Sources said that in a recent meeting with top officials of the HRD ministry, issues related to fee waivers were raised.
The IITs mentioned that the system of giving exemptions to a large number of students without giving reimbursements was affecting their funds.
The government has announced free education for undergraduate courses to students who belong to SC, ST and persons with disabilities categories.
Students from families with an yearly income of less than Rs 1 lakh are also able to study in the IITs for free. Those belonging to families with an annual income of less than Rs 5 lakh also get a partial waiver.
"The matter is likely to be recommended to the IIT council," a source said.