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Friday, April 6, 2018

Motor Accident Case- corporate laws- insurance laws- Not considered future prospects - reduce the award of interest from 9% p.a. to 6% p.a.=In view of the decision of the Constitution Bench in Pranay Sethi (supra), an addition of 25% is warranted, on account of future prospects having regard to the age of the deceased. The total income, after accounting for future prospects at 25% would work out to Rs 1,14,000 per annum. An amount of one fourth would have to be reduced on account of personal expenses. The net income would work out to Rs 85,500. Applying a multiplier of 14 the total compensation would work out to Rs 11,97,000. Adding a further amount of Rs 70,000 under conventional heads as stipulated in the judgment 1 (2017) 13 SCALE 12 4 in Pranay Sethi (supra), the total compensation payable would work out to Rs 12,67,000. We find no reason or justification for the High Court to reduce the award of interest to 6% p.a.. The rate of interest of 9% p.a. fixed by the Tribunal is restored.

1

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO 2697 OF 2018
(Arising out of SLP(C)No 2927 of 2017)
BHARTIBEN NAYABHA KER AND ORS ..Appellants
VERSUS
SIDABHA PETHABHA MANKE AND ORS ..Respondents
J U D G M E N T
Dr D Y CHANDRACHUD, J
1 The present appeal arises from a judgment of a learned Single Judge
dated 15 March 2016, in a first appeal from the decision of the Motor Accident
Claims Tribunal (MACT), Jamnagar.
2 The appellants are heirs and legal representatives of Nayabha Mapbha
Ker who died as a result of a motor accident on 18 July 1993. He was travelling
in a jeep bearing Registration No GBI-7896 which was being driven by the
fourth respondent towards Mithapur. At about 3.00 am the first respondent who
REPORTABLE
2
was driving a truck bearing Registration No.GJ-10-T-747, came from the
opposite direction and dashed against the jeep. Nayabha was seriously injured
and died during the course of the accident. His heirs filed a claim petition under
Section 166 of the Motor Vehicles Act, 1988 before the MACT, Jamnagar
seeking compensation in the amount of Rs 13 lakhs. By its award dated 19
July 1999 the Tribunal allowed the claim in the amount of Rs 7,78,000 together
with interest at the rate of 12 % per annum. The appellants filed a first appeal
before the High Court of Gujarat. The High Court, by its impugned judgment,
allowed an additional amount of Rs 33,000 under the head of loss of life,
expenses and consortium but reduced the rate of interest from 12 % p.a. to 9%
p.a. Aggrieved by the judgment of the High Court, the claimants are in appeal.
3 The deceased was 41 years old at the time of the accident. He had
acquired a B.A. and B.Ed. qualification. For seven years, he had served as
President of the Taluka Panchayat. The deceased owned agricultural land. The
Tribunal assessed the annual income of the deceased at Rs.81,000 comprised
of his agricultural income and income from other sources. Applying a multiplier
of 12, the Tribunal computed an amount of Rs. 7.56 lakhs towards the loss of
dependency. A total amount of Rs 7.78 lakhs was awarded inclusive of
conventional heads. In appeal, the High Court came to the conclusion that the
total income would work out to Rs 92,000 out of which one fourth would be
deducted for personal expenses. Applying a multiplier of 14, the High Court
3
awarded an additional amount of Rs 33,000. However, the rate of interest has
been reduced to 9% per annum.
4 Basically two submissions have been urged on behalf of the appellants.
First, it has been urged that the High Court did not allow for future prospects for
which provision has to be made in view of the law settled by a Constitution
Bench of this Court in National Insurance Company Limited v Pranay Sethi1
.
Second, it has been urged that there was no justification for the High Court to
reduce the award of interest from 9% p.a. to 6% p.a.
5 The High Court has computed the total income of the deceased at Rs
91,800 (Rs 55,000 being the income from agriculture and Rs 36,800 being the
income from salary). In view of the decision of the Constitution Bench in Pranay
Sethi (supra), an addition of 25% is warranted, on account of future prospects
having regard to the age of the deceased. The total income, after accounting
for future prospects at 25% would work out to Rs 1,14,000 per annum. An
amount of one fourth would have to be reduced on account of personal
expenses. The net income would work out to Rs 85,500. Applying a multiplier
of 14 the total compensation would work out to Rs 11,97,000. Adding a further
amount of Rs 70,000 under conventional heads as stipulated in the judgment

1
(2017) 13 SCALE 12
4
in Pranay Sethi (supra), the total compensation payable would work out to Rs
12,67,000.
6 We find no reason or justification for the High Court to reduce the award
of interest to 6% p.a.. The rate of interest of 9% p.a. fixed by the Tribunal is
restored.
7 The appeal is accordingly allowed by directing that the quantum of
compensation shall stand enhanced to Rs 12,67,000 on which interest shall be
payable at 9% p.a. from the date of the claim petition. There shall be no order
as to costs.
