Capitation fee
The Prohibition of Unfair Practices in Technical Educational Institutions, Medical Institutions and Universities Bill 2010 defines it as any amount that is This practice is widely prevalent in private colleges and universities in India, especially those that grant baccalaureate degrees in engineering, IT and sciences for which the demand for admissions exceeds the supply, but a number of technical educations has been closing down in recent years, and many seats go vacant.
[4][5] The capitation fee has been considered to be one of the reason for the exorbitant hike in healthcare costs and deteriorating medical standards.
Choosing not to pay additional fees may even lead to a form of extortion, by withholding the degree from students.
The donation money is often not accounted, and its usage and allocation are mismanaged and not reported to income tax.
Capitation fees are generally seen as a main revenue generator that private institutions may charge, which contend that admissions that cater to affordable sections of society somehow affect the overall number of students educated.
In its emphatic judgement in the Mohini Jain V/s State of Karnataka case, the Supreme Court declared that charging of capitation fees was arbitrary, unfair, and in violation of the fundamental right to equality in Article 14 of the Constitution.
[13] Faking News has an article, 'School Principal elected for the coveted 'Business Person of the Year' award', acknowledging the practices of some of the private schools in India, while also noting that "a school principal winning a business award created unrest among the top business leaders in India".
[14] However, institutions (business schools, engineering colleges, medical colleges) that take capitation fees also receive significant amount of funding from governmental funding agencies like AICTE, DST, UGC and various ministries under central government and state government.
The funds support infrastructure ranging from faculty laptops, printers, lab facilities and trading rooms in business schools.
[23] Various renowned and prestigious private schools and colleges across India have been found demanding a capitation fee.
The incident came into light through a surprise check drive initiated by the government in Tamil Nadu at 142 self-financing engineering colleges in the state.
[24] Another scam exposed by a popular news channel, Times Now, suggested that Information and Broadcasting Minister for State Jagathrakshakan was allegedly associated with Shree Balaji Medical College in malpractices in admissions.
[27] The Income Tax Department has been conducting raids on some of the organisations that take a capitation fee.
In August 2014, the Supreme Court appointed Mr Salman Khurshid, former Union Law Minister, as an amicus curiae and asked him to come out with suggestions and methodologies to end this practice.
(4) Articles in a leading international medical journal discussing about the capitation fee practices in medical colleges in India suggested that those who complete their courses from a capitation fee taking colleges should not be allowed for postings abroad.
[44][45] The All India Council for Technical Education (AICTE), the regulatory body for technical education in India, has called "upon the students, parents and the general public not to pay any capitation fee or any other fee other than that mentioned in the Prospectus of the Institutions for consideration of admission".
[47] As per AICTE norms, business schools are not meant to charge a fee higher than mentioned in the prospectus.
In case of such malpractices, the Board may take drastic action leading to disaffiliation of the school".
