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Petitioner: EDUCATIONAL SERVICES (PVT) LIMITED and 4 others VS Respondent: FEDERATION OF JUDGMENT
Court Name: Islamabad High Court Judge(s): Aamer Farooq Title:EDUCATIONAL SERVICES (PVT) LIMITED and 4 others vs FEDERATION OF
JUDGMENT
Reported As: 2016 C.L.R. 1577, PLD 2016 Islamabad 141 Result: Order accordingly Judgment JUDGMENT AAMER FAROOQ, J.- This judgment shall decide the instant petition as well as the petitions mentioned in the schedule attached herewith as common questions of law and facts are involved. 2. In all the petitions (except Writ Petition No,3715/2012 and Writ Petition No,3272/2015) the petitioners have assailed notification dated 23.09.2015 issued by respondent No,2 whereby the petitioners were directed not to increase any fee/charges/funds in 2015 and also to refund/adjust any increase in fee/fund/charges already charged. The impugned notification further provided that in case of default, proceedings under section 16 Islamabad Capital Territory, Private Educational Institutions (Registration and Regulation) Act, 2013 (hereinafter the Act) shall be initiated. In the petitions vires of sections 4(c) and 5(1)(b) and 5(1)(h) of the Act have also been challenged. 3. The facts, in brief, are that all the petitioners (except for petitioners in W.P. No,3715/2012 and W.P. No,3272/2015) are Private Educational Institutions. The legal status of the petitioners varies from sole proprietorship/firm or partnership to a private limited company, however, all of them are running Institutions, inter alia, all over Islamabad Capital Territory and disseminating education against payment of fee by the students. In order to regulate the Private Educational Institutions in Islamabad the Act was passed by virtue of which Private Educational Institutions Regulatory Authority (PEIRA) was created. Section 4 of the Act provides for the aims and objectives of the PEIRA. In this behalf one of the objectives of the Authority is to determine and fix rate of fee charged by the Institutions. Similarly, section 5 of the Act prescribes functions and powers of PEIRA. Under section 5(1)(b) ibid the Authority is to register and regulate Private Educational Institutions in
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Islamabad 'Capital Territory including fixation of grade-wise rate of admission fee, security fee, monthly tuition fee and other fees being charged by Private Educational Institutions. Similarly, under section 5(1)(h) it is the function of PEIRA to ensure that the service i,e, quality of education being provided and salary paid to the teachers commensurate with the fee being charged. Admittedly, PEIRA never fixed the fee (Admission Fee, Tuition Fee and other Charges) being charged by the petitioners, however, through impugned notification it restrained the Private Educational Institutions from raising the fee/charges in the year 2015 and also to refund/return the enhanced fee/charges for the year 2015. 4. Mr. Shahid Hamid and Ms. Ayesha Hamid, ASC/ learned counsel for the petitioners in the instant petition inter alia submitted that since under sections 4 and 5 of the Act no fee was ever fixed by respondent No,2, therefore, through impugned notification the referred respondent cannot restrain the petitioners from enhancing fee in 2015; that the impugned notification is retrospective in operation inasmuch as it also covers the fees already received by the petitioners. Learned counsel pointed out that the petitioner is an Educational Institution having branches all over Pakistan; the petitioner also awards merit based scholarships and concession to staff children, therefore, in such like circumstances restraining the petitioner from enhancing the fee is without any justification or basis. Learned counsel further submitted that the impugned notification is without jurisdiction and lawful authority; that under Article 25-A of the Constitution it is the responsibility of the State to provide free education .To the children in Pakistan and the petitioners by running Educational Institutions do not step into the shoes of the State whereas are running the Institutions on commercial basis; that there is no restriction under the Constitution of the Islamic Republic of Pakistan or any other law for running Educational Institutions on commercial basis. It was further submitted that freezing the fee of the Educational Institutions including the petitioner is unreasonable. Learned counsels also made a challenge to the vires of sections 4(c) and 5(1)(b) and 5(1)(h) of the Act. In this behalf it was contended that the referred provisions are in violation of Article 18 of the Constitution inasmuch as it is the fundamental right of the petitioner to conduct business, however, the same is subject to reasonable restrictions imposed by the law whereas the restrictions imposed under sections 4 and 5 ibid are unreasonable. In this behalf reliance was placed on the Case titled P.A. Inamdar and others v. State of Maharashtra and others (AIR 2005 SC 3226). It