REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
IA Nos. 57 & 59
IN
CIVIL APPEAL NO. 4060 OF 2009
Modern Dental College and Research
Centre and others b�&. Applicants
Versus
State of Madhya Pradesh & Ors. b�&. Respondents
O R D E R
K.S. Radhakrishnan, J.
1. We are in these applications called upon to decide the question as to
whether the unfilled NRI seats are to be transferred to general pool and be
shared equally to be filled up on the basis of the Common Entrance Test
conducted by the State level Committee b� Vyavsayik Pariksha Mandal (VYAPAM)
or by the Common Entrance Test conducted by the Association of Private
Dental and Medical Colleges (APDMC), so far as the private unaided
medical/dental colleges in the State of Madhya Pradesh are concerned.
2. Applicants, herein had filed Writ Petition No. 2732 of 2009 before
the High Court of Madhya Pradesh (Jabalpur) challenging the constitutional
validity of Madhya Pradesh Niji Vyavsayik Shikshan Sanstha (Pravesh Ka
Viniyaman Avam Shulk ka Nirdharan) Adhiniyam, 2007 (in short b� the Actb� ) and
the Rules framed thereunder. The High Court vide its judgment dated
15.5.2009 repelled the challenge to the Act and the Rules but declared that
the provisions of Rule 10(2)(iii) of 2009 as ultra vires. The High Court
also held that the Judgment would not affect the Common Entrance Test
already conducted by VYAPAM for the year 2009-10. The above-mentioned Writ
Petition was disposed of along with other similar matters and a common
Judgment was delivered by the High Court.
3. Aggrieved by the judgment in Writ Petition No. 2732 of 2009, Civil
Appeal No. 4060 of 2009 was filed by the applicants herein. While
admitting the appeal, a Bench of this Court had prima facie found that the
provisions of the Act handing over the entire selection process to the
State Government or the agencies appointed by the State Government for
undergraduate, graduate and postgraduate medical/dental colleges and fee
fixation was contrary to and inconsistent with the principles laid down by
the eleven-Judges Bench Judgment in TMA Pai Foundation and Others v. State
of Karnataka and Others [(2002) 8 SCC 481] (for short b� Pai Foundationb� ) and
the Judgment in P.A. Inamdar and others v. State of Karnataka and others
[(2005) 6 SCC 537] (in short b� Inamdarb� ). The Court also observed that 2007
Act would become unconstitutional, if read literally, but an interim
arrangement was made with regard to the admissions in the private unaided
medical/dental colleges in the State of Madhya Pradesh for the year 2009-
10; the operative portion of that order reads as follows:
b� We, therefore, direct that the admissions in the private unaided
medical/dental colleges in the State of Madhya Pradesh will be done
by first excluding 15% NRI seats (which can be filled up by the
private institutions as per para 131 of Inamdar case), and
allotting half of the 85% seats for admission to the undergraduate
and post graduate courses to be filled in by an open competitive
examination by the State Government, and the remaining half by the
Association of the Private Medical and Dental Colleges. Both the
State Government as well as the Association of Private Medical and
Dental Colleges will hold their own separate entrance examination
for this purpose. As regards b� the NRI seatsb� , they will be filled
as provided under the Act and the Rules, in the manner they were
done earlier.b�
4. The Court also observed that the solution arrived at might not be
perfect, but it had only tried to find out a best via media for admissions
for the academic year 2009-10. However, it was recommended that the same
might also be considered for future sessions. The order passed by the
Court is reported in Modern Dental College and Research Centre and Ors. v.
State of Madhya Pradesh and Ors. [(2009) 7 SCC 751]. (in short Modern
Dental College)
5. The above arrangement indicates that 15% of the total sanctioned
intake in the unaided Private Medical and Dental Colleges was set apart for
giving admission to NRI students and the remaining 85% seats would be
filled up equally through the examination conducted by the State and the
Common Entrance Test conducted by the Colleges. Controversy now is only
with regard to unfilled NRI seats due to lack of sufficient NRI students,
and in what manner those seats have to be filled up. State, has maintained
the stand that those unfilled seats would also go to the general pool and
be shared by both the State and the Colleges equally. Such a stand was
taken by the State on the basis of the interpretation placed by this Court
in filling up the unfilled NRI seats in its judgment dated 30.9.2010 in
R.D. Gardi Medical College and Anr. etc. v. State of M.P. and Ors. (2010)
10 SCC 225 (in short Gardi Medical College), wherein, while interpreting
Rule 8 of the M.P. Admission Rules, 2008 the two-Judges Bench of this Court
observed as follows:
b� A plain reading of the above leaves no manner of doubt that
unfilled NRI seats had to be transferred to the general pool to be
filled up on the basis of the merit of the candidates in the State-
level common entrance test conducted by the Madhya Pradesh Vyavsayik
Pariksha Mandal or by any other agency authorised by the State
Government for that purpose. The unfilled seats in the NRI quota
were, therefore, to be treated as a part of the general pool and
once that was done the share of the college in terms of the order
passed by this Court would be 50% out of the said seats. The High
Court has, in that view, rightly held that while the management was
justified in filling up 5 unfilled seats in NRI quota, the remaining
5 could not have been filled up otherwise than on the basis of the
entrance test referred to in Rule 8.b�
Court, in the above case, was dealing with the admissions for the academic
year 2010-11.
