Supreme Court: In a writ petition filed against the Union Government, Bar Council of India and State Bar Councils for charging the exorbitant enrolment fees and declaring the amount taken as arbitrary, unreasonable, and illegal, the three Judge bench comprising of Dr. DY Chandrachud, CJI, J.B Pardiwala, and Manoj Misra, JJ. has held the following:
- The SBCs cannot charge “enrolment fees” beyond the express legal stipulation under Section 24(1)(f) as it currently stands;
- Section 24(1)(f) specifically lays down the fiscal pre-conditions subject to which an advocate can be enrolled on State rolls. The SBCs and the BCI cannot demand payment of fees other than the stipulated enrolment fee and stamp duty, if any, as a pre-condition to enrolment;
- The decision of the SBCs to charge fees and charges at the time of enrolment in excess of the legal stipulation under Section 24(1)(f) violates Article 14 and Article 19(1)(g) of the Constitution; and
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This decision will have prospective effect. The SBCs are not required to refund the excess enrolment fees collected before the date of this judgment.
Background:
The SBCs charge enrolment fees stipulated under Section 24(1)(f) of the Advocates Act to admit law graduates on their State roll. At the time of enrolment, the SBCs also charge various “fees” and “charges” in addition to the enrolment fees in the form of library fund contributions, administration fees, identity card fees, welfare funds, training fees, processing fees, certificate fees, etc. The amount of fees charged by the SBCs differ significantly. This results in a law graduate paying between Rupees fifteen thousand to Rupees forty-two thousand (depending on the SBC) as cumulative fees at the time of enrolment.The petitioner’s case was that Section 24(1)(f) of the Advocates Act, 1961 specifies that to be admitted as an advocate, an applicant must pay enrolment fees of Rs.600 to the State Bar Council (‘SBC’) and Rs.150 to the Bar Council of India. Moreover, if the applicant belongs to Scheduled Caste or Scheduled Tribe, then the enrolment amount paid to the Bar Council of India (‘BCI’) is Rs. 25 and to the respective State Bar Council is Rs. 100. However, contrary to this, the State Bar Councils are charging exorbitant fees which vary in different States.
Issues:
- Whether the enrolment fees charged by the SBCs are in contravention of Section 24(1)(f) of the Advocates Act, 1961?
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Whether payment of other miscellaneous fees can be made a pre-condition for enrolment?
Analysis and Decision:
The Court noted that presently, the SBCs charge different fees from advocates at the time of enrolment. Most SBCs charge an enrolment fee in addition to other miscellaneous fees. For instance, the Bar Council of Maharashtra and Goa is charging library fees, certificate fees, administration fees, identity card fees, training fees, and welfare fund contributions. Resultantly, the enrolment fee and the other fees charged by the SBC amounts to Rupees fifteen thousand for general candidates and Rupees fourteen thousand five hundred for candidates from SC and ST category
The Court derived the following principles concerning the rule-making power of the SBCs under Section 15:
- The SBCs can exercise rule-making powers only for the subject matters specified under Chapter II;
- Although the SBCs have a broad rule-making power, it must be exercised to further the object and purpose of the Advocates Act;
- The SBCs cannot use their rule-making power under Section 15 with respect to subject matters on which the BCI has been granted exclusive power to make rules under the Advocates Act; and
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Approval by the BCI to an invalid rule made by the SBCs cannot be deemed to validate the invalid rule.
The Court said that the scope of the rule-making power of Bar Councils under Section 15 extends to give effect to the provisions of Chapter II, namely, Sections 3 to 14.
After taking note of Section 28 of the Advocates Act, the Court said that it empowers the SBCs to make rules to carry out the purposes of Chapter III. According to Section 28(2), the SBCs can make rules providing for the:
- Time within which and form in which an advocate shall express an intention for the entry of their name in the State roll under Section 20;
- Form in which an application shall be made to the SBCs for admission as an advocate and how such application shall be disposed of by the
- Enrolment committee of the SBCs;
- Conditions subject to which a person may be admitted as an advocate;
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Instalments in which the enrolment fee may be paid.
The Court concluded that SBCs and the BCI act as the delegates of Parliament under the Advocates Act, thus the Rules made by them must follow the below mentioned principles:
- Delegate cannot act contrary to the express provisions and object of the parent legislation;
- A delegate cannot widen or constrict the scope of the parent legislation, or the legislative policy prescribed under it; and
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A fiscal provision has to be construed strictly and a delegate cannot consider any circumstance, factors or condition not contemplated by the parent legislation.
The Court noted that the legislative policy of enrolment and admission of advocates is contained in Chapter III of the Advocates Act. Section 24(1) lays down the qualifications subject to which an advocate may be admitted on a State roll. Section 24(1)(f) provides that the enrolment fee payable by general candidates is Rupees seven hundred fifty and by SC and ST candidates, Rupees one hundred and twenty-five. The Court said that that Section 24(1)(f) reflects the legislative policy of the Advocates Act that subject to the fulfilment of other conditions of Section 24(1), the payment of the stipulated monetary amount will make a person eligible to be admitted as an advocate.
The Court said that the SBCs cannot charge “enrolment fees” beyond the express legal stipulation under Section 24(1)(f) as it currently stands. Therefore, prescribing enrolment fees beyond Rupees seven hundred fifty for general candidates and Rupees one hundred twenty-five for SC and ST candidates is contrary to Section 24(1)(f). The subject matter of the enrolment fee is covered by the Advocates Act. Therefore, the SBCs, being delegated authorities, do not have any legislative powers to prescribe enrolment fees contrary to the statutory stipulation.
