ORDER
Shah J.
1. On 31st October 2002 eleven Judge Bench of the Supreme Court delivered the judgment in the case of T.M.A.Pai Foundation and Ors. v. State of Karnataka and Ors. (2002) 8 SCC 481. A brief background as to how the matter was referred to eleven Judge Bench may be noticed. The Writ Petition No. 350 of 1993 filed by the Islamic Academy of Education and connected petitions were placed before a Bench of five Judges. As the Bench was prima facie of the opinion that Article 30 did not clothe a minority educational institution with the power to adopt its own method of selection and the correctness of the decision in St Stephen’s College v. University of Delhi, was doubted, it was directed that the questions that arose should be authoritatively answered by a larger Bench. These cases were then placed before a Bench of 7 Judge. The questions framed were recast and the Court directed that the matter be placed before a Bench of at least 11 Judges, as it was felt that in view of the Forty-second Amendment to the Constitution whereby “education” had been included in Entry 25 of List III of Seventh Schedule, the question who would be regarded as a “minority” was required to be considered because the earlier case-law related to the pre-amendment era, when education was only in the State List. The question referred to larger Bench were reframed by 11 Judges. The Bench did not answers 4 out of 11 questions. Question no 9 was whether the decision of the Supreme Court in Unnikrishnan J.P. v. State of A.P, 1993 1 SCC 643 (except where it holds that primary education is a fundamental right) and the scheme framed thereunder require consideration/ modification and if yes, what ? The scheme framed in Unnikrishnan restricting the right of the citizen to establish private unaided institutions including minority institutions and manage the same is held to be unconstitutional. All orders and directions issued by the State Government to or in furtherance of the directions in Unnikrishnan are also held to be unconstitutional.
2. After the judgment was delivered in T.M.A.Pai Foundation on 31st October 2002, the State of Maharashtra formulated and framed a series of regulations and guidelines by issuing various Government Resolutions (GRs) on 5.4.2003, 16.4.2003 and 24.4.2003. It is directed that 85% seats in unaided private medical and dental colleges shall be filled in on the basis of the Common Entrance Test (CET) conducted by the State Government through centralized admission procedure leaving 15% quota to the private managements. In Engineering Colleges also State quota is fixed at 85% but seats are to be filled on the basis of HSC (10+2) examination. In so far as minority institutions are concerned, minority quota is fixed at 50% to be filled in by the minority community students on inter-se merit and remaining 50% to be filled in by the State agency, through centralized admission procedure. It is further directed that there shall be reservation for backward classes and a small percentage of reservation is also provided for members of defence personnel, physically handicapped etc. It is also directed that fees in private unaided colleges, shall be fixed by the regulatory authority to be appointed by the State of Maharashtra. By G R dated 16.4.2003 the Medical Education Regulatory Authority (MERA) is established to fix fees of medical and dental colleges. By a further G R dated 24.4.2003 Educational Institutions Regulatory Authority (EIRA) is established to fix the fees of engineering Courses/colleges. Writ petitions came to be filed in Bombay as well as before the Nagpur bench and Aurangabad Bench challenging the validity of the GRs mainly on the ground that the law laid down by the Supreme Court in T.M.A. Pai Foundation has been totally violated and under the garb of implementing the decision in T M.P.Pai Foundation the State Government is trying to perpetuate the scheme framed in Unnikrishnan which has been set aside and overruled by the Supreme Court. By the order passed by the learned Chief Justice, these petitions are clubbed together and have been assigned to this court.
3. The petitioners before us are private unaided institutions, both minority and non-minority. We are not concerned in the present case with the rights of the aided minority and non minority institutions and restrictions imposed by the State upon them but we are concerned with the rights and obligations of private unaided institutions run by the minorities and non minorities.
4. In the wake of the decision in T.M.A.Pai Foundation different statutes and regulations were framed by the different State Governments. It appears that various State Governments and educational institutions understood majority judgment in different perspective. These statutes and regulations were assailed before the different High Courts and in their orders while granting interim reliefs therein different High Courts construed the judgment in T.M. A Pai Foundation differently. The perceptions of the States as also the High Courts in reading the judgment widely varied. The interim orders passed by the High Courts were assailed before the Supreme Court. A five Judge Bench was constituted so that the doubts/ anomalies, if any, would be clarified.
5. The five Judge Bench framed the following questions:
1) Whether the educational institutions are entitled to fix their own fee structure;
2) Whether minority and on minority educational institutions stand on the same footing and have the same rights;
3) Whether private unaided professional colleges are entitled to fill in their seats, to the extent of 100% and if not to what extent; and
4) Whether private unaided professional colleges are entitled to admit students by evolving their own method of admission.
