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Madhya Pradesh High Court · body

2007 DIGILAW 485 (MP)

Priyanka v. State of M. P.

2007-04-27

A.K.PATNAIK, K.K.LAHOTI

body2007
Judgement A. K. PATNAIK, C.J. :- In this batch of writ petitions, we are called upon to decide the fees payable by students admitted to free seats in MBBS and BDS courses in private Medical and Dental Colleges in the State of Madhya Pradesh during the academic year 2003-2004. 2. The relevant facts briefly are that the Professional Examination Board set up by the Government of Madhya Pradesh conducted the Common entrance Examination, known as "PMT 2003", for admissions to the MBBS and BDS courses in private Medical and Dental Colleges in the State of Madhya Pradesh for the academic year 2003-2004. The Government of Madhya Pradesh in the Medical Education Department issued orders on 3-7-2003 fixing the fees for free seats, payment seats and NRI seats in private Medical and Dental Colleges in MBBS and BDS courses at Rs. 38,500/-, Rs. 1,65,000/- and $12,000/- respectively. Accordingly, call letters were issued to the students for counselling mentioning fees for admission to free seats in MBBS and BDS courses in the academic year 2003-2004 in private Medical and Dental Colleges in Madhya Pradesh as Rs. 38,500/- per annum. Pursuant to the call letters, counselling took place and the students who opted for admissions to MBBS/BDS courses in private Medical and Dental Colleges were allotted seats in private Medical or Dental Colleges. On 9-9-2003, the Government of Madhya Pradesh in the Medical Education Department again issued an order/public notice in the newspapers that for admissions made on the basis of PMT 2003 to MBBS and BDS courses in private Medical and Dental Colleges, the fees for free seats are Rs. 38,500/- per annum, the fees for payment seats are Rs. 1,65,000/- per annum and the fees for NRI seats are 12,000 dollars per annum. The managements of private Medical and Dental Colleges, on the other hand, claimed that they were entitled to fix the fees for students admitted to their colleges as per the law declared by the Supreme Court in T. M. A. Pai Foundation and others v. State of Karnataka and others ( (2002) 8 SCC 481 : ( AIR 2003 SC 355 ). 3. Thus, disputes arose regarding the fees payable by students admitted to the free seats in MBBS and BDS courses in private Medical and Dental Colleges in the State of M. P. during 2003-2004. Writ Petition Nos. 3. Thus, disputes arose regarding the fees payable by students admitted to the free seats in MBBS and BDS courses in private Medical and Dental Colleges in the State of M. P. during 2003-2004. Writ Petition Nos. 27726 of 2003, 27729 of 2003 and 27735 of 2003 have been filed by the students contending that the students admitted to the free seats in the MBBS or Dental Course in the private Medical/Dental Colleges in the State of M. P. during the academic year 2003-2004 are liable to pay only Rs. 38,500/- as fixed by the Government in the orders dated 3-7-2003 and 9-9-2003. On the other hand, Writ Petition Nos. 27727 of 2003, 27728 of 2003 and 219 of 2005 have been filed by the managements of the private Medical and Dental Colleges challenging the orders of the State Government dated 3-7-2003 and 9-9-2003 fixing the fees of Rs. 38,500/- per annum for students admitted to free seats in private colleges in the State of M. P. as contrary to the judgment of the Supreme Court in T. M. A. Pai Foundation ( AIR 2003 SC 355 ) (supra). 4. Mr. Aditya Sanghi, learned counsel for the petitioners in WP Nos. 27726/2003, 27729/2003 and 27735/2003, who are all students, submitted that in the orders dated 3-7-2003 and 9-9-2003, the State Government fixed the fees of Rs. 38,500/- for admission to the free seats in MBBS and BDS courses in the private Medical and Dental Colleges in the state of Madhya Pradesh for the academic year 2003-2004 and accordingly call letters for counselling were issued to the students in which tuition fees of Rs. 38,500/- per annum was mentioned for free seats for the MBBS and BDS courses in the private Medical and Dental Colleges in the State of Madhya Pradesh. He submitted that the State Government had also fixed the fees for MBBS and BDS courses in Government colleges, but at the counselling the students opted for admissions in private Medical and Dental Colleges instead of the Government colleges because of various other advantages such as location of the private Medical and Dental Colleges compared to the Government Medical and Dental Colleges. He submitted that since the students had altered their position on the basis of promise made to them that the fees in free seats for MBBS and BDS courses in private Medical and Dental Colleges will be only Rs. 38,500/-, the managements of the private Medical and Dental Colleges are estopped from claiming higher fees. He cited the decision in State of Orissa and others v. Mangalam Timber Products Ltd. (2004) 1 SCC 139 : ( AIR 2004 SC 297 ) in which the Supreme Court has held that the State Government having persuaded Mangalam Timber Products Ltd. to establish an industry and Mangalam Timber Products Ltd. having acted on the solemn promise of the State Government and purchased raw material at a fixed price and also sold its products by pricing the same taking into consideration the price of the raw material fixed by the State Government, the State Government could not later on be permitted to revise the terms for supply of raw material from the a back date adversely affecting the interest of Mangalam Timber Products Ltd. He also cited the decision of the Supreme Court in State of Punjab v. Nestle India Ltd. and another, (2004) 6 SCC 465 : (AIR 2004 SC 4559) for the proposition that the doctrine of promissory estoppel was not limited to the cases where there was some contractual relationship or other pre-existing legal relationship between the parties but applied even when the promise is intended to create legal relations or affect a legal relationship which will arise in future. 