...........................................CJI
 [DIPAK MISRA]
 ...........................................J
 [A M KHANWILKAR]
 ...........................................J
 [Dr D Y CHANDRACHUD]
New Delhi;
April 05, 2018

West Bengal Estate Acquisition Act, 1953 = No doubt the proceedings initiated under Section 44(2a) of the Acquisition Act in 1969 were set at naught by the order of the High Court dated 1.6.1973, but then only Golap Bala Saha Mondal had initiated the process while no such process was initiated by Jitendra Lal Paul. After the proceedings of the Revenue Officer were set aside on 1.6.1973, it appears that action was taken qua the land of Jitendra Lal Paul and that is how respondent Nos.1 & 2 have registered pattas issued by the State authorities in July, 1980 and claim to be in possession. The appellant purchased the same land in 1987 and possibly at the behest of the heirs of Jitendra Lal Paul, woke up to file the writ petition in the year 1990. The appellant and the respondents herein, were made a party in those proceedings. Predicated on the reasoning of the order dated 1.6.1973, this petition succeeded by the order dated 17.7.1997. It is thereafter that the appellant filed the writ petition, which was transferred to the Tribunal without impleading respondent Nos.1 & 2 as parties in whom the land Civil Appeal No.3932/2009 Page 14 of 15 vested, rightly or wrongly. In such a situation the first two respondents, at least, have a right to be heard and that is what has weighed with the High Court while setting at naught the directions of the Tribunal dated 19.9.2000 and subsequent proceedings thereto, vide order in appeal dated 7.5.2004.

 REPORTABLE
 IN THE SUPREME COURT OF INDIA
 CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.3932 OF 2009
ASHIM RANJAN DAS (D) BY LRS. ….Appellant
Versus
SHIBU BODHAK & ORS. .…Respondents
J U D G M E N T
SANJAY KISHAN KAUL, J.
1. One Krishna Pada Supai (for short ‘KPS’) was holder and in
possession of land under an ex-intermediary Kali Charan Pramanick.
The land is stated to have been duly recorded in the name of KPS in
the Records of Rights of Mauza Jogatipota, P.S. Sonarpur, being R.S.
Khatian No.15 of Mauza Jagatipota, West Bengal. In the year 1962,
14.89 acres of land held by KPS was transferred to two persons –
Jitendra Lal Paul (8.26 acres) and Golap Bala Saha Mondal (6.63
acres). The origination of the dispute is the proceedings suo moto
initiated by the concerned Revenue Officer under Section 44(2a) of the
Civil Appeal No.3932/2009 Page 1 of 15
West Bengal Estate Acquisition Act, 1953 (hereinafter referred to the
‘Acquisition Act’). In order to appreciate the nature of proceedings, it
is necessary to give a small overview of the Acquisition Act. The
preamble to the Acquisition Act states as under:
“An Act to provide for the State acquisition of estates, of rights
of intermediaries therein and of certain rights of raiyats and
under-raiyats and of the rights of certain other persons in lands
comprised in estates.”
2. Section 2(i) of the Acquisition Act defines “intermediary” and
reads as under:
“S. 2. Definitions. –
(i) "intermediary" means a proprietor, tenure-holder, undertenure-holder
or any other intermediary above a raiyat or a
non-agricultural tenant and includes a service tenure-holder
and, in relation to mines and minerals, includes a lessee and a
sub-lessee;”
3. Chapter II of the Acquisition Act provides for “Acquisition of
estates and of the rights of intermediaries therein”. The relevant
provision is as under:
“S. 4. Notification vesting estates and rights of
intermediaries. – (1) The State Government may from time to
time by notification declare that with effect from the date
mentioned in the notification, all estates and the rights of every
intermediary in each such estate situated in any district or part
of a district specified in the notification, shall vest in the State
free from all incumbrances.”
Civil Appeal No.3932/2009 Page 2 of 15
…. …. …. …. ….
“S. 5. Effect of notification. – (1) Upon the due publication of
a notification under section 5, on and from the date of vesting –
xxxx xxxx xxxx xxxx xxxx
(c) (Subject to the provisions of sub-section (3) of section 6,
every non-agricultural tenant holding any land) under an
intermediary, and until the provisions of Chapter VI are given
effect to, every raiyat holding any land under an intermediary,
shall hold the same directly under the State, as if the State had
been the intermediary, and on the same terms and conditions as
immediately before the date of vesting:
Provided that if any non-agricultural tenant pays rent wholly in
kind or partly in kind and partly in cash, then, notwithstanding
anything contained in the foregoing clause, he shall pay such
rent as a Revenue Officer specially empowered by the State
Government in this behalf may determine in the prescribed
manner and in accordance with the principle laid down in
clause (ii) of section 42:
Provided further that any person aggrieved by an order passed
by the Revenue Officer determining rent under the first proviso
may appeal to such authority and within such time as may be
prescribed;”
…. …. …. …. ….
