committee shall give the institution an opportunity of
being heard before fixing any fee:
Provided that no such fees, as may be fixed by the Committee,
shall amount to profiteering or comercialisation of education.”
156
Page 157 59. Various factors indicated in Section 9 including reasonable
surplus required for growth and development of the institution and
other relevant factors for imparting professional education have to be
considered by the committee. Furthermore, in terms of Sections 4(8)
and 9(2), before fixing the fee, the committee ought to afford an
opportunity of being heard to the institutions which may furnish the
necessary information. This ensures that private unaided educational
institutions can putforth their legitimate claims pertaining to fees which
is to be charged from the students admitted in these institutions.
Though Section 9 empowers the committee to determine the fee, the
High Court read down Sections 4(1), 4(8) and Section 9 of Act 2007
holding that those provisions “in substance empower the committee to be
only satisfied that the fee proposed by a private professional educational
institutions did not amount to profiteering or commercialization of
education and was based on the factors mentioned in Section 9(1) of the
Act 2007…”.
60. Contention of the appellants is that Sections 4(1), 4(8) and
Section 9 relating to fixation of fees in the Act 2007 are violative of their
right to occupation” guaranteed under Article 19(1)(g) of the Constitution
of India. It is submitted that when eleven-Judge Bench of this Court in
T.M.A. Pai held that “…The decision on the fee to be charged must
157
Page 158 necessarily be left to the private educational institution that does not seek
or is not dependent upon any funds from the Government.”, then private
institutions have an indefeasible right to fix their own fee structure and
there is no occasion for the Government to enact such legislation
empowering the committee to determine the fees to be charged.
61. Drawing our attention to para (39) of T.M.A. Pai, it has also
been contended that T.M.A. Pai recognizes the importance of private
unaided educational institutions by citing figures as to how numbers of
government colleges have remained stagnant whereas numbers of
private educational institutions have increased. It was submitted that
as the eleven-Judge Bench recognised the right of private educational
institutions to admit students and determine their own fee structure,
the right of private unaided institutions to charge their own fees cannot
be curtailed by the impugned legislation and therefore Sections 4(1), 4(8)
and Section 9 of Act 2007 are liable to be struck down.
62. Per contra, learned counsel for the respondents submitted
that relevant provisions of the Act empowering the committee to
determine the fee that are only to ensure that the fees charged are not
exorbitant and such regulation are not an impediment to the exercise of
“right to occupation” of the private unaided educational institutions. It
was submitted that the High Court has read down Sections 4(1), 4(8)
158
Page 159 and 9 of the Act 2007 by holding that the committee need only be
satisfied that the fee proposed by a professional educational institution
did not amount to profiteering by keeping in view the factors laid down
in Section 9 of the Act. The question falling for consideration is whether
and to what extent the State can impose restrictions vis-à-vis the fee
structure of private unaided professional educational institutions.
63. Article 41 of the Constitution contemplates that “The State
shall, within the limits of its economic capacity and development, make
effective provisions for securing the right to work, to education……”
Article 41 does not prescribe an age group for which this right is to be
secured. Primary objective of the State as laid down in Article 41 is to
ensure that quality higher education is imparted by educational
institutions and to ensure excellence in it. Act 2007 is in furtherance of
the constitutional obligation imposed upon the State in the form of
Directive Principles of State Policy.
64. The words “the state shall within the limits of its economic
capacity…” in Article 41 empowers the State to permit private
educational institutions to be established and administer themselves.
The hard reality is that private educational institutions are a necessity
in the present day context and T.M.A. Pai, in para (39) has recognized
this importance of private unaided educational institutions. Para (39)
159
Page 160 reads as under:-
“39. That private educational institutions are a necessity
becomes evident from the fact that the number of government-
maintained professional colleges has more or less remained
stationary, while more private institutions have been
established. For example, in the State of Karnataka there are 19
medical colleges out of which there are only 4 government-
maintained medical colleges. Similarly, out of 14 dental colleges
in Karnataka, only one has been established by the
Government, while in the same State, out of 51 engineering
colleges, only 12 have been established by the Government. The
aforesaid figures clearly indicate the important role played by
private unaided educational institutions, both minority and non-
minority, which cater to the needs of students seeking
professional education.”
65. Observing that education has been a business for a long
time, in Modern School v. Union of India and Ors. (2004) 5 SCC 583, in
paras (3) to (5), this Court has held as under:-
“3. In modern times, all over the world, education is big
business. On 18-6-1996, Professor G. Roberts, Chairman of the
Committee of Vice-Chancellors and Principals commented:
“The annual turnover of the higher education sector has
now passed the £ 10 billion mark. The massive increase in
participation that has led to this figure, and the need to
prepare for further increases, now demands that we make
revolutionary advances, in the way we structure, manage
and fund higher education.”
4. In the book titled Higher Education Law (2nd Edn.) by
David Palfreyman and David Warner, it is stated that in modern
times, all over the world, education is big business. On account
of consumerism, students all over the world are restless. That
schools in private sector which charge fees may be charitable
provided they are not run as profit-making ventures. That
educational charity must be established for the benefit of the
public rather than for the benefit of the individuals. That while
individuals may derive benefits from an educational charity, the
main purpose of the charity must be for the benefit of the
public.
160
Page 161 5. At the outset, we hasten to clarify that although we are in
agreement with the authors, quoted above, we do not wish to
generalise and in the Indian context we may state that there are
good schools which even today run keeping in mind laudable
charitable objects.”
