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Tuesday, April 19, 2016

Essentiality Certificate- In this context, we may profitably refer to the decision in D.Y. Patil Medical College v. Medical Council of India & Anr.[2] wherein the controversy had arisen due to rejection of the application of the institution on the ground that Essentiality Certificate was not filed along with the application form. The Court dwelled upon the principles stated in Educare Charitable Trust v. Union of India & Anr.[3], Royal Medical Trust (supra) and various other decisions and, after anaylsing the scheme of the Act, has held:- “It is apparent from the aforesaid decision and the regulations that the application at the first instance is required to be complete and incomplete applications are liable to be rejected. Thereafter, there has to be an inspection and other stages of decision-making process.” - The application for grant of approval was filed with the Essentiality Certificate which was a conditional one and, therefore, a defective one. It was not an Essentiality Certificate in law. In such a situation, the High Court could not have directed for consideration of the application for the purpose of the inspection. Such a direction, we are disposed to think, runs counter to the law laid down in Educare Charitable Trust (supra) and Royal Medical Trust (supra). We may further proceed to state that on the date of the application, the Essentiality Certificate was not in order. The Schedule prescribed by the MCI, which had been approved by this Court, is binding on all concerned. MCI cannot transgress it. The High Court could not have gone beyond the same and issued any direction for conducting an inspection for the academic year 2016-17. Therefore, the directions issued by the learned single Judge and the affirmation thereof by the Division Bench are wholly unsustainable.Consequently, the appeal is allowed and the judgments and orders passed by the High Court are set aside. It will be open to the Trust to submit a fresh application for the next academic year in consonance with the provisions of the Regulations of the MCI and as per the time Schedule; and in that event, it will be considered appropriately.

                                                                  REPORTABLE

                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO.3964 OF 2016
                 (Arising out of S.L.P.(C) NO.5326 OF 2016)



Medical Council of India                        ...  Appellant(s)
                                Versus
V.N. Public Health & Educational           ...     Respondent(s)
Trust & Ors




                               J U D G M E N T



Dipak Misra, J.

      Leave granted.
2.    The first respondent, V.N. Public  Health  &  Educational  Trust  (for
short, “the Trust”), vide letter dated 30.08.2015 submitted  an  application
for establishment of a new medical college from the  academic  year  2016-17
to  the  competent  authority  of  the  Central  Government  and  the   said
application dated 30.08.2015 was forwarded by the  Government  of  India  to
the appellant, Medical Council of India (MCI) vide letter dated  23.09.2015.
  After  initial  scrutiny  of  the  application,  MCI  noticed   that   the
Essentiality Certificate issued by the Government of  Kerala  in  favour  of
the Trust was not valid as the same was not in accordance  with  the  format
prescribed by the Establishment of the  Medical  College  Regulations,  1999
(for short, “the Regulations”) of the MCI.  Regard being had to  the  nature
of the Essentiality Certificate and the decision  of  this  Court  in  Royal
Medical Trust (Registered) and another v. Union of India &  another[1],  the
MCI decided to  recommend  to  the  Central  Government  to  disapprove  the
application submitted by the  Trust  for  establishment  of  a  new  medical
college commencing from the academic year 2016-17. The Government  of  India
vide its letter dated 04.11.2015 called upon the Trust to appear before  the
Committee on 16.11.2015 to explain its stand. As the said respondent  failed
to appear before the concerned Committee on the date fixed, the  matter  was
decided ex parte.
3.    As the factual score would depict, the Trust being  aggrieved  by  the
issuance of an invalid certificate by the State of  Kerala  and  disapproval
of its scheme for establishment of a new medical college from  the  academic
year 2016-17 approached the High  Court  of  Kerala  at  Ernakulam  in  Writ
Petition (C) No.  35705 of 2015.  The learned single Judge vide order  dated
25.11.2015 issued the following directions:-

“In the light of Ext.P1 renewal application  and  the  renewed  Essentiality
Certificate, this court is of the view  that  petitioner’s  application  for
establishment of new Medical College shall not be  rejected  on  account  of
any deficiency existed in the renewed certificate. In the  meanwhile,  there
shall be a direction to the third respondent to pass appropriate  orders  on
Ext.P6 within ten days.  Post after two weeks.”


