MBBS fee cannot be Enhanced without AFRC recommendations: Supreme Court

New Delhi: While dismissing the appeals by the private medical colleges of Andhra Pradesh who had been asked to refund the excess tuition fees collected from the students, the Supreme Court bench recently clarified that Fee fixation could only be done on the basis of the recommendations and report by the Admission and Fee Regulatory Committee.

With this observation, the top court bench comprising of M R Shah upheld the High Court order which had dismissed the Government Order dated 06.09.2017 enhancing the tuition fee for the block years 2017-­2020 by at least seven times.

The matter concerns the fee fixation for the block years 2017 to 2020 when the State Government issued a G.O dated 06.09.2017 and enhanced the tuition fee for MBBS courses without waiting for the report from Admission and Fee Regulatory Committee (AFRC). Back then the State had enhanced the fees at an exorbitant rate of Rs 24 lakhs per annum i.e. almost seven times the tuition fees notified for the previous block period. 

Consequently, the matter was challenged before the High Court and the Court ultimately set aside the concerned G.O while observing that considering the provisions of Andhra Pradesh Admission and Fee Regulatory Committee Rules, 2006, the fee cannot be fixed/enhanced without the recommendations of AFRC. Further the HC bench had opined that the recovery of enhanced tuition fee by the respective medical colleges was bad in law. 

Also Read: NMC Fee Order for 50 percent Private Medical College Seats not Applicable in Kerala: High Court

Back then, the HC had also held that if any excess fee had been collected than the G.O dated 18.06.2011, the same shall be refunded by the colleges to the students after adjusting the amounts payable under G.O dated 18.06.2011.

Following this, the respective private medical colleges and institutes who are now required to refund the amount approached the Supreme Court while being aggrieved with the order of the HC.

After considering the contentions of all the parties and perusing the order of the HC, the top court bench opined that, "the High Court has not committed any error in quashing and setting aside the G.O. dated 06.09.2017 enhancing the tuition fee for the block years 2017-­2020."

Observing that the tuition fees could not have been enhanced unilaterally by the State Government and without the reports and recommendations of the AFRC, the top court bench further noted that, "Even otherwise considering the relevant provisions of the Rules, 2006 the fixation could have been only on the recommendations/report by the AFRC and under Rule 4 of the Rules, 2006 a duty is cast upon the AFRC to recommend the fee fixation."

Perusing Rule 4 of Andhra Pradesh Admission and Fee Regulatory Committee Rules, 2006, the top court bench held, "Therefore, the G.O. issued by the State Government enhancing the tuition fee for the private medical colleges on the representations made by the private medical colleges was wholly impermissible and most arbitrary and only with a view to favour and/or oblige the private medical colleges. The same is rightly set aside by the High Court."

"The State could not have issued the G.O. enhancing the tuition fee for private medical colleges dehors the recommendations of the AFRC. Any enhancement of the tuition fee without the recommendations of the AFRC shall be contrary to the decision of this Court in the case of P.A. Inamdar (supra) and even the relevant provisions of the Rules, 2006. Therefore, the High Court has rightly quashed and set aside G.O. dated 06.09.2017," further read the judgment.

While considering the HC direction to the colleges to refund any excess amount collected from the students, the top court bench considered the contention of the counsel for the appellant private medical college, who submitted that between 2011 and 2017, the costs/expenses of the colleges had increased and the requirement of paying stipend to the students had been introduced in the year 2016.

Therefore, the college's counsel argued that the fee fixed in the year 2011 would cause significant loss to the colleges and the tuition fees was bound to be increased. With this argument, the counsel for the college prayed that at this stage the colleges may not be directed to refund the tuition fees collected on the basis of the G.O dated 06.09.2017. Further the counsel pointed out that in many cases students have adjusted the difference in the subsequent fees. 

On the other hand, the counsel for the students vehemently opposed this prayer and submitted that the private medical colleges who are the beneficiaries of the illegal G.O issued by the State cannot be permitted to retain the amount which they have recovered on the basis of the illegal G.O.

Meanwhile, the counsel for AFRC submitted that during the enquiry proceedings for determining the tuition fee for the block period 2017-2020, the State Government unilaterally and without waiting for the report/recommendations by the AFRC increased the tuition fee. Further, it was submitted that AFRC via notification dated 08.12.2016 had proposed to review and determine the fees' structure and call for relevant materials from the medical colleges and the students and the review and determination of fees was pending. In the meantime, the association of colleges had addressed a letter to the State seeking a revision which the State had permitted in clandestine manner.

