LexThe Maharashtra Educational Institutions (Prohibition of Capitation Fee) Act, 1987
Maharashtra · state statute
Open in Lexace · Ask the AI about this act1988 : Mah. VI] 1
THE MAHARASHTRA EDUCATIONAL INSTITUTIONS
(PROHIBITION OF CAPITATION FEE) ACT, 1987
[Text as on 15th September 2025]
________________
CONTENTS
PREAMBLE.
SECTIONS.
1. Short title and extent.
2. Definitions.
3. Demand or collection of capitation fee prohibited.
4. Regulation of fees.
5. Aggrieved person can file a police complaint.
6. Power to enter and inspect.
7. Penalties.
7A. Punishment for abetment.
7AA. Offences to be cognizable and non-bailable.
8. Offences by companies.
9. Compensation for accusation without reasonable cause.
10. Act to have overriding effect.
11. Protection of action taken under this Act.
12. Rules.
13. Savings.
2 The Maharashtra Educational Institutions (Prohibition [1988 : Mah. VI
of Capitation Fee) Act, 1987
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of Capitation Fee) Act, 1987
LIST OF AMENDMENT ACTS
1. Amended by Mah. 24 of 1996 (29-08-1996)1
1 Note.- The date mentioned in the bracket indicates the date of commencement of the Act.
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of Capitation Fee) Act, 1987
MAHARASHTRA ACT No. VI OF 19881
[THE MAHARASHTRA EDUCATIONAL INSTITUTIONS
(PROHIBITION OF CAPITATION FEE) ACT, 1987.]
[This Act received the assent of the Governor on the 13th April 1988; assent was first published
in the Maharashtra Government Gazette, Extraordinary No. 12, Part IV, on the 15th April 1988.]
An Act to prohibit collection of capitation fee for admission of students to, and their
promotion to a higher standard or class in, the educational institutions in the
State of Maharashtra and to provide for matters connected therewith.
WHEREAS the practice of collecting capitation fee for admitting students into educational
institutions and at the time of promoting students to a higher standard or class at various stages of
education is on the increase in the State;
AND WHEREAS this undesirable practice has been contributing to large scale commercialisation
of education which is not conductive to the maintenance of educational standards;
AND WHEREAS the National Policy on Education 1986 envisages that the commercialisation of
technical and professional education should be curbed and that steps should be taken to prevent the
establishment of institutions set up to commercialise education;
AND WHEREAS with a view to effectively curb this evil practice, it is expedient in the public
interest to prohibit collection of capitation fee for admission of students to, and their promotion to a
higher standard or class in, the educational institutions in the State of Maharashtra and to pro vide for
matters connected therewith; It is hereby enacted in the Thirty -eighth Year of the Republic of India as
follows :—
1. Short title and extent.— (1) This Act may be called the Maharashtra Educational Institutions
(Prohibition of Capitation Fee) Act, 1987.
(2) It extends to the whole of the State of Maharashtra.
2. Definitions.— In this Act, unless the context requires otherwise,—
(a) “capitation fee” means any amount, by whatever name called, whether in cash or kind,
2[* * *] in excess of the prescribed or, as the case may be, approved, rates of fees regulated under
section 4;
3[(aa) “Deputy Director” means the Deputy Director of Education or any Officer co -
designated as such by the State Government, working under the Director of Education, Director of
Higher Education, Director of Technical Education, Director of Medical Education or Director of
Vocational Education, or any other Directorate of the State Government entrusted with the task of
supervision of educational institutions imparting any kind of education in the State;]
(b) “educational institution” or “institution” means a school (including Kindergar ten,
Pre-primary, Balwadi or Nursery School), a college or an institution, by whatever name called or a
part thereof, whether managed by Government, local authority, a University or a private
management including educational institution established and administrated by any minorit y and
imparting education and training, exclusively or as one of the various activities, whether technical,
professional, vocational or otherwise, and includes any other institution, or a part thereof, as the
1 For Statement of Objects and Reasons of the L. A. Bill No. XXII of 1987, see Maharashtra Government Gazette, 1987,
Extraordinary No. 31, Part V, dated the 16 th April 1987, page 251; for Joint Committee Report see Maharashtra
Government Gazette, 1988, Extraordinary No. 20, Part V, dated the 24th March 1988, pages 6-8.