5. Mr. Sanghi next submitted that the entire case of the managements of private Medical and Dental Colleges is based on the law laid down by the Supreme Court in T. M. A. Pai Foundation ( AIR 2003 SC 355 ) (supra) that unaided private Medical and Dental Colleges were entitled to determine their own fee structure, but the Supreme Court has also held in T. M. A. Pai Foundation that a rational fee structure should be adopted by the management of private unaided colleges and they will not be entitled to charge capitation fee or indulge in profiteering and that the State Government can devise an appropriate machinery to ensure that no capitation fee is charged and no such profiteering takes place. He submitted that after the judgment delivered by the Supreme Court in T. M. Pai Foundation, no machinery was established by the State Government for ensuring that only rational fee is charged and no capitation fee is charged. Hence, the Supreme Court again reconsidered the matter in the case of Islamic Academy of Education and another v. State of Karnataka and others (2003) 6 SCC 697 ) :( AIR 2003 SC 3724 ) and in its order dated 14-8-2003 directed in para 21 of the order as reported in the SCC : (Para 20 of AIR) that for the year 2003-2004 seats be filled up by the institution and the State Governments in the ratio 50:50. He submitted that in the case of Islamic Academy of Education (supra), the Supreme Court also directed that a Committee headed by a retired High Court Judge be constituted for approving the fee structure proposed by the private unaided institutions. He submitted that the Supreme Court also held in Islamic Academy of Education (supra) that each educational institute must place before the Committee, well in advance of the academic year, its proposed fee structure and that the proposed fee structure so approved by the committee was also to be indicated in the prospectus issued for admission. He submitted that the directions of the Supreme Court in the case of Islamic Academy of Education were to apply to admissions for the academic year 2004-05 and not to academic year 2003-04. He submitted that the Fee Fixation Committee constituted by the State Government of Madhya Pradesh has therefore held in its final order dated 9-3-2005 that the committee had no jurisdiction under the order of the Supreme Court in Islamic Academy of Education (supra) to fix fees for the academic year 2003-2004 and the fees for the academic year 2003-2004 has to be decided by the State Government. 6. Mr. 6. Mr. Sanghi further submitted that in P. A. Inamdar and others v. State of Maharashtra ( (2005) 6 SCC 537 ) : ( AIR 2005 SC 3226 ), the Supreme Court reiterated that every institution has to devise its own fee structure subject to limitation that there can be no profiteering by such institutions and that capitation fees cannot be charged directly or indirectly or in any form and that it was permissible to regulate admission of fee structure for ensuring that such profiteering does not take place and no capitation fee in any form is charged. He submitted that in any case the Supreme Court has held in para 154 : (Para 151 of AIR) of the judgment in P. A. Inamdar and another v. State of Maharashtra (supra) that the judgment in that case will not have the effect of disturbing the admissions already made and that the judgment will be given effect to from the academic year commencing next after the judgment. He submitted that since the judgment in P. A. Inamdar (supra) was delivered after the academic session 2003-04, it will not apply to admissions and fees in private institutions for the academic year 2003-04. 7. Mr. Ashok Lalwani, learned counsel appearing for the petitioners in W. P. No. 27727/2003 and W. P. No. 27728/2003 which are private dental Colleges in the State of Madhya Pradesh, submitted that the Madhya Pradesh Chikitsa Shiksha Act has no application to private Dental Colleges and therefore the fees of Rs. 38,500/-fixed for BDS courses in the private Dental Colleges fixed by the State Government under the said Act is without jurisdiction. He further submitted that the judgment of the Supreme Court in Unni Krishnan J. P. and others v. State of Andhra Pradesh and others ( (1993)1 SCC 645 ) : ( AIR 1993 SC 2178 ) has been overruled by the 11 Judges judgment of the Supreme Court in TMA Pai Foundation ( AIR 2003 SC 355 ) (supra) and therefore the scheme framed by the Supreme Court in Unni Krishnan (supra) providing lower fees for free seats and higher fees for payment seats was not applicable w.e.f. 31-10-2002 when the judgment of the Supreme Court was delivered in TMA Pai Foundation (supra). He submitted that in TMA Pai Foundation (supra), the majority judgment clearly held that an education institution which does not seek any aid from Government must have the freedom to determine the fees that can be charged from the students and the only limitations on such freedom of the management of private unaided educational institution are that the fee structure must be rational and there should be no profiteering by the management of the private colleges and they should not charge capitation fees though reasonable surplus for development of the institution was permissible. He submitted that this position of law was reiterated by the Supreme Court in its order dated 14-8-2003 in Islamic Academic of Education ( AIR 2003 SC 3724 ) (supra). He argued that the State Government was therefore not right in issuing the impugned orders dated 3-7-2003 and 9-9-2003 fixing the fees for Dental course in private Dental Colleges in the State of MP for the academic year 2003-2004 as Rs. 38,500/-. He submitted that in accordance with the judgment of the Supreme Court in TMA Pai Foundation (supra) and Islamic Academy of Education (supra), the petitioners wrote letters to the State Government proposing fees of Rs. 2,75,000/- for the students to be admitted to the BDS course in their colleges and the State Government also approved the fees proposed by the petitioners and therefore the petitioners are entitled to charge fees as decided by the petitioner colleges and approved by the State Government. Mr. Lalwani submitted that in the alternative the petitioners should be allowed to charge fees as fixed by the Fee Fixation Committee for the academic year 2004-2005 to students who have been admitted to the BDS course in the private Dental Colleges during the academic year 2003-2004. He submitted that if the Court is not inclined to direct the students to pay the fees fixed by the Fee Fixation Committee for the academic year 2004-05, the Court may constitute a separate committee for determining the fee to be payable by students admitted to the private Dental Colleges in the State of Madhya Pradesh during the academic year 2003-2004. 