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2022 Supreme(Mad) 3595

IN THE HIGH COURT OF JUDICATURE AT MADRAS
MUNISHWAR NATH BHANDARI, N. MALA, JJ.
Education Promotion Society for India, Rep. by its Executive Secretary, Chennai - Appellant
Versus
Union of India, Rep. by its Secretary, New Delhi & Others - Respondent
W.P. Nos. 10088, 11595, 11598, 11601, 16702, 17966, 17969 & 21517 of 2022 & W.M.P. Nos.9782, 9784, 11074, 11075, 11078, 11079, 11081, 11082, 16010, 16011, 17308, 17310, 17314, 17315, 20537 & 20538 of 2022
Decided On : 09-09-2022

Advocates appeared:
For the Petitioner:Vijay Narayan, Senior Counsel for Abishek Jenasenan, Advocate. For the Respondents:R1, R2 & R3, R. Sankaranarayanan, Addl. Solicitor-General Assisted by Rajesh Vivekananthan, Asst. Solicitor-General, R4, V. Sudha, Advocate.

Headnote:(A) Constitution of India - Article 19(1)(g) - National Medical Commission Act, 2019 - Section 10(1)(i) - Challenge to provision regulating fees in private medical institutions - Office Memorandum issued regulating fee structure on 50% seats equivalent to government medical colleges - Previous judgments emphasized no cross-subsidization of fees between students - Constitutional validity upheld but need for re-evaluation of Memorandum directed. (Paras 9, 54)

(B) Fees Regulation - Educational institutions granted discretion to fix fees but subjected to regulatory oversight - T.M.A. Pai Foundation and Islamic Academy of Education reaffirmed that fees must not exploit students or commercialize education and should be fair and reasonable. (Paras 89, 75)

Facts of the case:
Writ petitions filed by educational societies and institutions challenging the constitutionality of Section 10(1)(i) of the National Medical Commission Act, alleging the rigid fee structure undermines autonomy and is unconstitutional. The contention emphasized transitional implications of government quota fees on economically disadvantaged students. (Paras 2, 8)

Findings of Court:
The court held that the provision for fee regulation does not offend constitutional principles but requires safeguards against inequities arising from differing fee structures. The need for regulatory mechanisms to prevent commercialization in education was highlighted. (Paras 36, 41)

Issues: The court addressed whether the regulatory framework established by Section 10(1)(i) invites unjust cross-subsidization among students and undermines educational autonomy. The validity of the Office Memorandum as a guideline on fee fixation was also questioned. (Paras 48, 52)

Ratio Decidendi: The court clarified that while the state can regulate fees to prevent exploitation, it must ensure that privilege granted to institutions does not infringe on rights of equitable access to education, aiming to maintain integrity in educational standards. (Paras 57, 91)

Result: The writ petitions disposed of with directions to reassess the Memorandum in line with judicial observations on equitable fee administration.

Table of Content
1. challenge to section 10(1)(i) of the act. (Para 1 , 2)
2. disparity in fee structure; impact on admissions. (Para 3 , 4 , 6 , 8)
3. prior judgments emphasize fee autonomy. (Para 5 , 7 , 9 , 10)
4. regulatory powers of national medical commission. (Para 11 , 12 , 13)
5. need for regulatory frameworks in education. (Para 14 , 15 , 16 , 19)
6. the constitutionality of section 10(1)(i) upheld. (Para 22 , 23 , 24)
7. fee regulations must align with public interest. (Para 25 , 27 , 28)
8. no rigid fee structures, flexibility recognized. (Para 30 , 34)
9. direction for reviewing fee office memorandum. (Para 51 , 54)

JUDGMENT

(Prayer: Petition filed under Article 226 of the Constitution of India praying for a writ of declaration declaring that Section 10 (1)(i) of the Nation Medical Commission Act, 2019 is ultra vires the Constitution of India, illegal, null and void and consequently call for the records of the third respondent in the Office Memorandum dated 03.02.2022 in reference No.NMC/ US(NMC)/ Fee-Regulating-Committee/ 2021-22 issued in exercise of the power granted under Section 10 (1)(i) of the National Medical Commission Act , 2019 and quash the same.)

Common Order:

Munishwar Nath Bhandari, CJ.

1. A batch of writ petitions has been filed to challenge Section 10 (1)(i) of the National Medical Commission Act , 2019 [for brevity, “the Act of 2019”] and the Office Memorandum dated 3.2.2022 issued in exercise of the power conferred under Section 10 (1)(i) of the Act of 2019.

2. The writ petitions have been preferred by the Education Promotion Society for India, Pondicherry Institute of Medical Sciences, apart from various medical colleges. The Education Promotion Society of India is a society which consists of various educational institutions across the country, including Deemed to be Universities and private self-financing institutions affiliated to the State Universities in the respective States.

3. Learned counsel appearing on behalf of the writ petitioners referred to the previous litigation in regard to the seat matrix for admission and the fee for the medical course, when a challenge was made to capitation fee charged by few medical colleges.

4. It is submitted by learned counsel for the petitioners that the Apex Court has addressed the issue aforesaid and the first judgment on it was in the case of Unni Krishnan J.P. and others v. State of Andhra Pradesh and others, (1993) 1 SCC 645. In the said judgment, a scheme was devised to have 50% of the seats to be “free seats” and the remaining 50% of the seats to be “payment seats”. By virtue of the said judgment, a disparity on fee arose in view of the fact that a candidate given admission against a “free seat” was to pay a meagre amount, while the candidate admitted against the “payment seat” was to pay higher amount of fee.

5. The scheme evolved in Unni Krishnan J.P. and others, supra, did not continue for long in view of the judgment of the Apex Court in the case of T.M.A.Pai Foundation and others v. State of Karnataka and others, (2002) 8 SCC 481, wherein it was held that the scheme evolved in Unni Krishnan J.P. and others, supra, cannot be considered to be reasonable as it cross-subsidizes the fee of the students admitted against “free seats” by those admitted against “payment seats”, as the cost incurred by the institution to impart medical education has to be borne by and large by the students admitted against the “payment seat”.

6. In the light of the said judgment, the petitioners have challenged the Office Memorandum dated 3.2.2022 issued by the National Medical Commission which provides that fee of the 50% seats in the private medical colleges and deemed universities should be at par with the fee in the government medical colleges of the State and Union Territory and for the remaining 50% seats, guidelines are laid down for fixation of fee and other charges to cover the cost incurred by the institution. It is submitted that by virtue of the Office Memorandum under

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