2 The words “paid or collected, directly or indirectly” were deleted by Mah. 24 of 1996, s. 2(a).
3 Clause (aa) was inserted by Mah. 24 of 1996, s. 2(b).
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State Government may, by notification in the Official Gazette, specify; but excludes coaching class,
by whatever name called;
(c) “Local Authority”,—
(i) in relation to an educational institution managed by a Zilla Parishad, means the Zilla
Parishad constituted under the Maharashtra Zilla Parishads and Panchayat Samitis Act, 1961
(Mah. V of 1962);
(ii) in relation to an educational institution managed by a Municipal Corporation, means
the Municipal Corporation constituted under the 1Bombay Municipal Corporation Act (Bom.
III of 1888), the 2City of Nagpur Corporation Act, 1948 (C. P. and Berar II of 1950) or, as the
case may be, the 3Bombay Provincial Municipal Corporations Act, 1949 (Bom. LIX of 1949);
(iii) in relation to an educational institution managed by a Municipal Council, means the
Municipal Council constituted under the 4[Maharashtra Municipal Councils, Nagar
Panchayats and Industrial Townships] Act, 1965;
(d) “management”,—
(i) in the case of an institution managed by the State Government, means the State
Government;
(ii) in the case of an institution managed by a local authority, means that local authority;
(iii) in the case of an institution managed by a University, means that University; and
(iv) in any other case, means the managing committee or the governing body by
whatever name called, of an educational institution to which the affairs of that institution are
entrusted and, where such affairs are entrusted to any person whether called as Secretary,
Correspondent or by any other name or designation, includes such person;
(e) “minority educational institution” means an institution established and administrated by a
minority having a right to do so under clause (1) of article 30 of the Constitution of India;
(f) “prescribed” means prescribed by rules made under this Act;
(g) “rules” means the rules made under this Act;
(h) “University” means a university constituted under any law for the time being in force.
3. 5[Demand or collection] of capitation fee prohibited. — (1) Notwithstanding anything
contained in any law for the time being in force, no capitation fee shall be 6[demanded or collected] by
or on behalf of any educational institution or by any person who is in charge of or is responsible for, the
management of such institution, from or in relation to, any student in consideration of his admission to,
and prosecution of, any course of study or of his promotion to a higher standard or class in, such
institution.
(2) Notwithstanding anything contained in sub -section (1), the management may 7[in good faith,
demand or, collect or accept donations in cash or kind in prescribed manner,] from benevolent persons
or organisations or public trusts or any other association of persons, for opening of new educational
institution or for development or expansion of educational facilities in the existing educational
institutions or for creation of endowment fund for award of scholarships, prizes or the like, but while
collecting or accepting such donations the management shall not reserve any seats in any educational
institution run by it in consideration of such donations. All money and articles received in donation shall
1 The short title was amended as “Mumbai Municipal Corporation Act” by Mah. 25 of 1996, Sch.
2 This Act was repealed by Mah. 23 of 2012, s. 7.
3 The short title was amended as “the Maharashtra Municipal Corporation Act” by Mah. 23 of 2012, s. 4.
4 These words were substituted for the words “Maharashtra Municipalities” by Mah. 24 of 1996, s. 2(c).
5 These words were substituted for the word “Collection” by Mah. 24 of 1996, s. 3(d).
6 These words were substituted for the word “collected” by Mah. 24 of 1996, s. 3(d).
7 These words were substituted for the words “in good faith collect or accept donations in cash or kind, in the prescribed
manner” by Mah. 24 of 1996, s. 3(b)(i).
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of Capitation Fee) Act, 1987
be accounted for in the institution and the money shall be deposited in the name of the institution in any
scheduled or co -operative bank and shall be applied or expended for the purpose for which such
donations are collected or accepted or shall be applied towards the objects of the institution:
Provided that, where in consideration of accepting such donations any seat is reserved for admission
to any student in such institution such acceptance of donation shall be deemed to be collection of
capitation fee:
1[* * * * * * *]
(3) Where the State Government, on receipt of any complaint or otherwise, is satisfied th at the
management of any institution or any person who is in -charge of or is responsible for the management
of such institution, has contravened the provisions of this Act or the rules made thereunder, the State
Government may, in addition to any prosecuti on that may be instituted under this Act, after giving a
reasonable opportunity of being heard, direct such institution or person responsible that the capitation
fee collected in contravention of this Act shall be refunded to the person from whom it was collected and
on its or his failure to do so, the amount together with interest thereon shall—
(a) in the case of an aided educational institution, be deducted from the grant-in-aid payable
by the State Government to such institution; and then the same be p aid to the person from whom
such capitation fee was collected; and
(b) in the case of an un-aided educational institution, be recovered as arrear of land revenue;
and when so recovered be paid to the person from whom such capitation fee was collected.