66. Furthermore, in para (61) of T.M.A. Pai, this Court inter alia
was of the view that the standards maintained by the private
educational institutions are higher and it is in the interest of general
public that more quality education institutions are established and such
educational institutions shall have the right to admission of the
students and fee to be charged. However, para (69) of T.M.A. Pai held
private educational institutions were not entitled to charge capitation
fee. Para (69) reads as under:-
“69. In such professional unaided institutions, the management
will have the right to select teachers as per the qualifications
and eligibility conditions laid down by the State/university
subject to adoption of a rational procedure of selection. A
rational fee structure should be adopted by the management,
which would not be entitled to charge a capitation fee.
Appropriate machinery can be devised by the State or university
to ensure that no capitation fee is charged and that there is no
profiteering, though a reasonable surplus for the furtherance of
education is permissible. Conditions granting recognition or
affiliation can broadly cover academic and educational matters
including the welfare of students and teachers.”
67. In order to expound the aforesaid position, in Islamic
Academy of Education, the first question that came up for consideration
was whether private unaided educational institutions are entitled to fix
their own fee structure. This Court in order to harmonize the plea of
161
Page 162 private educational institutions to earn a reasonable surplus and with
the aim of preventing commercialization of education, directed the State
to set up a committee headed by a retired High Court Judge to approve
the fee structure or propose some other fee which can be charged by the
institute. In para (7) of Islamic Academy of Education this Court
directed as under:-
“7. ….we direct that in order to give effect to the judgment in
T.M.A. Pai case the respective State Governments/concerned
authority shall set up, in each State, a committee headed by a
retired High Court Judge who shall be nominated by the Chief
Justice of that State…… The Committee shall then decide
whether the fees proposed by that institute are justified and are
not profiteering or charging capitation fee. The Committee will
be at liberty to approve the fee structure or to propose some
other fee which can be charged by the institute. The fee fixed by
the Committee shall be binding for a period of three years, at the
end of which period the institute would be at liberty to apply for
revision...”
68. Referring to paras (69) and (70) of T.M.A. Pai and reiterating
that fee charged by private educational institutions should not amount
to profiteering, in P.A. Inamdar case, it was held as under:-
“129. In Pai Foundation, it has been very clearly held at several
places that unaided professional institutions should be given
greater autonomy in determination of admission procedure and
fee structure. State regulation should be minimal and only with
a view to maintain fairness and transparency in admission
procedure and to check exploitation of the students by charging
exorbitant money or capitation fees.
139. To set up a reasonable fee structure is also a component
of “the right to establish and administer an institution” within
the meaning of Article 30(1) of the Constitution, as per the law
declared in Pai Foundation. Every institution is free to devise its
own fee structure subject to the limitation that there can be no
162
Page 163 profiteering and no capitation fee can be charged directly or
indirectly, or in any form (paras 56 to 58 and 161 [answer to
Question 5(c)] of Pai Foundation are relevant in this regard).
Capitation fees
140. Capitation fee cannot be permitted to be charged and no
seat can be permitted to be appropriated by payment of
capitation fee. “Profession” has to be distinguished from
“business” or a mere “occupation”. While in business, and to a
certain extent in occupation, there is a profit motive, profession
is primarily a service to society wherein earning is secondary or
incidental. A student who gets a professional degree by payment
of capitation fee, once qualified as a professional, is likely to aim
more at earning rather than serving and that becomes a bane to
society. The charging of capitation fee by unaided minority and
non-minority institutions for professional courses is just not
permissible. Similarly, profiteering is also not permissible.
Despite the legal position, this Court cannot shut its eyes to the
hard realities of commercialisation of education and evil
practices being adopted by many institutions to earn large
amounts for their private or selfish ends. If capitation fee and
profiteering is to be checked, the method of admission has to be
regulated so that the admissions are based on merit and
transparency and the students are not exploited. It is
permissible to regulate admission and fee structure for
achieving the purpose just stated.”
69. From the above discussion, it clearly emerges that in exercise
of their “right to occupation”, private institutions cannot transgress the
rights of the students. Discernibly, the Act does not give unbridled
power to the authority to determine the fee. Determination of fee has to
be based on the factors stipulated in Section 9 of the Act. Further, an
opportunity of appeal is also provided for in the Act 2007 to the
aggrieved. Fundamental rights of colleges to run their administration,
includes fixation of fee. However, such right in turn has to be balanced
with the rights of the students, so that they are not subjected to
163
Page 164 exploitation in the form of profiteering.
70. For the foregoing discussion, I hold that the State has the
legislative competence to enact the impugned legislation-Act 2007 to
hold common entrance test for admission to professional educational
institutions and to determine the fee and the High Court has rightly
upheld the validity of the impugned legislation. Regulations sought to
be imposed by the impugned legislation on admission by common
entrance test conducted by the State and determination of fee are in
compliance of the directions and observations in T.M.A. Pai, Islamic
Academy of Education and P.A. Inamdar. Regulations on admission
process are necessary in the larger public interest and welfare of the
student community to ensure fairness and transparency in the
admission and to promote merit and excellence. Regulation on fixation
of fee is to protect the rights of the students in having access to higher
education without being subjected to exploitation in the form of
profiteering. With the above reasonings, I concur with the majority view
in upholding the validity of the impugned legislation and affirm the well
merited decision of the High Court.
.…………………….J
(R. BANUMATHI)
New Delhi;
164
Page 165 May 02, 2016
165
Login with google
Legal Notes
Add a Note....