was further contended that the respondents by a blanket order cannot fix the fee for all the Educational Institutions; in fact the requirements and fee structure of every Educational Institution is different, therefore, in order to fix the fee as required under the law each Educational Institution has to be given an opportunity to justify and explain its expenses and revenue required for running the Institution and providing the facilities. Reliance was placed on the case titled Arshad Mehmood v. Government of Punjab through Secretary (PLD 2005 SC 193). Learned counsel also by way of comparison submitted that in England there is an authority referred to as Independent Schools Inspectorate and under the same there is no restriction on the fee to be charged by the schools. With respect to retrospectivity of the notification reliance was placed, on Imtiaz Ahmed and others v. Punjab Public Service Commission through Secretary, Lahore and others (PLD 2006 SC 472), Sheikh Fazal Ahmed v. Raja Ziaullah Khan and another (PLD 1964 SC 494), Islamic Republic of Pakistan through the Secretary M/o Commerce and Local Government (Commerce Division), Islamabad v. Mazhar ul Haq and 2 others (1977 SCMR 509) and Trustees of Port of Karachi and another v. Zaffar Zaid Ahmed (1988 SCMR 810). 5. In W.P. No,3181/2015, Mrs. Asma Jahangir, ASC on behalf of the petitioner, adopted the arguments of the learned counsel for the petitioners in W.P. No,3178/2015. Initially in Writ Petition No,3181/2015 no challenge to the vires of the Act was made, however, subsequently an application was moved by virtue of which permission was sought to challenge the vires as well which was allowed by this Court and amended petition was filed accordingly. It was contended that under Article 18 of the
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Constitution of Pakistan a guarantee has been made to every citizen of Pakistan to enter into any lawful profession and occupation and to conduct any lawful business or trade subject to such qualifications as prescribed by the law. It was contended that qualifications as prescribed in Article 18 pertains to regulation of any trade or profession by a licensing system or regulation of trade, commerce or industry in the interest of free competition, however, it was contended that no restriction regarding the charging of fee or making profit can be imposed by law. Reliance was placed on the case titled Khawaja Imran Ahmed v. Noor Ahmed and another (1992 SCMR 1152), Shahabuddin and another v. Pakistan, etc. (PLD 1957 West Pakistan Karachi 854) and Murree Brewery Company Ltd. v. Director-General, Excise and Taxation (1991 MLD 267). Learned counsel also submitted that unreasonable restrictions as imposed in the case of the petitioner which effect the autonomy and freedom to carry out business and profession are ultra vires Article 18 of the Constitution. Reliance in this regard was placed on the case titled Arshad Mehmood and others v. Government of Punjab through Secretary, Transport 'Civil Secretariat, Lahore and others (PLD 2005 SC 193), Messrs Elahi Cotton Mills Ltd and others v. Federation of Pakistan through Secretary M/o Finance, Islamabad and 6 others (PLD 1997 SC 582), K.B. Threads (Pvt.) Limited through Chief Executive and others v. Zila Nazim, Lahore (Amir Mehmood) and others (PLD 2004 Lahore 376), Abdul Hakim Qureshi v. State of Bihar (AIR 1961 SC 448) and Muhammad Yaseen v. Town Committee Jalalabad and others (AIR 1952 SC 115). It was also contended that the Government has miserably failed to adhere to its Constitutional obligation to provide free education to the children whereas by promulgation of the impugned notification the Federal Government is trying to transfer the burden of its failure on the shoulders of non-funded private Educational Institutions. Learned counsel also contended that in opening the education sector for private participation, the Government walks a fine line when deciding whether to let market forces prevail or to make an effort to regulate the sector. In 'the normal case the private sector can charge any price for its education and in the latter case the Government regulates the market which is a difficult and cumbersome task. Learned counsel by way of comparison submitted that experience in India shows that the Courts have made a full circle and have allowed unfunded private Educational Institutions to regulate their affairs. Reliance was placed on the cases titled as Miss Mohini Jain v. State of Karnataka (1992 3 SCC 666), 4 P.A. Inamdar v. State of Maharashtara (2005 6 SCC 537) and Unaided Private Schools of Rajesthan v, Union of India and another (2012 6 SCC 1). Learned counsel also contended that no notice was issued to the petitioner before issuing the impugned notification, therefore, the petitioner has been condemned unheard. It was also contended that the principle of natural justice shall have to be ,read into sections 4(c) and 5(1)(b)(h) of the Act. 6. Syed Naeem Bukhari, learned counsel for the petitioners in W.P. No,3598/2015 adopted the arguments of the learned counsel for the petitioners in W.P. No,3178/2015, however, submitted that the provisions of the Act and the impugned notification are not applicable to the Institutions offering A & 0 Levels. 