Levying Internship Fee From Foreign Medical Graduates Is Illegal And Ultravires The NMC Act, 2019: Kerala High Court - 2025-06-27

Kerala High Court Quashes Government Order Imposing Internship Fees on Foreign Medical Graduates

Kochi , India – In a significant ruling for medical students, the Kerala High Court has declared the state government's decision to levy an internship fee on Foreign Medical Graduates (FMGs) as "illegal and ultravires." Justice N. Nagaresg , in a judgment delivered on June 3, 2025, set aside the Government Order (G.O.) that mandated a monthly fee of ₹5,000 for FMGs undergoing their Compulsory Rotating Medical Internship (CRMI) in the state.

The court held that the National Medical Commission (NMC) has the exclusive authority to set policies for medical education, including internships, and its clear directive is that no fee should be charged.

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Background of the Case

A batch of writ petitions was filed by Indian students who had obtained their primary medical degrees from countries like Russia , Bulgaria , and the Philippines. To practice medicine in India, these FMGs must pass the Foreign Medical Graduate Examination (FMGE) and complete a mandatory 12-month CRMI, for which they need provisional registration from a State Medical Council.

The petitioners challenged the Kerala Government Order (G.O. dated 03.04.2025) which required them to pay an annual fee of ₹60,000 (₹5,000 per month) for their internship. They argued this was discriminatory, exploitative, and contrary to the regulations set by the National Medical Commission.

Arguments from Both Sides

Petitioners' Contentions: - The counsels for the petitioners argued that the NMC, through its circulars (dated 04.03.2022 and 19.05.2022), had explicitly stated that "no amount/fee is charged by the Medical Colleges from FMGs for permitting them to do their internship." - They contended that any discretion granted by the NMC to the states was solely for determining the stipend payable to interns, not for imposing a fee. - It was highlighted that a prior Division Bench of the High Court had already directed the state to reconsider the fee in light of the NMC's policy. - The petitioners asserted that once they clear the FMGE, they are on par with Indian Medical Graduates and should not be treated differently. They further argued that the fee lacked any quid pro quo , as no additional facilities were provided in return.

State's Defence: - The Special Government Pleader, representing the State of Kerala, argued that the state has the power to prescribe fees under the Constitution. - The government justified the fee by stating that FMGs are often placed in District/General Hospitals which require additional infrastructure, manpower, and security to serve as training centres. - The state claimed that NMC circulars gave it the discretion to decide on fees. It also pointed out that the fee had been reduced from an earlier ₹10,000 per month to ₹5,000 to bring it on par with the fee for interns from private medical colleges.

Court's Rationale and Legal Principles

Justice N. Nagaresg undertook a detailed analysis of the National Medical Commission Act, 2019, and the associated regulations. The court's decision was anchored in several key findings:

1. Supremacy of NMC Policy: The court affirmed that Section 10 of the NMC Act, 2019, grants the NMC the power to lay down policies for maintaining high standards in medical education. These policies and regulations have a "statutory flavour" and cannot be disregarded by state governments.

2. Purpose of the NMC Act: The judgment highlighted that the NMC Act was enacted to provide "affordable" medical education. The court noted, "Any fee prescribed by the State Governments... would therefore have an impact on access to quality and affordable medical education which is the purpose for which the National Medical Commission Act, 2019 has been enacted."

3. Clear Interpretation of NMC Circulars: The court firmly rejected the state's interpretation that the NMC's discretion extended to levying fees. It observed that the NMC's clarification regarding state discretion was specifically under the heading "payment of stipend to FMGs." The judgment stated: > "A reading of Circular dated 19.10.2022 would make it clear that the discretion granted by the NMC to the State authorities is confined to payment of stipend to the FMGs."

4. Internship as Employment: The court added a crucial dimension to the debate by characterizing the internship as a form of employment. Since interns hold provisional registration and are deployed in a "resident medical capacity," they provide valuable services to hospitals. The court reasoned: > "The Medical Colleges/General Hospitals are therefore getting benefits of their service, which is in the nature of employment... When the NMC Act, 2019 mandates payment of stipend to medical interns for their service, the State will not be justified in levying internship fee from the Medical Graduates."

Final Decision and Implications

Based on this reasoning, the High Court quashed the Government Order dated 03.04.2025, deeming it illegal and unsustainable. The court ruled that the state government cannot charge an internship fee from FMGs.

The judgment provides significant relief to thousands of foreign-educated medical graduates seeking to complete their training in India. It reinforces the authority of the NMC as the apex regulatory body for medical education and underscores the principle that internships are a period of service deserving of a stipend, not an educational course for which a fee can be charged. The issue of payment of stipend to the FMGs, however, was left open by the court.