8. Mr. 8. Mr. Kishore Shrivastava, learned senior counsel appearing for the petitioner in W. P. No. 219/2005, which is a private Medical College in the State of Madhya Pradesh, submitted that the law laid down by the Supreme Court in the case of TMA Pai Foundation ( AIR 2003 SC 355 ) (supra) is clear that private educational institutions must have autonomy with regard to fixation of fees and the only limitations put on such autonomy to fix the fees are that a rational fee structure must be adopted and no capitation fee should be charged. He submitted that after the judgment of the Supreme Court was delivered on 31-10-2002, the State Government ceased to have power to fix the fees for private Medical Colleges and accordingly the public notice/order dated 9-9-2003 of the State Government fixing the fees for private Medical Colleges in the State of M. P. for the MBBS course for the academic year 2003-04 as Rs. 38,500/- was illegal and was liable to be quashed. He submitted that the observations in the subsequent order dated 14-8-2003 of Supreme Court in the case of Islamic Academy of Education ( AIR 2003 SC 3724 ) (supra) that for the year 2003-2004, 50% of the seats in the private Professional Colleges will be filled up by State quota meant that students selected by the State Government must be admitted to 50% of the seats and did not mean that students who were admitted to the 50% of the seats were liable to pay lesser fees fixed by the State Government. He referred to the letter dated 1-9-2003 of the petitioner College to the Chief Minister in which the petitioner had requested the Chief Minister to cancel the order dated 3-7-2003 of the State Government fixing the fees for private Medical and Dental Colleges as Rs. 38,500/-. He also referred to the reply of the Director, Medical Education that the Government has determined the fees for private Medical and Dental Colleges for the MBBS and BDS course for the academic year 2003-04. He referred to the prospectus of the petitioner College for admission to MBBS course for the year 2003-04 to show that the petitioner had put the students to notice that tuition fees for admission for the students would be Rs. 3,50,000/- per year. He referred to the prospectus of the petitioner College for admission to MBBS course for the year 2003-04 to show that the petitioner had put the students to notice that tuition fees for admission for the students would be Rs. 3,50,000/- per year. He submitted that at the time of admission of the students in the year 2003-04 an undertaking was taken from the students that they will pay the difference amount in case the Court holds that they are liable to pay higher fees. He submitted that Fee Fixation Committee has determined the fees for the academic years 2004-2005 to 2006-2007 for students admitted to the MBBS course in the petitioner private Dental College as Rs. 1,64,000/-. He submitted that in the interim order dated 3-2-2005 passed by this Court in W. P. No. 3737/2004, this Court has also taken a view that fees determined by the Fees Fixation Committee for the academic year 2004-2005 at Rs. 1,65,000/- per annum will apply to the academic year 2003-2004. He submitted that this was also the view of the Committee in the interim order dated 31-5-2004 that the fees payable by the students admitted for MBBS course in the private Medical and Dental Colleges should be the same as those admitted to the academic year 2004-2005. 9. Mr. Vivek Awasthy, learned Government Advocate appearing on behalf of the State of Madhya Pradesh submitted that the Fee Fixation Committee constituted pursuant to order dated 14-8-2003 of the Supreme Court in Islamic Academy of Education ( AIR 2003 SC 3724 ) (supra) had no jurisdiction to fix the fees for the academic year 2003-2004 but had the jurisdiction to approve the fees for MBBS and BDS courses in private Medical and Dental Colleges in the State of MP for the year 2004-2005 onwards. He submitted that for the year 2003-2004 the State Government had power to determine the fees and accordingly determined the fees for the free seats in MBBS and BDS course in private Medical and Dental Colleges in the State of MP as Rs. 38,500/-per annum in accordance with the judgment of the Supreme Court in Unni Krishnan ( AIR 1993 SC 2178 ) (supra). 10. 38,500/-per annum in accordance with the judgment of the Supreme Court in Unni Krishnan ( AIR 1993 SC 2178 ) (supra). 10. We have considered the submissions of the learned counsel for the parties and we do not think that the principles of promissory estoppel will apply in these cases because the managements of the private Medical and Dental Colleges do not seem to have held out any promise to the students admitted to their colleges in MBBS/BDS course during the academic year 2003-2004 that they will be liable for a fee of Rs. 38,500/- only. On the other hand, the managements of the private Medical and Dental Colleges in the State of Madhya Pradesh have been claiming that as per the judgment of the Supreme Court in TMA Pai Foundation ( AIR 2003 SC 355 ) (supra) delivered on 31-10-2002, they have a right to determine the fee to be charged from the students admitted to their colleges. It is the State Government which issued the orders on 3-7-2003 and 9-9-2003 fixing the fee of Rs. 38,500/- for admission to the free seats in MBBS/BDS course in the private Medical and Dental Colleges in the State of Madhya Pradesh for the academic year 2003-2004. In absence of any promise held out by the managements of the private Medical and Dental Colleges that the fee for admission to the free seats in MBBS/BDS course in their colleges would be Rs. 38,500/- they cannot be held to be bound by any such promise. We also do not think that the authority of the State Government to determine the fee for the private Medical and Dental Colleges in the State of Madhya Pradesh in the orders dated 3-7-2003 and 9-9-2003 is actually derived from the M. P. Chikitsa Shiksha Act or the Rules made thereunder and hence we need not examine the provisions of the M. P. Chikitsa Act or the Rules made thereunder to find out whether the State Government had the power to fix the fees for students admitted to the private Medical and Dental Colleges in the State of Madhya Pradesh during the academic year 2003-2004. The authority of the State Government to fix the fees for professional courses in private unaided colleges is derived from the directions of the Supreme Court in Unni Krishnan ( AIR 1993 SC 2178 ) (supra). 