4.     Thereafter  the  learned  single  Judge  took  note  of   the   fresh
Essentiality Certificate and the following directions  were  issued  as  per
the order dated 16.12.2015:-

“The petitioner is an educational agency.  They  applied  for  establishment
of a medical college. The original Essentiality Certificate  issued  by  the
State Government suffered from  defects  as  it  was  not  in  the  required
format.  Based on  the  interim  order,  the  petitioner’s  application  for
Essentiality Certificate kept pending before the Central Government and  the
State Government was directed to consider the application for fresh  revised
Essentiality certificate. Now  it  is  submitted  that  the  petitioner  has
obtained a fresh Essentiality Certificate and it has been  submitted  before
the first respondent. Therefore the  first  respondent  shall  consider  the
application and take a decision after hearing  the  petitioner  and  do  the
needful in accordance with the law.”


5.    Dissatisfied with the aforesaid order, the  appellant  preferred  Writ
Appeal No. 96 of 2016. It was  contended  before  the  Division  Bench  that
pursuant to the order passed  by  the  learned  single  Judge,  the  Central
Government on 23.12.2015 had asked the MCI to review the recommendation  but
the said direction was not possible to be adhered to on account of the  time
schedule fixed pertaining to such  matters.  It  was  also  urged  that  the
letter of intent had to be issued by the Central  Government  on  or  before
15.01.2016 and sufficient time was not available for  taking  further  steps
in the matter. Additionally, it was argued that as per  the  time  schedule,
MCI was required to give the recommendation to the  Central  Government  for
issue of letter of intent by 15.12.2015.  The Division Bench,  after  noting
the submissions, passed the following order:-

“5. Though it is argued by the learned counsel for the  appellant  that  the
time schedule could  not  be  changed,  still  the  Central  Government  has
sufficient power to extend the time schedule to a certain  extent  and  when
the Central Government had requested the MCI to consider the application  in
terms of the letter dated 23.12.2015,  we  do  not  think  that  this  Court
should interfere in the matter at this stage of the proceedings.

6. As far as the judgment is concerned, the learned Single  Judge  had  only
directed  the  Central  Government  to  consider  the  application  of   the
petitioner and take  a  decision  after  hearing  them.   That  process  has
already been completed and Annexure A2 dated 23.12.2015 has been  issued  by
the Central Government.”


      Being of this view, it declined to interfere with the order passed  by
the learned single Judge and dismissed the appeal.
6.    We have heard Mr. Vikas Singh, learned senior counsel along  with  Mr.
Gaurav Sharma, learned counsel for the appellant, Ms. Pinky  Anand,  learned
Additional Solicitor General along  with  Mr.  B.  Krishna  Prasad,  learned
counsel for respondent No. 2 and Mr. Huzefa Ahmadi, learned  senior  counsel
along with Mr. Ranjiv Ranjan Dwivedi, learned counsel for respondent  No.  1
and Mr. M.T. George, learned counsel for respondent No. 3.
7.    The focal issue that arises for consideration is whether  the  learned
single Judge was justified in directing the MCI to take  into  consideration
the revised Essentiality Certificate submitted by the Trust  after  30th  of
September, 2015, and whether the Trust had submitted a proper and  requisite
Essentiality Certificate along with  the  application  on  30th  of  August,
2015.   As  is  demonstrable,  the  Trust  had   submitted   an   incomplete
application on 30th of August, 2015  which  was  forwarded  by  the  Central
Government to the MCI vide communication  dated  23.09.2015.  Be  it  stated
that the MCI had noticed that the Essentiality Certificate was on record  by
the time the application was forwarded to it.  The  MCI  on  scrutiny  found
that the Essentiality Certificate was not  in  accordance  with  the  format
prescribed by the Regulations and accordingly  did  not  recommend  for  the
approval of the college.
8.    Mr. Singh, learned senior counsel for the  appellant,  has  drawn  our
attention to the renewed Essentiality Certificate granted by the  Government
of Kerala on 31.08.2015.  The relevant part of the  said  Certificate  reads
as follows:-

“The Managing Trustee-Secretary, V.N. Public  Health  &  Educational  Trust,
NRT Nagar, Theni, Tamil Nadu  State  has  applied  for  establishment  of  a
Medical College at Walayar in Palakkad District.  On  careful  consideration
of  the  proposal,  the  Government  of  Kerala  has  decided  to  issue  an
Essentiality Certificate  to  the  applicant  for  the  establishment  of  a
Medical College with 150 seats.

      It is certified that:

      (a) The applicant owns and manages 300  bedded  hospital  at  Palakkad
District.

      (b) It is desirable to establish  a  Medical  College  in  the  public
interest.

      (c) Establishment of a Medical College at Palakkad  District  by  V.N.
Public Health & Educational Trust is feasible.

