A COOKERY college that dramatically increased enrolments of overseas students without permission has won the right to stay in business.

Sydney-based Austech Institute for Further Education had not behaved unethically, the NSW Administrative Decisions Tribunal found.

The tribunal pointed out that the regulator, the NSW Vocational Education and Training Accreditation Board, had been "fully aware" of Austech's expansion since 2006 and had taken no action until December 2008.

In a ruling last month the tribunal set aside a September 2009 board decision to cancel Austech's registration. The tribunal also approved expansion plans.

The college featured in last July's ABC Four Corners program, Holy Cash Cows, which was devoted to alleged abuses in the education export industry.

The college began life in Blacktown with 10 students in 2002. By 2007-08 it had a $30.4 million turnover and was one of Australia's 100 fastest growing companies.

From 2005-2008 a qualification in cookery or hairdressing "virtually guaranteed" a permanent residency visa, according to Monash University researcher Bob Birrell. Skilled migration rules have since been tightened up.

During a September 2007 audit of Austech, board officer Elaine Jackson pointed out that the college had more than 700 students enrolled but permission for only 225, the tribunal heard.

But the board did nothing about this, an Austech executive, Umesh Banga, testified. By October 2008, the college had near doubled enrolments to 1398 students.

Mr Banga told the tribunal he believed "many other [colleges] were exceeding their [enrolment] limits".

The tribunal concluded that what Austech had done was "not unethical in circumstances where the board was fully aware of the situation and did not take any action" until December 2008.

"Mr Banga agreed that Austech profited from the fact that student numbers were considerably higher than the [enrolment] cap but his understanding was that the board gave them tacit approval to increase the numbers by not directing them to comply with the cap, even though [the board was] fully aware of the situation," the tribunal said.

In the hearing, the board's only legal argument on the over-enrolment point went to Austech's ethical standards, the tribunal emphasised.

A NSW state government spokesman said the board was considering the decision of the tribunal.