“S. 6. - Right of intermediary to retain certain lands:- (1)
Notwithstanding anything contained in sections 4 and 5, an
intermediary shall, except in the cases mentioned in the
proviso to sub-section (2) but subject to the other provisions of
that sub-section, be entitled to retain with effect from the date
of vesting —
Civil Appeal No.3932/2009 Page 3 of 15
(a) land comprised in homesteads;
(b) land comprised in or appertaining to buildings and
structures owned by the intermediary or by any person, not
being a tenant holding under him by leave or license;
Explanation. – For the purposes of this clause ‘tenant’ shall not
include a thika tenant as defined in the Calcutta thika Tenancy
act, 1949 (W.B. Act II of 1949);
(c) non-agricultural land in his khas possession including land
held under him by any person , not being a tenant, by leave or
license, not exceeding fifteen acres in area, and excluding any
land retained under clause (a):
Provided that the total area of land retained by an intermediary
under clauses (a) and (c) shall not exceed twenty acres, as may
be chosen by him:
Provided further that if the land retained by an intermediary
under clause (c) or any part thereof is not utilised for a period
of five consecutive years from the date of vesting, for a gainful
or productive purpose, the land or the part thereof may be
resumed by the State Government subject to payment of
compensation determined in accordance with the principles
laid down in sections 23 and 24 of the land Acquisition Act,
1894 (I of 1894);
(d) agricultural land in his khas possession, not exceeding
twenty-five acres in area , as may be chosen by him:
Provided that in such portions of the district of Darjeeling as
may be declared by notification by the State Government to be
hilly portions, an intermediary shall be entitled to retain all
agricultural land in his khas possession , or any part thereof as
may be chosen by him;
(e) tank fisheries;
Civil Appeal No.3932/2009 Page 4 of 15
xxxx xxxx xxxx xxxx xxxx
(2) An intermediary who is entitled to retain possession of any
land under sub-section (1) shall be deemed to hold such land
directly under the State from the date of vesting as a tenant,
subject to such terms and conditions as may be prescribed and
subject to payment of such rent as may be determined under
the provisions of this Act and as entered in the record-of-rights
finally published under Chapter V except that no rent shall be
payable for land referred to in clause (h) or (i) :
Provided that if any tank fishery or any land comprised in a
tea-garden, orchard, mill, factory or workshop was held
immediately before the date of vesting under a lease, such
lease shall be deemed to have been given by the state
Government on the same terms and conditions as immediately
before such date subject to such modification therein as the
State Government may think fit to make.”
(emphasis supplied)
4. The effect of the aforesaid provisions, thus, is that once the
process is followed, the rights of intermediary is to vest in the State,
free from all encumbrances and the exceptions are provided in Section
6(1).
5. In a nutshell, the Act provides for vesting of the land of the
intermediary as per process with the State Government but an
intermediary is entitled to retain possession of any land from the date
Civil Appeal No.3932/2009 Page 5 of 15
of vesting the lands falling under the exceptions enumerated in clauses
(a) to (e) of sub-section (1) of Section 6 of the Acquisition Act as a
tenant of the State.
6. Insofar as invocation of power under Section 44 (2a) by the
Revenue officer is concerned, the relevant provisions are reproduced
as under:
“Section 44. Draft and final publication of the record-ofrights.
– (1) When a record-of-rights has been prepared or
revised , the Revenue Officer shall publish a draft of the record
so prepared or revised in the prescribed manner and for the
prescribed period and shall receive and consider any objections
which may be made to any entry therein or to any omission
therefrom during the period of such publication:
Provided that no order passed under section 5A shall be liable to
be reopened in pursuance of an objection made under this subsection.
(2) When all such objections have been considered and disposed
of according to such rules as the State Government may make in
this behalf, the Revenue Officer shall finally frame the record
and cause such record to be finally published in the prescribed
manner and make a certificate stating the fact of such final
publication and the date thereof and shall date and subscribe the
same under his name and official designation.”
xxxx xxxx xxxx xxxx xxxx
(2a) An officer specially empowered by the State Government
may, on application within nine months, or of his own motion
within [sixty years], from the date of final publication of the
record-of-rights or from the date of coming into force of the
Civil Appeal No.3932/2009 Page 6 of 15
West Bengal Estates Acquisition (Second Amendment)
Ordinance, 1957 (West Ben. Ord. X of 1957), whichever is later,
revise an entry in the record finally published in accordance with
the provisions of subsection (2) after giving the persons
interested an opportunity of being heard and after recording
reasons therefor:
Provided that nothing in the foregoing paragraph shall be
deemed to empower such officer to modify or cancel any order
passed under section 5A, while revising any entry:
Provided further that no such officer shall entertain any
application under this sub-section or shall of his own motion
take steps to revise any entry, if an appeal against an order
passed by a Revenue Officer on any objection made under subsection
(1), has been filed before the commencement of the West
Bengal Estates Acquisition (Second Amendment) Ordinance,
1957, before a tribunal appointed for the purpose of this section,
and, notwithstanding anything in this section, any such appeal
may continue and be heard and disposed of as if the West Bengal
Estates Acquisition (Second Amendment) Ordinance, 1957, had
not been promulgated.”
7. The Revenue Officer, thus, sought to exercise power under
Section 44(2a) of the Acquisition Act suo moto on 7.4.1969.
Thereafter he cancelled the tenancy rights of both Jitendra Lal Paul and
Golap Bala Saha Mondal vide order dated 12.5.1969. This order was
assailed in a WP being Civil Rule No.2915 (W) of 1969 by Golap Bala
Saha Mondal alone. The learned single Judge of the Calcutta High
Court set aside the order dated 12.5.1969 vide order dated 1.6.1973.
The rationale for doing so is two-fold – though Golap Bala Saha
Civil Appeal No.3932/2009 Page 7 of 15
Mondal was in possession of land on payment of rent to the State
Government and her name had been mutated on purchase in the year
1962, the proceedings under Section 44(2a) were held without notice to
her. Secondly, the Revenue Officer was held to have no jurisdiction to
go into the question as to whether the recorded owner is the benamidar
for any other person.
8. On the other hand, on the demise of Jitendra Lal Paul, the land
vested with his widow, Kusumbala Paul, who sold it to Mr. Rathindra
Chandra Hore. The appellant, Ashim Ranjan Das, purchased the said
land measuring 8.26 acres in 1987 from Mr. Rathindra Chandra Hore,
which was originally held by late Jitendra Lal Paul.