6. The State Government while framing the Madhya Pradesh Private Medical
and Dental Under Graduate Course Entrance Examination Rules, 2011
incorporated Rule 5 with regard to unfilled NRI seats with specific
reference to the above-mentioned judgment dated 30.9.2010. The Rule reads
as follows:
b� RESERVATION: Every Institution shall be allowed to fill up to 15%
of the sanctioned seats by NRI candidates only, in the manner
prescribed by the admission and Fee Regulatory Committee. These
NRI seats shall be filled up through a separate counselling. NRI
seats remaining vacant shall be merged into the counselling of Non
NRI Candidates, as per Honb� ble Supreme Court Order in Civil Appeal
No. 8429-8430/2010 dated 30.9.2010.b�
7. The applicants, noticing that the judgment dated 30.9.2010 in Gardi
Medical College would seriously affect the rights of unaided educational
institutions in the matter of filling up of unfilled NRI seats, filed IA
Nos. 51-52 of 2011 in Civil Appeal No. 4060 of 2009 for appropriate
modification / clarification of the orders passed by two-Judges Bench in
Modern Dental College as well as R.D. Gardi Medical College. The
applications came up for hearing before two-Judges Bench of this Court on
1.8.2011 and this Court passed the following order:
b� We are of the opinion that there appears to be some conflict
between the observations made in para 28 of the judgment of the two-
Judges Bench rendered in the case of R.D. Gardi Medical College and
Another. etc. v. State of M.P. and Ors. [(2010) 10 SCC 225], quoted
below:
28. A plain reading of the above leaves no manner of doubt that
unfilled NRI seats had to be transferred to the general pool to
be filled up on the basis of the merit of the candidates in the
State-level common entrance test conducted by the Madhya
Pradesh Vyavsayik Pariksha Mandal or by any other agency
authorised by the State Government for that purpose. The
unfilled seats in the NRI quota were, therefore, to be treated
as a part of the general pool and once that was done the share
of the College in terms of the order passed by this Court would
be 50% out of the said seats. The High Court has, in that view,
rightly held that while the management was justified in filling
up 5 unfilled seats in NRI quota, the remaining 5 could not
have been filled up otherwise than on the basis of the entrance
test referred to in Rule 8.
and the observations made in para 27(1), quoted below, of T.M.A.
Pai Foundation and others v. State of Karnataka and others [(1995)
5 SCC 220] which is a three Judge Bench decision:
b� 27(1) So far as NRI quota is concerned, it is fixed at fifteen
per cent for the current academic year. It shall be open to
the management to admit NRI students and foreign students up to
the aforesaid specified percentage, it shall be open to them to
admit students on their own, in the order of merit, within the
said quota. This direction shall be a general direction and
shall operate in the case of all the States where admissions
have not been finalized. It is, however, made clear that by
virtue of this direction, no student who has already been
admitted shall be disturbed or removed.b�
The Court, therefore, referred the matter to a larger Bench. However, by
the time year 2011-2012 came to a close hence, the larger Bench could not
resolve the apparent conflict and hence, a two Judges Bench of this Court
disposed of both IA Nos.51 and 52 vide its order dated 23.9.2011.
8. The same issue, has again been cropped up, now for the academic year
2012-13, hence, it is necessary to clarify the order dated 27.5.2009 in
Modern Dental College and the judgment of this Court dated 30.9.2010 in
R.D. Gardi Medical College as to how the unfilled NRI seats be filled up.
For the said purpose, the applicants have filed IA Nos.57-59 of 2011, which
came up for hearing before two-Judges Bench of this Court on 9.12.2011 and
the Court ordered that the applications be placed before the Constitution
Bench.
9. Since main issue referred to Constitution Bench is not likely to come
up for hearing shortly and the issue projected in I.As with regard to
unfilled seats is of urgent nature, thus, they have been considered by us.
Hence, these applications have come up before us for consideration vide
order passed by Honb� ble the Chief Justice of India.
