Introduction:

In RK Sarathkumaran v. The Chairman and Others, the Madras High Court delivered a significant judgment reinforcing that education cannot be turned into a profit-making enterprise. The case involved a batch of MBBS students who pursued their degrees at the Chettinad Academy of Research and Education (CARE) University under the management quota during the academic years 2014–15, 2017–18 and 2018–19. After completing their examinations and before commencing internship, the students were instructed by the university to pay an exorbitant “break fee” of ₹2,00,000 per subject for arrear examinations, in addition to ₹35,000 as exam fee. Their access to the campus, identity cards, and internship opportunities were blocked when they failed to pay the demanded fee. The petitioners argued that such a fee was arbitrary, illegal, and beyond the jurisdiction of the university. Justice G.K. Ilanthiraiyan examined the legality of the fee, the regulations governing deemed universities, and the university’s justification for the charges. The High Court’s detailed judgment not only protected students from unjust financial exploitation but also emphasised that education is a noble societal obligation, not a commercial venture.

Arguments of the Petitioners:

The petitioners presented their case in a detailed manner, asserting that the university’s demand for a “break fee” was wholly arbitrary, illegal, and in direct violation of statutory guidelines. They highlighted that the University Grants Commission (UGC) and National Medical Council (NMC) regulate fee structures for deemed universities and that no institution is permitted to collect any amount over and above the fee fixed by the Fee Fixation Committee. The petitioners emphasised that Section 24 of the UGC Act, read with relevant UGC Regulations, expressly prohibits collection of capitation fees in any form, whether direct or indirect, and argued that the so-called “break fee” was nothing but a disguised capitation fee. They pointed out that the university had not disclosed such a fee in its prospectus, thereby depriving students of crucial financial information before admission. The petitioners further contended that supplementary classes were not compulsory under any regulation of the Medical Council of India, so insisting on additional tuition fees for such classes was unjustified. The students stated that blocking their access to the university campus, withholding internship permissions, and refusing to issue provisional certificates amounted to coercion and a violation of their educational rights. They also relied on UGC submissions which reiterated that no deemed university could collect capitation fees. Overall, their argument centred on the illegality of the fee, the breach of statutory regulations, and the coercive actions of the university.

Arguments of the Respondent University:

CARE University defended its actions by arguing that the issue of tuition fee for additional classes was already under consideration before the Supreme Court, and therefore the High Court ought not to adjudicate on it. They contended that the fee was not a capitation fee or donation but a reasonable tuition fee charged for supplementary classes that the petitioners allegedly attended. According to the university, the students had repeatedly failed their examinations, forming a separate “break batch” that required additional coaching, clinical sessions, and academic support, all of which involved extra financial burden on the institution. The university argued that this expenditure justified the collection of a break fee. They maintained that the amount was not excessive, but proportionate to the resources invested in facilitating the students’ academic progress. CARE University further submitted that none of the charges collected could be considered “illegal” because they were collected for services rendered and did not fall within the prohibited category of capitation. Additionally, the university asserted that it had the authority to regulate academic administration and was within its rights to charge extra for supplementary classes that required additional manpower and infrastructural usage. The respondents insisted that the students, having repeatedly failed examinations, should reasonably bear the cost of extended academic engagement. Thus, the university argued that the fee was justified, necessary, and not in violation of any statutory regulation.

Court’s Judgment:

Justice G.K. Ilanthiraiyan delivered a detailed and strongly worded judgment, emphasising the moral and constitutional responsibility of educational institutions. The Court held that education cannot be reduced to a profit-making business and that institutions must serve society with integrity. The bench observed that the university’s prospectus and regulations did not mention any “break fee” and that supplementary classes were not compulsory under the Medical Council of India guidelines. Therefore, compelling students to attend supplementary classes and charging them hefty amounts for the same was arbitrary and illegal. The Court found that the break fee was an additional tuition fee disguised as a miscellaneous charge, imposed without any authority under the law. The Court rejected the university’s arguments and held that the fee violated UGC and NMC regulations. It also upheld the UGC’s stand that any form of donation or capitation fee—direct or indirect—is prohibited, and deemed universities must strictly adhere to the fee structure fixed by the Fee Fixation Committee. The Court directed CARE University to stop charging any additional tuition fee in the name of break fee or miscellaneous fee. It also ordered the State Government, UGC and NMC to enforce the Fee Fixation Committee’s fee structure uniformly across all deemed universities. Further, the university was directed to refund the illegally collected fee within two weeks, with 6% interest, and release all educational certificates withheld from the petitioners. The judgment reinforced the principle that educational institutions cannot exploit students financially and must operate with fairness, transparency, and accountability.