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Law Students Challenge ₹50,000 CLAT Counselling Fee: Delhi & Kerala HCs Step In

Introduction: The CLAT Counselling Fee Controversy

Every year, thousands of aspirants from across India prepare for the Common Law Admission Test (CLAT), the gateway to the prestigious National Law Universities (NLUs). But in 2024–25, a storm has erupted over the high cost of the counselling process—especially the ₹50,000 fee charged to secure admission after clearing CLAT. This steep fee, seen by many as unjust and exclusionary, has led to nationwide student protests, online petitions, and even court challenges.

Now, the Delhi High Court and Kerala High Court have stepped in, accepting petitions filed by CLAT 2025 aspirants challenging the legality and fairness of this fee structure. What started as a student-led movement has now grown into a national conversation about access to legal education, economic justice, and the constitutional right to equality.

What Is CLAT and Why the Fee Matters?

The Common Law Admission Test (CLAT) is a centralized entrance test for admissions to undergraduate (UG) and postgraduate (PG) law programs in 22 National Law Universities (NLUs) across India.

Here’s how the fee structure works:

Application Fee: ₹4,000 for general category candidates, ₹3,500 for SC/ST candidates.
Counselling Fee: ₹30,000 (General); ₹20,000 (Reserved Category).
Confirmation Fee: ₹20,000 (General); ₹20,000 (Reserved Category).

This means a student from the general category ends up paying a total of ₹54,000 (application + counselling + confirmation). For many students—especially from marginalised and economically weaker backgrounds—this is a huge burden even before admission is confirmed.

Student-Led Resistance: Who Raised the Voice?

The resistance against the counselling fee started at the grassroots level—by the students, for the students. A petition was circulated online, demanding that the Consortium of NLUs revise the fee structure and make it inclusive.

Prominent student bodies that backed this movement include:

Savitribai Intersectional Study Circle at NALSAR
NALSAR Student Bar Council
NLSIU’s Savitri Phule Ambedkar Caravan (SPAC)
DNLU Jabalpur Student Council
DSNLU Student Bar Association
NLIU Bhopal SPAC

Their collective voice forms a powerful message: Legal education should not be a privilege reserved for the wealthy.

What Are the Students Demanding?

The student petition highlights several concerns:

1. Financial Exclusion

Students from low-income families often don't have access to loans before admission is confirmed. The current system requires a large upfront payment, which is impractical for many.

2. Structural Barriers

Instead of simplifying the process, the two-tiered counselling and confirmation fee structure (₹30,000 + ₹20,000) introduced in 2023 has made it more complicated and expensive.

3. Lack of Refund Policy

If a student decides to withdraw from the counselling process, no refund is given. This is seen as exploitative, especially when some students are forced to opt out due to financial constraints.

4. Merger and Reduction of Fees

Students propose a single, reduced one-time payment, with a full refund policy for those who opt out before final allocation.

Legal Action Begins: Cases in Delhi and Kerala High Courts

The student movement took a legal turn when three CLAT 2025 aspirants, with support from the Legal Collective for Students’ Rights (LCSR), filed a petition in the Kerala High Court. A similar plea was also filed in the Delhi High Court by another candidate.

Kerala High Court Case

Date of Hearing: July 31, 2025
Petitioners: Three law aspirants supported by LCSR
Core Argument: The ₹50,000 fee is unconstitutional, creates economic discrimination, and violates Article 14 (Right to Equality) and Article 21 (Right to Education with Dignity).

Delhi High Court Case

Date of Hearing: September 9, 2025
Petitioner: Individual aspirant
Core Argument: The counselling process should have a clear refund mechanism and be aligned with the NEP’s goal of inclusive education.

Both High Courts have agreed to examine the matter, raising hopes among thousands of aspirants.

What Does the National Education Policy (NEP) Say?

The National Education Policy (NEP) 2020 stresses the importance of equity and inclusion in education, particularly for:

Economically weaker sections
SC/ST/OBC communities
First-generation learners

According to NEP:

“No student should be denied access to higher education due to financial constraints.”

Student groups argue that the current CLAT fee structure violates this principle, acting as a financial filter rather than an academic one.

