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Delhi Public School Society faces allegations of fraud

A member has questioned agreements the Society signed with some franchises.

Pankaj Vohra  New Delhi | 18th Oct 2014

The Delhi Public School Society, which runs more than 100 schools in India and abroad including DPS, Mathura Road, DPS, R.K. Puram and DPS, Chandigarh, is now caught in yet another controversy. This time, a member of the working group and a life member of the Society has sought clarifications from the chairman, V.K. Shunglu on whether the agreements the Society signed with some franchises recently were conforming to the copy submitted to the Central Board of Secondary Education (CBSE). And if not, the implications were of a very grave nature and could amount to gross irregularities on part of the Society, thereby making it prima facie into a case of fraud.

The Society has been in the news ever since the controversial elections in which former Comptroller and Auditor General (CAG), Shunglu, considered to be a man of unimpeachable integrity, was declared elected as chairman by one vote. The matter is pending before the Delhi High Court after Ashok Chandra, former petroleum secretary, who was defeated as the vote cast by Khushwant Singh in his favour went missing, filed a petition. The court is seized of the matter, but a legal battle involving two of the country's best known bureaucrats has caught wide public attention.

In the latest instance, Sharada Nayak, a life member and member of the working group has cautioned the chairman that the MoU entered into by the society with the franchises did not involve any monetary consideration that is either not approved or acceptable as per the required norms of the CBSE. "If it does so, you are the best person to understand the implications of signing such an MoU besides an approved agreement. I don't subscribe to signing of any such MoU without the consent, opinion and approval of other life members. As we all know that the CBSE is an affiliating body and any stricture passed by them for violation of any norms shall affect the future of both our schools and children."

Sources said that the Society has signed two sets of agreements with the franchises. The one which has the approval of the CBSE has no financial implications or mention, but another set that has been signed seeks to raise the affiliation fee from Rs 10 lakh to 12 lakh. The copy of the second agreement has not been given to the franchises and this would therefore make it difficult for them to transfer the money to the Society with the required approval of their respective Trusts. In other words, the second set of agreement is void as no money can be legally paid unless it has been sanctioned.

Nayak, in another letter dated 15 October to Shunglu has again raised the matter of signing the agreement and MoU by the "Pro Vice Chairmen" (read owners) of various DPS schools. "As stated earlier, I shared my reservations both on non sharing of the copy of the MoU and also about the consideration if any charged from any of the PVCs in contradiction of the terms of agreement."

She brings out the anomalies in the letter as there is "no specific period for which these agreements are entered into either for a specific period or in perpetuity. In case of termination, ideally the logo and the name Delhi Public School should be withdrawn immediately after termination which seems inadvertently not mentioned in the agreements. After a careful reading of the Indian Contract Act, 1872, consideration is one of the essential elements for an agreement to become a contract. It is a requisite for all contracts other than those made by deed. Except in cases of natural love and affection, compensation for past voluntary service, agreement to pay time barred debt, completed gift, contract of agency, remission by the promise after the performance of the promise and/or continuation to charity the consideration is not required. Consideration maybe (sic) of nominal value or substantial value."

The implication of what Nayak is alleging is that the DPS Society has signed two sets of agreements with the franchises. One is without consideration, which has been sent to the CBSE and the other is with consideration, the copy of which has not been supplied to the franchises. In other words, information about monetary transaction being involved has been concealed from the CBSE.

Sources said that ever since the matter was raised by Nayak, who is also demanding a meeting of the life members to take their opinion, the DPS Society has stopped the process.

Efforts to contact V.K. Shunglu and Ranvir Taneja, the Society secretary proved futile.

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