New Delhi, April 21: The Centre has told private B-schools they must refund any student who changes his mind after admission and wishes to leave.

The move will prevent the private institutes from cashing in on the uncertainty over IIM admissions, and ease the anxiety of 4,000 to 5,000 students trapped in the Other Backward Classes quota tussle.

With the human resource development ministry having stopped the IIMs from announcing their general-category admissions lists today, many of the shortlisted students are expected to seek admission to private B-schools.

“We’ll be losing the cream of the students,” an IIM official had said on Thursday.

Both the IIMs and the students know that if the court later lifts the stay on the quota, paving the way for the admissions process to resume, the selected students would want to come back to the IIMs.

That would ordinarily mean losing the huge sums they have paid the private institutes, whose annual fees can be anything between Rs 1 lakh and Rs 3 lakh, comparable to the IIMs. The government’s refund diktat, carrying the threat of de-recognition if disobeyed, takes care of the problem.

The directive applies to a host of private and government B-schools and engineering institutes. It has been issued by the All India Council of Technical Education (AICTE), a statutory government body that regulates technical institutions, universities and deemed universities but not the IITs and IIMs.

The notification says an institution must refund the entire money if a student withdraws his admission before the start of the academic session, deducting only a processing fee that cannot be more than Rs 1,000.

If a student quits after the session starts, and if the seat is filled by another candidate, the institution will still have to return the deposit but can deduct the monthly tuition fee and hostel charges.

The notification also says an institute cannot retain a student’s original school-leaving certificate if he wishes to leave.

The council’s regulations are binding, and failure to comply can lead to “withdrawal of approval and recognition”.

“The AICTE shall on its own take such steps as necessary to enforce these orders on the basis of specific complaints received from those affected,” the council said.

It added it had received complaints that tech schools and universities were admitting students “long before the start of an academic session”.

“They are collecting the full fee from the students and retaining their original certificates. The time limit to join courses and programmes is being unrealistically advanced to pre-empt the students from joining other institutions of their choice.”

The council regulates about 1,400 private technical and management institutes other than a host of government institutions. Among the more prominent are XLRI, Jamshedpur, and Jamnalal Bajaj Institute of Management Studies, Mumbai.