(4) The management of any educational institution or any person who is incharge of or who is
responsible for the management of such institution 2[demanding], collecting or accepting donations
under sub-section (2) in connection with or in relation to any stu dent in consideration of his admission
to and prosecution of, any course of study or his promotion to a higher standard or class in institution,
shall be deemed to have contravened the provisions of sub-section (1) and shall be liable to be proceeded
against and punished accordingly.
4. Regulation of fees.— (1) It shall be competent for the State Government to regulate the tuition
fee or any other fee that may be received or collected by any educational institution for admission to,
and prosecution of study in any class or standard or course of study of such institution in respect of any
or all classes of students.
(2) The fees to be regulated under sub-section (1) shall—
(a) in the case of the aided institutions, be such as may be prescribed by a university under
the relevant University Law for the time being in force in the State or as the case may be, by the
State Government; and
(b) in the case of the un-aided institutions, having regard to the usual expenditure excluding
any expenditure on lands and buildings or on any such other item as the State Government may
notify, be such as the State Government may approve:
Provided that, different fees may be approved under clau se (b) in relation to different institutions
or different classes or different standards or different courses of studies or different areas.
(3) The fees, to be prescribed or approved under sub-section (2) shall include the following items,
namely:—
(a) Tuition fee, whether on term basis or monthly or yearly basis;
(b) Term fee per academic term;
(c) Library fee and deposit as security per year or for the entire course;
(d) Laboratory fee and deposit as security per year or for the entire course;
1 Second proviso was deleted by Mah. 24 of 1996, s. 3(b)(ii).
2 This word was inserted by Mah. 24 of 1996, s. 3(c).
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of Capitation Fee) Act, 1987
(e) Gymkhana fee on yearly basis;
(f) Caution money for the entire course;
(g) Examination fee, if any, per year or for the entire course;
(h) Hostel fee, Messing charges, if these facilities are provided, whether on term basis or on
monthly or yearly basis;
(i) Any such other fee or deposit as security or amount for any other item, as the State
Government may approve.
(4) The fees regulated under the section shall ordinarily remain in force for a period of three years
and the State Government shall appo int a Committee of persons who, in the opinion of the State
Government, are experts in educational field, for taking the review of the fee structure and may, after
considering the report of the Committee, revise the fees if it considers it expedient to do so.
(5) Every educational institution or as the case may be, management shall issue an official receipt
for the fees or deposits or any other amounts collected for any purpose, which shall be specified in such
receipt.
1[5. Aggrieved person can file a police complaint.— Any person from whom a capitation fee or
donation has been demanded or collected by the management of any educational institution or on behalf
of any educational institution by any person who is in-charge of, or is responsible for, the management
of such institution, in relation to any student in consideration of his admission to and prosecution of, any
course of study or of his promotion to a higher standard or class in such institution, may file a complaint
against such management or suc h person, as the case may be, with the concerned police station within
thirty days from the date on which such capitation fee or donation or both has been demanded or collected
by such management or such person.]
6. Power to enter and inspect. — (1) Any Officer not below the rank of 2[Deputy Director of
Education] specially authorised by the State Government in this behalf, may at any time during the
normal working hours of any educational institution enter such institution or any premises thereof or any
premises belonging to the management of such institution in relation to such institution, if he has reason
to believe that there is or has been any contravention of the provisions of this Act or the rules made
thereunder and search and inspect any records, accounts, registers or other documents belonging to such
institution or of the management in so far as such records, accounts, registers or other documents relate
to such institution and seize any such records, accounts, registers or other documents for the purpose of
ascertaining whether there is or has been any such contravention.
(2) The provisions of the Code of Criminal Procedure, 1973 (II of 1974) relating to searches and
seizures shall apply, so far as may be, to searches and seizures under sub-section (1).
