High Court Kerala High Court

Pocker Sahib Memorial Orphanage vs The Government Of Kerala on 19 March, 2007

Kerala High Court
Pocker Sahib Memorial Orphanage vs The Government Of Kerala on 19 March, 2007
       

  

  

 
 
  IN THE HIGH COURT OF KERALA AT ERNAKULAM

WP(C) No. 20124 of 2005(U)


1. POCKER SAHIB MEMORIAL ORPHANAGE
                      ...  Petitioner

                        Vs



1. THE GOVERNMENT OF KERALA, REP. BY
                       ...       Respondent

2. THE DIRECTOR OF COLLEGIATE EDUCATION,

3. THE DEPUTY DIRECTOR OF COLLEGIATE

                For Petitioner  :SRI.V.M.KURIAN

                For Respondent  :GOVERNMENT PLEADER

The Hon'ble MR. Justice A.K.BASHEER

 Dated :19/03/2007

 O R D E R
                           A.K. BASHEER, J.

                         --------------------------

     W.P.(C).  NOS. 20124, 28031, 31070 OF 2005 &

                             9876 OF 2006

                            ---------------------


              Dated this the 19th day of March, 2007


                            J U D G M E N T

The core issue, which has come up for consideration in

these writ petitions is whether the Government is justified in

directing the Private Aided Colleges to transfer the

accumulated funds in P.D. Accounts in the name of Principal

of such colleges to the Government account. By Circular dt.

April 20, 2005, a copy of which is available on record as

Ext.P6 in W.P.(C) No.20124/05, and by letter dt. September

20, 2005, a copy of which is available on record as Ext.P13

in W.P.(C) No.9876/06, it was ordered by the Director of

Collegiate Education that all amounts lying in such accounts

in the name of Principal of the institutions till the last date of

the previous academic year shall be transferred to the

Government Account. The said orders are under challenge in

these writ petitions, which are at the instance of

management and heads of such aided institutions.

WPC NO.21124/05 & Conn. Cases 2

2. A brief reference to the essential facts may be

necessary to consider the question whether the above

circular and letter issued by the Director of Collegiate

Education are legally valid and unsustainable.

3. It is not in dispute that the Government of Kerala

had entered into separate individual agreements, known as

Direct Payment Agreement, with the managements of

various aided colleges in the State. As regards the collection

of fee, the following clauses were incorporated in the

agreements. Ext.P1 is stated to be one such agreement

entered into between the Government and the management

of aided college in Malappuram district. Since the clauses in

all the agreements are identical, the following clauses in

Ext.P1 are being extracted hereunder for convenience.

“2 . The Educational Agency shall cause to collect

through the Principal of the institution on or

before the date prescribed according to the rules

in each month the tuition fees prescribed and

fines imposed on the students and remit all such

amounts to the credit of the Government in the

Treasury at Tirur in such manner as may be

prescribed by the Government from time to time.

The amounts collected on a day shall be remitted

WPC NO.21124/05 & Conn. Cases 3

in the said Treasury within the next 4 working

days.

3. The Educational Agency shall cause to collect

from the students such special fees at such rates

as may be prescribed by the University from time

to time.

4. (i) The Educational Agency shall cause to

remit all fee collections other than those

mentioned in clauses 1 and 2 in the Treasury at

Tirur in a separate account opened in the name

of the Principal of the Institution. Such

remittance shall be made within the next four

working days after collection. The Principal shall

be competent to draw money from this account

and incur necessary expenditure on the items for

which such fees were collected.

(ii) The special fee collected for a purpose

shall be utlised only for the purpose for which it is

intended and for no other purpose.

(iii) The special fee collected from the

students of a college under the Educational

Agency shall be utilised only for the purpose of

that college and not for the purpose of any other

college.

5. No fees other than those authorised under this

agreement shall be collected from the students of

the Institution.”

4. It is pertinent to note that the Educational Agency

has been given liberty to collect special fee from the

WPC NO.21124/05 & Conn. Cases 4

students at such rates that may be prescribed by the

University from time to time. The special fee collected by

the institution has to be remitted in a separate account to be

opened in the name of the Principal of the institution.

Clause 4(1) stipulates that the Principal shall be competent

“to draw money from this account and incur necessary

expenditure on the items for which such fees were

collected” (Emphasis supplied). It is further provided in the

agreement that “the special fee collected for a purpose shall

be utilised only for the purpose for which it is intended and

for no other purpose” and that the special fee collected from

the students of a college under the Educational Agency shall

be “utilised only for the purpose of that college and not for

the purpose of any other college.”