Analysing the Consortium of NLUs’ Perspective

The Consortium of NLUs, responsible for conducting CLAT, has so far justified the ₹50,000 fee as follows:

Administrative costs: Running the centralised counselling portal, maintaining databases, and handling allotments.
Ensuring seriousness: A higher fee allegedly prevents casual applications or seat blocking.
Transparency: The fee system is pre-disclosed in official notifications.

However, critics argue that:

The same goals can be achieved with lower fees.
Technology costs have reduced, making administration cheaper.
Fee amounts should not be used as a deterrent against misuse.

Ground Reality: What Happens to Students Who Can’t Pay?

Let’s consider the case of Anjali (name changed), a CLAT aspirant from Bihar whose father is a daily wage worker. She scored well in CLAT 2025 but could not pay the ₹50,000 counselling fee in time. Despite qualifying, she lost the opportunity to get into a National Law University.

This is not an isolated case. Several similar stories are emerging from rural India, Dalit households, and first-gen learners.

The problem isn't lack of merit—it’s lack of means.

Public Outcry: Social Media, Petitions, and Solidarity

The online petition against the CLAT fee gathered thousands of signatures within days. On social media, hashtags like:

#CLATFeeWaiver
#MakeLawInclusive
#RefundCLATFee
have trended across platforms like X (formerly Twitter), Instagram, and LinkedIn.

Lawyers, professors, alumni of NLUs, and even practicing judges have expressed concern over the exclusionary nature of the fee system.

Broader Implications: Is It Just About CLAT?

No. This issue raises broader questions:

Should professional education come at such high upfront costs?
Are public-funded universities accessible only to the middle and upper class?
Is the current system violating constitutional rights?

The CLAT fee debate could set a precedent for other entrance tests, including medical and engineering admissions, especially in publicly funded institutions.

What Can Be Done? Suggested Solutions

Merge Counselling and Confirmation Fees

A single consolidated fee of ₹20,000–₹25,000 would be more reasonable.

Introduce Installment Plans

Allow students to pay the amount in 2–3 parts, reducing the burden on families.

Make Fees Refundable

If a student opts out before the final round of seat allocation, they should get a refund (after deducting minimal administrative charges).

Set Up a Financial Assistance Cell

Just like IITs and IIMs have financial aid offices, NLUs should set up a pre-admission assistance mechanism.

Full Transparency

Counselling rules, refund policies, and seat allocation details should be made public and easy to understand.

What Legal Experts Are Saying

Renowned legal experts and educationists have weighed in on the matter:

Justice (Retd.) A.P. Shah: “Such high fees in a public entrance process create structural inequality and are legally questionable.”
Prof. Faizan Mustafa (Former VC, NALSAR): “If the CLAT Consortium is non-profit and public in nature, it must align its actions with social justice goals.”
Advocate Karuna Nundy: “Charging ₹50,000 from aspirants—many of whom are yet to get into college—without a refund policy is unjust enrichment.”

The Road Ahead: What Happens Next?

With hearings scheduled in two High Courts, the following outcomes are possible:

Judicial Intervention: Courts may direct the Consortium to reduce or refund the counselling fee, or ask for a review of the process.
Policy Reform: The Ministry of Education or UGC may step in, issuing guidelines for reasonable counselling fees in centralised entrance tests.
Voluntary Reform by NLUs: Under public pressure, the Consortium may announce changes on its own to avoid negative publicity and court rulings.
National Debate: This case could trigger larger legal and policy reforms across entrance tests in India.

Final Thoughts: A Fight for Access, Not Concession

This isn't just a fee protest. It’s a larger demand for justice in education.

The legal profession in India needs diversity—not just in terms of gender or caste—but also in economic representation. If financial hurdles prevent bright, hardworking students from entering law schools, we weaken the very foundation of justice.

The courts stepping in gives hope. But the real change will come only when institutions recognise that access is a right, not a luxury.

Conclusion

The challenge against the ₹50,000 CLAT counselling fee is more than a legal battle—it’s a movement to make legal education inclusive, affordable, and fair. With the judiciary now stepping in, the spotlight is on the Consortium of NLUsto align its fee structure with the values of equity and access enshrined in the Constitution and the NEP.

Whether you're a law aspirant, educator, or policymaker, this case is a reminder: the true test of justice starts not in courts—but at the doors of opportunity.