9. It appears that since only Golap Bala Saha Mondal had filed the
earlier writ petition, the State Government took steps qua the land of
Jitendra Lal Paul on the premise that the land vested in the State
Government and executed Deeds of Ryoti Settlement with regards to
the land in favour of respondents No. 1 and 2 herein. The first two
respondents before us are therefore the patta holders of the land
through registered pattas of July, 1980. That is how the title came to
Civil Appeal No.3932/2009 Page 8 of 15
respondent Nos.1 & 2, before the sale to the Appellant.
10. In the year 1990, the heirs of Jitendra Lal Paul, i.e., Kusumbala
Paul and others filed a writ petition, being C.O. No.8958 (W) of 1990,
on the ground that the land cannot be treated to be vested in the State
Government. In the said proceedings, Ashim Ranjan Das, the appellant
herein, was also joined as Petitioner No. 8. Respondents No. 1 and 2
herein were joined as respondents No. 10 and 13 respectively. In
terms of the order dated 17.7.1997, the writ petition was allowed
predicated on the earlier order passed on 1.6.1973 by the High Court in
terms whereof the process undertaken by the respondent-authorities
under Section 44(2a) of the Acquisition Act had been set aside.
11. The respondents No. 1 and 2 before us, did not take any steps to
challenge the said order of 17.7.97, till 1998 when the Appellant before
us filed a writ petition, being WP No.4327 (W) of 1998, with a prayer
to mutate his name in the records, in respect of the lands purchased
from Mr. Rathindra Chandra Hore. This writ petition was transferred
to the Tribunal constituted under The West Bengal Land Reforms and
Tenancy Tribunal Act, 1997 (hereinafter referred to as the ‘WB Land
Civil Appeal No.3932/2009 Page 9 of 15
Reforms & Tenancy Act’) and renumbered as Transferred Application
No. 401 of 2000 (LRTT). Section 4 of the WB Land Reforms &
Tenancy Act deals with the establishment of the Tribunal, Section 9
with the transfer of case records from the High Court while Section 11
provides for an appeal to the Division Bench of the High Court.
12. The Tribunal in terms of the order dated 19.9.2000 directed the
Block Land and Land Reforms Officer to restore all the land in the
name of KPS. The endeavour to seek recall of this order by the State
Government was unsuccessful vide order dated 22.3.2001.
Consequently, the Block Land and Land Reforms Officer forwarded
the annulment proposal to the Sub-Divisional Officer (‘SDO’) for
taking necessary action in terms of the order passed by the Tribunal.
The SDO in turn issued notice to the patta holders for hearing.
13. Shibu Bodhak and Tapan Malik respondents No.1 and 2 herein
respectively, filed an application in the High Court of Calcutta
registered as W.P.L.R.T. No.1045/2001, being an appeal filed u/s 11 of
the WB Land Reforms & Tenancy Act and also invoking Article 226 of
the Constitution of India, inter alia praying for issuance of a writ in the
Civil Appeal No.3932/2009 Page 10 of 15
nature of mandamus, commanding the respondents to set aside the
order dated 19.9.2000 and 22.3.2001 passed by the Tribunal in Appeal
No.401/2000, which was transferred from the High Court, and also
directing the respondents to set aside the action of the appropriate
authority under The West Bengal Land Reforms Act, 1955 (hereinafter
referred to as the ‘WB Land Reforms Act’) which had issued a notice
dated 17.4.01 for the cancellation of patta. Mr. Shibu Bodhak and
Tapan Malik challenged the order of the Tribunal directing the
authorities to cancel the pattas of patta holders inter alia on the ground
of absence of opportunity of being heard.
14. We may notice here that the WB Land Reforms Act was enacted
with the objective as set out in the Preamble, which reads as under:
“An Act to reform the law relating to land tenure consequent on
the vesting of all estates and of certain rights therein [and also to
consolidate the law relating to land reforms] in the State.”
The WB Land Reforms Act sought to vest the rights in the land in the
raiyat (a person or an institution holding land for any purpose
whatsoever).
15. This was opposed by the appellant before us on the ground that
Civil Appeal No.3932/2009 Page 11 of 15
since the vesting in the State Government had been set aside by the
High Court on 1.6.1973 albeit at the behest of Golap Bala Saha
Mondal, the grant of pattas by the State Government was void ab initio
including in respect of the present first two respondents in July, 1980.
We may add here that the rights of the appellant are derived from
Jitendra Lal Paul for which the writ petition was filed only in the year
1990. It appears that in the interregnum period the land was
transferred to respondent Nos.1 & 2. It was also contended by the
appellant that the first two respondents could not complain or make a
grievance for not being made parties in Appeal No.401/2000 since the
issue of the proceedings under Section 44(2a) of the Acquisition Act
already stood resolved and had attained finality.
16. The aforesaid appeal filed by respondent Nos.1 & 2 was,
however, allowed vide impugned order dated 7.5.2004, noticing that
respondent Nos.1 & 2 herein were the patta holders in respect of the
land and were not heard by the Tribunal before directing the
cancellation of the pattas given to them. They had continued in
possession since 1980 and it is only on issuance of notice by the
appropriate authority in April, 2001 that they came to know of the
Civil Appeal No.3932/2009 Page 12 of 15
cancellation of the patta. The writ petition filed, which was transferred
to the Tribunal only made a prayer for mutation of the land in the name
of the appellant for which patta was held by respondent Nos.1 & 2 and
they were not parties. It was further opined that the Tribunal having
already reached a finding and issuing directions to the authorities for
mutation of the plots in favour of the appellant, the hearing to be given
by the Block Land and Reforms Officer would be of no consequence.
