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Full Case Details
Section 3 of Tamil Nadu Private Educational Institutions (Regulation) Act, 1966mandatorily
required a private educational institution to obtain the permission of the competent authority
for the purpose of running it. Section 4 of the Act required the manager of a private
educational institution to make an application for permission in the prescribed form.
“4. Application for permission – (2) Every such application shall –
(c) contain the following particulars, namely:
(i) the name of the private educational institution and the name and address of the
manager;
(ii) the certificate, degree or diploma for which such private educational institution
prepares, trains or guides or proposes to prepare, train or guide its students or the certificate,
degree or diploma which it grants or confers or proposes to grant or confer;
(iii) the amenities available or proposed to be made available to students;
(iv) the names of the members of the teaching staff and the educational qualifications of
each such member;
(v) the equipment, laboratory, library and other facilities for instructions;
(vi) the number of students in the private educational institution and the groups into which
they are divided;
(vii) the scales of fees payable by the students;
(viii) the sources of income to ensure the financial stability of the private educational
institution;
(ix) the situation and the description of the buildings in which such private educational
institution is being run or is proposed to be prescribed;
(x) such other particulars as may be prescribed.”
“6. Grant of permission – On receipt of an application under Section 4 the competent
authority may grant or refuse to grant the permission after taking into consideration, the
particulars contained in such application:
Provided that the permission shall not be refused under this section unless the applicant has
been given an opportunity of making his representation:
Provided further that in case of refusal of permission the applicant shall be entitled to refund
of one-half of the amount of the fee accompanying the application”
The competent authority was empowered under Section 7 to cancel the permission in certain
circumstances. One of the conditions for exercise of power was contravention of any direction
issued by the competent authority under Section 15. The power to exempt any institution from
the provisions of the Act was vested in the State Government under Section 22, which read:
“22. Power to exempt – Notwithstanding anything contained in this Act, the government may,
subject to such conditions as they deem fit, by notification exempt any private educational
institution or class of private educational institutions from all or any of the provisions of this
Act or from any rule made under this Act.”
L.M. SHARMA, J. – The question involved in these appeals relates to the vires of the Tamil
Nadu Private Educational Institutions (Regulation) Act, 1966, hereinafter referred to as ‘the
Act’. The appellants are interested in running educational institutions, which are covered by
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the expression “private educational institution” within the ‘meaning of Section 2(f) of the Act.
The main challenge is directed against Sections 2(c), 3(a), 3(b), 6, 7 read with Sections 15, 22
and 28. The High Court struck down Section 28 and upheld the other sections. That part of
the judgment where Section 28 has been declared to be invalid has not been impugned by the
respondent-State.
- The Act is impugned on the ground that it does not lay down any guideline for the exercise
of the power by the delegated authority, as a result of which the authority is in a position to
act according to his whims. The Act having failed to indicate the conditions for exercise of
power, the decision of the competent authority is bound to be discriminatory and arbitrary. It
has also been argued that the restrictions put by the Act on the appellants, who are running
tutorial institutions are unreasonable and cannot be justified under sub-clause (g) of Article
19(1) of the Constitution. - The learned counsel appearing for the respondent has attempted to defend the Act on the
ground that sufficient guidance is available to the authority concerned from sub-section (2)(c)
of Section 4 which enumerates the particulars required to be supplied in the application for
permission. They are 10 in number. - The point dealing with legislative delegation has been considered in numerous cases of this
Court, and it is not necessary to discuss this aspect at length. It is well established that
determination of legislative policy and formulation of rule of conduct are essential legislative
functions which cannot be delegated. What is permissible is to leave to the delegated
authority the task of implementing the object of the Act after the legislature lays down
adequate guidelines for the exercise of power. When examined in this light the impugned
provisions miserably fail to come to the required standard. - The purpose of the Act is said to regulate the private educational institutions but does not
give, any idea as to the manner in which the control over the institutions can be exercised.
