SC upholds Rs 23.10 crore penalty on management school

The Supreme Court on Friday allowed the AICTE to impose a penalty of Rs 23.10 crore on Fore School of Management here for creating additional seats to its management course, saying the institution had no business to admit the students beyond the number permitted to it.

A bench of Justices Deepak Gupta and Surya Kant found the action of the petitioner-institution in granting admission to the students beyond the seats sanctioned as “totally illegal and contrary to law”.

“Time and again, this court has noticed that the educational institutions admit students beyond the numbers permitted putting the future of the students at stake. In the present case, we are not setting aside the admission of the students because that action would be too harsh upon the students who should not suffer for the totally illegal action of the petitioner institution,” the bench said.

The court noted the institution admitted additional 42 students in 2016 after obtaining a total fee of Rs 11 lakh from each of them without the mandatory approval from the AICTE.

Relying upon the AICTE's Approval Process Handbook, the court said the regulatory body can impose the penalty. “The petitioner has been let off lightly since only one penalty has been imposed whereas the AICTE could have imposed more than one penalty prescribed,” it noted.

The court also directed the students who have completed the course must be awarded the degrees. “The students who had paid large sums of money should not be made to suffer. They have already completed the course but the degrees have not been awarded to them," it said.

The institution which had already deposited Rs four crore during the pendency of the matter was told to deposit the remaining amount of Rs 19.10 crore within eight weeks with the AICTE.