The order dated 19.9.2000 of the Tribunal was, thus, set aside as also
all proceedings thereto. However, no observations were made on the
merit of the controversy and this setting aside was necessitated on
account of violation of principles of natural justice. The Tribunal was
directed to give a chance to the first two respondents herein to file their
affidavits and thereafter pass an order on the merits of the controversy
raised by the appellant.
17. The appellant is aggrieved by this remitting of the matter to the
Appellate Tribunal. We may also note that this appeal was filed
originally in the year 2004 and 14 years have elapsed since then.
18. We believe the endeavour of the appellant through the present
Civil Appeal No.3932/2009 Page 13 of 15
proceedings has proved to be a fruitless exercise as by now the matter
on being remanded would have been adjudicated, after giving
opportunities to the first two respondents. The case has had a
chequered factual history. No doubt the proceedings initiated under
Section 44(2a) of the Acquisition Act in 1969 were set at naught by the
order of the High Court dated 1.6.1973, but then only Golap Bala Saha
Mondal had initiated the process while no such process was initiated
by Jitendra Lal Paul. After the proceedings of the Revenue Officer
were set aside on 1.6.1973, it appears that action was taken qua the
land of Jitendra Lal Paul and that is how respondent Nos.1 & 2 have
registered pattas issued by the State authorities in July, 1980 and claim
to be in possession. The appellant purchased the same land in 1987
and possibly at the behest of the heirs of Jitendra Lal Paul, woke up to
file the writ petition in the year 1990. The appellant and the
respondents herein, were made a party in those proceedings.
Predicated on the reasoning of the order dated 1.6.1973, this petition
succeeded by the order dated 17.7.1997. It is thereafter that the
appellant filed the writ petition, which was transferred to the Tribunal
without impleading respondent Nos.1 & 2 as parties in whom the land
Civil Appeal No.3932/2009 Page 14 of 15
vested, rightly or wrongly. In such a situation the first two
respondents, at least, have a right to be heard and that is what has
weighed with the High Court while setting at naught the directions of
the Tribunal dated 19.9.2000 and subsequent proceedings thereto, vide
order in appeal dated 7.5.2004.
19. We are, thus, of the view that there is no merit in the appeal,
which is dismissed leaving the parties to bear their own costs.
..….….…………………….J.
 [J. Chelameswar]
 ...……………………………J.
 [Sanjay Kishan Kaul]
New Delhi.
April 05, 2018.
Civil Appeal No.3932/2009 Page 15 of 15

corporate laws -M.P. Power Management Company Ltd.- Suffice to note that in cases of delay, Articles 2.5 and 2.6 provide for levy of penalty. As observed by the High Court, since the contract permits imposition of penalty, respondent No.1 is liable to pay penalty in terms of clause 2.5.1 of the PPA for the delay. But the action of the appellant in terminating the contract is arbitrary and was rightly set aside by the High Court.

REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 3600 OF 2018
(Arising out of SLP(C) No.23848 of 2017)
M.P. POWER MANAGEMENT COMPANY LTD. …Appellant
Versus
RENEW CLEAN ENERGY PVT. LTD. & ANR. ...Respondents
J U D G M E N T
R. BANUMATHI, J.
Leave granted.
2. This appeal arises out of the judgment passed by the High Court
of Madhya Pradesh, Principal Seat at Jabalpur in and by which the High
Court allowed the Writ Petition No.12432 of 2017 setting aside the order
of termination of contract dated 11.08.2017 while maintaining the
appellant's action on invocation of bank guarantee in terms of clause
2.5.1 of the contract.
3. Brief facts which led to filing of this appeal are as follows:
The appellant-M.P. Power Management Company Ltd. initiated the
process of procurement of power from Grid Connected Solar Energy
through tariff based competitive bidding for meeting its Renewable
Purchase obligations in the State of Madhya Pradesh. Accordingly, a
1
Request for Proposal (RFP) dated 06.05.2015 was issued by the
appellant for long term procurement of 300 MW power from Grid
connected Solar Energy Sources through tariff based competitive
bidding. Out of 100 bidders who participated in the bidding process,
respondent No.1-ReNew Clean Energy Private Ltd. was selected on the
basis of cheaper merit order rates. The appellant issued a Letter of
Intent dated 23.10.2015 in favour of respondent No.1 allotting 51 MW
capacity at quoted tariff of Rs.5.457/kwh for twenty five years which was
accepted by respondent No.1 by its consent letter dated 26.10.2015. A
Power Purchase Agreement (PPA) dated 10.11.2015 was executed
between the appellant and respondent No.1 for sale and procurement of
51 MW solar power, for which, respondent No.1 submitted a bank
guarantee from respondent No.2-Bank for an amount of
Rs.15,30,00,000/- valid till January, 2018.
4. Since respondent No.1 was unable to obtain the requisite land for
establishing the power plant, respondent No.1 requested assistance
from the State Government. Accordingly, the Collector, District-Rajgarh
by order dated 21.04.2016 allotted 96.73 acres of revenue land to MP
New and Renewable Energy Department for further allotment on lease
to respondent No.1. This was done by the appellant even though the
land procurement was the obligation of the bidder.