After considering the contentions of both the parties, the top court bench observed, "As observed hereinabove no error has been committed by the High Court in quashing and setting aside G.O. dated 06.09.2017 enhancing the tuition fee for the private medical colleges. The Government of Andhra Pradesh on the representations made by the private medical colleges enhanced the tuition fee for private medical colleges though the revision of fees was pending consideration with the AFRC. The State Government enhanced the tuition fee exorbitantly to Rs. 24 lakhs per annum which was seven times the fee fixed earlier. Once the State Government enacted the Rules, 2006 which provides determination and fixation and the review of the tuition fees by the AFRC, the State Government was bound by the Rules, 2006 and could not have enhanced the fee during the review pending with the AFRC. To enhance the fee unilaterally would be contrary to the objects and purpose of Andhra Pradesh Educational Institutions (Regulation of Admissions and Prohibition of Capitation Fee) Act, 1983 as well as the Rules, 2006 and the decision of this Court in the case of P.A. Inamdar (supra)."

"To enhance the fee to Rs. 24 lakhs per annum i.e., seven times more than the fee fixed earlier was not justifiable at all. The education is not the business to earn profit. The tuition fee shall always be affordable. Determination of fee/review of fee shall be within the parameters of the fixation rules and shall have direct nexus on the factors mentioned in Rule 4 of the Rules, 2006, namely, (a) the location of the professional institution; (b) the nature of the professional course; (c) the cost of available infrastructure; (d) the expenditure on administration and maintenance; (e) a reasonable surplus required for growth and development of the professional Institution; (f) the revenue foregone on account of waiver of fee, if any, in respect of students belonging to the reserved category and other Economically Weaker Sections of the society. All the aforesaid factors are required to be considered by the AFRC while determining/reviewing the tuition fees. Therefore, the High Court is absolutely justified in quashing and setting aside G.O. dated 06.09.2017," the bench further clarified.

Holding that the HC had rightly directed to refund the excess tuition fees collected under the G.O dated 06.09.2017, the Supreme Court bench observed,

"Now so far as the directions issued by the High Court to refund the amount of tuition fee collected under G.O. dated 06.09.2017 and to refund the balance amount after adjusting the fee paid pursuant to the earlier determination as per G.O. dated 18.06.2011 is concerned, we are of the opinion that the High Court has not committed any error in issuing such directions. The management cannot be permitted to retain the amount recovered/collected pursuant to the illegal G.O. dated 06.09.2017. The medical colleges are the beneficiaries of the illegal G.O. dated 06.09.2017 which is rightly set aside by the High Court. The respective medical colleges have used/utilized the amount recovered under G.O. dated 06.09.2017 for a number years and kept with them for a number of years on the other hand students paid the exorbitant tuition fee after obtaining loan from the financial institutions/banks and paid the higher rate of interest."

"If at all the AFRC determines/fixes the tuition fee which is higher than the tuition fee fixed earlier it will be always open for the medical colleges to recover the same from the concerned students, however, the respective medical colleges cannot be permitted to retain the amount collected illegally pursuant to G.O. dated 06.09.2017. Therefore, even the directions issued by the High Court to refund the amount of tuition fee collected pursuant to G.O. dated 06.09.2017 after adjusting the amount payable as per the earlier determination is not required to be interfered with," it further noted.

Therefore, dismissing the appeals by the private medical colleges, the bench observed,

"In view of the above and for the reasons stated above both the appeals fail and the same deserve to dismissed and are accordingly dismissed, however, with cost which is quantified at Rs. 5 lakhs to be equally paid by the appellant(s) as well as the State of Andhra Pradesh (i.e., Rs. 2.5 lakh by the appellant(s) and Rs. 2.5 lakh by the State of Andhra Pradesh) to be deposited with the Registry of this Court within a period of six weeks from today and on such deposit the same be transferred to National Legal Services Authority (NALSA) and Mediation and Conciliation Project Committee, Supreme Court of India (MCPC) equally."

To read the order, click on the link below.

https://medicaldialogues.in/pdf_upload/supreme-court-afrc-190255.pdf

Also Read: Puducherry students demand private medical colleges fees on par with TN based institutes, write to Fee Committee