Audit reports of private schools in the national capital by the Delhi government’s Department of Education (DoE) over the past decade have reportedly flagged financial irregularities. These include non-implementation of the 7th Pay Commission, unauthorised fund transfers, and the failure to maintain separate development fund accounts, each in contravention of the Delhi School Education Rules (DSER), 1973.
Accusations of inaction against the Directorate of Education
The Directorate of Education is facing allegations of failing to act on these violations by the parents. It has been accused of issuing warnings without following up with enforcement or punitive action to hold school managements accountable. Parents’ groups allege that this has allowed some schools to continue imposing arbitrary fees. The DoE did not respond to queries regarding these accusations.
A highly placed source in the education department, however, claimed that the DoE has consistently asked schools to comply with guidelines each year. “We are taking this matter very seriously, and we are making the amendments accordingly in the upcoming Delhi School Education (Transparency in Fixation and Regulation of Fees) Draft Bill, 2025 to curb these practices in Delhi,” the source added.
Audit points to recurring lapses from FY 2016 to 2024
A review by Patriot of multiple fee hike orders between 2016 and 2024 indicates a recurring pattern: schools allegedly violating financial norms, and limited follow-up by the regulatory body. Aparajita Gautam, President of the Delhi Parents Association (DPA), said that the trend has affected many families and is also undermining the integrity of Delhi’s education system. She called for strict and immediate accountability.
Funds reportedly diverted to managing societies despite restrictions
Despite clear directives from the DoE and a Supreme Court judgment, some schools have continued transferring money to their managing societies or trusts. This practice has been restricted since 1999 following the Duggal Committee’s recommendations and was reinforced in a 2009 Supreme Court ruling that unaided schools must not divert funds to their parent bodies.
GD Goenka Public School, Rohini
The school was found in violation of Rule 177 of the DSER, 1973 for using student funds to repay loans related to building redevelopment and vehicle purchases between FY 2014–15 and FY 2021–22. The amount totalled Rs 9.73 crore. Despite earlier instructions from the Directorate, the school continued such expenditures. The Department has now directed the school to recover the entire amount from its managing society within 30 days, warning of strict action if it fails to comply.
KR Mangalam World School
The school used Rs 2.77 crore of student funds to repay loans and interest for a bus and a car. A journal entry of Rs 1.54 crore was made in March 2023 without adequate justification. The total amount to be recovered remains Rs 2.77 crore. The school was instructed by the education department on December 14, 2023 to submit all relevant details and recover the amount within 30 days on January 14, 2024.
Laxmi Public School
In FY 2022–23, the school’s audit reported Rs 6.81 crore as recoverable from its society. Earlier, Rs 1.37 crore had been transferred as “rent” in FY 2018–19. Both amounts have been found to be in violation of regulations. A recovery notice with a 30-day deadline was by DoE April 12, 2024.
Ahlcon Public School
The school transferred Rs 5.66 crore over three years to Ahlcon International School as “financial assistance,” a violation of Rule 177. The DoE directed the recovery of Rs 5.39 crore, of which only Rs 26.62 lakh has been recovered so far.
Bal Bhavan Public School
In FY 2022–23, the school spent Rs 4.36 crore on infrastructure additions, lifts, and equipment, without adherence to Rule 177. Although the school justified these expenses, the DoE rejected the defence, as per an official communication. The school informed DoE that Rs 89.54 was recovered; and the remaining Rs 3.47 crore was to be repaid within 30 days by December 24, 2023.
Darbari Lal DAV Model School
The school reportedly spent Rs 8.68 lakh on unauthorised construction and diverted Rs 5.89 crore from the Development Fund to pay salaries and operational costs. An additional Rs 37.77 lakh was used for transportation. The school has also been criticised for failing to maintain proper asset records, prompting recovery orders.
Ravindra Public School
Between FY 2017–18 and 2022–23, Rs 5.98 lakh was used for capital expenses, including cameras and furniture, without prioritising salaries as mandated by Rule 177. On December 14, 2023, the DoE had asked the school to recover the amount from its society within 30 days by January 14, 2024.