7. Syed Hamid Ali Shah and Barrister Hasnain Ali Ramzan ASCs in W. P. No, 3301/2015 and Mr. Tariq Saleem Sheikh in W.Ps.3241/2015 and 3240/2015 on behalf of the petitioners pointed out that the petitioners are companies registered under the Company Laws of Pakistan and run and manage various Educational Institutions all over the Pakistan under the name and style "Headstart School", Lahore Grammar School, and Roots Millennium Schools. At the outset learned counsel submitted that the petitioners run and manage Institutions solely upon the fees that are generated from the students and in this regard no subsidy/special exemption or grant from the Government is enjoyed by the petitioners; that the petitioners pay all the taxes that are levied and applicable. Learned counsel further pointed out that the submissions are twofold i,e, firstly, declaration to the effect that notification dated '23.09.2015 be declared illegal and without lawful authority and secondly, that various provisions of the Act be declared as ultra vires the Constitution. With regard to the first
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submission learned counsel contended that the Act does not prescribe any prior permission to be sought before enhancing fee, therefore, the impugned notification whereby it provides that prior permission was to be sought is 'confiscatory in nature and also cannot have any retrospective effect. It was further contended that all the directions contained in the impugned notification are in excess of the powers conferred by section 4 of the Act. Learned counsel read out sections 4 and 5 and pointed out that under section 4(c) as well as 5 (1)(b) and (h) fee of a Private Institution is to be fixed and determined by PEIRA and in this regard it was contended that nowhere it is provided that prior permission is to be obtained before fixing the fee. Secondly, it was contended that sections 4(c), 5(1)(b)&(h) are ultra vires the Constitution. In this behalf it was contended that the Government is under Constitutional duty to enact laws in conformity with Article 25 of the Constitution. Reliance was placed on the case reported as (1999 SCMR 1012). In this behalf it was pointed out that if the laws are not in conformity with the fundamental rights as guaranteed in the Constitution, the same can be struck down by invoking the jurisdiction of High Court. Reliance was placed on Sh. Liaquat Hussain and others. v. Federation of Pakistan . Through M/o Law, Justice and Parliamentary Affairs, Islamabad and others (PLD 1999 SC 504). Learned counsel also placed reliance on case titled Baz Muhammad Kakar and others v. Federation of Pakistan through Ministry of Law and Justice and others (PLD 2012 SC 923) to substantiate his argument that any legislation where due process of law and right of access to justice is denied the same can be struck down. .Learned counsel contended that where the price of service or a good is fixed without providing any opportunity of hearing the same is liable to be struck down. In this behalf reliance was placed on the case titled Pacific Pharmaceuticals Ltd. v. Government of Pakistan and another (2002 YLR 3125) and Messrs Elahi Cotton Mills Ltd. And others v. Federation of Pakistan through Secretary Mb Finance, Islamabad and 6 others (1997 PTD 1555). Learned counsel further contended that where inflated and arbitrary powers are given to any authority that tantamount to excess delegation and the same is not sustainable. Reliance was placed on the case titled Shaukat All Mian and another v. The Federation of Pakistan (1999 CLC 607) and Mehram All and others v. Federation of .Pakistan and others (1998 SCMR 1156). Learned counsel also submitted that under Article 25-A of the Constitution it is the responsibility of the State to provide free and compulsory education to all the children between the ages of 5 to 16 years in such manner as may be determined by the law, therefore, it is the responsibility of the Government to do the needful and that responsibility cannot be delegated to the private non-funded Educational Institutions. Learned counsel also pointed out that when the children are admitted in Educational Institutions a legally enforceable contract comes into existence. In this behalf it was contended that when an application for admission is made it is an offer on part of the student and when the admission is granted that amounts to acceptance of the offer whereupon a contract subject to payment of fee/consideration comes in existence. It was further contended that in case anyone wants to get out of the contract, the same can be done accordingly. Reliance was placed on case titled Akhtar Ali Javed v. Principal, Quaid-i-Azam Medical College, Bahawalpur (1994 SCMR 532). 