The school I went to had similar but more insane policies
* I frequently took computer science graduate courses and received only undergrad. credit because they could not offer the undergrad course
* Other majors were default prohibited from taking computer science courses under the guise of a shortage of places in classes. Even when those majors required a computer science course to graduate
I would like to point out that 300 and 400 level courses in the CS program usually had no more than 8 students. I distinctly remember meeting in a closet for one of my classes, because we had so few students they couldn't justify giving us a classroom.
Contrast that with the math department where I wanted to take some courses in parallel rather than serial. After a short conversation with the professor he said "ok sure, seems alright to me".