Introduction:

In a significant ruling that underscores the balance between institutional autonomy and regulatory oversight in the education sector, the Chhattisgarh High Court, in Chhattisgarh Private School Management Association v. State of Chhattisgarh, upheld the constitutional validity of the Chhattisgarh Non-Government Schools Fees Regulation Act, 2020, and the corresponding Chhattisgarh Non-Government Schools Fees Regulation Rules, 2020, which had been challenged by the Chhattisgarh Private School Management Association and Bilaspur Private School Management Association Society.

Arguments:

The petitioners, representing private unaided schools affiliated with the Central Board of Secondary Education, argued that the impugned legislation imposed unreasonable restrictions on their right to administer their institutions, particularly in areas relating to fee fixation, administrative control, appointments, and admissions. They contended that the Act prescribed a rigid and state-controlled fee structure, dictated the formation and composition of governing bodies, mandated compulsory nomination of teachers and staff for appointments, and even influenced the nomination of students for admissions, thereby undermining the core autonomy of private unaided schools. Citing the landmark Supreme Court judgment in TMA Pai Foundation v. State of Karnataka (2002), the petitioners stressed that private institutions must enjoy maximum autonomy in administration and that the State has no authority to interfere with fee structures, especially when the schools in question do not receive any grant-in-aid from the government. They argued that such legislative interference violated their fundamental rights under Articles 14 and 19(1)(g) of the Constitution and that the Act effectively ignored the principle that educational institutions should be allowed to determine their financial and operational policies so long as there was no profiteering or capitation fee. The petitioners also highlighted the practical hardship caused by the Act, noting that these schools are entirely dependent on fees paid by parents to cover salaries of teaching and non-teaching staff, infrastructure maintenance, and other operational expenses, and that the inflexibility imposed by the State would severely impact their sustainability.

On the other hand, the State of Chhattisgarh defended the legislation, arguing that it was enacted with the clear intent to regulate the process of fee fixation in non-government schools and to promote mutual consultation between school managements and guardians, thereby ensuring transparency, fairness, and avoidance of exploitative practices. The State emphasized that “education” falls under Entry 25 of the Concurrent List (List III) in the Seventh Schedule of the Constitution, giving the State Legislature ample legislative competence to frame such laws, subject to parliamentary legislation under Entries 63 to 66 of List I. It further asserted that the Act did not take away the right of schools to fix fees entirely but introduced a reasonable regulatory framework to ensure that fees remained just, reasonable, and proportionate, with a clear process involving consultations and checks to prevent profiteering. Moreover, the State contended that the petitioners, being societies registered under the Societies Registration Act, 1971, did not fall within the definition of “citizens” under the Constitution and thus could not invoke Article 19(1)(g) protections, which are available only to citizens. The State also pointed out that the petitioners had challenged the Act and Rules in their entirety without providing specific pleadings on how their fundamental rights were individually infringed.

Judgement:

In assessing the matter, the Division Bench of Justice Sanjay K. Agarwal and Justice Sachin Singh Rajput first addressed the issue of legislative competence, affirming that “education” indeed lies within the Concurrent List, thereby empowering both the Union and State legislatures to enact laws regulating it. The Court then examined the claim of violation of TMA Pai Foundation, noting that while the Supreme Court in that case recognized the autonomy of private educational institutions in day-to-day administration, it also held that the State could prescribe reasonable regulations in matters such as qualifications, salaries, experience, and other professional standards for teachers, and importantly, could impose restrictions to prevent commercialization of education, such as banning capitation fees and profiteering. The High Court concluded that the 2020 Act and Rules aligned with these permissible regulatory measures, as their primary objective was to ensure fairness in fee structures, rather than usurping the entire administrative domain of schools. On the issue of locus standi, the Court underscored that the fundamental freedoms under Article 19, including the right to practice any profession or carry on any occupation, trade, or business under Article 19(1)(g), are guaranteed only to citizens and not to juristic entities such as registered societies; hence, the petitioners could not claim protection under this provision. Addressing the argument regarding hardship, the Court observed that hardship faced by an individual or a particular group, even if genuine, is not a valid ground to strike down legislation, especially when the law is designed for the “general good” and is otherwise constitutionally valid. Referring to the principle applicable to rules framed under Article 309 of the Constitution, the Court emphasized that when such rules serve the larger public interest, incidental hardship to individuals cannot be a reason for judicial invalidation. The Court also clarified that the Act’s definition of “Non-Government School” covered only those institutions whose fees were not fixed by the State or Central Government or their organizations, and that the Act’s short title made its intent explicit—providing a legal framework for mutual consultation between school managements and guardians in the process of fee fixation. In light of these findings, the Bench held that the State Government was well within its rights to enact and implement the 2020 Act and Rules, as they served the legitimate aim of preventing exploitative fee practices while still leaving room for school managements to operate within a regulated structure. The Court found the Act neither arbitrary nor violative of Article 14’s equality mandate, as the classification it created between government-aided and non-aided institutions was reasonable and had a clear nexus with the object sought to be achieved. Ultimately, dismissing the petitions, the Court declared that the Chhattisgarh Non-Government Schools Fees Regulation Act, 2020, and the associated Rules were constitutionally valid, did not infringe upon any fundamental rights of the petitioners, and struck an appropriate balance between institutional autonomy and the State’s regulatory role in ensuring equitable access to quality education. This decision reinforces the judicial approach that while private educational institutions enjoy a measure of autonomy, they operate within a constitutional framework that permits the State to intervene for public interest, transparency, and prevention of commercialization, especially in a sector as vital as education, which the Constitution recognizes as both a fundamental right for citizens and a critical area of governance for the State.