8. Syed Ahmed Hassan Shah, Advocate for the petitioners in W.Ps. Nos.3137/2015 and 3278/2015 also adopted the arguments addressed by the learned counsel for the petitioner in W.P. No,3178/2015. It was further contended that the Act does not empower the respondents to issue the impugned notification and the impugned office order; that the impugned notification was issued in disregard to the provisions of the Act; that the Act does not require the petitioners to obtain prior approval or permission of the respondents, particularly respondent No,2 before enhancing the school fee/charges, therefore, the impugned notification is misconceived and liable to be struck down. Learned counsel further submitted that the exercise of powers and authority by the respondents is dependent upon framing of rules by respondents No,1 under section 22 of the Act and also framing of regulations under section 23 ibid. It was further contended that till todate no rules and
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regulations have been framed. Learned counsel contended that no fee can be fixed retrospectively. The academic year commenced in August 2015, however, the impugned notification was issued in September, 2015 pertaining to academic year, 2015; that the impugned notification has been issued without lawful authority inasmuch as PEIRA has not been properly constituted and no Chairman or Member of respondent No,2 has been appointed as required under section 6 of the Act. It was also contended that the impugned notification is ultra vires Article 18 of the Constitution. The vires of sections 4(c), 5(1)(b) and (1)(h) were also assailed on the touchstones of Article 18 ibid. Learned counsel also pointed out that respondent No,2 cannot fix the fee of all the Educational Institutions in a uniform way inasmuch as under the Act it has to take into account the standard of services, quality of education, range of elective subjects offered by the Institution, extracurricular activities, salaries to teachers and other staff members as well as ancillary services and facilities provided by Private Educational Institutions. In support of his contention reliance was placed on the case titled D.G. Khan Cement Companies Limited through Company Secretary/through Chairperson v. Monopoly Control Authority (PLD 2007 Lahore 1), Pacific Pharmaceuticals Ltd v. Government of Pakistan and another (2002 YLR 3125) and Muhammad Amin Muhammad Bashir Limited v. Government of Pakistan through Secretary Ministry of Finance, Central Secretariat, Islamabad and others (2015 SCMR 630). 9. Mr. Shoaib Razzaq, Advocate for the petitioner in W.P. No,3312/2015 adopted the arguments of the learned counsel for the petitioner in W.P. No,3178/2015. 10. Mr. Khurram Hashmi, Advocate for the petitioner in W.P. No,3374/2015 adopted the arguments of the learned counsel for the petitioner in W.P. No,3178/2015. 11. Malik Imran Safdar, Advocate for the petitioner in W.P. No,3376/2015 adopted the arguments of the learned counsel for the petitioner in W.P. No,3178/2015. 12. Mr. Mazhar Ali, Advocate for the petitioner in W.P. No,3507/2015 adopted the arguments of the learned counsel for the petitioner in W.P. No,3178/2015. Similarly, learned counsel for the petitioner in W.P. No,3215/2015 adopted the arguments of the learned counsel for the petitioners in W.P. No,3178/2015. 13. Mr. Jawad Hassan, Advocate in W.P. No,3483/2015 inter alia 'submitted that through the impugned notification the respondents have placed an unreasonable restriction upon the petitioners' right to conduct its lawful trade or business, therefore, the same is ultra vires the Constitution; that the impugned notification is in violation of Article 18 of the Constitution. It was further contended that impugned notification is retrospective in its applicability, hence is not enforceable; that the 'respondents have not fixed rates of fee nor have issued any direction in this behalf; therefore, no permission can be sought for increase in the fee from the respondents. Learned counsel also contended that under sections 4(c),. 5(1)(b)&(1)(h) an objective determination of the expenses incurred by the petitioner is required whereas no such inquiry has been held by respondent No,3; that the impugned notification has been issued in violation of principles of natural justice; that the impugned notification is in violation of Articles 23 and 24 of the Constitution; that the scheme of law i,e, the Act is to be implemented through rules and regulations and till such time the same is done no restriction can be imposed on the petitioners. It was further submitted that under Article 25-A of the Constitution it is the duty of the Federal Government to provide free education to all the children till the age of 16 and this duty cannot be delegated to the petitioners. In support of his contentions learned counsel placed reliance on the asset titled Arif Majeed Malik and others v. Board of Governors Karachi, Grammer School (2004 CLC 1029) and Petition Regarding Miserable Condition of the Schools: In Re Constitution Petition No,37 of 2012, decided on 11th February, 2013, (2013 SCMR 764). 14. During the course of proceedings applications were made by some of the parents to be impleaded as respondents. The applications were allowed. However, after the conclusion of