10. We have heard learned senior counsel - Shri C.A. Sundaram and Dr.
Rajeev Dhawan and learned counsel for the State of Madhya Pradesh - Shri
B.S. Banthia. We may at the outset point out that in the instant
applications, we are concerned only with the question as to how and in what
manner the unfilled NRI seats be filled up for the year 2012-13 till the
appeal is finally disposed of, which issue, in our view, is no more res
integra. This Court had earlier in various judgments dealt with the
purpose and object of creating NRI quota and the manner in which those
quota had to be filled up. A three-Judges Bench of this Court in TMA Pai
Foundation and Others v. State of Karnataka and Others (1994) 4 SCC 728 had
an occasion to consider how, the vacant seats, in the NRI quota be filled
up and ordered as follows:
b� So far as NRI quota is concerned, we fixed the same as 15% last
year. We fixed NRI quota in respect of minoritiesb� institutions as
5%. Although the NRI quota should not, normally, be more than 5%
but keeping in view the reduction in the fee structure, we fix the
same as 10% (of the total seats) for this year. We further make it
clear that in case any in the NRI quota remains unfilled, the same
can be filled by the Management at its discretion.b�
Later another three-Judges Bench of this Court in TMA Pai Foundation and
Others v. State of Karnataka and Others (1995) 5 SCC 220 had also endorsed
the same view holding that it would be open to the Management to admit NRI
students and foreign students within that quota and in case they were not
able to get the NRI or foreign students upto the aforesaid specified
percentage, it would be open to them to admit students on their own, in the
order of merit, within the said quota. The operative portion of the order
with regard to NRI quota for the year 1995-96 was as follows:
(1) So far as NRI quota is concerned, it is fixed at
fifteen per cent for the current academic year. It shall be open
to the management to admit NRI students and foreign students within
this quota and in case they are not able to get the NRI or foreign
students upto the aforesaid specified percentage, it shall be open
to them to admit students on their own, in the order of merit,
within the said quota. This direction shall be a general direction
and shall operate in the case of all the States where admissions
have not been finalized. It is, however, made clear that by virtue
of this direction, no student who has already been admitted shall
be disturbed or removed.b�
Similar order was also passed by this Court in AP (P) Engg. College
Management Assn. v. Govt. of A.P. (2000) 10 SCC 565. The operative portion
of the order of the two-Judges Bench reads as follows:
b� 4. After hearing learned counsel for the parties, we direct that
the State of Andhra Pradesh shall allow the 5% NRI quota in the
private engineering colleges in the State of Andhra Pradesh to be
filled up in the manner earlier directed by this Court and to
permit the management of the private engineering colleges to fill
up the unfilled NRI quota, at its own discretion, subject, however,
to the criteria of merit, qualification and fee structure b� as
prescribed by the Government not only for the current academic year
but also for successive academic years, till the main matter is
decided by this Court in the pending cases.b�
11. We may also in this connection refer to the judgment of the seven-
Judges Bench in P.A. Inamdar v. State of Maharashtra [(2005) 6 SCC 537],
wherein this Court had dealt with the rights of unaided minority and non-
minority educational institutions and held that the State cannot regulate
or control admissions, so as to compel them to give up a share of the
available seats to the candidates chosen by the State, as if it was filling
up, the seats available, to be filled up at its discretion in such private
institutions. Court held that would amount to nationalization of seats,
such imposition of quota of State seats or enforcing reservation policy of
the State on available seats in unaided professional institutions are acts
constituting serious encroachment on the right and autonomy of private
professional educational institutions. It was also ordered that such
appropriation of seats can also not be held to be a regulatory measure in
the interest of the minority within the meaning of Article 30(1) or a
reasonable restriction within the meaning of Article 19(6) of the
Constitution.
Inamdar having said so dealt with NRI seats as well. In Para 131 of
judgment, the Court had only dealt with the question as to how NRI seats
had to be filled up: First, it was ordered that the seats should be
utilized bona fide by NRIs only and for their children or wards. Further,
it was ordered that within quota, merit should not be given a complete go-
bye. Further, it was also ordered that the amount of money, in whatever
form collected from such NRIs, should be utilized for benefiting students
such as from economically weaker sections of the society, whom, on well
defined criteria, the educational institution might admit on subsidized
payment of their fee.
Further, In para 132 of the Inamdar, it had also been clearly held
that the policy of reservation should not be enforced by the State nor any
quota or percentage of admissions could be carved out to be appropriated by
the State in a minority or non-minority unaided educational institution.
12. We are of the considered view that the above principles laid down by
a larger Benches of this Court, in the matter of filling up of NRI seats
were not correctly understood or applied by this Court in R.D. Gardi
Medical College while interpreting Rule 8 of the M.P. Admission Rules,
2008. The finding recorded in R.D. Gardi Medical College that the
unfilled seats in NRI quota in unaided professional colleges should be
treated as a part of the general pool and be shared equally by the State
and the unaided professional colleges goes contrary to the principles laid
down by the eleven-Judges Bench in Pai Foundation, Inamdar as well as the
Judgments rendered by the three Judges Bench in Pai Foundation referred to
earlier. The wrong interpretation given by in R.D. Gardi Medical College
is seen incorporated in Rule 5 of the Madhya Pradesh Private Medical and
Dental Under Graduate Course Entrance Examination Rules 2011 as well, which
in our view cannot be legally sustained.
13. We are, therefore, inclined to allow both the applications and over
rule the direction given by the two learned Judges of this Court in R.D.
Gardi Medical College and hold that it is open to the unaided professional
educational institutions to fill up unfilled NRI seats for the year 2012-
13 and for the succeeding years through the entrance test conducted by them
till the disposal of the appeal subject to the conditions laid down in
Inamdar strictly on the basis of merits.
14. IA Nos. 57 and 59 of 2011 in Civil Appeal No. 4060 of 2009 are
allowed to the extent mentioned above and disposed of on the basis of the
above modifications and clarifications.
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(B.S. Chauhan)
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(K.S. Radhakrishnan)
New Delhi,
April 3, 2012