N.K. Bagrodia Public School
The school used Rs 54.54 lakh from the Development Fund for building work in FY 2016–17 and 2017–18. Under the terms of its concessional land allotment, these expenses should have been borne by the society. As per a DoE order dated December 14, 2023, recovery was pending, and the amount was recorded as part of the school’s available funds.
Venkateshwar Global School
Rs 6.59 crore was spent between FY 2016–17 and 2018–19 on construction and loan repayments from school funds, in violation of DSER. Despite several DoE orders, the amount was not recovered till December 14, 2023, as per a DoE order issued on the same date.
De Indian Public School
The school used Rs 2.30 crore between FY 2014–15 and 2016–17 for construction and swimming pool expenses, which should have been borne by the society. DoE orders issued in 2019, 2022, and 2023 have not led to recovery.
Also Read: Delhi: Private schools flout RTE norms as government fails to act
“There are several other private educational institutions following the same practice year after year, yet no stern action has been taken by Delhi’s education department,” Gautam alleged. “This suggests either a nexus between the department and the schools or a lack of will to uphold the right to education.”
Development fund accounts missing or inadequately maintained
Clause 14 of the DoE’s February 11, 2009 order mandates that development fees—if charged—must be placed in a separate Development Fund Account and used only for capital expenditures. The fees must not exceed 15% of the annual tuition and require a Depreciation Reserve Fund to be maintained.
However, Laxmi Public School reported a development fund balance of Rs 3,59,13,092 as of March 31, 2023, but had no corresponding cash or bank balance. The DoE has directed the school to revise its accounts and ensure compliance.
Similarly, Ahlcon Public School’s audited accounts for FY 2022–23 showed a development fund balance of Rs 3,41,72,428 as of March 31, 2023, but no separate account or earmarked investment was maintained, according to the department.
From FY 2020–21 to FY 2022–23, KR Mangalam World School collected Rs 5,92,75,772 as development fees without prior DoE approval. The department instructed the school to refund or adjust the full amount. The collections were Rs 1,83,35,620 in FY 2020–21, Rs 1,82,26,941 in FY 2021–22, and Rs 2,27,13,211 in FY 2022–23.
Parents questioned the necessity of collecting such fees annually. “If schools already have a surplus in their development fund, then why are they charging 15% of the total fee every year?” one parent asked.
“The education department is aware of these irregularities in private schools across the national capital. Still, we want to know why no action is being taken,” Gautam added.
7th Pay Commission recommendations not implemented
According to the DoE’s fee hike orders for session 2023-2024, Laxmi Public School has not implemented the 7th Central Pay Commission and has also failed to invest in plan assets for employee retirement benefits.
Similar findings were noted in GD Goenka Public School, Ahlcon Public School, Bal Bhavan Public School, Ravindra Public School, and De Indian Public School.
“Most schools have not implemented the 7th Pay Commission despite increasing fees over the years. The education department has turned a blind eye,” Gautam said.
She also cited the Justice Anil Dev Committee report, which reviewed fee hikes by unaided private schools. The report found that out of more than 1,000 schools examined, 531 had raised fees under the pretext of implementing the Sixth Pay Commission despite having sufficient funds.
The committee recommended that these schools refund the excess amounts collected, with 9% interest, to the affected parents. The then Delhi government had instructed schools to comply, but follow-up remains unclear.
“The DoE has not ensured whether the arbitrary fees have been refunded. No data has been made available by the department,” Gautam added.
Bal Bhavan Public School denied the allegations, stating that it fully complies with all rules, including implementation of the 7th Pay Commission.
Other schools did not respond to Patriot regarding the findings of the audit reports at the time of publication. The online version of the story will be updated as and when Patriot receives their responses.
The recent audit report by the Directorate of Education (DoE) for the financial year 2024-2025 has not been made public yet as the last date for the private schools to submit final accounts including receipt and payment account, income and expenditure account and balance sheet of the preceding year duly audited by a Chartered Accountant is 31 July, as per Appendix II to Rule 180(1) of DSER, 1973.