6. The decision of the five Judge Bench is delivered on 14.8.2003 in Writ Petition (Civil) No. 350 of 1993, Islamic Academy of Foundation and Anr. v. State of Karnataka and Ors. The Bench held that there can be no fixing of a rigid fee by the Governments. Each institute must have the freedom to fix its own fee structure taking into consideration the need to generate funds to run the institution and to provide facilities necessary for the benefit of the students. They must also be able to generate surplus which must be used for the betterment and growth of the educational institution. However, it was emphasized that imparting of education is essentially charitable in nature and there cannot be any profiteering and capitation fee cannot be charged. Thus the surplus/profit that can be generated must be only for the benefit /used of the of that educational institute. The Bench directed the constitution of a committee headed by a retired High Court Judge who shall be nominated by the Chief Justice of that State to decide whether the fee proposed by the institutions are justified and are not profiteering or charging capitation fee. The Bench was further pleased to hold that non minority educational institutions would not have the same rights as conferred on minority educational institutions by Article 30 of the Constitution of India. Non Minority educational institutions do not have the protection of Article 30. Thus in certain matters they cannot and do not stand on similar footing as minority educational institutions. Question No. 2 was answered accordingly. As far as questions Nos. 3 and 4 are concerned, the Bench noted that the majority judgment in T.M.A.Pai Foundation makes a clear distinction between professional educational institutions (both minority and non minority) and other educational institutions. i.e. schools and undergraduate colleges. In the case of non minority professional colleges only a certain percentage of seats can be reserved for admission by the management and rest have to be filled in on merit on the basis of counselling by the State agencies. However, the expression ‘different percentage for minority professional institutions, carries different meaning than the expression ,certain percentage for unaided professional college’. In fixing percentage for unaided minority professional colleges the State must keep in mind, apart from the local needs, interest/need of that community in the State. The need of the community in the State would be paramount vis a vis local needs. It was however, emphasised that minority professional colleges while selecting/ admitting students of their own community/ language cannot ignore the inter se merit amongst the students of their community/ language. Thus admission, even of members of their community/ language must strictly be on the basis of merit except that in case of their own students it has to be merit inter se of those students only. Further, if the seats cannot be filled up from members of their community / language, then other students can be admitted on the basis of merit based on a common entrance test conducted by Government agencies. The Bench further held that the words “Common Entrance Test” clearly indicate that each institute cannot hold a separate test. The managements could select students, of their quota, either on the basis of the common entrance tests conducted by the State or on the basis of a common entrance to be conducted by an association of all colleges of a particular type in the State e.g. medical, engineering, or technical etc. The common entrance test, held by the association, must be for admission to all colleges of that type in the State. The State Governments were directed to appoint a permanent committee headed by a retired High Court Judge to ensure that the tests conducted by the association of colleges are fair and transparent. Finally it was noted that as far as year 2003-2004 is concerned, time is running out as the outer time limit for admission is fast approaching or has gone and to meet the urgent situation without going into the issues involved in the various petitions/ applications, the Bench directed the seats be filled in by the institutions and the State Governments in the ratio 50 : 50.
7. In the light of the above decision of the five Judge Bench the core issues raised in these petitions such as whether the State Governments are entitled to allot the quota or seats to be filled in by the private managements and whether the private and unaided professional institutions are entitled to have their own admission process and lay down their own fee structure do not survive. It is, however, urged on behalf other petitioners that certain important aspects have not been dealt with in the decision of the five Judge Bench. Elaborate submissions have been made on those matters by the learned counsel appearing for the petitioners and the learned Advocate General appearing for the State.
8. Before adverting to the submission made at the Bar we may refer to the relevant questions framed by the eleven Judge Bench in T.M.A. Pai Foundation. In T.M.A.Pai Foundation, the Bench framed 11 questions. The Bench did not answer 4 out of 11 questions. We are concerned in this case with questions Nos. 3(b), 4, 5(a), 5(b), 5(c) and 9 which read as follows:
“3(b) To what extent can professional education be treated as a matter coming under minorities rights under Article 30?
4. Whether the admission of students to minority educational institution, whether aided or unaided, can be regulated by the State Government or by the University to which the institution is affiliated?
5(a) Whether the minorities’ rights to establish and administer educational institutions of their choice will include the procedure and method of admission and selection of students?
5(b) Whether the minority institutions’ right of admission of students and to lay down procedure and method, if any, would be affected in any way by the receipt of State aid?
5(c) Whether the statutory provisions which regulate the facets of administration like control over educational agencies, control over governing bodies, conditions of affiliation including recognition/ withdrawal thereof, and appointment of staff, employees, teachers and principals including their service conditions and regulation of fees, etc would interfere with the right of administration of minorities?
9. Whether the decision of this court in Unni Krishnan J.P. v. State of A.P.) except where it holds that primary education is of fundamental right) and the scheme framed thereunder require reconsideration/ modification and if yes, what?”
9. The answers to the relevant questions are in the following terms:
“A.3(b) Article 30(1) gives religious and linguistic minorities the right to establish and administer, educational institutions of their choice. The use of the words “of their choice” indicates that even professional educational institutions would be covered by Article 30.
A.4 Admission of students to unaided minority educational institutions, viz schools and undergraduate colleges where the scope for merit based selection is practically nil, cannot be regulated by the State or University concerned, except for providing the qualifications and minimum conditions of eligibility in the interest of academic standards.
The right to admit students being an essential facet of the right to administer educational institutions of their choice, as contemplated under Article 30 of the Constitution, the State Government or the University may not be entitled to interfere with that right, so long as the admission to the unaided educational institutions is on a transparent basis and the merit is adequately taken care of. The right to administer, nor being absolute, there could be regulatory measure for ensuring excellence hereof, and it is more so in the matter of admissions to professional institutions.