      (d) The Essentiality Certificate  is  issued  on  condition  that  all
clinical materials as per Medical  Council  of  India  norms  will  be  made
available in the hospital  within  the  stipulated  time  as  fixed  by  the
Medical Council of India.

      (e) The Management will  share  50%  of  the  total  MBBS  seats  with
Government to fill students from the list prepared by the  Commissioner  for
Entrance Examinations, Kerala.

      It is further certified that in case the  applicant  fails  to  create
infrastructure for the Medical College  as  per  Medical  Council  of  India
norms and fresh admissions are stopped by the Central Government, the  State
Government  shall take over  the  responsibility  of  the  students  already
admitted in the College with the permission of the Central Government.”
                                                            [Emphasis added)


9.    The pertinent part of the communication dated 19.10.2015 made  by  the
MCI to the competent authority of the Central Government is as follows:-

“It is to inform you that on perusal of the application/documents  submitted
by the applicant, it is noted  that  as  per  the  Essentiality  Certificate
dated 31/08/2015 issued  by  the  Government  of  Kerala  “The  Essentiality
Certificate  is issued on condition  that  all  clinical  materials  as  per
Medical Council of India norms  will  be  made  available  in  the  hospital
within the stipulated time as  fixed  by  the  Medical  Council  of  India.”
However, prescribed proforma for Essentiality Certificate states  that  “(d)
Adequate clinical materials as per the Medical Council  of  India  norms  is
available.”

In view of the  above,  it  is  clear  that  at  the  time  of  issuance  of
Essentiality Certificate, the  applicant  does  not  fulfill  the  mandatory
qualifying criteria of the availability of the “Adequate  clinical  material
as per the Medical Council of India norms.” Accordingly, the applicant  does
not meet the mandatory criteria prescribed under the regulations.

In this regard, it is further to inform you that the Hon’ble  Supreme  Court
vide its judgment dated 20/08/2015 in W.P. (C)  No.  705/2015-Royal  Medical
Trust (Regd.) and Another Vs. Union  of  India  and  Anrs.  has  passed  the
following Order:-
“… (A) Initial assessment of the  application  at  the  first  level  should
comprise  of  checking   necessary   requirements   such   as   essentiality
certificate, consent of affiliation and  physical  features  like  land  and
hospital requirement.  If an applicant fails to fulfill these  requirements,
the application on the face of it, would  be  incomplete  and  be  rejected.
Those who fulfill the basic requirements would be  considered  at  the  next
stage…”

In view of  the  above,  the  Council  Office  has  decided  to  return  the
application for establishment of new  medical  college  at  Wayalar,  Kerala
(Palakkad Institute of Medical Sciences, Palakkad, Kerala)  by  V.N.  Public
Health & Education  Trust,  Tamilnadu  to  the  Central  Govt.  recommending
disapproval of the scheme u/s 10A of the IMC  Act,  1956  for  the  academic
year 2016-17, as the applicant fails to  fulfill  necessary  requirement  of
availability of the adequate clinical material as per  the  Medical  Council
of India norms.”

10.   On a perusal of the Essentiality Certificate dated 31.08.2015,  it  is
obvious that it is a  conditional  certificate.   The  said  fact  has  been
reiterated by the appellant-MCI vide its communication dated  19.10.2015.  A
conditional certificate cannot be  regarded  as  the  requisite  Certificate
inasmuch as the conditions  which  are  essential  to  the  certificate  are
required to be fulfilled.  On the basis of such a certificate, the  MCI  was
not  expected  to  approve  the  application  submitted  by  an  educational
institution.  It  had  clearly  communicated  that  the  prescribed   format
stipulates that  adequate  clinical  material  as  per  the  MCI  norms  “is
available”. Thus, the availability has to be in praesenti but not  to  be  a
condition to be satisfied at a later stage.  That is not  the  postulate  in
the Regulations.  In  Royal  Medical  Trust  (supra),  a  three-Judge  Bench
referring to Section 10-A of the  Indian  Medical  Council  Act,  1956  (for
brevity, “the Act’) has ruled that:-

