Maharashtra: Private MBBS, BDS colleges cannot show stipend as expenditure, says FRA

Aurangabad: The Fee Regulatory Authority (FRA) of Maharashtra recently denied the claim made by the association of private MBBS and BDS colleges in the state of considering stipend paid to candidates as expenditure of the institutes . The FRA further turned down the association's demand of 15% notional hike in fees.

This order came after the association of private MBBS and BDS colleges in the state that contended that the money paid as Stipend to the candidates is an expenditure to the institution and not that of the hospital and hence, is required to be shown as expenses of the institutes.

However, the authority found the debate as illogical and stated that services of candidates are "essentially and predominantly" used by the hospitals attached with MBBS and BDS colleges.

"Whether it is called stipend or salary, their (students) services are essentially and predominantly used in hospitals. Hence, it can be rightly treated as hospital expenditure. It being a hospital deficit is allowed - as an allowable expenditure to some reasonable limits. The FRA also relaxes these limits in genuine cases. Hence, colleges should not have any grievance on the stipend matter," stated the regulatory body in the order, quotes TOI.

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As per a recent TOI report, various observations were made by the authority, among which it was categorically noted that the amount collected as fees were shown as Stipend, which ridicules the fundamental intention behind the Scheme of Stipend. Besides, FRA also mentioned that the burden of "needless charity" done by the institutes while running the hospital cannot be shifted onto the shoulders of candidates.

The authority was of the opinion that separation of fees and stipends will probably reduce fees at private MBBS and BDS colleges.

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Though FRA held that the fundamental rights of colleges to run their administration, includes fixation of fee. However, such a right, in turn has to be balanced with the rights of candidates, so that they are not subjected to exploitation in the form of profiteering, thereby, denying a 15% notional hike in fees, FRA stated"Unless there is due justification, fees cannot be even determined, let alone increased."