Cheque Bounce

Cheque Bounce on Cash Loan Above ₹20,000? Kerala HC Says Case Not Valid Without Clear Reason

Introduction: A Landmark Ruling on Cash Loans and Cheque Bounce

In a groundbreaking judgment, the Kerala High Court has ruled that a cheque issued towards repayment of a cash loan exceeding ₹20,000—in violation of Section 269SS of the Income-Tax Act—does not qualify as a "legally enforceable debt" under Section 138 of the Negotiable Instruments (NI) Act unless a valid explanation is provided.

This decision is not only legally significant but also a major step toward curbing black money and promoting transparency in financial transactions.

Also Read: Cheque Bounce Cases in India: Know Your Legal Rights, Defenses, and Latest Updates

What is Section 138 of the NI Act?

Before diving into the judgment, let’s understand what Section 138 of the Negotiable Instruments Act, 1881 says.

Section 138 deals with dishonour of cheques for insufficiency of funds. If someone issues a cheque that is later dishonoured by the bank due to lack of funds or because it exceeds the amount arranged to be paid, the drawer of the cheque can face criminal liability.

To constitute an offence under Section 138, the following must occur:

The cheque must be issued for the discharge of a legally enforceable debt or liability.
It must be returned unpaid by the bank.
The payee must give a written notice within 30 days.
The drawer fails to make the payment within 15 days from receipt of the notice.

So, a legally enforceable debt is the cornerstone of a Section 138 case.

Also Read: How to Recover Money You Lent to Someone

What is Section 269SS of the Income-Tax Act?

Section 269SS of the Income-Tax Act, 1961 prohibits a person from accepting a loan or deposit of ₹20,000 or more in cash. Such transactions must be made only through:

Account payee cheque,
Account payee bank draft, or
Use of electronic clearing systems (NEFT/RTGS/IMPS).

If this provision is violated, Section 271D of the same Act provides for a penalty equal to the amount of the loan or deposit taken.

The intent behind this provision is to eliminate cash-based large transactions, thereby reducing tax evasion and money laundering.

Background of the Kerala High Court Case

The case was titled P.C. Hari vs. Shine Varghese. The facts are as follows:

The complainant, Shine Varghese, alleged that the accused, P.C. Hari, had borrowed ₹9,00,000 in cash and issued a cheque to repay it.
The cheque was dishonoured due to "insufficient funds."
The complainant sent a legal notice, and upon non-payment, filed a criminal case under Section 138 of the NI Act.
Both the Magistrate Court and Sessions Court found the accused guilty.
Aggrieved, the accused moved the Kerala High Court in a criminal revision petition.

Also Read: Safe Friendly Loans in India: Everything You Need to Know About the Law

Arguments by the Petitioner (Accused)

The petitioner’s counsel, Advocate D. Kishore, raised some compelling points:

Violation of Section 269SS: The alleged cash loan of ₹9,00,000 was a clear violation of Section 269SS of the Income-Tax Act.
Illegality of Transaction: Since the transaction was illegal under tax law, it cannot be considered a legally enforceable debt under the NI Act.
Burden of Proof: The accused had challenged the complainant's financial capacity and intent from the beginning.
No Income Tax Paid: The complainant admitted to not reporting this large cash transaction for income tax purposes, undermining the legality and credibility of the debt.

Also Read: Property Documents for Home Loan in India: An In-Depth Analysis

Arguments by the Respondent (Complainant)

Advocate Manu Ramachandran, appearing for the complainant, defended the case by arguing:

Presumption under Section 139 NI Act: The law presumes that a cheque was issued for a legally enforceable debt unless the contrary is proved.
Penalty Does Not Nullify Debt: A violation of Section 269SS only attracts a penalty, but it does not render the transaction void or illegal.
Borrower Cannot Take Advantage: The borrower (accused) cannot take benefit of an illegality (cash loan) that he himself participated in.
Reliance on Bombay HC Judgment: He cited the judgment of Krishna P Morajkar v. Joe Ferrao, which held that violations of tax laws do not affect the enforceability of the debt under NI Act.

Legal Issues Before the Court

Justice P.V. Kunhikrishnan of the Kerala High Court framed a crucial legal question:

“Can a criminal court enforce a debt arising out of a cash transaction that violates Section 269SS of the Income-Tax Act?”

