The Kerala High Court has ruled that Akshaya Centres, which are designed to facilitate access to government services for ordinary citizens, cannot operate with a profit motive or unilaterally set service charges for essential services. Justice N. Nagaresh observed that these centres are meant as service centres to bridge the digital divide and should not be treated as business enterprises whose franchisees determine fees for users under the guise of service.
The case involved petitions filed by the Forum of Akshaya Centre Entrepreneurs and the All Kerala Akshaya Entrepreneurs Confederation challenging a government order that fixed fees for “K-Smart” services offered at Akshaya Centres. The entrepreneurs argued that the fee-fixing order had been imposed without consulting them, failed to account for differences in workload and cost, and revoked earlier orders of the Local Self Government Department that had allowed centres to charge per page for certain online services.
Akshaya Centres are part of the Kerala State IT Mission’s public-private partnership scheme under the Department of Information Technology. Under this scheme, selected entrepreneurs enter into agreements with the District Collector to operate centres that provide Government-to-Citizen (G2C) services. These centres are intended to ensure government services reach the public, especially in rural and underserved areas, by enabling digital access and reducing the effects of digital illiteracy.
The petitioners asserted that the new government order fixing uniform charges disregarded operational diversity among Akshaya Centres and placed financial burdens on some centres, especially those dealing with lower volumes of work or higher costs of operations. They urged the Court to stay the order and to require the government to take their representations into account before fixing the service charges.
The Court, however, refused to stay the government order. It held that under the terms of the contractual arrangements, the entrepreneurs have no statutory right to decide service charges. The entrepreneurs are bound by the agreements they have entered into and must abide by government-issued fee schedules if that was the condition stipulated in those agreements. The Court emphasized that the relationship between the Akshaya entrepreneurs and the government is purely contractual, and that if the terms are unacceptable, the entrepreneurs had the choice either to accept them or to withdraw from the scheme.
Justice N. Nagaresh noted that these centres are not business centres operating for profit but are meant to serve the public under government oversight. As essential government-mandated services are routed through these centres, the power to fix charges lies with the government, not with the individual franchisees. The Court thus held that entrepreneurs cannot dictate service charges independently in respect of services that are government obligations.
Accordingly, the writ petitions filed by the Akshaya entrepreneurs were dismissed. The Court confirmed that government-fixed fees do not need to be negotiated or determined by the franchisees as long as they operate under valid agreements which allow the government to prescribe such fees.
The case name is Forum of Akshaya Centre Entrepreneurs and Another v. State of Kerala and Others, W.P.(C) Nos. 29740 & 30756 of 2025.
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