2
5. According to respondent No.1, there were difficulties in accessing
the land, because when measurement of land was taken on 29.06.2016,
it was found encroached and the project team faced heavy resistance,
physical attacks etc. and therefore, respondent No.1 vide its letter dated
29.09.2016 requested the appellant to allow to change of location of the
project. The said permission sought for by respondent No.1 was
granted by the appellant by its Resolution dated 29.12.2016. The
relevant portion of the Resolution reads as under:-
"Resolved that condition for not allowing change of location after 210
days from signing of PPA be relaxed and following Solar Power
developers be allowed to change the location of their respective project,
subject to provision of clause 2.5 and 2.6 of the PPA."
6. After permission was granted to change the location of the
project, respondent No.1 purchased lands to an extent of about 253
acres in villages Bansara and Pipriya Rai in Ashok Nagar district and
undertook the development/construction activities. On 10.07.2017,
respondent No.1 wrote to appellant that "commissioning process was in
final stages and we expect to commission the plant on 31.08.2017
(tentative date), which is ahead of scheduled commissioning date of
07.09.2017."
7. As per clause 2.5.1 of the PPA, a maximum period of nine months
beyond 07.06.2016 for achieving Conditions Subsequent enables the
appellant to terminate the agreement if respondent No.1 failed to satisfy
3
the Conditions Subsequent by this date along with penalty which was to
be calculated as per clause 2.5.1 of the PPA. In the light of the
abovesaid provisions of the PPA, the appellant by order dated
11.08.2017 terminated the PPA and imposed a penalty of
Rs.11,95,54,200/- on respondent No.1. Being aggrieved, respondent
No.1 filed Writ Petition No.12432 of 2017 before the High Court praying
that the appellant be directed not to give effect to termination and
encashment of performance bank guarantee. The High Court vide
impugned judgment dated 18.08.2017 partly allowed the writ petition
setting aside the order of termination of the contract while maintaining
the invocation of the bank guarantee.
8. We have heard the learned counsel appearing for the parties and
perused the impugned judgment and materials on record.
9. Clause 2.1 of the PPA required respondent No.1 to fulfil all
Conditions Subsequent within a period of 210 days from the effective
date i.e. 06.06.2017, failing which Article 2.5 of the PPA allowed further
extension up to nine months for fulfillment of the Conditions Subsequent
subject to payment of liquidated damages in terms of the PPA. Clause
2.5 of the PPA reads as follows:-
2.5 DELAY IN ACHIEVING CONDITIONS SUBSEQUENT
2.5.1. In case of delay in achieving any of the Conditions Subsequent
under clause 2.1 (a to h), as may be applicable, MPPMCL shall
4
encash CPG (submitted by Seller @ Rs.30 Lakhs/MW) as under,
subject to Force Majeure:
a) Delay from 0-3 months - 1% per week.
b) Delay from 3-6 months - 2% per week for the
period exceeding 3 months, apart from (a) above.
c) Delay from 6-9 months - 3% per week for the
period exceeding 6 months, apart from (a) and (b)
above.
d) In case of delay of more than 9 months, MPPMCL
shall terminate PPA and release balance amount of
CPG.
10. Since respondent No.1 was unable to obtain the requisite land, on
request by respondent No.1, the State Government allotted 96.73 acres
of land at district Rajgarh to the appellant for being allotted to
respondent No.1 on lease. According to respondent No.1, upon
initiation of measurement and demarcation exercise by the revenue
officials, the land was found to be heavily encroached and there was
stiff resistance which continued every time respondent No.1 tried to
approach the said land and therefore, respondent No.1 could not
access the project site and commence any construction activities. On
request by respondent No.1 by its letter dated 29.09.2016, respondent
No.1 sought for change of location of the project. The Board of
Directors considered the request of respondent No.1 and by Resolution
dated 29.12.2016 allowed change of location of the project. Thereafter,
respondent No.1 purchased the land to an extent of 253 acres in village
Bansara and Pipriya Rai in Ashok Nagar district within a period of about
eighty three days from the date of the appellant's approval. After
5
acquiring the land, respondent No.1 undertook the construction
activities and the project in an advanced stage of synchronization as
early as on 10.07.2017. The same was notified to the appellant by
communication dated 10.07.2017 stating that the commissioning of the
project is in final stage and that the expected date of commissioning of
the project is 31.08.2017 which according to respondent No.1 is ahead
of the scheduled commissioning date i.e. 07.09.2017 in terms of the
PPA.
11. Even when respondent No.1 has undertaken the construction
activities in the changed location and informed the appellant that the
expected date of commissioning of the project is 31.08.2017, the
appellant terminated the contract by its order dated 11.08.2017. As
pointed out by respondent No.1 in its counter affidavit, on 06.06.2016,
respondent No.1 has got sanction of the term debt facility of Rs.267.37
crores from PTC India Financial Services Limited and has spent huge
amount in purchasing the land to an extent of 253 acres in Ashok Nagar
district. Respondent No.1 has also spent substantial amount in
development of the project in the changed location and reached an
advanced stage of commissioning the project by 31.08.2017. The delay
in commissioning the project appears to be due to unavoidable
circumstances like resistance faced at the allotted site in Rajgarh district
6
and subsequent change of location of the project. These circumstances,
though not a Force Majeure event, time taken by respondent No.1 in
change of location and construction of the plant have to be kept in view
for counting the delay. Having invested huge amount in purchasing the
land and development of the project at Ashok Nagar district and when
the project is in the final stage of commissioning, the termination of the
contract is not fair.
