NAJIYA NEERMUNDA Vs. KUNHITHARUVAI MEMORIAL CHARITABLE TRUST

JUDGEMENT

(1.) The controversy in these Appeals pertains to fee fixation by the Admission and Fee Regulatory Committee for MBBS students in private self-financing medical colleges in the State of Kerala.

(2.) Pursuant to the judgement of this Court in P.A. Inamdar and Ors. v. State of Maharashtra and Ors., (2005) 6 SCC 537, the State of Kerala enacted Kerala Professional Colleges or Institutions (Prohibition of Capitation Fee, Regulation of Admission, Fixation of Non-Exploitative Fee and Other Measures to Ensure Equity and Excellence in Professional Education) Act, 2006. The Rules framed under the said Act came into force w.e.f. 2006. The said Act was replaced by Kerala Medical Education (Regulation and Control of Admission to Private Medical Educational Institutions) Act, 2017 (hereinafter referred to as "the 2017 Act"). Certain provisions of the 2017 Act were challenged by way of Writ Petitions filed in the High Court of Kerala. The fixation of admission fee for all the medical colleges in the State of Kerala provisionally at Rs. 5 Lakh by the Admission and Fee Regulatory Committee was also subject matter of challenge in the said Writ Petitions. Section 8 of the 2017 Act delineates the powers and functions of the Admission and Fee Regulatory Committee (hereinafter referred to as "the Committee") constituted under Section 3 of the 2017 Act. Section 8(1)(a) provides that the Committee can direct a private aided or unaided medical institution to furnish the required information along with necessary material for enabling the Committee to determine the fee that may be charged by the institution in respect of each medical course. Section 11 of the 2017 Act mentions the factors that are to be taken into account by the Committee for determination of the fee to be charged by a private aided or unaided medical institution. The challenge to Sections 8(1)(a) and Section 11 of the 2017 Act was rejected by the High Court in its judgment dated 02.11.2017. However, the High Court held that fixation of fee provisionally was ultra vires the 2017 Act. After examining the law laid down by this Court in T.M.A. Pai Foundation and Ors. v. State of Karnataka and Ors., (2002) 8 SCC 481, Islamic Academy of Education v. State of Karnataka and Ors., (2003) 6 SCC 697, P.A. Inamdar (supra) and Modern Dental College and Research Centre and Ors. v. State of Madhya Pradesh and Ors., (2016) 7 SCC 353 with respect to fixation of fee for professional courses in unaided medical colleges, the High Court of Kerala held that the institutions shall propose the fee structure and the scrutiny by the Committee shall only be for the purpose of ensuring that such fee is not exploitative and that the institutions are not indulging in profiteering or collecting capitation fee. According to the High Court, the Committee can formulate a policy of directing the colleges to submit audited accounts of previous years for the purpose of ascertaining that there is no profiteering by the institutions in fixing the fee. The High Court made it clear that the Committee cannot go into the desirability or appropriateness of the expenses incurred by the institution as per its own notions and standards. While disposing of the Writ Petitions, the High Court fixed a time schedule for finalizing the fee to be paid by students as it would be detrimental to the interests of both students and the institutions to keep the finalization of fee pending for a long time.

(3.) Consequent upon the judgment dated 02.11.2017 of the High Court, the Committee fixed fee for the MBBS course for the years 2017-18 and 2018-19 for private medical colleges. Dissatisfied with the fee fixed by the Committee, the managements of private self-financing medical colleges again approached the High Court by filing Writ Petitions which were heard and disposed of by the High Court on 28.02.2019. The principal contentions of the managements before the High Court were that the Committee acted in excess of its jurisdiction in fixing fee for the years 2017-18 and 2018-19 and that all the members of the Committee were not parties to the order of fee fixation. Considering the first point of the Committee acting in excess of the jurisdiction vested in it by the 2017 Act, the High Court was of the opinion that the Committee was empowered to ensure that the fee fixed by the institutions was reasonable. The contention of the managements that the proposal made by them in respect of the fee to be collected from the students has to be accepted by the Committee which does not have the power to disallow any expenditure, was not accepted by the High Court. That the Committee lacked the power to fix a fee different from the one proposed by the managements was also rejected by the High Court. After carefully considering the judgments of this Court relating to fee fixation and the judgments of the High Court on the same point, a Division Bench of the High Court of Kerala in its judgment dated 28.02.2019 observed that the Committee has the power to examine whether the fee proposed by the managements of private self-financing medical colleges was not excessive and non-exploitative, apart from considering that the surplus proposed was reasonable and was being ploughed back into the institution. The managements of private self-financing medical colleges were directed to cooperate with the Committee by furnishing all the accounting details as directed by the Committee. It is important to note that the High Court observed that the Committee has the power to examine the material furnished by the institutions for eliminating impermissible ingredients so as to arrive at a reasonable fee that can be charged by the management. As all members of the Committee were not present during the decision-making process of fixation of fee, the High Court set aside the order passed by the Committee. The Committee was directed to pass fresh orders for fixing the fee in accordance with law at the earliest. The Committee issued fresh orders in July, 2019 in respect of fixation of fee for MBBS Course for the years 2017-18 and 2018-19. Proceeding on the premise that the orders passed earlier fixing the fee were set aside by the High Court for lack of quorum, the Committee did not re-examine the proposals made by the managements earlier. The Committee reiterated the fee that was fixed for the medical colleges in its earlier orders. The managements of private self-financing colleges approached the High Court of Kerala by filing Writ Petitions challenging the orders passed by the Committee by which the fee fixed for the years 2017-18 and 2018-19 had been repeated again. By an order dated 14.01.2020, the High Court directed the managements of private self-financing colleges to provide a statement, accompanied with an affidavit and a list of documents within a period of 3 weeks from the date of the order, relating to: