27.1 Bare Act Provision
24. Penalties.— Whoever contravenes the provisions of section 22 or section 23 shall be punishable with fine which may extend to one thousand rupees, and if the person contravening is an association or other body of individuals, every member of such association or other body who knowingly or wilfully authorises or permits the contravention shall be punishable with fine which may extend to one thousand rupees.
27.2 Explanation
UGC is empowered to take action against a private university awarding first degree and/or a postgraduate degree/diploma, which is not specified by the UGC and any private university continuing such programme and awarding unspecified degree shall be liable for penalty under Section 24 of the UGC Act.[1]
Penalties for contravening the provisions of ss. 22 and 23 were provided in s. 24 of the UGC Act. The amount of penalties under this section is only Rs. 1000 (One Thousand). There are lot of frauds happening in education sector, specifically fake degree scams, and UGC Act is imposing only a fine of such low level. Such scams are having transactions in lakhs of money and collective sum crosses crores, and for such culprits who destroyed dreams and time of students are punished with such low value fine.[2] The degree fraud crimes shall be penalized with special provisions having high sum of fines.
27.3 Critical Analysis
Procedural Delay: The enforcement of Section 24 is hampered by a reliance on the traditional criminal justice system, which is notoriously slow. The UGC does not have the power to impose these fines directly. It must file a criminal complaint in a court of law. Given the backlog in the Indian judicial system, a case against a fake university for violating Section 23 can take a decade to reach a verdict. By then, the institution has often closed, re-branded, or shifted its operations. Before initiating prosecution under Section 24, the UGC typically issues multiple Show Cause notices and Public Alerts. While meant to protect natural justice, this adds months of procedural delay during which the unauthorized institution continues to enroll and mislead students. Since many of these fake entities operate across state lines or digitally, determining the correct local magistrate’s jurisdiction for the Section 24 filing adds further administrative friction and delay.
Constitutional Validity and Ultra Vires: Section 24 is the penal extension of the Union’s power under Entry 66 of List I, but it faces challenges regarding the proportionality of its punishment. A major critique is whether a fine of one thousand rupees is a proportionate punishment for the massive fraud of running a fake university? If a penalty is so low that it doesn’t deter the crime, it fails the constitutional test of being a reasonable regulation.[3] If the UGC attempts to impose an Administrative Fine on its own without going through a court, such an act would be ultra vires of Section 24. The Act specifically contemplates a judicial penalty, not an executive one. : Under the Code of Criminal Procedure (CrPC), now the Bharatiya Nagarik Suraksha Sanhita (BNSS), the courts take cognizance. If the UGC fails to follow the exact manner of complaint prescribed in the Act, the entire prosecution under Section 24 can be struck down as technically invalid.
Room for Misinterpretation: The simplicity of Section 24 leaves several gaps that fake institutions exploit to avoid penalties. The Act says every person who contravenes the provision shall be punished. In the case of a Corporate Body or a Trust, who is the person? Is it the Chairman? The Registrar? The lack of specific Company Liability language allows high-level officials to shift the blame to lower-level employees. Does a university holding itself out as a university violate the Act once, or every day it stays open? Misinterpretation of whether the fine is per day or per instance significantly changes the impact of the penalty. Institutions often argue that since they are granting Certificates and not Degrees as defined in Section 22, they haven’t contravened the Act and thus cannot be punished under Section 24.[4] This narrow interpretation has allowed thousands of vocational centers to operate in a legal gray area.
Colonial Era Policy and Irrelevance: The penal structure of Section 24 is widely considered Irrelevant and a relic of a bygone era. The fine mentioned in the original 1956 Act (Rs. 1,000) was a significant sum in the colonial-era economy but is a joke in 2026. For a commercial entity making crores in fees, a small fine is just a cost of doing business. This is a classic colonial-era oversight where penalties were not indexed to inflation. Although I am against criminal imprisonment, but for crimes related to educational frauds, criminal imprisonment of related persons may also be included and punishment shall include property seizure, shutting down such institutions, and compensation for victim students shall also be incorporated. Absence of compensation clause in UGC Act for such frauds, is typical colonial era approach which is not at all making justice with victim students.
[1] Sikkim Manipal University vs Indira Gandhi National Open University [AIR 2016 (NOC) 155 (SIK.)]
[2] “Australia places India in ‘highest risk’ category for student visa applications days after fake degree scam busted in Kerala. Here’s what happened” Shraddha Pandey, OpIndia, Dt. 12.1.2026, available at: https://www.opindia.com/2026/01/australia-places-india-in-highest-risk-category-for-student-visa-applications-days-after-fake-degree-scam-busted-in-kerala-heres-what-happened/, last visited on 20.3.2026
[3] “Testing the Penalty Yardstick of the Amended Competition Law Against the Dogma of Doctrine of Proportionality” Ashutosh Pandey, SCC Online, Dt. 16.10.2023, https://www.scconline.com/blog/post/2023/10/16/testing-the-penalty-yardstick-of-the-amended-competition-law-against-the-dogma-of-doctrine-of-proportionality/, Last visited on 20.3.2026
[4] Institution Of Mechanical Engineers vs State Of Punjab [AIR 2019 SUPREME COURT 3882]