A minority institution does not cease to be so, the moment grant in aid is received by the institution. An aided minority educational institution therefore would be entitled to have the right of admission of students belonging to the minority group and at the same time, would be required to admit a reasonable extent of non minority students, so that the rights under Article 30(1) are not substantially impaired and further the citizen’s rights under Article 29(2) are not infringed. What would be a reasonable extent, would vary from the types of institutions, the course of education for which admission is being sought and other factors like educational needs. The State Government concerned has to notify the percentage of the non minority students to be admitted in the light of the above observations. Observance of inter se merit amongst the applicant belonging to the minority group could be ensured. In the case of aided professional institutions it can also be stipulated that passing of the common entrance test held by the State agency is necessary to seek admission. As regards non minority students who are eligible to seek admission for the remaining seats, admission should normally be on the basis of the common entrance test held by the State agency followed by counselling wherever it exists.
A.5(a) A minority institution may have its own procedure and method of admission as well as selection of students but such a procedure must be fair and transparent and the selection of students in professional and higher education college should be on the basis of merit. The procedure adopted or selection made should not be tantamount to mal administration. Even an unaided minority institution ought not to ignore while exercising its right to admit students to the college aforesaid, as in that event, the institution will fail to achieve excellence.
A.5(b) While giving aid to professional institutions it would be permissible for the authority giving aid to prescribe bye rules or regulations the conditions on the basis of which admission will be granted to different aided colleges by virtue of merit, coupled with the reservation policy of the State qua non minority students. The merit my be determined either through a common entrance test conducted by the University or the Government concerned followed by counselling or on the basis of an entrance test conducted by individual institutions – the method to be followed is for the University or the government to decide. The authority may also devise other means to ensure that admissions granted to an aided professional institution on the basis of merit. In the case of such institutions, it will be permissible for the government or the University to provide that consideration should be shown to the weaker sections of the society.
A.5(c) So far as the statutory provisions regulating the facets of administration are concerned, in case of an unaided minority educational institution, the regulatory measure of control should be minimal and the conditions of recognition to an university or board have to be complied with but in the matter of day to day management, like the appointment of staff teaching and non teaching and administrative control over them, the management should have the freedom and there should not be any external controlling agency. However, a rational procedure for the selection of teaching staff and for taking disciplinary action has to be evolved by the management itself.
For redressing the grievance of employees of aided and unaided institution who are subjected to punishment or termination from service, a mechanism will have to be evolved, and in our opinion, appropriate tribunals could be constituted, and till then, such tribunals could be presided over by a Judicial. Officer of the ran of District Judges.
The State or other controlling authorities, however, can always prescribe the minimum qualification, experience and other conditions bearing on the merit of an individual for being appointed as a teacher or a principal of any educational institution.
Regulations can be framed governing service conditions for teaching and other staff for whom aid is provided by the State, without interfering with the overall administrative control of the management over the staff.
Fees to be charged by unaided institutions cannot be regulated but no institution should charge capitation fee.
A.9 The scheme framed by this court in Unni Krishnan case and the directions to impose the same, except where it holds that primary education is a fundamental right, is unconstitutional. However, the principle that there should not be capitation fee or profiteering is correct. Reasonable surplus to meet cost of expansion and augmentationof facilities does not however amount to profiteering.”
10. Dr. Naik, appearing for some of the minority institutions made a faint attempt to urge that notwithstanding the decision of the 5 Judge Bench in Islamic Academiy of Foundation the minority institutions have a right to fill up 100% seats. The learned counsel urged that the State Government cannot have any quota in unaided minority institutions. The submission is required only to be stated to be rejected. This very submission was made before the 5 Judge Bench and was emphatically rejected. In a separate but concurring judgment Sinha J, observed:” If it be, held that the minority institutions can admit all the students belonging to their own community whereas the non minority institutions cannot, the same, in my opinion, would amount to re-writing the judgment. The argument which have been advanced in this behalf if accepted, would clearly lead to the conclusion that the majority decision in TMA Pai Foundation is wrong.” In the light of these observations it is impossible to accept the argument that the unaided minority institutions have a right to admit 100% students in their institutions.
11. Mr. Dada, who is also appearing for the minority institutions strenuously contended that even though the State has right to fill up non minority quota, it has no power to resort to reservationpolicy in unaided minority institutions. According to Mr. Dada the restrictions imposed on the right of the minority institution to manage an educational institution run by it may be regarded as valid, it is not only necessary that the regulation may be reasonable but it must also be one which is regulative of the educational character of the institution and is conducive to making the institution an effective vehicle of education for the minority community or other persons resorting to it. A regulation which prescribes reservation of seats for backward classes or Scheduled Tribes might be in public interest. It may be in the interest of bringing the educational level and standard of backward classes or Scheduled Tribe concerned. However, such a regulation cannot be regarded as conducive to the improvement of the quality of the education imparted or to the excellence of that institution as an educational institution. Mr. Dada placed heavy reliance on the decisions of the Division Bench of this court in Khan Abdul Hamid Abdul Razak v. MASS Polytechnic, 1984 Mah L J 400, Sindhu Education Society v. State of Maharashtra and Ors., (Writ Petition No. 2409 of 1981), Rev Sister Marry Damian and Anr. v. The Education Officer, Zilla Parishad, Nagpur and Ors., (Writ Petition No. 1770 of 1980). Mr. Dada also placed reliance on the decision of the Full Bench of this court in St Franacis De Sales Education Society, Nagpur and Anr. v. State of Maharashtra and Ors., 2001 II CLR 794 where the ratio of Khan Abdul Hamid Abdul Razak (supra) and Sindhu Education Society (supra), holding that the minority run institutions cannot be subjected to reservation policy, was upheld.
