The suit filed through AoR Sabarish Subramanian and settled by Senior Advocate P. Wilson, alleges that the Centre has made the release of SSS funds conditional upon Tamil Nadu’s implementation of the National Education Policy (NEP) 2020 and the PM SHRI Schools scheme; both of which the State has consistently opposed.
Tamil Nadu has sought a declaration that such linkage is “unconstitutional, illegal, unreasonable, and arbitrary.” It also urged the Court to direct the Centre to immediately disburse the allocated funds, along with future interest.
"There is no dispute or ambiguity in the Defendant’s obligation to pay the sum of Rs. 2151,59,61,000/-(Rupees Two Thousand One Hundred and Fifty-One Crores Fifty-Nine Lakhs and Sixty-One Thousand only) to be contributed by the Defendant from its obligatory share under the Samagra Shiksha Scheme to the Plaintiff State for the FY 2024-25," it states.
The State highlighted that while the Project Approval Board sanctioned RS. 3,585.99 crore as total outlay (with RS. 2,151 crore as the Centre’s 60% share) in its February 2024 meeting, not a single instalment has been released. It accused the Centre of using “pressure tactics” to force NEP implementation.
The State maintained that the NEP and PM SHRI Schools are policy decisions lacking statutory force and cannot be imposed. It argued that linking these schemes to the disbursement of SSS funds—which are backed by the Right to Education Act, 2009—violates federal principles and undermines State autonomy.
"The glaring reason for such non-disbursement is that the Defendant has linked the release of Samagra Shiksha Scheme funds with the implementation of ‘National education policy’ and ‘NEP exemplary PM SHRI Schools’ Scheme despite the fact that these policy/scheme which are separate schemes," it reads.
The Suit notes that funds have been released to all States except Tamil Nadu, Kerala, and West Bengal, disrupting salaries, student entitlements, and infrastructure support.
The Suit relies on Union of India v. Mohit Minerals (2022) to assert the State’s constitutional right to reject non-binding Union policies.
Case Title: The State of Tamil Nadu v. Union of India [Diary No. 28793/2025]