“Section 10-A contemplates submission of a scheme to the Central  Government
in the prescribed form, which scheme is then to be referred by  the  Central
Government to MCI for its appropriate recommendations. The scheme is  to  be
considered having regard to the features referred to in sub-section (7)  and
is then placed before the Central Government along with the  recommendations
of MCI. In exercise of powers conferred by Section 10-A  read  with  Section
33 of the Act, MCI with the previous sanction of the Central Government  has
made “Establishment of the Medical College Regulations,  1999”  (hereinafter
referred to as “the Regulations”) which were published  in  the  Gazette  of
India on 28-8-1999. Para 3 of the  Regulations  lays  down  that  no  person
shall establish a medical college except after  obtaining  prior  permission
of the Central Government by submitting a scheme. The Regulations then  deal
with the scheme in extenso.  Clauses  1  and  2  of  the  scheme  deal  with
“eligibility criteria” and “qualifying  criteria”,  respectively.  Clause  3
then sets out certain requirement in parts (i), (ii)  and  (iii)  concerning
various  details  about  the  status  of  the  applicant  in  terms  of  the
eligibility criteria, name and address  of  the  medical  college  including
various facets of the infrastructure and planning and  the  details  of  the
existing  hospital  including  availability  of   various   facilities   and
capacities as also upgradation and expansion programme.”


      After so stating, the Court referred to  para  7  of  the  Regulations
which deals with the report of the MCI, and para 8 that deals with grant  of
permission by the Central Government. Reference has also been  made  to  the
schedule for receipt  of  applications  for  establishment  of  new  medical
colleges and increase of admission capacity in an existing  medical  college
and processing of  the  applications  by  the  Central  Government  and  the
Medical Council of India.  Thereafter, Court has proceeded to observe:-

“MCI and the Central Government have  been  vested  with  monitoring  powers
under Section 10-A and the Regulations. It is expected of these  authorities
to discharge their functions well within the statutory confines as  well  as
in conformity with the Schedule to the Regulations. If there is inaction  on
their part or non-observance of the time  schedule,  it  is  bound  to  have
adverse effect on all concerned. …”


11.   After so stating, the three-Judge  Bench  has  directed  the  schedule
must ideally take care of:-

“(A) Initial assessment  of  the  application  at  the  first  level  should
comprise  of  checking   necessary   requirements   such   as   essentiality
certificate, consent for affiliation and physical  features  like  land  and
hospital requirement. If an applicant fails to  fulfil  these  requirements,
the application on the face of it, would  be  incomplete  and  be  rejected.
Those who fulfil the basic requirements would  be  considered  at  the  next
stage.

(B) Inspection should then be conducted by the Inspectors of  MCI.  By  very
nature  such  inspection  must  have  an  element  of  surprise.   Therefore
sufficient time of about three to four months ought to be given  to  MCI  to
cause inspection  at  any  time  and  such  inspection  should  normally  be
undertaken latest by January. Surprise  inspection  would  ensure  that  the
required facilities and infrastructure are always in place and not  borrowed
or put in temporarily.

(C) Intimation of the result or outcome of  the  inspection  would  then  be
communicated. If  the  infrastructure  and  facilities  are  in  order,  the
medical college concerned  should  be  given  requisite  permission/renewal.
However, if there are any deficiencies  or  shortcomings,  MCI  must,  after
pointing out the deficiencies, grant to  the  college  concerned  sufficient
time to report compliance.

(D)  If  compliance  is  reported  and  the  applicant   states   that   the
deficiencies stand removed, MCI must cause compliance  verification.  It  is
possible  that  such  compliance  could  be  accepted  even  without  actual
physical  verification  but  that  assessment  be  left  entirely   to   the
discretion of  MCI  and  the  Central  Government.  In  cases  where  actual
physical verification is required,  MCI  and  the  Central  Government  must
cause such verification before the deadline.

(E) The result of such verification if positive in  favour  of  the  medical
college   concerned,   the   applicant   ought   to   be   given   requisite
permission/renewal. But if the deficiencies still persist or  had  not  been
removed, the applicant will stand disentitled so far as that  academic  year
is concerned.”

12.   Mr. Singh, learned senior counsel  appearing  for  the  appellant  has
drawn our attention to the order dated January 18, 2016 passed in I.A.  Nos.
7 & 8 in Writ Petition (Civil) No. 76 of 2015 titled Ashish  Ranjan  &  Ors.
v. Union of India & Ors. wherein the Court had taken  note  of  notification
issued by the MCI with the previous  sanction  of  the  Central  Government.
The  notification  has  prescribed  the  time  schedule   for   receipt   of
applications  for  establishment  of   new   medical   colleges/renewal   of
permission and processing of the applications by the Central Government  and
the Medical Council of India. The schedule in this regard reads as follows:-