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arguments another application was moved for impalement (C.M. No,910/2016 in W.P. No,3598/2015) on behalf of one of the parents in which notice was not issued as allowing every such application would result in a never ending series of applications and that would have delayed the adjudication of the matter. Counsels for the parents' in some of the cases were duly heard and their arguments are noted below. Mian Muhammad Zafar Iqbal, Advocate filed W.P. No,3272/2015 on behalf of the parents seeking direction and declaration to the effect that enhancement in fee every year without permission of PEIRA is without lawful Authority and the same be done in accordance with law. Similarly, in W.P. No,3715/2012 filed by Mr. Ammar A. Sehri, Advocate, the petitioner sought direction against Federal Government and PEIRA to register all the Private Educational Institutions and take steps to control excessive charge of fee by them. 15. Mr. Qasim Wadood, Advocate (appearing for parents) in W.P. No,3178/2015 submitted that in India under section 3 of Haryana Schools Education Act, 1995 there is a power of Government to regulate the education in schools. In this behalf it was contended that under section 167 of the same at the start of the academic year the manager of every school has to file details of fee to be charged in the said year and no increase is to be made in that respective year. It was also submitted that similar provisions exist in Tamal Nado Schools Regulations on Collection of Fee Act, 2009. 16. The learned counsel for PEIRA inter alia submitted that the fundamental right as provided in Article 18 is not absolute and is subject to reasonable restrictions as provided under the law and the provisions of Act do provide reasonable restrictions in this behalf. Learned counsel also contended that the charge of the exorbitant fee by the private Educational Institutions tantamount to extortion which is not sustainable under the law. In this behalf it was contended that the private Educational Institutions by imparting education are carrying out the constitutional duty as provided in Article 25-A of the Constitution, hence no excessive or exorbitant fee can be charged by them. Learned counsel took the Court through various provisions of the Act to show that the scheme of the Act is clear and provides a regulatory framework whereby the charging of fee by private Educational Institutions is regulated. In support of his contentions learned counsel placed reliance on the case titled Salfi Textile Mills Ltd and another v. Federation of Pakistan and 2 others PLD 1995 Karachi 132, Messrs Khawer Paper Mart through Proprietor v. National Tariff Commission through Chairman and another (2011 PTD 2243), Lt. Gen. (Retd.) Jamshaid Gulzar and another v. Federation of Pakistan and others (2014 SCMR 1504), Delhi Abibharaka Mahsangh v. Union of India and others (AIR 1999 Delhi 124), Messrs Shaheen Cotton Mills, Lahore and another v. Federation of Pakistan, Ministry of Commerce through Secretary and another (PLD 2011 Lahore 120) and Multiline Associates v. Ardeshir Cowasjee and 2 others (PLD 1995 SC 423) and (AIR 2004 SC 2236). 17. Learned Deputy Attorney-General on behalf of Federal Government contended that PEIRA issued the impugned notification in exercise of powers conferred under section 5(1)(b) of the Act after receiving complaints from the parents. In this behalf it was contended that the referred Authority has explicit powers to regulate the fee under sections 4 and 5 of the Act. It was further submitted that fixation and regulation of the fee was the sole prerogative of the PEIRA. Learned Deputy Attorney-General candidly admitted that there is no bar on commercialization of education, however, it was contended that the same does not mean absolute freedom. It was contended that where an authority has the power to pass an order then it is not liable to be interfered with by any Court unless it is mala fide or based on wrong Principles. Reliance was placed on Pakcom Limited and others v. Federation of Pakistan and others (PLD 2011 SC 44). It was also contended that a writ cannot be filed to establish rights rather, it is for the enforcement of the, rights. It was also asserted that where the legislature specifically gave any enactment retrospective effect the same should not be interfered with. Reliance was placed on the case titled Irshad Ahmed Sheikh v. National Accountability Bureau and others (2015 SCMR 588). It was further maintained that the relevant
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provisions of the Act are intra vires and in this behalf under Article 18 of the Constitution the Government has the authority to impose reasonable restrictions which do not mean prohibition or prevention completely. Reliance was placed on the case…
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