Harshpal Singh Sawhney & Ors. v. Central Board of Secondary Education & Ors.

1. The Petitioners before this Court have filed this Writ Petition as a Public Interest Litigation (PIL) under Article 226 of the Constitution of India, aggrieved by the commercialization of education and corrosion of standards of education management, especially with reference to Respondent No. 5 herein, the Delhi Public School Society (“DPSS”). Accordingly, the Petitioners have sought, inter-alia, directions to Respondent No. 1, the Central Board of Secondary Education (“CBSE”), to Digitaaly inquire into and regulate the transactions between Education Societies and Franchise Schools and, more specifically, inspect the affairs of the schools operated by DPSS.

2. The Petitioners’ contention is that the Respondent No. 5, Delhi Public School Society is a Society registered under the Societies Registration Act, 1860, and the Society through its Chairman i.e. Respondent No.6 Mr. V. K. Shunglu has executed various joint venture agreements with several schools (franchisees agreements) for permitting certain other schools to use the name of Delhi Public School (DPS), its logo and motto.

3. It has been stated that large number of agreements have been executed between the Respondent Society and certain schools, and the Petitioners have given examples of certain schools. The Petitioners have stated that one such agreement has been executed with M/s Rachna Educational Society, Warangal, Andhra Pradesh, for setting up of a school at Warangal. The M/s Rachna Educational Society as per the agreement has to pay sum of Rs. 12 lakhs to the DPSS.

4. Similar agreement has been executed in respect of Delhi Public School, Kashipur, Uttarakhand for sum of Rs. 27,57,500/, and other agreements have been executed in favour of DPS, Pinjore, Haryana and DPS Allahabad, Uttar Pradesh as well.

5. The Petitioners have given examples of various franchisee agreements executed from time to time and have alleged a large number of irregularities in respect of management of DPS Society.

6. The Petitioner has prayed for the following reliefs in the Writ Petition: Digitaaly “a. Issue a writ of Mandamus directing Respondent No. 1to inquire into the nature of agreements and transactions between Education Societies and Franchisee schools and take, appropriate action against them, and b. Issue a writ of Mandamus directing Respondent No. 1 to 3 to. conduct an inquiry into the affairs of Respondent No. 5 and' other Societies and Trust, to take appropriate action against the erring members and office bearers, and c. Issue a writ of Mandamus directing Respondent No. 2 to inspect the affairs of the schools run by Respondent No. 5 as per Rule 170 of the Delhi School Education Rules, 1973, and d. Quash and set aside the illegal Joint Venture Agreements and Memorandum of Understandings such as entered into by Respondent No. 5 and other similarly placed Societies pertaining to granting of/operation of franchisee schools. Pass any such further orders or directions as this Hon‟ble High Court may deem fit and proper in the facts and circumstances of the case.”

7. The Petitioners have impleaded the State Government, the Central Board of Secondary Education as well as other authorities as Respondents.

8. By filing interlocutory applications, the Petitioners have brought on record various other agreements executed by the Respondent Society as well as their balance sheets. The CBSE has filed a detailed and exhaustive reply and it has been stated that the Board, in accordance with the Affiliation Bylaws, grants affiliation to the schools subject to fulfilment of the norms, and By-law 21 provides for power and functions of the School Management Committee. Affiliation By-law 21 under Chapter VI of the By-laws, reads as under: “21. Powers and Functions of the School Management Committee Digitaaly Subject to overall control of the Society/Trust/ Company Registered under Section 25 of the Companies Act, 1956 the School Managing Committee shall have the following powers/functions: i. It shall have the power to supervise the activities of the school for its smooth functioning. ii. It will work according to the specific directions given by the Society regarding admission policy. However, admissions will be made as per merit without discretion of caste/ creed/religion and region. iii. It shall look into the welfare of the teachers and employees of the school. iv. It shall evolve both short-term and long-term programmes for the improvement of the school. v. It shall have the powers for making appointment of teachers and non teaching staff. vi. It shall exercise financial powers beyond those delegated to the Principal within the budgetary provision of the school. vii. It shall have the power to take stock of academic programmes and progress of the school without jeopardising the academic freedom of Principal. viii. It shall guide the Principal to maintain tone and discipline in the school. ix. It shall ensure that the norms given In the Act of the State and by the CBSE regarding terms and conditions of service and other rules governing recognition/affiliation of the school are strictly adhered to, x. It should ensure that the school gets Furniture, Science equipment. Library books and other teaching aids and the requisite sports material in adequate quantity and on time. xi. It shall exercise powers to take disciplinary action against staff. Digitaaly xii. It shall have powers to sanction leave to the Head of the Institution including casual leave. xiii. It shall ensure that no financial irregularity is committed or any irregular procedure with regard to admission/examination is adopted. xiv. It shall have the power to propose to the Society rates of tuition fees and other annual charges and also review the budget of the school presented by the Principal for forwarding the same to Society for approval. xv. The Managing Committee will meet at least twice in an academic session.

9. Affiliation By-law 7 under Chapter II of the By-laws reads as under: “7. Financial Resources

1. The school must have sufficient financial resources to guarantee its continued existence. It should have permanent source of income to meet the running expenses of the school so as to maintain it at a reasonable standard of efficiency, to pay salaries to teachers and other categories of staff regularly at least at par with the corresponding categories in the State Government Schools and to undertake improvement/development of school facilities. In case of institutions which are in the receipt of grant-in-aid from the State Government/ U.T. the permanent Source of income shall include the amount of grant-in-aid also.

2. No part of income from the institution shall be diverted to any individual in the Trust/ Society/# Company registered under section 25 of the companies act, 1956 School Management Committee or to any other person. The savings, if any, after meeting the recurring and nonrecurring expenditure and contributions and developmental, depreciation and contingency funds may be further utilized for promoting the school. The accounts should be audited and certified by a Chartered Accountant and proper accounts statements should be prepared as per rules. A Digitaaly copy each of the Statement of Accounts should be sent to the Board every year.

3. The channeling of funds by the management to person (s) or enterprise other than for furthering education in the school will contravene the rules governing affiliation and call for appropriate action by the Board, which may lead to disaffiliation of the concerned institutions.”

10. The Central Board of Secondary Education, vide its Counter Affidavit dated 11.07.2016, has stated, that as per the applicable By-laws, various Delhi Public Schools have been established under different trusts and societies having affiliation with the CBSE, and, their name, per se, is not DPS but they have added names like DPS Ghaziabad and DPS Madhubani Pvt. Ltd. with a different logo.

11. The Respondent CBSE has further stated that in respect of violation of affiliation By-laws, action was initiated in respect of DPS, Kashipur, Uttarakhand. However, no further action has been taken on account of interim order passed by the High Court of Uttarakhand at Nainital in that matter.

12. The Respondents have categorically stated that as and when a complaint is received, action has been initiated by them, and they shall be taking appropriate action in accordance with law, strictly in consonance with the Affiliation By-laws.