11. The authority of the State Government to fix the fees for professional courses in private unaided colleges is derived from the directions of the Supreme Court in Unni Krishnan ( AIR 1993 SC 2178 ) (supra). 11. In Unni Krishnan (supra), B. P. Jeevan Reddy, J., delivering the majority judgment held that so far as unaided institutions are concerned, they cannot be compelled to charge the same fee as is charged in Governmental institutions for the simple reason that they have to meet the cost of imparting education from their own resources and the main source, apart from donations/charities, if any, can only be the fees collected from the students and therefore 'cost based educational institutions' have to come in. His Lordship explained that the cost of education may vary from institution to institution and the facilities provided, equipment, infrastructure, standard and quality of education obtaining may vary from institution to institution and the solution has to be evolved taking into account all these variable factors. His Lordship however cautioned that commercialization of education cannot and should not be permitted because commercialization is positively harmful and is opposed to public policy and hence there should be no room for the management or anyone on its behalf to demand or collect any amount beyond what is permitted. The Supreme Court then proceeded to frame a scheme whereunder 50% of the seats in every professional college were to be free seats and the remaining 50% seats in professional college were to be payment seats and the free seats were to be filled up by the candidates selected on the basis of their higher position in the merit determined in a common entrance examination and the payment seats were to be filled up by the candidates lower in the merit list determined in the common entrance examination. Clauses (5) and (6) (a) of the Scheme as framed in Unni Krishnan ( AIR 1993 SC 2178 ) (supra), which relates to determination of fees to be charged by private unaided professional colleges, are quoted hereinbelow : "(5). Each professional college shall intimate the competent authority, the State Government and the concerned University in advance the fees chargeable for the entire course commencing from that academic year. The total fees shall be divided into the number of years/semesters of study in that course. Each professional college shall intimate the competent authority, the State Government and the concerned University in advance the fees chargeable for the entire course commencing from that academic year. The total fees shall be divided into the number of years/semesters of study in that course. In the first instance, fees only for the first year/semester shall be collected. The payment students will be, however, required to furnish either cash security or Bank guarantee for the fees payable for the remaining years/semesters. The fees chargeable in each professional college shall be subject to the ceiling prescribed by the appropriate authority or by a competent Court. The competent authority shall issue a brochure, on payment of appropriate charges, along with the application form for admission, giving full particulars of the courses and the number of seats available, the names of the colleges, their location and also the fees chargeable by each professional college. The brochure will also specify the minimum eligibility conditions, the method of admission (whether by entrance test or otherwise) and other relevant particulars. 6(a). Every State Government shall forthwith constitute a Committee to fix the ceiling on the fees chargeable by a professional college or class of professional colleges, as the case may be. The Committee shall consist of a Vice-Chancellor, Secretary for Education (or such Joint Secretary, as he may nominate) and Director, Medical Education/Director Technical Education. The Committee shall make such enquiry as it thinks appropriate. It shall, however, give opportunity to the professional colleges for their associate(s), if any, to place such material, as they think fit. It shall, however, not be bound to give any personal hearing to anyone or follow any technical rules of law. The Committee shall make such enquiry as it thinks appropriate. It shall, however, give opportunity to the professional colleges for their associate(s), if any, to place such material, as they think fit. It shall, however, not be bound to give any personal hearing to anyone or follow any technical rules of law. The Committee shall fix the fee once every three years or at such longer intervals, as it may think appropriate." It will, thus, be clear that under the scheme framed by the Supreme Court in Unni Krishnan, each professional college was required to intimate the competent authority, the State Government and the concerned University in advance the fee chargeable for the entire course commencing from the academic year concerned; the total fees were to be divided into the number of years /semesters of the study in that course; such fee chargeable in each professional college was to be subject to the ceiling prescribed by the appropriate authority; the State Government was to constitute a Committee to fix the ceiling on the fees chargeable by a professional college or class of professional colleges, as the case may be; the professional colleges or their associations were to be given an opportunity to place such material as they think fit, before the Committee and the Committee was to make such enquiry as it thinks appropriate before fixing ceiling on the fees chargeable by a professional college or a class of professional colleges and on the basis of the recommendation of the Committee, the State Government was to fix the ceiling on the fee. This scheme was modified by the Supreme Court by an order dated 14-5-1993 in Unni Krishnan J. P. v. State of A. P., reported in (1993) 4 SCC 111 , permitting the professional colleges to admit Non-Resident Indian (NRI) students to the extent of 5% of the total intake capacity for a given year and the fees payable by such NRI students were to be such as prescribed by the Committee referred to in clause (6)(a) of the scheme in Unni Krishnan. 