12. The judgments of the Division Bench in Khan Abdul Hamid Abdul Rasak and Sindhu Education Society as well as judgment of the Full Bench in St Francis De Sales Education Society are based on thedecision of the Supreme Court in Rev. Sidhrajbhai Sabhai and Ors. v. State of Gujarat and Anr., AIR 1963 SC 540. In that case a Bench of six Judges of the Supreme Court was required to consider the validity of an order of the Government which required all private training colleges in the State of Bombay to reserve 60% of the seats for training Boards school teachers nominated by the Government. This order was challenged before the Supreme Court. The Supreme Court observed that all minorities, linguistic or religious, have by Article 30(1) an absolute right to establish and administer educational institutions of their choice, and any law or executive direction which sought to infringe the substance of that right under Article 30(1) would to that extent be void. This, however, was not to say that it was not open to the State to impose restrictions upon the exercise of that right. The fundamental freedom was to establish and administer educational institutions; it was a right to establish and administer what was in truth educational institutions which cater to the educational needs of the citizens or sections thereof. It was pointed out that unlike Article 19, on which reasonable restrictions could be placed, Article 30 is absolute in terms; it is not made subject to any reasonable restrictions of the nature the fundamental freedoms enunciated in Article 19 may be subjected to. This, however, did not mean that it is not open to the State to impose regulations upon the exercise of this right. The fundamental freedom is to establish and administer what are in truth educational institutions which cater to the educational needs of the citizens or sections thereof. The Supreme Court observed :
“Regulations made in the true interests of efficiency of instructions, discipline, health, sanitation, morality, public order and the like may undoubtedly be imposed. Such regulations are no restrictions on the substance of the right which is guaranteed; they secure the proper functioning of the institutions, in matters educational”.
13. The Supreme Court indicated the philosophy behind the absolute fundamental freedom right granted to minorities under Article 30 in the following words:
“15. The right established by Article 30(1) is a fundamental right declared in terms absolute. Unlike the fundamental freedoms guaranteed by Article 19 it is not subject to reasonable restrictions. It is intended to be a real right for the protection of the minorities in the matter of setting up of educational institutions of their own choice. The right is intended to be effective and is not to be whittled down byso-called regulative measures conceived in the interest not of the minority educational institutions, but of the public or the nation as a whole. If every order which while maintaining the formalcharacter of a minority institution destroys the power of administration is held justifiable, because it is in the public or national – interest, though not in its interest as an educational institution the right guaranteed by Article 30(1) will be put a “teasing illusion”, a promise of unreality. Regulations which may lawfully be imposed either by legislative or executive action as a condition of receiving grant or of recognition must be directed to making the institution effective as an educational institution. Such regulation must satisfy a dual test- the test of reasonableness and the test that it is regulative of the educational character of the institution and is conducive to, making the institution an effective vehicle of education for the minority community or other persons who resort to it”.
14. In T.M.A. Foundation the majority did not agree with the above observations in Sidhrajbhai Sabhai’s case. The learned Chief Justice speaking for the majority observed as follows:
“107. The aforesaid decision does indicate that the right under Article 30(1) is not so absolute as to prevent the Government from making any regulation whatsoever. As already noted hereinabove, in Sidhajbhai Sabhai case it was laid down that regulation made in the true interests of efficiency of instruction, discipline, health, sanitation, morality and public order could be imposed. If this is so, it is difficult to appreciate how the Government can be prevented from framing regulations that are in the national interest, as it seems to be indicated in the passage quoted hereinabove. Any regulation framed in the national interest must necessarily apply to all educational institutions, whether run by the majority or the minority. Such a limitation must necessarily be read into Article 30. The right under Article 30(1) cannot be such as to override the national interest or to prevent the Government from framing regulations in that behalf. It is, of course, true that government regulations cannot destroy the minority character of the institution or make the right to establish and administer a mere illusion; but the right under Article 30 is not so absolute as to be above the law. It will further be seen that in Sidhajbhai Sabhai case no reference was made to Article 29(2) of the Constitution. This decision, therefore, cannot be an authority for the proposition canvassed before us”.
(emphasis supplied)
15. The learned Chief Justice concluded as follows:
“135. We agree with the contention of the learned Solicitor General, that the Constitution in Part III does not contain or give any absolute right. All rights conferred in Part III of the Constitution are subject to at least other provisions of the said Part. It is difficult to comprehend that the framers of the Constitution would have given such an absolute right to the religious or linguistic minorities, which would enable them to establish and administer educational institutions in a manner so as to be in conflict with the other Parts of the Constitution. We find it difficult to accept that in the establishment and administration of educational institutions by the religious and linguistic, no law of the land, even the Constitution is to apply to them.
136. Decisions of this court have held that the right to administer does not include the right to maladminister. It has also been held that the right to administer is not absolute, but must be subject to reasonable regulations for the benefit of the institutions as the vehicles of education, consistent with national interest. General laws of the land applicable to all persons have been held to be applicable to the minority institutions also- for example, laws relating to taxation, sanitation, social welfare, economic regulation, public order and morality.
137. It follows from the aforesaid decisions that even though the words of Article 30(1) are unqualified, this court has held that at least certain other laws of the land pertaining to health, morality and standards of education apply. The right under Article 30(1) has, therefore, not been held to be absolute or above other provisions of the law, and we reiterate the same. By the same analogy, there is no reason why regulations or conditions concerning generally, the welfare of students and teachers should not be made applicable in order to provide a proper academic atmosphere, as such provisions do not in any way interfere with the right of administration or management under Article 30(1).”