12. The High Court observed that the delay in completing the project
was only for sixteen days. But according to the appellant, respondent
No.1 was granted time period of 210 days to complete the Conditions
Subsequent after which the penalty was leviable for the delay and if the
delay exceeded more than nine months, the appellant could terminate
the contract. According to appellant, the delay was not of sixteen days;
but the said delay of sixteen days is beyond the period of nine months
permissible under the PPA. In the light of our observations above, we
are not inclined to go into the merits of this contention. Suffice to note
that in cases of delay, Articles 2.5 and 2.6 provide for levy of penalty. As
observed by the High Court, since the contract permits imposition of
penalty, respondent No.1 is liable to pay penalty in terms of clause 2.5.1
of the PPA for the delay. But the action of the appellant in terminating
the contract is arbitrary and was rightly set aside by the High Court.
7
13. While setting aside the termination of the contract, the High Court
maintained the action of invocation of bank guarantee in terms of clause
2.5.1 of the PPA. By order dated 22.09.2017, this Court has stayed the
order of the High Court subject to restitution by the appellant of the
amount covered by the bank guarantee which has been invoked which
is said to have been complied with by the appellant. In our view,
interest of justice would be met by directing respondent No.1 to pay
penalty amount of Rs.11,95,54,200/- imposed upon respondent No.1 by
the appellant.
14. In the result, the appeal is dismissed. The respondent No.1 shall
pay the penalty of Rs.11,95,54,200/- to the appellant within a period of
four weeks from the date of this judgment. No costs.
.…….…………...………J.
 [RANJAN GOGOI]
…………….……………J.
 [R. BANUMATHI]
New Delhi;
April 05, 2018
8

Thursday, April 5, 2018

corporate laws - Education Laws - Neet PG- 44 Doctors who did their MBBS/BDS Courses from State of Karnataka and have cleared the NEET-PG, 2018 examination with high merit position and are aspiring for admission to Post-Graduate Courses in Karnataka. The principal prayer in the writ petition seeks issuance of an appropriate writ, order or direction quashing Clause 4 of the Information Bulletin jointly issued by Directorate of Medical Education, = the Information Bulletin for PGET-2014 did not actually give institutional preference to students who had passed MBBS/BDS from Colleges or universities in State of Karnataka but made some of them ineligible to take the entrance test for admission to PostGraduate Medical or Dental Course in State of Karnataka and that said clause was held ultra vires Article 14 of the Constitution and declared null and void. The relevant clause under consideration, namely, Clause 4.1 of the Information Bulletin for PGET-2018 is identical in substance to the one that was considered in Vishal Goyal (supra). The matter is thus no longer resintegra and is completely covered by the decision in Vishal Goyal (supra). In the circumstances, we respectfully follow the decision of this Court in Vishal Goyal (supra) and hold Clause 4.1 of the Information Bulletin (PGET-2018) which was published on the website on 10.03.2018 to be invalid to the extent it disqualifies petitioners and similarly situated candidates who completed their MBBS/BDS Degree Courses from colleges situated in Karnataka from competing for admission to Post-Graduate Medical/Dental Courses in Government Medical Colleges and against government quota seats in non-governmental institutions This writ petition stands allowed in the aforesaid terms. State of Karnataka and Respondent Nos.2 and 3 are directed to suitably modify and amend the Information Bulletin in question in keeping with the observations made in this Judgment and re-publish the Calendar of Events in terms of this Judgment and complete the entire process within the timeline stipulated by the concerned regulatory authorities.

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
WRIT PETITION (CIVIL) NO.204 OF 2018
Dr. Kriti Lakhina and Others ….Petitioners
Versus
State of Karnataka and Others …. Respondents
J U D G M E N T
Uday Umesh Lalit, J.
1. This petition under Article 32 of the Constitution of India has been
filed by 44 Doctors who did their MBBS/BDS Courses from State of
Karnataka and have cleared the NEET-PG, 2018 examination with high
merit position and are aspiring for admission to Post-Graduate Courses in
Karnataka. The principal prayer in the writ petition seeks issuance of an
appropriate writ, order or direction quashing Clause 4 of the Information
Bulletin jointly issued by Directorate of Medical Education, Government of
2
Karnataka and Karnataka Examinations Authority, Government of
Karnataka, Respondent Nos.2 and 3 respectively.
2. The Information Bulletin in question lays down, inter alia, conditions
for admission to Post-Graduate Medical and Dental Courses in respect of
government quota seats in Medical/Dental Colleges in State of Karnataka
and was published on the website on 10.03.2018. Relevant portion of
Clause 4 of this Information Bulletin deals with eligibility conditions in
following terms:
“4. ELIGIBILITY
4.1 ELIGIBILITY for Government seats (G) &GMP
seats:
A candidate who fulfills the following criteria is eligible
to appear for the online seat allotment process, namely:-
 He/she is a citizen of India, who is of Karnataka Origin
and has studied MBBS or BDS degree in a Medical or Dental
College situated in Karnataka or outside Karnataka and
affiliated to any University established by law in India
recognized by Medical Council of India or Dental Council of
India and Government of India and has qualified in the NEET
(National Eligibility-cum-Entrance Test) for admission to post
graduate medical or dental degree/diploma courses.
Note: Children for the purpose of the rule means natural born
son/daughter and not adopted son/daughter and not
grandson/grand daughter.
3
Explanation: A candidate of Karnataka Origin: means, a
candidate found eligible under clause A or B below.