12. 12. In accordance with the aforesaid scheme, the State Government in different States notified a lower fee for free seats and much higher fee for payment seats and candidates who secured higher position in the merit list in a common entrance examination were admitted to the free seats and those candidates who secured lower position in the merit list in a common entrance examination were admitted to the payment seats in the private professional colleges. The Professional Examination Board set up by the State of Madhya Pradesh conducted the common entrance examination for admissions to the private professional colleges and the State Government every year notified fees for free seats and for payment seats and the candidates were admitted to such free seats and payment seats on the basis of their merit position in a common entrance examination. 13. On 31-10-2002 a Bench of 11 Judges of the Supreme Court delivered the judgment in TMA Pai Foundation ( AIR 2003 SC 355 ) (supra) and the majority of the Judges speaking through the then Chief Justice B.N. Kirpal observed that the scheme in Unni Krishnan was that the payment seat student would not only pay for his own seat but also finance the cost of a free seat classmate, but it seems unreasonable to compel a citizen to pay for the education of another. Paragraph 37 of the majority judgment of Kirpal, C.J., at page 539 of (2002) 8 SCC 481 : ( AIR 2003 SC 355 at p. 384) is quoted hereinbelow : " Unni Krishnan judgment has created certain problems, and raised thorny issue. In its anxiety to check the commercialization of education, a scheme of 'free' and 'payment' seats was evolved on the assumption that the economic capacity of the first 50% of admitted students would be greater than the remaining 50%, whereas the converse has proved to be the reality. In this scheme, the 'payment seat' student would not only pay for his own seat, but also finance the cost of a 'free seat' classmate. In this scheme, the 'payment seat' student would not only pay for his own seat, but also finance the cost of a 'free seat' classmate. When one considers the Constitution Bench's earlier statement that higher education is not a fundamental right, it seems unreasonable to compel a citizen to pay for the education of another, moreso in the unrealistic world of competitive examination which assesses the merit for the purpose of admission solely on the basis of the marks obtained, where the urban students always have an edge over the rural students. In practice, it has been the case of the marginally less merited rural or poor student bearing the burden of a rich and well exposed urban student." 14. Kirpal C.J. also held in TMA Pai Foundation's case ( AIR 2003 SC 355 ) that pursuant to the scheme in Unni Krishnan, the State Governments have legislated in conformity with the scheme curtailing all the essential features of the right of administration of a private unaided educational institution and the legislations have not been fair or reasonable and the private institution has been made indistinguishable from the Government institution. The majority judgment of Kirpal C.J. in paragraph 45 at page 541 of the SCC (at pp 385-86 of AIR) in which the scheme in Unni Krishanan was overruled, is quoted hereunder : "In view of the discussion hereinabove, we hold that the decision in Unni Krishnan case in so far as it framed the scheme relating to the grant of admission and the fixing of the fee, was not correct, and to that extent, the said decision and the consequent directions given to UGC, AICTE, the Medical Council of India, the Central and State Governments etc. are overruled." 15. The Supreme Court in the majority judgment in TMA Pai Foundation also held that a private educational institution if it chooses not to seek any aid from the Government, must have the freedom to determine the scale of fee that it can charge from the students, but it cannot be allowed to charge capitation fee and indulge in profiteering because education is an essential charitable activity. This will be clear from paragraph 57 of the judgment at page 545 of the SCC : (at p. 388 para 57 of AIR) quoted hereinbelow : "We, however, wish to emphasize one point, and that is that inasmuch as the occupation of education is, in a sense, regarded as charitable, the Government can provide regulations that will ensure excellence in education, while forbidding the charging of capitation fee and profiteering by the institution. Since the object of setting up an educational institution is by definition 'charitable', it is clear that an educational institution cannot charge such a fee as is not required for the purpose of fulfilling that object. To put it differently, in the establishment of an educational institution, the object should not be to make a profit, inasmuch as education is essentially charitable in nature. There can, however, be a reasonable revenue surplus, which may be generated by the educational institution for the purpose of development of education and expansion of the institution." Thus, in TMA Pai Foundation, the Supreme Court clearly recognized the power of the Government to make regulation forbidding charging of capitation fee and profiteering by the private unaided educational institutions. 