Is it permissible to benefit from things that one's brother takes from students, knowing that the institute's action is impermissible?

It is forbidden for the institute to seize students' belongings by force and without right, as this is considered usurpation (ghasb), and usurpation is prohibited by the Qur'an, Sunnah, and scholarly consensus. Allah Almighty says: "And do not consume one another's wealth unjustly but only [in lawful] business by mutual consent." The Prophet, peace and blessings be upon him, said: "The wealth of a Muslim person is not lawful except with his willing consent." The questioner must avoid these things and advise his brother to repent and return them to their owners.