Supreme Court Issues Notice On TN Govt's Plea Against HC Order To Reimburse Private Schools Even If Centre Doesn't Release RTE Funds

The Supreme Court today agreed to consider the challenge to the Madras High Court order, which held that the State Government cannot cite non-receipt of funds from the Union Government as a reason to wriggle out of its statutory liability under Section 12(2) of the Right to Education Act to reimburse private schools admitting students from economically weaker sections.

The bench of Justice Vikram Nath and Justice Sandeep Mehta issued notice to the Union Government and the private respondent in the matter. 

Appearing for the State of Tamil Nadu, Sr Advocate P Wilson stressed that the impugned order would lead to excessive financial burden upon the state. 

The State argued that the High Court's directions for making reimbursements under S. 12 (2) of the RTE read with Rule 9 of the Tamil Nadu Right of Children to Free and Compulsory Education Rules 2011 created " a financial burden of Rs. 314,98,01,025/- (Rupees Three Hundred Fourteen Crores Ninety Eight Lakhs One Thousand Twenty-Five Only) upon the Petitioner State." 

Wilson submitted that for the academic years 2021-2022 and 2022-2023, the Union failed to release Rs 342.69 crores, representing its 60% share. The bench however, pointed out that a similar suit on the issue filed by the State Government is already pending. 

The State also stressed that before the High Court, the original petitioner had only sought directions to the State Government to initiate the admission process under the Right to Education Act, 200,9, for the academic year 2025-2026.

It emphasised: "From the pleadings, there is no whisper of any such relief seeking directions of timely disbursal of reimbursements to such private schools under Section 12(2) of the RTE Act, 2009 or de-linking of Right to Education component from the Samagra Shiksha Scheme."  

The High Court bench of Justice GR Swaminathan and Justice V Lakshminarayanan passed this order while disposing of a petition seeking directions to the State to initiate the admission process under the Right to Education Act, 2009 for the academic year 2025-2026 immediately. 

The High Court also observed that the funds payable by the Central Government to the States under the Right to Education Act need not be linked to the implementation of the National Education Policy (NEP). At the same time, it refrained from passing any directions to the Union for the release of RTE funds citing the pendency of the original suit before the Supreme Court.

At the same time, the High Court observed that the primary responsibility is that of the State to make reimbursement under Section 12(2).

"The State Government has a non-derogable obligation to reimburse private unaided schools. Non-receipt of funds from the Union Government cannot be cited as a reason to wriggle out of this statutory obligation," the High Court said.

In the plea before the Supreme Court, the State argued that the Union also had a concurrent responsibility under the Act.

The plea explains, "The Section 7 of the Right to Education Act, 2009 (RTE Act) envisages a concurrent responsibility to both Central Government and the State Government for providing funds for the implementation of the provisions of the Act. However, this concurrent responsibility is not equally devolved between both Central and State Governments. Therefore, all such obligations have to be understood and interpreted under the canopy of Section 7 of the RTE Act. The legislative intent behind the Section 7 was to ensure that the State could not suffer any paucity of funds leading to failure in implementation of the provisions of the Act it was due to this reason a concurrent responsibility to both the Central and State Government has been entrusted." 

The plea further adds that the High Court overlooked the fact that under the Samagra Shiksha Scheme, the  Project Approval Board (PAB), which also undertakes the functions and the duties of the Central Government and approves the total budget as well as the total aggregate funds to be shared between the Central and the State Governments.

The petition was filed through AoR Sabarish Subramanian.

Case Details : GOVERNMENT OF TAMIL NADU Vs. V ESWARAN| Diary No.- 44034/2025