How to eradicate Capitation Fee?
(or Donation / Building Fund / Development Fund )

Almost all seats in the management quota in engineering and other professional colleges are sold openly and cash collected by the management of these institutions. In most leading colleges the admissions for 2008-2009 under management quota has been completed. Officially these institutions maintain that they are yet to start the admission process. The admission to various branches of engineering, medicine and other professional courses under management quota has been booked by collecting large sums of amount in cash under capitation fees, development fund etc without any official receipt.

The governments at Cental and various states and the governing bodies for education in India like UGC, HR Ministry, AICTE (www.aicte.ernet.in) all maintain that they have not received any complaint regarding illegal collection of money for admission by any college in India. This is collective play acting by all these bodies and every school leaving kid in India knows the current market rate for getting admission in colleges and universities run by trusts and societies. Merit has no place in this collective game of greed and loot.

These public charitable trusts and societies amass huge wealth every year by granting admissions under the management quota and the so called donation is collected in cash and no receipts are issued in most cases. This is one of the main causes for the spiralling real estate prices as the black money finds its hiding place in investments in real estate where the declared price of land is often a fraction of the actual transacted value.

When temples can get administered and controlled by government through direct supervision and by appointment of officers (like Hindu Religious and Charitable Endowments Administration Department in Tamil Nadu www.hrce.tn.nic.in) why not the educational institutions and universities the so called public charitable trusts be administered by the government in a more transparent way.

In 2007 the capitation fees collected for admitting a student in engineering course by these colleges ranged between Rs 15lakhs and Rs 3 lakhs depending on their reputation and demand. It is still worse in private deemed universities where the number of seats in some branches of engineering is increased depending on the demand. In one such deemed university about 2000 students are admitted to one or two branches of engineering. and most of the seats are filled only after collecting capitation fee from each student to the tune of Rs 7 lakhs and above.

It is time these educational institutions which are taking advantages of benefits granted to public charitable trusts and societies taken over by government and administered to ensure that the education is not only for the rich and these institutions are run as per the objectives laid out in their trust deeds and society registration declarations. If that is not possible then government should appoint trustees from government and eminent personalities with high integrity and rotate them periodically.

India has seen tremendous growth when sectors like telecom, banking and insurance are privatised and in all these sectors the prices have come down. It is right time that government should open all forms of education to private sector, remove restrictions like number of seats etc. At present due to restrictions, regulations and licence raj the demand far outstrips the supply. The total cost of setting up an education institution and getting all necessary permissions becomes too large due to present state of affairs. Under the deregulated regime initially there will be mushrooming of institutions but on the longer run the best will survive. Let the public and students decide the best.

Under right to information act, government or UGC or AICTE should collect information from the public through their web sites on the current rates of capitation /donation prevailing in various colleges and trigger CBI enquiries on a continuous basis. The information provided by the public should be collected without the need to declare the particulars of informants and it will help gather more feedback on such practices from the affected students. At present the government wants information or complaint from the student / parents to initiate action. This is not possible and practical as it affects the student's future and safety.

If these institutions are for the purpose of promoting education only, then why there should be separate government and management quotas. All state governments should start more engineering colleges and at least one medical college per district. More participation from the government side will create a level playing field and much needed intervention from government towards the welfare of its citizens. Government of India should fix a target for college/university to population ratio and increase the supply to match the demand some thing similar to what it has achieved in Teledensity.

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI said in one of their judgments

"Capitation fee cannot be permitted to be charged and no seat can be permitted to be appropriated by payment of capitation fee. “Profession” has to be distinguished from “business” or a mere “occupation”. While in business, and to a certain extent in occupation, there is a profit motive, profession is primarily a service to society wherein earning is secondary or incidental. A student who gets a professional degree by payment of capitation fee, once qualified as a professional, is likely to aim more at earning rather than serving and that becomes a bane to society. The charging of capitation fee by unaided minority and non-minority institutions for professional courses is just not permissible. Similarly, profiteering is also not permissible. Despite the legal position, this Court cannot shut its eyes to the hard realities of commercialisation large amounts of education and evil practices being adopted by many institutions to earn for their private or selfish ends. If capitation fee and profiteering is to be checked, the method of admission has to be regulated so that the admissions are based on merit and transparency and the students are not exploited. It is permissible to regulate admission and fee structure for achieving the purpose just stated."

UGC has banned capitation fees in any form by Private deemed universities. http://www.indiaedunews.net/Today/UGC_bans_capitation_fees_in_deemed_universities_3218

The readers of this article are free to post their replies with the information of going rates of donation/capitation fees at various colleges in India.