The Court remarked that the legislative history suggests that the legislature was averse to imposing any charges other than enrolment fees at the time of enrolment. This was in furtherance of the legislative object to foster an inclusive Bar. However, the SBCs are imposing miscellaneous fees and charges in the guise of an enrolment fee, which cumulatively exceeds the statutory stipulation under Section 24(1)(f). The decision of the SBCs to charge an enrolment fee beyond the stipulated amount is contrary to the legislative object of the Advocates Act.
After taking note of the resolution dated 26-06-2013 passed by the BCI, wherein BCI directed the SBCs to charge Rupees six thousand as enrolment fees for general candidates and Rupees three thousand for SC and ST candidates, the Court said that the fact that the enrolment fee stipulated under Section 24(1)(f) has not been revised by the legislature does not clothe the BCI with any authority to direct the SBCs to charge revised enrolment fees. Thus, the Bench held that this resolution is devoid of legal authority.
Charges other than the enrolment fee cannot be a valid pre-condition
The Court noted that the Certificate of enrolment is issued to the applicant by the SBC. The enrolment fee prescribed under Section 24(1)(f) comprehends the whole enrolment process.
The Court said that the SBCs charge various fees such as verification fees, application fees, registration fees, and identity card fees at the time of enrolment. The SBCs charge these fees as concomitant to the process of enrolment. These charges are per se not related to the process of enrolment, but in most cases the candidates have no choice but to pay the levies.
Thus, the Court emphasised that all the miscellaneous fees collected from a candidate at the time of enrolment essentially serves as a pre-condition to the process of enrolment. Section 24(1) specifically lays down the pre-conditions subject to which an advocate can be enrolled on State rolls. Since Section 24(1)(f) specifies the amount that can be charged by the SBCs as an enrolment fee, the SBCs and the BCI cannot demand payment of fees other than the stipulated enrolment fee as a pre-condition to enrolment.
After noting that Rule 40 under Section IVA of Chapter II of Part VI under the BCI Rules mandates every advocate borne on the rolls to pay the SBC a sum of Rupees three hundred every third year, the Court said that this sum cannot be collected from the Advocates at the time of enrolment. It must be collected from them after they are admitted on the State roll.
Article 14: Substantive equality and manifest arbitrariness
The Court said that the SBCs at the time of enrolment charge fees in contravention of Section 24(1)(f) and the legislative policy of the Advocates Act. Therefore, the excess enrolment fees charged by the SBCs are manifestly arbitrary. Further, the effect of charging exorbitant enrolment fees as a pre-condition for enrolment has created entry barriers, especially for people from marginalized and economically weaker sections, to enter into the legal profession. Thus, the current enrolment fee structure is manifestly arbitrary because it denies substantive equality.
Article 19(1)(g): Unreasonableness
The Court said that the excess enrolment fee imposed by the SBCs is without authority of law. Further, there are no reasonable criteria behind the decision of the SBCs to charge such exorbitant amounts as enrolment fees. The SBCs cannot have unbridled powers to charge any fees given the express legislative policy under Section 24(1)(f). Imposing excessive financial burdens on young law graduates at the time of enrolment causes economic hardships, especially for those belonging to the marginalized and economically weaker sections of society. Therefore, the current enrolment fee structure charged by the SBCs is unreasonable and infringes Article 19(1)(g).
Financial implications for the SBCs and the BCI
While noting that the SBCs and the BCI depend entirely on the amount collected from candidates at the time of enrolment for performing their functions under the Advocates Act, including payment of salaries to their staff, the Court said that instead of devising ways and means to charge fees from enrolled advocates for rendering services, the SBCs and the BCI have been forcing young law graduates to cough up exorbitant amounts of money as a pre-condition for enrolment.
The Court suggested that the SBCs and the BCI should devise an appropriate method of charging fees that is fair and just not only for the law graduates intending to enroll, but also for the advocates already enrolled on the State rolls.
The Court further suggested that there are several reasonable ways by which the SBCs and BCI can and already do collect funds at later stages of an advocate’s career. For instance, under the Advocates Welfare Fund Act 2001, advocates must affix mandatory welfare stamps on vakalatnamas which are used to collect funds for advocate welfare.
After taking note of Section 15 of the Advocates Welfare Fund Act 2001, which mandates the SBCs to pay annually to the welfare fund an amount equal to twenty per cent of the enrolment fee received by it under Section 24(1)(f) of the Advocates Act, the Court clarified that this decision will not have any effect on the obligation of the SBCs under Section 15 because they will continue to charge the enrolment fee as stipulated under Section 24(1)(f).
The Bench directed the SBCs and the BCI to ensure that the fees charged at the time of enrollment comply with Section 24(1)(f) and the provision is not defeated either directly or indirectly under the garb of different nomenclatures.
The Court further said that no case is made out for this Court to exercise its power under Article 142 to implement the BCI Draft Enrolment Rules in their current form.
The Court declared that the judgment will have a prospective effect, thus the Bar Councils are not required to refund the enrolment fees collected in excess of the statutory amount so far.
Also Read:
[Gaurav Kumar v. Union of India, Writ Petition (C) No. 352 of 2023, decided on 30-07-2024]
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