16. The Supreme Court also observed in TMA Pai Foundation ( AIR 2003 SC 355 ) that a rational fee structure should be adopted by the management and appropriate machinery can be devised by the State or University to ensure that no capitation fee is charged and that there is no profiteering, though a reasonable surplus for the furtherance of education is permissible. Paragraph 69 of the judgment in TMA Pai Foundation at page 549 of the SCC : (at P. 391, Para 69 of AIR) is quoted hereinbelow : "In such professional unaided institutions, the management will have the right to select teachers as per the qualifications and eligibility conditions laid down by the State/University subject to adoption of a rational procedure of selection. A rational fee structure should be adopted by the management which would not be entitled to charge a capitation fee. Appropriate machinery can be devised by the State or University to ensure that no capitation fee is charged and that there is no profiteering, though a reasonable surplus for the furtherance of education is permissible. Conditions granting recognition or affiliation can broadly cover academic and educational matters including the welfare of students and teachers." 17. Appropriate machinery can be devised by the State or University to ensure that no capitation fee is charged and that there is no profiteering, though a reasonable surplus for the furtherance of education is permissible. Conditions granting recognition or affiliation can broadly cover academic and educational matters including the welfare of students and teachers." 17. Although the judgment in TMA Pai Foundation was delivered on 31-10-2002, for the academic year 2003-2004, the Professional Examination Board set up by the State Government conducted the common entrance examination known as PMT 2003 and the Government of Madhya Pradesh in the Medical Education Department issued orders on 3-7-2003 fixing the fees for free seats in MBBS/BDS courses at Rs. 38,500/-, for payment seats at Rs. 1,65,000/- and for NRI seats at 12,000 dollars in accordance with the scheme in Unni Krishnan. Obviously, these different fees were fixed by the State Government after taking into consideration the material placed by the private Medical and Dental Colleges in the State of Madhya Pradesh on the costs of medical and dental education in accordance with Clauses (5) and (6)(a) of the scheme in Unni Krishnan. As we have seen, the scheme in Unni Krishnan was framed taking into consideration the costs of education for the professional college and the costs of education were to be borne by the students admitted to the MBBS/BDS courses, those admitted to the payment seats having to pay not for their own seats but also having to finance the cost of free seat classmates. It is for this reason that fee for free seats in MBBS/BDS courses has been fixed only at Rs. 38,500/-, but the fee for payment seats has been fixed at a much higher figure of Rs. 1,65,000/- by the State Government in the order dated 3-7-2003. Hence, the private Medical and Dental Colleges cannot have a grievance that by collecting low fee of Rs. 38,500/- from the students admitted to the free seats, they are unable to meet the costs of education because they are collecting much higher fees of Rs. 1,65,000/- from the students admitted to the payment seats and from the students admitted to NRI seats. Mr. 38,500/- from the students admitted to the free seats, they are unable to meet the costs of education because they are collecting much higher fees of Rs. 1,65,000/- from the students admitted to the payment seats and from the students admitted to NRI seats. Mr. Ashok Lalwani submitted that pursuant to the orders passed by the Fee Fixation Committee, the private Dental Colleges are charging lesser fees from the students admitted to the payment seats and have refunded amounts collected in excess of the fees fixed by the Fee Fixation Committee. This aspect will be considered while dealing with the cases relating to fee of students admitted to the payment seats during the academic year 2003-2004, which are pending before the Court. 18. Further in Cl. (5) of the Scheme in Unni Krishnan quoted above, it has been stated that each professional college shall intimate the State Government in advance the fees chargeable for the entire course commencing from that academic year and the total fees shall be divided into the number of years/semesters of study in that course and the competent authority shall issue a brochure giving full particulars of the fees chargeable by each professional college. This is because the students taking admission in the professional colleges must know in advance the fees he would be liable to pay for the entire course. Although in Cl. (6)(a) of the scheme in Unni Krishnan, it is provided that the fee once fixed can be revised after three years, this revision was for the purpose of taking into account the increase in the costs of education after three years and this revision was not to apply to the students who are already admitted to the course and who are liable to pay fees determined on the basis of cost of education for the entire course as prevalent at the time of admission. The fees of Rs. 38,500/- for free seats, Rs. 1,65,000/- for payment seats and 12,000 dollars for NRI seats were fixed by the order dated 3-7-2003 of the State Government after taking into consideration the costs of education for the entire MBBS/BDS course to be undertaken by the students admitted in the academic year 2003-2004. Hence, the students who have been admitted in the academic year 2003-2004 to free seats would be liable to pay Rs. 38,500/- for each of the years for the entire course of MBBS/BDS. Hence, the students who have been admitted in the academic year 2003-2004 to free seats would be liable to pay Rs. 38,500/- for each of the years for the entire course of MBBS/BDS. 19. As we have already discussed, the Supreme Court held in TMA Pai Foundation ( AIR 2003 SC 355 ) (supra) that a private unaided educational institution must have the right to fix the scale of fee that it can charge from the students, but the Supreme Court also made it clear that this right of a private unaided educational institution was not absolute and the Government could make regulation or devise appropriate machinery to ensure that no capitation fee was charged and that the management of the institution did not indulge in profiteering. Thus, the judgment of the Supreme Court in TMA Pai Foundation (supra) could be given effect to, only after the Government made a regulation or devised appropriate machinery to ensure that the fee proposed to be charged by a private unaided educational institution was rational and there was no charging of capitation fees and no profiteering. In Madhya Pradesh, the State Government neither made any regulation nor devised an appropriate machinery for ensuring that the fee proposed to be charged by a private unaided educational institution was rational and there was no charging of capitation fees or profiteering. 