|“S.   |Stage of processing                |Last date              |
|No.   |                                   |                       |
|1     |Receipt of applications by the     |Between 15th June to   |
|      |Central Government                 |7th July (both days    |
|      |                                   |inclusive) of any year |
|2     |Forwarding application by the      |By 15th July           |
|      |Central Government to Medical      |                       |
|      |Council of India                   |                       |
|3     |Technical Scrutiny, assessment and |By 15th December       |
|      |Recommendations for Letter of      |                       |
|      |Permission by the Medical Council  |                       |
|      |of India                           |                       |
|4     |Receipt of reply/compliance from   |Two months from receipt|
|      |the applicant by the Central       |of recommendation from |
|      |Government and for personal hearing|MCI but not beyond 31st|
|      |thereto, if any, and forwarding of |January.               |
|      |compliance by the Central          |                       |
|      |Government to the Medical Council  |                       |
|      |of India                           |                       |
|5     |Final recommendations for the      |By 30th April          |
|      |Letter of Permission by the Medical|                       |
|      |Council of India                   |                       |
|6     |Issue of Letter of Permission by   |By 31st May            |
|      |the Central Government             |                       |

Note 1. In case of renewal of permission, the applicants  shall  submit  the
application to the Medical Council of India by 15th July.

                      xxx         xxx              xxx

In exercise of the powers conferred by Section  33  of  the  Indian  Medical
Council Act, 1956(102) of 1956,  the  Medical  Council  of  India  with  the
previous sanction of the Central  Government,  hereby  makes  the  following
Regulations to further amend the “Opening of  a  New  or  Higher  Course  of
Study or Training (including Postgraduate Course of Study or  Training)  and
increase  of  Admission  Capacity  in  any  Course  of  Study  or   Training
(Including a Postgraduate Course of Study or  Training)  Regulations  2000”,
namely:-

(i) These Regulations may be called the “Opening of a New or  Higher  Course
of Study or Training (Including Postgraduate Course of  Study  or  Training)
and increase of Admission Capacity  in  any  Course  of  Study  or  Training
(including Postgraduate Course of Study or Training (Amendment)  Regulations
2015.

(ii) They shall come into force from the date of their  publication  in  the
Official Gazette.”

13.   The two-Judge Bench, after reproducing the entire  notification  which
deals with various situations, has given the stamp of approval to  the  said
Schedule.
14.   In this context, we may profitably refer  to  the  decision  in   D.Y.
Patil Medical College v. Medical Council of  India  &  Anr.[2]  wherein  the
controversy  had  arisen  due  to  rejection  of  the  application  of   the
institution on the ground that Essentiality Certificate was not filed  along
with the application form. The Court dwelled upon the principles  stated  in
Educare Charitable Trust v. Union of India & Anr.[3],  Royal  Medical  Trust
(supra) and various other decisions and, after anaylsing the scheme  of  the
Act, has held:-
“It is apparent from the aforesaid decision and  the  regulations  that  the
application at the first instance is required to be complete and  incomplete
applications are liable to be rejected.  Thereafter,  there  has  to  be  an
inspection and other stages of decision-making process.”

15.   The impugned order passed by the  High  Court  is  to  be  tested  and
adjudged on the anvil of the  aforesaid  authorities.  The  application  for
grant of approval was filed with the Essentiality Certificate  which  was  a
conditional one and, therefore, a defective one. It was not an  Essentiality
Certificate in law.  In such a situation, the  High  Court  could  not  have
directed for consideration  of  the  application  for  the  purpose  of  the
inspection. Such a direction, we are disposed to think, runs counter to  the
law laid down in Educare Charitable Trust (supra) and  Royal  Medical  Trust
(supra).  We  may  further  proceed  to  state  that  on  the  date  of  the
application, the Essentiality Certificate was not  in  order.  The  Schedule
prescribed by the MCI, which had been approved by this Court, is binding  on
all concerned.  MCI cannot transgress it.  The High  Court  could  not  have
gone beyond the same and issued any direction for conducting  an  inspection
for the academic year 2016-17.  Therefore,  the  directions  issued  by  the
learned single Judge and the affirmation thereof by the Division  Bench  are
wholly unsustainable.
16.   Consequently, the appeal is  allowed  and  the  judgments  and  orders
passed by the High Court are set aside. It will be  open  to  the  Trust  to
submit a fresh application for the next academic  year  in  consonance  with
the provisions of the Regulations of the MCI and as per the  time  Schedule;
and in that event, it will be considered appropriately.  In  the  facts  and
circumstances of the case, there shall be no order as to costs.


                                           ...............................J.
                                               [Dipak Misra]



                                           ...............................J.
       [Shiva Kirti Singh]
New Delhi
April 18, 2016
-----------------------
[1]

      [2] (2015) 10 SCC 19
[3]

      [4] 2015 (10) SCC 51
[5]

      [6] AIR 2014 SC 902 : (2013) 16 SCC 474


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