16. In St Stephen’s College v. University of Delhi the issue of minority institutions right to admit students came up for consideration of the Constitution Bench of the Supreme Court. The Supreme Court was examining the question as to whether the St Stephen’s college, which was held to be a minority institution, was bound by the university circulars directing that the college should admit students on the basis of percentage of marks secured in qualifying examination. It may be mentioned here that the college gave preference to students belonging to the minority (Christians). The majority judgment observed:.
“In the first place, it may be stated that the State or any instrumentality of the State cannot deprive the character of the institution, founded by a minority community by compulsory affiliation since Article 30(1) is a special right to minorities to establish educational institutions of their choice. The minority institution has a distinct identity and the right to administer with continuance of such identity cannot be denied by coercive action. Any such coercive action would be void being contrary to the constitutional guarantee. The right to administer is the right to conduct an manage the affairs of the institution. This right is exercised by a body of persons in whom the founders have faith and confidence. Such a management body of the institution cannot be displaced or recognised if the right is to be recognized and maintained. Reasonable regulations, however, are permissible but regulations should be of regulatory nature and not of abridgement of the right guaranteed under Article 30(1).”
17. The majority held that the minorities who are based on religion or language have a right to establish and administer educational institutions of their choice. The administration of educational institutions of their choice under Article 30(1) means “management of the institution”. This management must be free from control so that the founder or their nominees can mould the institution as they think fit and in accordance with their ideas of how the interests of the community in general and the institution in particular will be best served. At the same time, the Supreme Court observed:
“.. the standards of education are net part of the management as such. The standard concerns the body politic and is governed by considerations or the advancement of the country and its people. Such regulations do not bear directly upon management although they may indirectly affect it. The State, therefore, has the right to regulate the standard of education and allied mattes. Minority institutions cannot be permitted to fall below the standards of excellence expected of educational institutions. They cannot decline to follow the general pattern of education under the guise of exclusive right of management. While the management, must be left to them they may be compelled to keep in step with others”. (vide para 55). The Court quoted with approval the observations of Khanna J. in Ahmedabad St Zavier’s college society (supra) and Mathew J. in the same judgment and the observations in Lily Kurian. v. Lewina, , where it was emphasised:
“Protection of the minorities is an article of faith in the Constitution of India. The right to the administration of institutionsof minority’s, choice enshrined in Article 30(1) means ‘management of the affairs’ of the institution. This right is, however, subject to the regulatory power of the State. Article 30(1) is not a charter for maladministration; regulation, so that the right to administer may be better exercised for the benefit of the institution is permissible; but the moment one goes beyond that and imposes, what is in truth, not a mere regulation but an impairment of the right to administer, the Article come into play and the interference cannot be justified by pleading the interests of the general public; the interests justifying interference can only be the interests of the minority concerned”.
18. After referring to its own observations in Lily Kurian (supra), the majority judgment held in para 60 as under:-
“The right to administer does not include the right to maladminister. The State being the controlling authority had right and duty to regulate all academic matters. Regulations which will serve theinterests of students and teachers, and to preserve the uniformity in standards of education among the affiliated institutions could be made. The minority institutions cannot claim immunity against general law as such as laws relating to law and other, health, hygiene, labour relations, social welfare legislations, contracts, torts etc. which are applicable to all communities. So long as the basic right of minorities to manage educational institution is not taken away, the State iscompetent to make regulatory legislation. Regulations, however, shall not have the effect of depriving the right of minorities to educate their children in their own institution. This a privilege which is implied in the right conferred by Article 30(1)”
19. The Court held that the right to select students for admission was a part of administration and the impugned circular refusing permission to admission of girl students in the boys minority school, crosses the barrier of regulatory measures may come in the region of interference withthe administration of the institution, a right which is guaranteed to the minority under Article 30(1). Thus, it was held that in view of the importance which the Constitution attaches to protective measures to minorities under Article 30(1), the minority aided educational institutions are entitled to prefer their community, candidates to maintain the minority character of the institutions subject of course to conformity with the University standard. The State may regulate the intake in this category with due regard to the need of the community in the area which the institution is intended to serve. But in no case such intake shall exceed fifty percent of the annual admission. The Court concluded as follows:
“102. In the light of all these principles and factors, and in view of the importance which the Constitution attaches to protective measures to minorities under Article 30(1), the minority aided educational institutionsare entitled to prefer their community candidates to maintain the minority character of the institutions subject of course to conformity with the University standards. The State may regulate the intake in this category with due regard to the need of the community in the area which the institution is intended to serve. But in no case such intake shall exceed 50 per cent of the annual admission. The minority institutions shall make available at least 50 percent of the annual admission to members of communities other than the minority community. The admission of other community candidates shall be done purely on the basis of merit”.
20. In T M A Pai Foundation the learned Chief Justice observed:
” Thus, St. Stephen’s endeavoured to strike a balance between the two articles. Though we accept the ratio of St. Stephen’s which has held the field for over a decade, we have compelling reservations in accepting the rigid percentage stipulated therein. As Article 29 and Article 50 apply not only to institutions of higher education but also to schools, a ceiling of 50% would not be proper. It will be more appropriate that, depending upon the level of the institution, whether it be a primary or secondary or high school or a college, professional or otherwise, and on the population and education needs of the area in which the institution is to be located, the State properly balances the interests of all by providing for such percentage of students of the minority community to be admitted, so as to adequately serve the interest of the community for which the institution was established”.
