Public interest challenge upheld on fee collection limits and blanket bank guarantees in professional education.

Strict locus standi is relaxed in public interest litigation where binding admission and fee-collection rules affecting a broad class of students are under challenge, so maintainability may be sustained despite an objection from a petitioner who is an advocate. In unaided professional education, institutions may fix fees within the regulatory framework, but they cannot demand advance fee for more than one year or require every student to furnish a blanket bank guarantee for the entire remaining course. Security for possible midstream loss may be sought only in a limited, case-specific manner, ordinarily by bond and exceptionally by bank guarantee. Any excess advance fee already collected must be safeguarded for students.

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Issues: (i) Whether the writ petition in public interest was maintainable despite the preliminary objection on locus standi. (ii) Whether private medical institutions and the State could insist on advance fee for more than one year and a bank guarantee from every student for the entire remaining course duration.

Issue (i): Whether the writ petition in public interest was maintainable despite the preliminary objection on locus standi.

Analysis: The petition sought enforcement of binding directions governing admissions and fee collection in professional education. In matters affecting a large class of students, strict locus standi is relaxed in public interest litigation, and the Court declined to non-suit the petitioner merely because he was an advocate. The challenge raised a question of legality affecting the student community and did not warrant rejection on maintainability alone.

Conclusion: The preliminary objection was rejected and the writ petition was held maintainable.

Issue (ii): Whether private medical institutions and the State could insist on advance fee for more than one year and a bank guarantee from every student for the entire remaining course duration.

Analysis: The governing law recognises autonomy in fee fixation but forbids capitation fee and profiteering. Fee may be charged only for one year in accordance with the rules, and if an institution apprehends that a student may leave midstream, it may require security for the balance fee, ordinarily by bond and only exceptionally by bank guarantee. Requiring every student to furnish a bank guarantee for the whole remaining course, and collecting advance fee beyond one year, was found inconsistent with the principles laid down for unaided professional institutions. The Court also held that any advance fee already collected beyond one year must be protected and not appropriated as current income.

Conclusion: The practice of demanding advance fee beyond one year and insisting on bank guarantee from each student for the entire remaining course was declared illegal, while limited security by bond or bank guarantee for a particular student was left open.

Final Conclusion: The petition succeeded, and the institutions were restrained from collecting advance fee beyond one year or demanding blanket bank guarantees, with directions to safeguard any excess amounts already collected for the benefit of the students.

Ratio Decidendi: An unaided professional educational institution may regulate fee and seek security only within the limits necessary to prevent loss from a particular student leaving midstream, but it cannot impose a blanket demand for advance fee or bank guarantee on every student, as that amounts to impermissible profiteering and is contrary to the settled regulatory framework for professional education.

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