In simpler terms: If a person gives a loan above ₹20,000 in cash (which is prohibited), and the borrower gives a cheque which then bounces, can the lender prosecute the borrower under Section 138 of the NI Act?

Court’s Observations: Upholding Public Policy and Digital India

Justice Kunhikrishnan delivered an insightful judgment, observing the following:

1. Digital India and Cash Transactions

The judge emphasized that the Union Government is promoting digital transactions and reducing cash-based dealings.

“A court of law cannot turn its face and legalise cash transactions when the Government of India aims for complete digital transactions.”

2. Rebutting Section 139 NI Act Presumption

While Section 139 creates a presumption in favour of the holder of a cheque, this is rebuttable. If the accused can raise a probable defence, the presumption can fall.

Here, the accused:

Challenged the financial capacity of the complainant.
Pointed to the admitted violation of Section 269SS.
Highlighted that the complainant did not pay income tax or provide any valid explanation for giving ₹9 lakh in cash.

Thus, the accused rebutted the presumption under Section 139 by a preponderance of probabilities.

3. Illegality Cannot Be Legalised

The court respectfully disagreed with the Bombay High Court’s view in the Prakash Madhukarrao Desai case, stating:

“Legalising such transactions would convert black money into white money through criminal courts.”

The court compared this to the ‘Shylock’ approach—a reference to the greedy moneylender from Shakespeare’s The Merchant of Venice—suggesting that collecting penalties does not justify the original illegal transaction.

4. Need for a Valid Explanation

If a person gives a cash loan above ₹20,000 in violation of the Income-Tax Act, the court said it could only be treated as legally enforceable if the lender gives a reasonable and valid explanation.

For instance:

Emergency medical needs
Lack of banking facilities in remote areas
Documentary proof of urgency

In this case, no such justification was provided.

Also Read: SARFAESI Act, 2002 Explained: Working, Provisions, Objectives, and Applicability

Final Judgment: Conviction Set Aside

Based on its analysis, the Kerala High Court:

Allowed the criminal revision petition filed by P.C. Hari.
Set aside the conviction and one-year sentence imposed by the lower courts.
Ordered that any amount deposited by the petitioner during the proceedings should be refunded.

However, the judgment clarified that the ruling would apply prospectively and not to cases where this specific legal issue was not raised earlier.

What This Means for Cheque Bounce Cases on Cash Loans

This ruling has far-reaching implications:

Cash Loans Over ₹20,000 Not Automatically Legally Enforceable

Unless a valid reason is shown, a cheque issued for such a loan cannot result in successful prosecution under Section 138.

Burden of Proof on Accused

The accused must raise the defence that the transaction violated Section 269SS. If not raised, courts can presume legality.

Boost for Digital Transactions

The judgment aligns with the government’s push for digital economy and discourages large unaccounted cash deals.

Income Tax Compliance

Lenders who advance large cash loans may face tax penalties and also fail to recover their money legally through criminal prosecution.

Important Supreme Court Precedents Referenced

1. Rangappa v. Sri Mohan (2010)

Held that the presumption under Section 139 includes the existence of a legally enforceable debt, but this is rebuttable.

2. Krishna Janardhan Bhat v. Dattatraya G. Hegde (2008)

Held that mere issuance of a cheque does not by itself prove a legally enforceable debt.

However, Rangappa’s decision (by a larger bench) overruled Krishna Janardhan Bhat in parts, stating that Section 139 creates a strong presumption that must be disproved by the accused.

Conclusion: A Wake-Up Call for Cash Lenders

The Kerala High Court’s judgment is a stern reminder that legal recourse requires legal conduct. Giving large loans in cash may feel convenient, but it violates tax law, and worse, you may lose the right to recover it through criminal proceedings.

With this ruling, courts are making it clear: Illegal transactions cannot form the basis of legal enforcement.

If you're engaging in financial transactions, make sure they are:

Digitally documented,
Within legal limits,
And tax compliant.

Need Legal Advice on Cheque Bounce or Loan Disputes?

At LegalKart, you can consult experienced lawyers online and get clarity on your legal situation. Whether it's cheque dishonour, income tax violations, or loan recovery—our legal experts are just a call away.

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