20. On 14-8-2003 the Supreme Court delivered orders in Islamic Academy of Education ( AIR 2003 SC 3724 ) (supra) directing that in order to give effect to the judgment in TMA Pai Foundation ( AIR 2003 SC 355 ), the State Government shall set up in each State a Committee headed by a retired High Court Judge nominated by the Chief Justice of that State, which will decide whether the fee proposed by a private unaided educational institution was justified and did not amount to profiteering. The relevant portion of the order dated 14-8-2003 of the Supreme Court in Islamic Academy of Education is quoted hereinbelow (At pp. The relevant portion of the order dated 14-8-2003 of the Supreme Court in Islamic Academy of Education is quoted hereinbelow (At pp. 3739-40, para 6 of AIR) : "As, at present, there are statutes/regulations which govern the fixation of fees and as this Court has not yet considered the validity of those statutes/regulations, we direct that in order to give effect to the judgment in TMA Pai case the respective State Governments/concerned authority shall set up, in each State, a committee headed by a retired High Court Judge who shall be nominated by the Chief Justice of that State. The other member, who shall be nominated by the Judge, should be a Chartered Accountant of repute. A representative of the Medical Council of India (in short "MCI") or the All India Council for Technical Education (in short "AICTE"), depending on the type of institution, shall also be a member. The Secretary of the State Government in charge of Medical Education or Technical Education, as the case may be, shall be a member and Secretary of the Committee. The Committee should be free to nominate/co-opt another independent person of repute, so that the total number of members of the Committee shall not exceed five. Each educational institute must place before this Committee, well in advance of the academic year, its proposed fee structure. Along with the proposed fee structure all relevant documents and books of accounts must also be produced before the Committee for their scrutiny. The Committee shall then decide whether the fees proposed by that institute are justified and are not profiteering or charging capitation fee. The Committee will be at liberty to approve the fee structure or to propose some other fee which can be charged by the institute. The fee fixed by the Committee shall be binding for a period of three years, at the end of which period the institute would be at liberty to apply for revision. Once fees are fixed by the Committee, the institute cannot charge either directly or indirectly any other amount over and above the amount fixed as fees. If any other amount is charged, under any other head or guise e.g. donations, the same would amount to charging of capitation fee. Once fees are fixed by the Committee, the institute cannot charge either directly or indirectly any other amount over and above the amount fixed as fees. If any other amount is charged, under any other head or guise e.g. donations, the same would amount to charging of capitation fee. The Governments/appropriate authorities should consider framing appropriate regulations, if not already framed, whereunder if it is found that an institution is charging capitation fees or profiteering that institution can be appropriately penalized and also face the prospect of losing its recognition/affiliation." (Emphasis supplied) 21. Pursuant to the directions in the order dated 14-8-2003 of the Supreme Court in Islamic Academy of Education (supra), the State Government constituted Fees Fixation Committee headed by Justice Shacheendra Dwivedi (retired). Since this Committee was constituted after the academic year 2003-2004 had already commenced, it had no jurisdiction to decide the fee payable by the students admitted in the MBBS and BDS courses in the Private Medical and Dental Colleges in the State of Madhya Pradesh in the academic year 2003-2004 because students seeking admission must know before admission to a course, the fees they will have to pay for the course and cannot be asked in the middle of the course to pay a higher fee which they cannot afford. The Fees Fixation Committee itself in its final order dated 9-3-2005, has taken the view that it had jurisdiction to fix the fees for the academic years 2004-2005, 2005-2006 and 2006-2007 and had no jurisdiction to fix the fees for the academic year 2003-2004. Relevant extracts from the final order dated 9-3-2005 of the Fees Fixation Committee are quoted hereinbelow : "The fee structure for the year 2003-2004 was in fact to be decided by the State Government. However, the State Government had also not at all placed on record any decision taken otherwise by it. In view of the above, it would be clear that this Committee was constituted under the directions of Hon'ble Supreme Court for a specific purpose that the Committee shall decide the fee structure for medical and technical institutions for 3 years i.e. 2004-2005 to 2006-2007. As such, the Committee was not bound to decide or apply its fees fixation order to academic year 2003-2004. It would also be clear that for considering the fees of educational year 2003-2004 this Committee was not even in existence at that time. As such, the Committee was not bound to decide or apply its fees fixation order to academic year 2003-2004. It would also be clear that for considering the fees of educational year 2003-2004 this Committee was not even in existence at that time. The Committee had no jurisdiction under the order of Hon'ble Supreme Court for fixing the differential fees for academic year 2003-2004. In fact, the Committee had come into existence only when that academic year was nearing completion." 