(emphasis supplied)
21. In so far as aided minority institutions are concerned it is not disputed before us that the decisions in Khan Abdul Hamid Abdul Razak, Sindhu Eduction Society and St F De Sales and Education Society, stand overruled in view of the answer to question No. 5(b) in T.M.A Pai Foundation. The majority held that in case of such institutions, it will be permissible for the Government or the university to provide that consideration should be shown to the weaker sections of the society. While answering question No. 4 as to whether the admissions of students to minority education institutions, whether aided or unaided could be regulated by the State Government or by the University to which the institution is affiliated the majority observed:
“The right to admit students being an essential facet of the right to administer educational institutions of their choice, as contemplated under Article 30 of the Constitution, the State Government or the university may not be entitled to interfere with that right, so long as the admission to the unaided educational institutions is on a transparent basis and the merit is adequately taken care of. The right to administer, not being absolute, there could be regulatory measures for ensuring educational standards and maintaining excellence thereof, and it is more so in the matter of admissions to professional institutions”.
(emphasis supplied)
22. The learned Advocate General relied upon para 68 in T.M.A.Pai Foundation which is under sub-heading “private unaided professional colleges”. The said para reads as under:
“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 forgo 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 percentage 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”.
23. Based on the above para the learned Advocate General submitted that the majority judgment makes a clear distinction between professional educational institutions (both minority and non-minority) and other educational institutions i.e. schools and undergraduate colleges. He urged that in view of para 68 different percentage has to be fixed for unaided minority professional colleges. In fixing percentage for unaided minority professional colleges State must keep in mind, apart from local needs, the interest of that community in the State. However, the remaining seats could be filled in only based on merit basis i.e. CET conducted by the State agency. The learned Advocate General submitted that the State can make provision for backward/weaker sections of the society in non minority quota which is to be filled in by the State agency. He drew our attention to the observations of the learned Chief Justice in Islamic Academy of Foundation which read as follows:
“Paragraph 68 of the majority judgment in Pai’s case can be split into seven parts: Firstly, it deals with the unaided minority or non minority professional colleges.
Secondly, it will be unfair to apply the rule and regulations framed by the State Government as regards the government aided professional colleges to the unaided professional colleges.
Thirdly, the unaided professional institutions are entitled to autonomy in their administration, while at the same time they should not forgo or discard the principles of merit.
Fourthly, it is permissible for the university or the government at the time of granting recognition to require an unaided institution to provide for merit based admission while at the same time giving the management sufficient discretion in admitting students.
Fifthly, for unaided non minority colleges 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/University and for applying to the college/University for admission, while the rest of the seat may be filled up on the basis of counselling by the State agency.
Sixthly, the provisions for poorer and backward sections of the society in unaided professional colleges are also to be provided for.
Seventhly, the prescription for percentage of seats in unaided professional colleges has to be done by the government according to the local needs. A different percentage of seats for admission can be fixed for minority unaided and non minority unaided professional colleges.
Undoubtedly the majority judgment makes a distinction between private unaided professional colleges and other educational incitations i.e. schools and undergraduate colleges. The subheading “Private unaided professional colleges” includes both minority as well as non minority professional colleges. This is also clear from a reading of para 68. It appears to us that this distinction has been made (between private unaided professional colleges and other educational institutions) as the judgment recognizes that it is in national interest to have good and efficient professionals. The judgment provides that national interest would prevail, even over minority rights. It is for this reason that in professional colleges, both minority and non minority merit has been made the criteria for admission. However, a proper reading, of para 68, indicates that a further distinction has been made between minority and non minority professional colleges. It is provided that in cases of non minority professional colleges “a certain percentage of seats” can be reserved for admission by the management. The rest have to be filled up on basis of counselling by State agencies. The prescription of percentage has to be done by the government according to local needs. Keeping this in mind provisions have been made for the poorer and backward sections of the society. It must be remembered that, so far as medical colleges are concerned, an essentiality certificate has to be obtained before the college can be setup. It cannot be denied that whilst issuing the essentiality certificate the respective State governments take into consideration the local needs. These aspects have been highlighted in a recent decision of this court in State of Maharashtra v. Medical Association and Ors. . Whilst granting the essentiality certificate the State government undertakes to take over the obligations of the private educational institution in the event of that institution becoming incapable of setting of the institution or imparting education therein. A reading of para 59 and 68 shows that in non minority professional colleges admission of students, other than the percentage given to the management, can only be on the basis of merit as per the common entrance test conducted by government agencies. The manner in which the percentage given to the management can be filled in is set out hereinafter.
Para 68 provides that a different percentage can be prescribed for unaided minority professional college is also clear from the fact that para 68 also falls under main heading “In case of private institutions, can there be government regulations and, if so, to what extent?”.
(emphasis supplied)
24. The learned Chief Justice after noting para 47 of the judgment in T.M.A. Pai Foundation and earlier judgments including in Re: Kerala Education Bill concluded as under:
“… The expression “different percentage for minority professional institutions” carries different meaning than the expression “certain percentage for unaided professional colleges”. In fixing percentage for unaided minority professional colleges the State must keep in mind, apart from local needs, the interest/ need of that community in the State. The need of the community in the State would be paramount vis a vis the local needs.
