Before You Set up a School

 Opening a school is a herculean task in India. Despite this, more and more people are coming forward to start a venture because the demand for schools seems to be unending

A school is a unique business. Unique because it cannot even be called a ‘business’.

Running a school is considered a not-for-profit venture, but you just need to look around to see that the business opportunity is huge. According to an estimate by an NGO active in the field of education, there are more than 14 lakh children in Delhi alone who seek admission every year in various classes.

Schools cannot be set up by private entities. They have to be run by a society formed under the Societies Act of 1860, or a trust under Public Trust Act as existent in different states, or by forming a company under Section 25 of the Companies Act 1956. In other words, a school has to be set up strictly as a non-profit business. At least that is the theory.

Setting up a school is not just about constructing physical infrastructure in the form of building classrooms and setting up libraries and laboratories. It does involve obtaining permissions and licenses from concerned authorities at various stages. It starts with the setting up of a trust or a society, with a governing board of five or six members, with a president, chairperson, and a secretary duly identified, as specified under the law. This article will focus primarily on identifying the various steps involved in opening a school, providing facility for the study for students from Class 1 to Class 10.

The next step
Once the governing entity, whether a company, trust, or society, comes into existence, it will have to look for land. There are two possibilities—one, if the society or trust has a land of its own, or, second, when the governing entity decides to buy a land for the proposed school. Buying land from the government requires permission in the form of a no-objection certificate from the Department of Education of the concerned state. The no-objection certificate, called Essentiality Certificate (EC), certifies the requirement of a school in a particular area. The logic behind the practice is to make sure no two schools compete with each other and one becomes redundant. The EC comes with a rider that construction must commence within three years, failing which the society will have to reapply for the same.

One can apply to the concerned municipal corporation for land for the school with the EC. Land is supposed to be allotted to the governing entity at subsidized rates is usually allotted through auction.

Which laws?

“It is almost impossible for a new entrant to get land. Land is normally granted to established players with a chain of schools,” says R.B. Adityodaya Karna, deputy secretary of Prarthana Society, Bangalore, a trust that runs a school in the city.

Even if a member on the board of a governing entity has land that the entity wants to use for setting up a school, a no-objection from the Department of Education stating the requirement of a school in that area is required. The major education boards of the country, namely, the Central Board of Secondary Education (CBSE), the Council for the Indian School Certificate Examinations (CISCE), and state government boards, have clearly laid down norms for land requirements for schools. This, in most cases, is 2 acres, except for hilly regions and metropolitan cities, where the requirement is less. Construction can take place only on a part of the land, and a playground has to be created in the rest.

Adityodaya says, “While conceiving the idea of a school, one has to asses the potentials of a location, kind of competition possible, and the target group—the lower middle class, upper middle class or the rich class—the school will cater to.”

From the time of forming a governing entity to a school actually starting up, one normally requires about a year, though taking more than two years is also not unheard of. Normally the infrastructure required to start up can be constructed within a period of six to seven months. Once the construction is over, school authorities need to apply for recognition. Up to Class 5 recognition from municipality is all that is required. For Classes 6 to 8 recognition comes from the Department of Education. Recognition for anything above this also comes from the Education Department, but after a minimum gap of two years. School authorities are free to seek affiliation to CBSE or CISCE. In that case, the school will have to follow the guidelines of the board it is seeking affiliation to. The school will need to follow the syllabus, books prescribed by the affiliating board, and pay specified salaries to the teachers.

If it is not a government school, affiliation for schools normally comes in stages. Initially, for Classes 1 to 6 a temporary affiliation is given and guidelines are laid down for schools by the concerned education board. Once things are in place according to the guidelines, an inspection is conducted. If things are to the satisfaction of the board authorities, permanent affiliation is bestowed on the school. Adityodaya says inspections are not so rigorous after permanent affiliation is granted, but a school has to be run according to the rules of the board.

Licenses and documents
Setting up a school involves a lot of legal processes from the very beginning. While forming a society, trust, or company, one has to have a Memorandum of Association, a document needed almost at every stage later. Like for any other business, a detailed project report for the school is also needed.. In addition, details of land and building, auditor’s statement, bank statements of the governing entity and their members and auditor’s statements are needed at some point or the other.

Once the school building is ready for initial use, a certificate of recognition has to come from the state government, issued by the municipality for the junior classes, and by the Department of Education for middle school. If high school is to be added subsequently, certificate of up gradation is required which is again issued by the Education Department. Affiliation from either the CBSE or CISCE is also done through a set process. Things do not stop here, as schools need certificates for hygiene, water, and completion of the building from the municipality.