7. Penalties.— Whoever contravenes any provision of this Act or the rules made thereunder, shall,
on conviction, be punished with imprisonment for a term which shall not be less than one year but which
may extend to three years and with fine which may extend to five thousand rupees:
3[Provided that, any person who is accused of having committed the offence under sub-section (1)
of section 3 of demanding capitation fee shall, on conviction, be punished with imprisonment for a term
which shall not be less than one year but which may extend to two years and with fine which may extend
to five thousand rupees.]
1 Section 5 was substituted by Mah. 24 of 1996, s. 4.
2 These words were substituted for the words “District Education Officer” by Mah. 24 of 1996, s. 5.
3 This proviso was added by Mah. 24 of 1996, s. 6.
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of Capitation Fee) Act, 1987
1[7A. Punishment for abetment.— Whoever abets any offence punishable under this Act shall,
on conviction, be punished with the punishment provided for the offence.
7AA. Offences to be cognizable and non -bailable.— All offences under this Act, except the
offence of the demanding of capitation fee, shall be cognizable and non-bailable.]
8. Offences by companies.— (1) Where an offence under this Act or the rules made thereunder,
is committed by a company, every person, who at the time when the offence was committed, was in
charge of, and was responsible to, the company, for the conduct of the business of the company, as well
as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against
and punished accordingly:
Provided that, nothing contained in this sub -section shall render any person liable to any
punishment, if he proves that the offence was committed without his knowledge or that he had exercised
all due diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in sub -section (1), where any offence under this Act, or
the rules made thereunder, has been committed by a company and it is proved that the offence has been
committed with the consent or connivance of, or is attributable to any neglect on the part of any director,
manager, secretary or other officer or servant of the company, such director, manager, secretary or other
officer or servant concerned shall also be deemed to be guilty of that offence and shall be liable to be
proceeded against and punished accordingly.
Explanation.— For the purposes of this section,—
(a) “company” means anybody corporate and includes a trust, a firm, a society or other
association of individuals; and
(b) “director” in relation to—
(i) a firm, means partner in the firm;
(ii) a society, a trust or other association of persons or body of individuals, means t he
person who is entrusted under the rules of the society, trust or other association or body with
the management of the affairs of the society, trust or other association or body, as the case
may be.
9. Compensation for accusation without reasonable cau se.— Wherein a trial of an offence
under this Act, the Magistrate is of opinion that there was no reasonable ground for making the accusation
he may proceed to take action against the complainant or the informant under section 250 of the Code of
Criminal Procedure, 1973 (II of 1974).
10. Act to have overriding effect. — The provisions of this Act or the rules and orders made or
issued thereunder, shall have effect notwithstanding anything inconsistent therewith contained in any
other law for the time being in force or in any instrument having effect by virtue of such law.
11. protection of action taken under this Act.— No suit, prosecution or other legal proceeding
shall lie against the State Government or any officer of Government for anything which is in good faith
done or intended to be done under this Act or the rules made thereunder.
12. Rules.— (1) The State Government may, by notification in the Official Gazette, and subject to
the condition of previous publication, make rules for carrying out the purposes of this Act.
(2) Every rule made under this Act shall be laid as soon as may be, after it is made before each
House of the State Legislature, while it is in session for a total period of thirty days, which may be
comprised in one session or in two or more successive sessions, and if, before the expiry of the session
in which it is so laid or the session immediately following, both Houses agree in making any modification
1 Sections 7A and 7AA were inserted by Mah. 24 of 1996, s. 7.
10 The Maharashtra Educational Institutions (Prohibition [1988 : Mah. VI
of Capitation Fee) Act, 1987
in the rule or both Houses agree that the rule shall not be made, and notify such decision in the Official
Gazette, the rule shall form the date of publication of such notification have effect only in such modified
form or be of no effect, as the case may be; so, however, that any such modification or annulment shall
be without prejudice to the validity of anything previously done or omitted to be done under that rule.
13. Savings.— Notwithstanding anything contained in this Act, all orders, circulars, resolutions,
directions, rules, notifications, ordinances, statutes, schemes o r appointments made or issued and all
powers which were vested or exercisable by any person or authority in respect of the matters referred to
in this Act, whether in accordance with any law for the time being in force or otherwise and in force
immediately before the commencement of this Act shall, so for as they are not inconsistent with the
provisions of this Act, continue in force or continue to be so vested and be deemed to have been made
or issued or vested under the provisions of this Act unless and until superseded by anything done or any
action taken under this Act.