It must be clarified that a minority professional college can admit in their management quota, a student of their own community/language in preference to a student of another community even though that other student is more meritorious. However, whilst selection/admitting students of their community/language the inter-se merit of those students cannot be ignored. In other words whilst selecting/admitting student of their own community/language they cannot ignore the inter se merit amongst students of their community/language. Admission, even of members of their community/language, must strictly be on the basis of merit except that in case of their own students it has to be merit inter se those students only. Further if the seats cannot be filled up from members of their community/language then the other students can be admitted only on the basis of merit based on a common entrance test conducted by government agencies”.
(emphasis supplied)
25. In the light of the decision of 11 Judge Bench in T.M.A. Pai Foundation as interpreted by the 5 Judge Bench, we are inclined to accept the submission of the learned Advocate General that the State can make provision for reservation for backward class/weaker sections of the society in unaided minority institutions. The rights of the minorities to establish educational institutions of their choice and law enacted for the welfare of the backward class, both have laudable objectives. Both can co-exist in perfect harmony. Thus even minority unaided institutions are bound by the reservation policy framed by the State under Article 15(4), having its roots in national policies based on national interest which are binding upon every body and the limitations imposed upon it, have to be read in Article 30(1) of the Constitution.
26. A submission was made on behalf f the unaided private colleges, both minority and non minority, that the decision in T.M.A. Pai Foundation does not prevent the management from charging higher fee in 15% management quota prescribed by the State. This 15% quota was earlier known as NRI quota which could be filled in by the management subject to limitation that the management shall not charge more than five times than the payment seat. It is urged that if the managements are allowed to charge higher fees for small percentage of seats, students community as a whole should be benefited. Reliance is placed on the observations of Justice Variava in T.M.A. Pai Foundation that: “However, we cannot loss sight of the ground realities in our country. The majority of our population comes from the poorer section of our society. They cannot and will not be able to afford the fees which will now be fixed pursuant to the judgment. There must therefore be an attempt, not just on the part of the Government and the State but also by the educational institutions to ensure that students from the poorer section of society get admission. One method would be by making available scholarships or fee seats. If the educational institution is wiling to provide free seats then the costs of such free seats could also be partly covered by the fees which are now to be fixed. There should be no harm in the rich subsidizing the poor”.
27. We are unable to accept the submission advanced by the learned counsel for the petitioners. The Government Resolutions undoubtedly provide for 15% quota for managements. If is further provided that students who seek admission in the management quota need not appear for CET and the management can fill up this quota on the basis of inter-se merit. This management quota is the same as NRI quota which was permitted under the scheme framed in Unnikrishnan. In Unnikrishnan while framing the scheme the Court held that private unaided recognized/affiliated educational institutions running professional courses were entitled to charge a fee higher than that charged by Government institutions for similar courses, but that such a fee could not exceed the maximum limit fixed by the State. The scheme that was framed inter alia postulated that 50% of the seats in every professional college should be filled by the nominees of the Government or University, selected on the basis of merit determined by a common entrance test, which will be referred to as ‘free seats’, the remaining 50% seats ‘payment seats’ should be filled by those candidates who pay the fee prescribed therefor and the allotment of students against payment seats should be done on the basis of inter se merit determined on the same basis as in the case of free seats. The Court, by interim orders subsequent to the decision in Unni Krishnan had permitted 15% payment seats to be allotted to NRIs against payment of a higher amount as determined by the authorities. In T.M.A. Pai Foundation the scheme framed by the Court was held to be unconstitutional on the ground that (i) the scheme enforced by the State Governments in relation to privately managed institutions would not be a reasonable restriction within the meaning of Article 19(6) of the Constitution as it resulted into revenue shortfalls making it difficult for the educational institutions; (ii) the provision made for free seats and payment seats amounted to subsidizing education of the segment of society at the cost of other which was unreasonable having regard to the fact that higher education has been held not to be a fundamental right. In this connection observations of the learned Chief Justice in para 37 are pertinent:-
“Unni Krishnan judgment has created certain problems, and raised thorny issues. In its anxiety to check the commercialization of education, a scheme of “free” and “payment” seats was evolved on the assumption that the economic capacity of the first 50% of admitted students would be greater than the remaining 50%, whereas the converse has proved to be the reality. In this scheme, the “payment seat” student would not only pay for his own seat, but also finance the cost of a “free seat” classmate. When one considers the Constitution Bench’s earlier statements that higher education is not a fundamental right, it seems unreasonable to compel a citizen to pay for the education of another more so in the unrealistic world of competitive examinations which assess the merit for the purpose of admission solely on the basis of the marks obtained, where the urban students always have on edge over the rural students. In practice, it has been the case of the marginally less merited rural or poor student bearing the burden of a rich and well exposed urban student”.
(emphasis supplied)
28. The learned Chief Justice concluded that the decision of Unnikrishnan in so far as it framed the scheme relating to the grant of admission and the fixing of the fee, was not correct, and to that extent, the said decision and the consequent directions given to UGC, AICTE, the MCI, the Central Government and State Government etc. were overruled.
29. In T M A Pai Foundation the majority clearly held that admission in professional colleges should be solely on the basis of merit. The learned Chief Justice speaking for the majority observed:
“58. For admission into any professional institution, merit must play an important role. While it may 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 preference 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 admission 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 common entrance test conducted by the institution or in the case of professional colleges, by government agencies:.
30. In the light of the above observations in T.M.A. Pai Foundation it is impossible to accept the plea of the unaided colleges to allow them to charge higher fee to a segment of students. It would virtually amount to giving preference to less meritorious but more influential students. In our opinion it is not permissible for the institutions to collect more fees from some and lesser fees from others. There cannot be any distinction between the students admitted by the management and the students allotted by the State agency on the basis of counselling in matter of fee. Therefore it is impermissible for the management to charge and recover higher fee in respect of 15% quote fixed by the State.
