High Court Not Justified in Ordering Retrospective Fee Refunds for Pre‑2005 Students; College May Encash Bank Guarantees

A bench of Justice B.R. Gavai and Justice Augustine George Masih heard appeals by a private dental college against a common judgment of the High Court of Chhattisgarh that had applied a later fee fixation retrospectively and directed refunds to students admitted in 2003‑04 and 2004‑05. The appeals arose from challenges to the High Court's April 6, 2010 order which had directed that students pay tuition at the rate fixed by the State's Fee Fixation Committee and that any excess amounts already collected be refunded.

The Court allowed the appeals in part and set aside the High Court's direction to make retrospective refunds to students admitted prior to the academic year 2005‑2006. The Court observed that the fee fixation by the Committee followed this Court's decision in Islamic Academy of Education and was expressly made "applicable and that too only from the academic year 2005‑2006 onwards." The Court, in its reasoning, observed: "In that view of the matter, we are of the considered view that the High Court was not justified in directing the refund of excess fee to the students who were admitted prior to the academic year 2005-2006." The bench also noted that, pursuant to an earlier interim order dated May 12, 2010, refunds had already been made and therefore permitted the appellant‑college to encash the bank guarantees furnished by students for release of documents. The appeals were disposed of and pending applications stood disposed.

Background

The dispute arose after the appellant college was established with formal permission in February 2002 and fixed tuition fees in its prospectus at Rs.2,12,500 (general) and Rs.1,12,500 (reserved), plus a caution fee. Students were admitted under that prospectus in the academic years 2003‑2004 and 2004‑2005. Following this Court's judgment in Islamic Academy of Education (2003), the State constituted the Justice S.D. Jha Fee Fixation Committee, which ultimately fixed the tuition fee for the college at Rs.1,25,000 per year and stated that the fee would be effective from the academic year 2005‑2006 for three years. The State issued a communication on July 25, 2005 confirming that fixation.

The appellant‑college challenged the fee fixation before the High Court on grounds that the Committee had not considered necessary materials; the High Court directed a change in fees by order dated September 29, 2005. Separately, some students filed writ petitions and on November 29, 2005 the High Court restrained the college from demanding fees higher than Rs.1,25,000; that order was modified on January 31, 2006 to require payment of Rs.1,50,000 subject to final outcome. By its common judgment dated April 6, 2010, the High Court directed that the Rs.1,25,000 per year fee should apply even to students admitted prior to 2005‑06 and ordered refund of any excess amounts collected.

The college filed special leave petitions before this Court. On May 12, 2010 this Court issued notice and passed interim directions requiring the college to refund the excess amounts to students who had approached the Court and to release academic documents on furnishing bank guarantees; students who had not paid any fee were to be released on furnishing bank guarantees of Rs.1,00,000. On hearing, the Supreme Court found that the Fee Fixation Committee's determination was expressly prospective and therefore the High Court erred in ordering retrospective refunds. Since refunds had already been effected under the interim order, the Court permitted the college to encash the bank guarantees and disposed of the appeals.

Case No.: 2025 INSC 720 Case Title: Chhattisgarh Dental College and Research Institute v. Shweta Kabra and Others Appearances: For the Petitioner(s): [Not indicated in judgment] For the Respondent(s): [Not indicated in judgment]