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Issues Involved:
1. Commercialization of education by unaided recognized schools. 2. Authority of the Director of Education to regulate school fees. 3. Transfer of funds from schools to societies or trusts. 4. Constitutionality of the Delhi School Education Act, 1973 and its rules. 5. Appointment and findings of the Duggal Committee. 6. Impact of Supreme Court decisions on the case. Detailed Analysis: 1. Commercialization of Education by Unaided Recognized Schools: The High Court examined whether unaided recognized schools were indulging in commercialization of education and exploiting students and parents. It was found that the government had failed to perform its statutory functions under the Delhi School Education Act and Rules, leading to large-scale commercialization. The High Court held that it was the obligation of the Administrator and/or Director of Education to prevent commercialization and exploitation in private unaided schools, including those run by minorities. 2. Authority of the Director of Education to Regulate School Fees: The High Court upheld the Director of Education's authority to regulate school fees under Section 24 of the Act. The Director had issued an order on 10.09.1997, limiting registration, admission, and other fees. The High Court found that the Director had the power to issue directions to rectify defects or deficiencies found during inspections or otherwise in the working of the school. However, the Supreme Court later clarified that the Director's authority is limited and does not extend to general regulation of fees for unaided schools, as per the decisions in T.M.A. Pai Foundation and P.A. Inamdar. 3. Transfer of Funds from Schools to Societies or Trusts: The High Court and the Director of Education prohibited the transfer of funds from schools to societies or trusts, citing Rule 177 of the Delhi School Education Rules, 1973. The Supreme Court, however, clarified that while schools cannot transfer funds to societies, they can transfer funds to other schools under the same management, as long as it is for educational purposes and not for profiteering. 4. Constitutionality of the Delhi School Education Act, 1973 and its Rules: The constitutionality of the Act and its rules was not directly challenged in the case. However, the Supreme Court emphasized that any statutory directions must conform to the principles laid down in T.M.A. Pai Foundation and P.A. Inamdar, which provide greater autonomy to unaided institutions in setting their fee structures, subject to the prohibition of profiteering and capitation fees. 5. Appointment and Findings of the Duggal Committee: The High Court appointed the Duggal Committee to examine the fee structures of individual schools. The Committee found several irregularities and malpractices in the collection and utilization of funds by schools. The Supreme Court acknowledged the Committee's findings but emphasized that any regulatory measures must align with the principles established in T.M.A. Pai Foundation and P.A. Inamdar. 6. Impact of Supreme Court Decisions on the Case: The Supreme Court's decision in T.M.A. Pai Foundation, which overruled Unni Krishnan, established that the right to set up educational institutions is a fundamental right, subject to reasonable regulations. P.A. Inamdar further clarified the extent of regulatory control over unaided educational institutions. The Supreme Court in the present case modified the High Court's directions to ensure they were consistent with these landmark decisions, emphasizing minimal state interference and the autonomy of unaided institutions in fee determination, while preventing profiteering. Conclusion: The Supreme Court modified the High Court's judgment, emphasizing the autonomy of unaided schools in setting their fee structures and the limited regulatory role of the state, consistent with T.M.A. Pai Foundation and P.A. Inamdar. The review petitions were disposed of with no costs, and the state was allowed to amend its rules if necessary, subject to future challenges by school managements.
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