31. On behalf of the unaided medical and dental colleges a prayer was made to permit them to admit students in management quota on the basis of HSC results. It is urged that this system has stood the test of time, which is fair and transparent and based purely on merit and on the basis of examination conducted by the independent body. It is sought to be contended that the system of common entrance test (CET) since its inception has created more problems than it could solve. Students have been subjected to great hardship and inconvenience by the delays, inaccuracies and inefficiencies by the respondents and those associated with the CET. Therefore, it is submitted that at least for this year the medical and dental colleges should be permitted to fill up their 50% seats on the basis of the results in HSC examination. It is pointed out that so far as the engineering courses are concerned, admissions are made on the basis of results of HSC. We are unable to accept the submission of the learned counsel. The five Judge Bench has clearly directed that the CET to be held by the private management must be for admission to all colleges of that type in the State and in the absence of such CET seats in the management quota should be filled on the basis of the CET conducted by the State. There is one more reason why we cannot accept this prayer. It is an admitted position that admissions for medical and dental courses for the last 5 years have been granted on the basis of CET examination conducted by the State. Obviously therefore all the students desirous of securing admission to such colleges have reasonable and legitimate expectation that this year also admissions will be given on the basis of the CET conducted by the State for this year on 8.6.2003 of which results are declared on 27.6.2003.
32. We direct that for this academic year all admissions in unaided medical and dental colleges (except minority quota), shall be made on the basis of the CET conducted by the State. It is however clarified that the centralized process of admission conducted by the State would apply only to State quota of 50%. Mr. Subramanian, appearing for the Association of medial and dental colleges tendered on record a draft proposal for admission for the management quota for Academic Year 2003-04, which is reproduced below:
“Admission procedure for academic year 2003-04
1. 50% Government Seats:
First round of admissions by the Government for 50% seats will be completed by 3.9.2003. Any seats unfilled would be filled as per 2 below:
2. 50 Management seats:
1. The Association of Medical Colleges will publish an advertisement on 29.8.2003 containing the following:
a) Application forms will be available from the Association office, College office and also from Internet as stated in the Advertisement. The forms will be free.
b) Names of the Medical Colleges with the following information:
i) Address, telephone no, website, e-mail and
ii) The fees prescribed
iii) Number of seats.
c) The advertisement also will state that the merit list would be declared on 13.9.2003 at the Association office, on the website and on the information Boards of the colleges. The students will have to report to the college in which he/she has secured admission with the documents stated in the application form and pay the fees by 17.00 hours on 16.9.2003. Accordingly the students should be in readiness.
d) Fees fixed by each institution to be paid by the student subject to revision by the Committee. Any increase/decrease to be adjusted next year.
e) Applications will be made by the students to the respective colleges with a copy to the office of the Association in bombay by 6.9.2003 at 5 p.m. and by 8.9.2003 at 5 p.m. respectively. Applications may be made to the colleges personally by registered post AD or courier (E-mail or Fax) and same need not be accompanied by demand draft, which will be paid at the time of admission.
f) A student will show his preference to all the colleges listed in the advertisement by stating a numerical number of reference in the “Box” against each college.
g) On 17.9.2003 a notice should be put on the Notice Board of the respective college indicating the number of seats vacant and seeking applications for the same by 20.9.2003. These applications should be made to the respective colleges. There would be no application fees.
h) On 21.9.2003 a list of candidates granted admission against the vacant seats would be put up on the Notice Board of the respective college immediately. The list would be prepared by the respective college and would be based on inter se merit of applicants on the basis of CET conducted by the State. The fees should be paid and original certificates submitted by 24.9.2003.
i) On 26.9.2003 list of admitted candidates would be forwarded to MUHS and MCI so that they receive it by 29.9.2003, the next working day.”
33. Mr. Subramanian stated that the vacancies available in each individual college as on 17.9.2003 shall be notified on website as well as on the notice board of the college. The State Government has agreed to initiate first round of admission by 3.9.2003 and to complete the same by 12.9.2003. Mr. Subramanian stated that vacant seats in respect of State quota will also be notified on website on 13.9.2003 on receipt of the same from the State Government.
34. We direct the State Government to take final decision in respect of the following and notify the same within a week from today : (i) Extent of reservation for backward classes in the State quota, (ii) definition of weaker sections and (iii) extent of subsidy to be given to weaker sections.
35. We further direct that the private professional colleges shall announce their fee structure within one week from today which shall be notified on the website and the same shall be submitted to the State Government for scrutiny by the Committee appointed as per the direction of the Supreme Court. The fees which are collected in the meantime shall be subject to the adjustment as per the decision of the Committee in respect of each college.
36. As regards the controversy raised about the mode of filling of the vacant seats for lateral admission in second year engineering for the diploma holders sine the process of admission is almost complete we are not inclined to issue any directions in respect of these seats. However, we make it clear that fee for these seats shall be fixed on uniform basis and shall be subject to the final directions as the committee may give.
37. The State Government is directed to reframe the rules an guidelines in the light of the five Judge Constitution Bench judgment of the Supreme Court within a period of one week.
38. Petitions are disposed of in terms of above directions.
39. All the parties concerned to act on the ordinary copy of this order duly authenticated by the Private Secretary of this Court.