22. Much after the completion of academic year 2003-2004, the Supreme Court delivered the judgment in P. A.Inamdar ( AIR 2005 SC 3226 ) (supra) on 12-8-2005, and observed in paragraph 154 at page 609 as reported in SCC that the law laid down by the Supreme Court shall be given effect to from the academic year commencing next after the pronouncement of the judgment. Hence the judgment of P. A. Inamdar (supra) will not strictly apply to the fixation of fee for the academic year 2003-2004. Nonetheless in paragraphs 139 and 140 of the judgment of P. A. Inamdar as reported in the SCC, R. C. Lahoti, the then C.J., reiterated the law declared in TMA Pai Foundation ( AIR 2003 SC 355 ) (supra) that every institution is free to devise its own fee structure subject to the limitation that there can be no profiteering and no charging of capitation fee directly or indirectly or in any form and also observed that it is permissible to regulate the fee structure for ensuring that there is no profiteering and no charging of capitation fees. The relevant portion of paragraph 140 of the judgment of R. C. Lahoti, C.J., in P. A. Inamdar ( AIR 2005 SC 3226 , para 137) (supra) is quoted hereinbelow : "The charging of capitation fee by unaided minority and non-minority institutions for professional courses is just not permissible. Similarly, profiteering is also not permissible. Despite the legal position, this Court cannot shut its eyes to the hard realities of commercialisation of education and evil practices being adopted by many institutions to earn large amounts for their private or selfish ends. If capitation fee and profiteering is to be checked, the method of admission has to be regulated so that the admissions are based on merit and transparency and the students are not exploited. If capitation fee and profiteering is to be checked, the method of admission has to be regulated so that the admissions are based on merit and transparency and the students are not exploited. It is permissible to regulate admission and fee structure for achieving the purpose just stated." 23. From the aforesaid analysis, it will be clear that even after the judgment of the Supreme Court was delivered in TMA Pai Foundation ( AIR 2003 SC 355 ) on 31-10-2002, no regulation had been framed by the State Government of Madhya Pradesh nor any machinery devised to determine whether the fee proposed by a Private Medical/Dental College in the State of Madhya Pradesh was rational and did not amount to profiteering or charging of capitation fee and in absence of such regulation made by the State Government or machinery devised to determine whether the fee proposed by a Private Medical/Dental College in the State of Madhya Pradesh for MBBS/BDS courses was rational and did not amount to profiteering or charging of capitation fee, the judgment of the Supreme Court in TMA Pai Foundation could not be given effect to during the academic year 2003-2004, and the fees payable by the students had to be determined in accordance with the scheme in Unni Krishnan ( AIR 1993 SC 2178 ), which was in force for almost a decade. 24. As a matter of fact, the fees which have been proposed by the Private Medical and Dental Colleges in the State of Madhya Pradesh for the academic year 2003-2004 are not rational and we cannot hold that the managements of these colleges have not charged capitation fees or have not indulged in profiteering. The petitioners in W.P. No. 22727/2003 and W.P. No. 27728/2003, which are Private Dental Colleges in the State of Madhya Pradesh, have proposed fee of Rs. 2,75,000/- per year for a student admitted to BDS course during the academic year 2003-2004 and the petitioner in W.P. No. 219/2005, which is a Private Medical College in the State of Madhya Pradesh, has proposed fee for MBBS course for students admitted during the academic year 2003-2004 as Rs. 3,50,000/- per year. 2,75,000/- per year for a student admitted to BDS course during the academic year 2003-2004 and the petitioner in W.P. No. 219/2005, which is a Private Medical College in the State of Madhya Pradesh, has proposed fee for MBBS course for students admitted during the academic year 2003-2004 as Rs. 3,50,000/- per year. On the other hand, the Fees Fixation Committee constituted pursuant to the directions of the Supreme Court in Islamic Academy of Education ( AIR 2003 SC 3724 ) (supra) has determined the fees for MBBS and BDS courses for the students admitted during the subsequent academic years 2004-2005, 2005-2006 and 2006-2007 at much lower figures of Rs. 1,64,000/- for R. D. Gardi Medical College, Ujjain, Rs. 1.46,000/- for college of Dental Science and Hospital, Indore, and Rs. 1,12,000/- for other Dental Colleges. We are, thus, of the view that the fee of Rs. 2,75,000/- per year for BDS course and Rs. 3,50,000/- per year for MBBS course proposed by the petitioners in W.P. No. 22727/2003, W.P. No. 27728/2003 and W.P. No. 219/2005 are not in accordance with the judgment of the Supreme Court in TMA Pai Foundation (AIR 2003 SC 353) (supra). 25. In the result, we hold that under the scheme in Unni Krishnan, the State Government had the authority to issue the orders dated 3-7-2003 and 9-9-2003 fixing the fees for free seats in MBBS and BDS courses in Private Medical and Dental Colleges in the Madhya Pradesh at Rs. 38,500/- per year for each student and that the students admitted to the Private Medical and Dental Colleges in the State of Madhya Pradesh in the academic year 2003-2004 are liable to pay such fee of Rs. 38,500/- per annum for the entire BBS/BDS course. Accordingly, Writ Petitions No. 27726/2003, 27729/2003 and 27735/2003 filed by the students are allowed and Writ Petitions No. 27727/2003, 27728/2003 and 219/2005 filed by the Private Dental and Medical Colleges in the State of Madhya Pradesh are dismissed. Considering however the facts and circumstances of the case, the parties shall bear their own costs. Petitions allowed.