2021 Supreme(Ker) 798

IN THE HIGH COURT OF KERALA AT ERNAKULAM
T.R. RAVI, J.
Devi Scans (P) Ltd & Ors. - Petitioners
Versus
State of Kerala, Represented by Its Principal Secretary, Health and Welfare Department & Ors. - Respondents
W.P.(C) Nos.10997 & 11632 of 2021
Decided On : 04-10-2021

Point of Law: Cost at which the private laboratories are carrying on the tests cannot be determined solely based on the report from the 4th respondent regarding the rate at which the test can be conducted.

Headnote:

Constitution of India, 1950 – Article 32, 162, 246 - Disaster Management Act, 2005 - Section 10(2)(1), 20 ,24 & 65 - Epidemic Diseases Act, 1897 - Section 2 - Kerala Epidemic Diseases Ordinance, 2020 - Section 4 – Essential Commodities Act,1955 - Section 3(2)(c) – Covid 19 – RT-PCR test – Fixation of fee - Seeking to quash order the State has re-fixed the rates of RT-PCR tests chargeable by the private Laboratories in Kerala - National Task Force recommended that the maximum cost for testing a sample should not exceed Rs.4,500/-, which may include Rs.1,500/- as a screening test for suspect cases and an additional Rs.3,000/- for a confirmation test - It was ordered that the private laboratories shall perform RT-PCR tests for detection of Covid-19 at revised rate of Rs.500/- per test - That cost for conducting test based on costs of inputs, for period from December 2020 to January 2021, was between Rs.275/-to Rs.350/-, the price fixed at Rs.500/- is reasonable. It is also stated that the rates arrived at by 4th respondent for doing RT-PCR tests through static and mobile RT-PCR labs is Rs.448.20/-per test – Whether Ext.P10 issued by the Government a legislative process or an executive order - Is price fixation a legislative process and to what extent can the Court interfere - Should the State comply with principles of natural justice while fixing maximum rates at which RT-PCR should be done in private laboratories - Can Ext.P10 be treated as an order issued by the State in exercise of powers vested in it under provisions of the Disaster Management Act 2005, Section 2 of Epidemic Diseases Act, 1897, Section 86 of Travancore-Cochin Public Health Act, 1955, Section 81 of Madras Public Health Act,1939, Section 4 of Kerala Epidemic Diseases Ordinance, 2020 and he executive powers vested in Government under Article 162 of Constitution of India, with relation to Entry 6 of List II of 7th Schedule of the Constitution of India.

Finding of the Court:

None of the statutory provisions relied on by the State authorises them to issue an order controlling the rates at which the private laboratories should carry out the RT-PCR test - RT-PCR test also stands included within the meaning of the word “drugs” going by the test - Ext.P10 cannot also be treated as an order issued by the State in exercise of the powers vested in it under the provisions of the Disaster Management Act 2005, Section 2 of the Epidemic Diseases Act, 1897, Section 86 of the Travancore-Cochin Public Health Act, 1955, Section 81 of the Madras Public Health Act,1939, Section 4 of the Kerala Epidemic Diseases Ordinance, 2020 and the executive powers vested in the Government under Article 162 of the Constitution of India, with relation to Entry 6 of List II of 7th Schedule of the Constitution of India - Whether the ICMR has been statutorily empowered to issue orders fixing the maximum price at which a test necessary for diagnosis is to be conducted apparently for the fact that the situation required immediate action - ICMR in turn decided to relegate the price fixation to the State level with a rider that price will be fixed after discussions - Court intervened and directed the Government to fix the price after discussing with the private laboratories - It is thereafter that the price of Rs. 1,700/-for RT-PCR test was arrived at - State also does not have a case till the issuance of the order fixing the price of Rs. 1,700/-, that they had all the powers to fix the price without any discussion with private laboratories and without hearing them - Ext.P10 is liable to be set aside and State Government should take a fresh decision regarding the rate at which the RT-PCR should be conducted after discussing the issue with the private laboratories - 4th respondent is making bulk purchases and has the benefit of very low prices which will not be available to the private laboratories. The 4th respondent has also stated before the Court that even if they were to procure the materials for supply to the private laboratories as a temporary measure, they will not be able to procure all the materials, that the private laboratories would require - It would not be proper to set aside Ext.P10 and permit the petitioners to continue to charge Rs.1700/- which they were charging earlier with immediate effect.

Result: Writ petitions are disposed of