Factual school shutdown without prior statutory approval does not extinguish management’s liability for employee salaries.

The petitioners are teaching and non-teaching staff of Dayanand Adarsh Vidyalaya, a recognized private school.

The school management stopped paying salaries from 1st April 2020 and simultaneously ceased educational operations, claiming financial unviability and falling student strength.

Although the school applied for closure under Rule 46 of the Delhi School Education Rules (DSER) on 17th July 2019, the Directorate of Education (DoE) never granted formal approval.

The petitioners sought payment of salary arrears, 7th Central Pay Commission (CPC) benefits, and retiral dues, arguing that the school remained "open" in the eyes of the law despite the physical shutdown.

The school contended that liability should be limited to the school’s non-existent assets and not extend to the parent society or affiliating bodies.

1. Whether a recognized school can be treated as "closed" in law merely because the management unilaterally stopped functioning and locked the premises without prior statutory approval.

2. Whether the staff must be treated as continuing in service after 1st April 2020 for the purpose of salary and service benefits.

3. Whether liability for these dues can be carried beyond the school to the parent society, managing committee, or affiliating body.

Section 3 of the Delhi School Education Act (DSEA), which mandates that the closing of classes be subject to the Act and Rules.

Section 4 of the DSEA establishes financial stability as a continuing condition for recognition.

Rule 46 of the DSER explicitly prohibits the closure of a recognized school without "prior approval" of the Director.

Rule 55 provides for the lapse of recognition upon unauthorized cessation but does not validate the illegality of the stoppage.

The court followed the Division Bench ruling in Manju Tomar & Ors. v. NCT and the Supreme Court’s affirmation in NDMC & Anr. v. Manju Tomar, which established that closure without prior approval is illegal and management cannot shift the resulting financial burden.

The court relied on Anjna Sharma v. Shishu Bharti Vidyalaya regarding the society's liability for branch closures.

The court reasoned that Rule 46 is mandatory; the law does not permit "factual drift" or managerial declarations to substitute for a statutory process.

The court held that while Rule 55 triggers a lapse in recognition for unauthorized stoppage, it does not transform an unlawful act into a valid closure.

Consequently, since no prior approval was granted by the DoE, the school remained legally extant, and the employees’ service rights could not be extinguished by an administrative fait accompli.

Regarding liability, the court rejected the "free-standing shell" argument, noting that DSEA/DSER treat the school, its manager, and the running society as an integrated enterprise.

Under Section 20 of the DSEA, management can be taken over even if the building is owned by another, proving that the school’s obligations survive its physical premises.

The court determined that liability anchors to those in "real and effective control," though it noted the record was inconclusive as to whether control rested with Arya Samaj Tilak Nagar, Arya Vidya Parishad, or Delhi Arya Pratinidhi Sabha.

The court held that the management cannot derive advantage from its own illegal unilateral stoppage.

The court directed the DoE to: (i) identify the entity in effective control within 8 weeks; (ii) nominate an officer to compute petitioner-specific dues, including 7th CPC arrears and interest at 6% p.a.; and (iii) decide on the closure application within 10 weeks, ensuring all dues are secured before approval.

Liability was fixed jointly and severally upon the school and the entity identified as being in control.

The contempt petition was disposed of as the claims were merged into the independent writ proceedings.