The Preamble which describes the Act “for regulation” is not helpful at all. Learned counsel
for the State said that the Object and the Reasons for the Act are to eradicate corrupt practices
in private educational institutions. The expression “private educational institution” has been
defined as meaning any college, school or other institution “established and run with the
object of preparing, training or guiding its students for any certificate, degree or diploma”,
and it can, therefore, be readily inferred that the purpose of the Act is to see that such
institutions do not exploit the students; and while they impart training and guidance to the
students of a standard which may effectively improve their knowledge so as to do well at the
examination, they do not charge exorbitantly for their services. But the question is as to how
this objective can be achieved. Section 6 which empowers the competent authority to grant or
refuse to grant the permission for establishing and running an institution does not give any
idea as to the conditions which it has to fulfill before it can apply for permission under the
Act, nor are the tests indicated for refusing permission or cancelling under Section 1 of an
already granted permission. The authority concerned has been left with unrestricted and
unguided discretion which renders the provisions unfair and discriminatory. - It was argued on behalf of the State that since an application for permission has to supply
the particulars as detailed in Section 4(2)(c) (quoted above in paragraph 4), the Act must be
deemed to have given adequate guidelines. Special emphasis was given by the learned
counsel on the sub-clauses (iii), (iv) and (v) of Section 4(2)(c), which ask for information
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about the amenities for the students – the equipment, laboratory, library and other facilities for
instruction – and, the names of the teachers with their qualifications. It may be noted that the
Act, beyond requiring the applicant to make a factual statement about these matters, does not
direct the institution to make provisions for them (or for any or some of them) as condition for
grant of permission. The maintenance of any particular standard of these heads are not in
contemplation at all, although certain other aspects, not so important, have been dealt with
differently in several other sections including Sections 4, 5, 9, 10 and 11. Section 4(2)(b)
mandatorily requires the applicant to pay the “prescribed” fee; Section 5 gives precise
direction regarding the name by which the institution is to be called; and Section 9 about the
certificates to be issued by it; and Section 11 makes it obligatory to maintain accounts in the
“prescribed” manner. But, there is no indication, whatsoever, about the legislative policy or
the accepted rule of conduct on the vital issue about the maintenance of academic standard of
the institution and the other requirements relating to the building, library and necessary
amenities for the students, as the Act is absolutely silent about the criteria to be adopted by
the prescribed authority for granting or refusing permission. The rules which were made
under Section 27 in 1968’and called the Tamil Nadu Private Educational Institutions
(Regulation) Rules, 1968, are not called upon to lay down any norm on these issues and
naturally do not make any reference to these aspects. The result is that the power to grant or
refuse permission is to be exercised according to the whims of the authority and it may differ
from person to person holding the office. The danger of arbitrariness is enhanced by the
unrestricted and unguided discretion vested in the State Government in the choice of
“competent authority” defined in Section 2(c) in the following words:
“(c) “competent authority” means any person, officer or other authority authorised by the
government, by notification, to perform the functions of the competent authority under this
Act for such area or in relation to such class of private educational institutions, as may be
specified in the notification;”
The only safeguard given to the applicant institution is to be found in the first proviso to
Section 6 which says that the permission shall not be refused unless the applicant has been
given an opportunity of making his representation, but that does not by itself protect the
applicant from discriminatory treatment. So far Section 7 dealing with power to cancel the
permission granted earlier is concerned, no objection can be taken to the first part of the
section, where under the permission may be cancelled in case of fraud, misrepresentation,
suppression of material particulars or contravention of any provision of the Act or the Rules.
But the other ground on which the authority can exercise its power being contravention “of
any direction issued by the competent authority under this Act” again suffers from the vice of
arbitrariness. Section 15, the relevant section in this regard, states that “the competent
authority may, from time to time issue such directions regarding the management of a private
educational institution as it may think fit” (emphasis added). The section is too wide in terms
without indicating the nature of such direction or the extent within which the authority should
confine itself while exercising the power. Similar is the situation in the matter of exemption
from the Act. The power to grant exemption is contained in Section 22, quoted in paragraph 2
above. - The provisions of the Act indicate that the State Government has been vested with
unrestricted discretion in the matter of the choice of the competent authority under Section
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2(c) as also in picking and choosing the institutions for exemption from the Act under Section
22. - The learned counsel for the respondent-State contended that by reference in Section 4 to
the particulars to be supplied in the application for permission, it can be easily imagined that
the competent authority has to take into account all that may be validly relevant for the grant
or refusal of permission. We are afraid; the section cannot be saved by recourse to this
argument in absence of any helpful guidance from the Act. - For the reasons mentioned above, the impugned sections of the Act must be held to be
invalid. These provisions are inextricably bound up with the other parts of the Act so as to
form part of a single scheme, and it is not possible to sever the other parts of the Act and save
them. In the result, the entire Act is declared ultra vires. The appeal is accordingly allowed,
but, in the circumstances, without costs
