The Government Resolution, dated May 4, 1999, provides, among other things, for Fee Fixation Committees in recognised private schools to determine the fees. According to this, schools are not required to obtain Government approval for the fee structure unless they propose a hike of more than 10 per cent. Gujarat State Private Recognised School Teachers' Federation, challenging the Government Resolution, contended that under Primary Education Rule 106 of Bombay Primary Education Rules, 1949, tuition fees are required to be approved by the Government, while the resolution leaves it to the school.

Senior advocate Haroobhai Mehta along with Preetiben Pandya argued that though the Committee is required to include representatives of parents, the power to determine fees will be vested with the school managements. This will lead to exploitation of pupils and parents and will open gates for commercialisation of education, he said.

The Federation has also challenged the Government Resolution providing that 80 per cent income derived from fees will be earmarked for salary to teachers and employees. It contended that according to Rule 106, school managements are bound to pay salary to teachers according to Government regulations. It said payment of salary cannot be confined to 80 per cent of income from fees.

Mehta submitted that managements were bound to pay salaries in accordance with the Government Resolution dated September 7, 1998, whereby the Government has applied Fifth Pay Commission payscales to private primary schools. The court admitted the matter and directed early final hearing.