Unilateral stoppage of school functioning without prior statutory approval does not constitute lawful closure or extinguish employee salary liabilities.

The proceedings involve five connected matters concerning Dayanand Adarsh Vidyalaya, a recognized private school in Tilak Nagar.

The school effectively stopped functioning on April 1, 2020, citing financial unviability and falling student enrollment.

Petitioners, comprising teaching and non-teaching staff, alleged that while the school ceased operations and locked its premises, it failed to obtain the mandatory prior approval for closure from the Directorate of Education (DoE) under the Delhi School Education Rules.

Consequently, the Petitioners sought recovery of unpaid salaries from April 1, 2020, along with arrears arising from the 7th Central Pay Commission (CPC) effective from January 1, 2016.

The school management contended that liability should be limited to the school’s non-existent assets, while the Petitioners sought to fasten liability on the parent bodies, including Arya Samaj (Tilak Nagar) and Delhi Arya Pratinidhi Sabha, alleging they exercised real control over the institution.

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 Petitioners must be treated as continuing in service after April 1, 2020, thereby entitling them to salaries and service benefits

3. Whether liability for salary and retiral dues can be carried beyond the school to the society or parent bodies that managed its affairs

The Court primarily applied Sections 3, 4, 8, 10, and 20 of the Delhi School Education Act (DSEA), 1973, which govern the recognition, service conditions, and management of schools.

It specifically relied on Rule 46 of the Delhi School Education Rules (DSER), 1973, which mandates "prior approval" from the Director of Education for closing a school.

The Court followed the precedent in Manju Tomar Ors. v. NCT and Ors.

the Supreme Court’s ruling in NDMC Anr. v. Manju Tomar Ors. (2024), which held that a closure de hors Rule 46 is illegal and management cannot utilize such illegality to evade salary obligations

It also referenced Anjna Sharma v. Shishu Bharti Vidyalaya regarding the liability of a running society to absorb or pay staff of a closed branch.

The Court reasoned that legal closure is a statutory process, not a factual "drift" or managerial declaration.

Under Rule 46, the insistence on prior approval is mandatory to protect the interests of students and staff; thus, a physical lock on the gate does not terminate legal obligations.

The Court rejected the school’s reliance on Rule 55 (lapse of recognition), noting that while unlawful cessation may trigger a lapse in recognition, it does not validate an unapproved closure.

Regarding liability, the Court observed that the DSEA does not view the school as an isolated unit but as an enterprise under a managing committee and society.

It held that "unlawful closure does not scatter liability into the air" but keeps it anchored to the entity exercising "real and effective control".

However, finding the record inconclusive as to whether control rested with the local Arya Samaj or the Delhi Arya Pratinidhi Sabha, the Court determined that this factual nexus required a specific inquiry by the DoE.

The Court ordered that liability rests jointly and severally upon the school and the entity identified by the DoE as being in actual management.

The DoE was directed to: (i) identify the controlling entity within eight weeks

(ii) nominate an officer to compute Petitioner-wise dues including 7th CPC arrears and 6% interest

(iii) decide on the school’s closure application within ten weeks, ensuring dues are secured before granting any approval

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

Dues must be paid within four weeks of determination, failing which 9% interest will apply.