5. It appears that certain modifications were made in

the matter of collection of registration fees, between the

Government and the managements with which we are not

concerned at this stage.

6. As mentioned earlier, the Director of Collegiate

WPC NO.21124/05 & Conn. Cases 5

Education issued Ext.P6 circular and Ext.P13 letter directing

all Deputy Directors and Principals of Colleges to transfer the

accumulated funds lying to the credit of the Principals of the

institutions in their respective personal deposit accounts to

the Government fund.

7. In the counter affidavit reference has been made to

Article 282.5(D) of Kerala Financial Code Vol.I. It is

contended that in terms of the above article, the

accumulated unspent balance has to be refunded to

Government Account. It is further contended that the

Government is spending crores of rupees for running the

aided private colleges in the State. Moreover, the

management’s major portion of the fee collected from the

students can also be spend for the college. However,

University Grants Commission’s fund also were provided for

financial help to the colleges for infra structural facilities. It

is the case of the respondents that the Circular does not

impose any restrictions on the Educational Agencies in using

the current collections. What has been taken away is the

WPC NO.21124/05 & Conn. Cases 6

right to utilise the accumulated funds till March 2005. I am

afraid the above unilateral view taken by the Government

cannot be justified.

8. As mentioned earlier, the Government had entered

into individual agreements with the management of aided

colleges. The Clauses contained in the agreement will

have to be respected by both sides. The Government could

not have unilaterally issued a direction to the Director of

collegiate education to issue a circular appropriating the

accumulated funds to its fund without affording opportunity

to the management concerned to be heard. Therefore,

Ext.P6 circular shall not be enforced or implemented till a

final decision is taken by the Government of course, after

holding discussions with all the respective managements.

Till such time a decision is taken and appropriate new

clauses are incorporated in the agreement in modification of

the existing ones, the directions contained in Ext.P6 shall be

kept in abeyance.

9. Learned counsel for the petitioner in W.P.C. No.

WPC NO.21124/05 & Conn. Cases 7

20124/05 has invited my attention to the judgment rendered

by a Division Bench of this Court in W.A. No.380/06. It is

true that the Division Bench had confirmed the judgment of

the learned Single Judge against which the above appeal

was preferred. The issue in that case related to registration

fee collected by aided colleges. It appears that the said fee

is to be remitted to the treasury in a specified account. The

Deputy Director of Education on receipt of instructions from

the Directorate had ordered that the accumulated amounts

of registration fee lying to the credit of the personal deposit

account of the Principal of the colleges be transferred to the

Government fund. The learned Single Judge took the view

that such a decision could not have been taken by the

Government in view of the agreement executed between the

Government and the management. The learned Single

Judge was particularly referring to the retrospectivity of the

above order issued by the Directorate. The learned Single

Judge held that the Government was not justified in giving

retrospectivity to the above order. The said view taken by

WPC NO.21124/05 & Conn. Cases 8

the learned Single Judge was affirmed by the Division Bench

in writ appeal mentioned above.

10. It is true that the Division Bench had referred to

special fees in the judgment. Obviously, this appears to be a

mistake because, registration fee was only one of the

components of special fee and what the leaned Single Judge

dealt with was only the transfer of accumulated registration

fees. Anyhow, for the reasons stated in the judgment, I am

satisfied that the decision rendered by the Division Bench in

the Writ Appeal mentioned above may not have any

application in the facts of this case. Similarly, the petitioner

in W.P.C. No. 9876/06 has produced Ext.P13 in addition to

Ext.P6 which is a subsequent order issued by the Secretary

in the Department of Higher Secondary education.

In the above facts and circumstances, these writ

petitions are disposed of with a direction that before

enforcing Ext.P6 circular the Government shall hold

discussions with the respective managements and take a

decision in the matter with regard to the transfer of the

WPC NO.21124/05 & Conn. Cases 9

accumulated funds lying to the credit of the Principals of

various aided colleges with whom the Government has

entered into separate agreements. If the Government and

the respective managements agree upon the appropriation

of the accumulated funds, it will be open to the parties to

incorporate such a clause in the addenda of the agreement,

which may be executed between the parties. Till such time

a decision is taken in the matter, Ext.P6 shall not be

enforced. The Government shall take a decision in the

matter as expeditiously as possible, at any rate, within a

period of three months from the date of receipt of a copy of

this judgment.





                                                 A.K. BASHEER, JUDGE

vps


WPC NO.21124/05 & Conn. Cases    10





                                       KURIAN JOSEPH, JUDGE




                                                     OP NO.





                                                  JUDGMENT




                                        21st  DECEMBER, 2006