The Supreme Court has ordered a nationwide scrutiny of private universities, making it clear that institutions established for higher education cannot be operated as profit-making ventures.
A bench of Justice Ahsanuddin Amanullah and Justice NV Anjaria has directed private universities across the country to disclose detailed financial and administrative information covering the past five years.
The exercise will cover audited accounts, the generation and utilisation of funds, fee collections, surplus money and its investments, payments made to individuals outside direct educational functions and the benefits received from governments.
The Union Government, States and Union Territories have been directed to collect the information from the universities and submit affidavits through their respective Chief Secretaries. The information is to be furnished within six weeks from the Court’s September 17, 2026 order.
The Court stressed that while a private university can maintain a reasonable financial cushion to ensure its smooth operation, its resources must ultimately be managed in furtherance of its educational objectives.
“no private university shall be allowed to be run as a profit-making institution,” the bench observed, adding that universities must have sufficient resources for responsible financial management and suitable compensation of teaching and non-teaching staff.
From an individual grievance to a nationwide exercise
The proceedings originated from a grievance involving Noida-based Amity University. The Supreme Court, however, expanded the scope of the matter after finding that broader questions concerning the functioning, regulation and public benefits available to private universities warranted examination.
The Court said that an inquiry into these issues was necessary in the larger public interest.
Private universities have now been asked to provide extensive information covering not only their finances but also admissions, examinations, recruitment, teaching arrangements and grievance mechanisms.
Among the financial details sought are the manner in which surplus funds are handled and investments made from those funds. Universities must also disclose fees collected at admission and during courses, including amounts collected under labels such as development funds or charges for special events.
Government concessions and admissions under scrutiny
The universities will have to disclose the benefits and concessions obtained from Central and State governments, including allotment of land, relaxation of statutory requirements and any special privileges.
Details of the admission process for every course must also be furnished. This includes identifying those responsible for admissions, setting examination papers, conducting examinations, evaluating answer scripts and handling university funds, along with the management’s role in these areas.
Faculty recruitment and classroom teaching
The Court has also sought information concerning the recruitment of teaching and non-teaching employees, their salaries and other benefits, and the manner in which payments are made.
Universities must state whether specific service conditions have been notified for their staff and identify the competent authority responsible for allocating classes to teachers.
Details are to be provided of the teaching staff, the classes assigned to them and the number of classes actually conducted. Where a teacher did not take an assigned class, the university must explain what alternative arrangement was made to ensure that students were not affected.
The information relating to classroom allocation is to cover the period beginning January 2025.
Grievance redressal mechanisms also included
The Supreme Court has further sought details of the mechanisms established to address student and other grievances.
Universities will have to disclose the composition of grievance committees, the categories of complaints they are empowered to consider, the number and nature of complaints received and the outcome of those proceedings.
The broad information-gathering exercise places the financial functioning and academic administration of private universities under closer judicial scrutiny, while the Court continues to examine how these institutions are established, regulated and operated.