(Clause A)
i) A candidate who has studied and passed in one or more
Government or Government recognized, educational
institutions located in the State of Karnataka for a minimum
period of TEN academic years as on the 31st March, 2018,
commencing for 1st standard to MBBS/BDS and must have
appeared and passed either SSLC/10th standard or 2nd PUC/12th
standard examination from Karnataka State. In case of the
candidate who has taken more than one year to pass a class or
standard, the year of academic study is counted as one year
only (Document to be produced)
(Clause B)
ii) The candidate should have studied and passed 1st and 2nd
year Pre-University Examination or 11th or 12th standard
examination within the State of Karnataka from an Educational
Institution run or recognized by the State Government or
MBBS/BDS from a professional educational institution located
in Karnataka and that either of the parents must have
studied/resided in Karnataka for a minimum period of 10 years.
(Documents to be produced)”
3. It is submitted by the petitioners that this Information Bulletin issued
by Respondent Nos.2 and 3, to the extent Clause 4.1 thereof imposes a
condition of domicile for admission to MD, MS and Post-Graduate Diploma
seats in State of Karnataka is invalid and unconstitutional. According to the
petitioners said Clause 4.1 arbitrarily and illegally deprives the petitioners
who had obtained MBBS/BDS Degrees from the Colleges situated in
4
Karnataka from competing for admission to Post-Graduate Medical/Dental
Curses in Government Medical Colleges and against Government quota
seats in non-Governmental institutions. Reliance has been placed on the
Judgment of this Court in Vishal Goyal and Others v. State of Karnataka
and Others1
to submit that the controversy is no longer res-integra and the
view taken in Vishal Goyal (supra) ought to have been adhered to by
Respondent Nos.2 and 3 while issuing the Bulletin.
4. Since the matter involves urgency and the career prospects of the
petitioners and similarly situated candidates are in question, the matter was
taken up for hearing immediately. State of Karnataka entered appearance
and has filed its reply submitting inter alia, that under the eligibility
conditions, only candidates of Karnataka origin could compete for admission
to 50% government seats in government colleges and against government
quota seats in private colleges. The reply further stated that these eligibility
conditions were stipulated in order to ensure that the State’s requirement of
skilled human resource is met with and that the Post-Graduate Medical
Education Regulation 2000 (‘2000 Regulations’ for short) of Medical
Council of India do not prohibit the State from stipulating eligibility
conditions for Post-Graduate courses. According to certain statistics given
1
 (2014) 11 SCC 456
5
in the reply, candidates of Karnataka origin numbering 4093 candidates
would be competing for admission to 1828 seats while 10003 candidates of
origin other than Karnataka which number includes 1263 candidates from
outside the State who had studied and completed MBBS/BDS Courses from
the colleges situated in Karnataka would be competing for admission to
2301 seats. The reply further submitted that the State was within its right to
formulate eligibility conditions to give preference to candidates who were
most likely to serve the State.
5. In its reply, Medical Council of India (“MCI”, for short) submitted
that the Information Bulletin (PGET-2014) issued by the State of Karnataka
in the year 2014 contained similar eligibility criteria as provided in Clause
4.1 of the present Information Bulletin (PGET-2018) which was challenged
in the case of Vishal Goyal (supra) and that this Court held the preference
based on domicile to be violative of the principle of equality and liable to be
set aside. After referring to various Judgments of this Court the reply set
out the emerging legal position as perceived by MCI in following terms:-
“a. Reservation of seats at the post graduate level has been in
principle disapproved by the Hon’ble Supreme Court;
b. Reservation of seats at the post graduate level on the
basis of domicile/ residence/ place of origin is impermissible
and cannot be done by the State;
6
c. Institutional reservation/ preference for reserving seats at
the post graduate level is permissible subject to an outer limit of
50%;
d. Institutional reservation/ preference can be invalidated on
the ground that the same is violative of the principle of equality
enshrined under Article 14 of the Constitution of India;
e. There cannot be any domicile requirement imposed by
the State while implementing institutional reservation;
f. Institutional reservation/ preference disguised as domicile
reservation has been held to be invalid and violative of Article
14 of the Constitution.”
6. We heard Mr. Amrendra Sharan, learned Senior Advocate for the
petitioners, Mr. Basavaprabhu S. Patil, learned Senior Advocate for State of
Karnataka and official respondents and Mr. Gaurav Sharma, learned
Advocate for MCI.
7. Mr. Sharan, learned Senior Advocate relied upon the decisions of this
Court in Dr. Pradeep Jain and Others v. Union of India and Others2
,
Saurabh Chaudri and Others v. Union of India and Others3
, Magan
Mehrotra and Others v. Union of India and Others4
, Nikhil Himthani v.
State of Uttarakhand and Others5
 and finally on the decision of this Court
in Vishal Goyal (supra). In his submission these decisions as culminated in
2
 (1984) 3 SCC 654 paras 20, 22 and 24
3
 (2003) 11 SCC 146 paras 29, 69 and 70
4
 (2003)11 SCC 186 paras 3 and 8
5
 (2013) 10 SCC 237 para 3
7
the decision in Vishal Goyal (supra) fully conclude the matter. These
submissions were supported by Mr. Gaurav Sharma, learned Advocate for
the MCI.
8. Mr. Patil, learned Senior Advocate, on the other hand relied upon the
decision of this Court in D.P. Joshi v. State of Madhya Bharat and
Another6
 and on paragraphs 6, 13 and 16 of the decision in Dr. Pradeep
Jain (supra), in support of his submissions.
9. After conclusion of hearing, written submissions were filed by the
parties. In their written submissions, petitioners inter alia submitted that
Clause 4.1 of the Information Bulletin in question was violative of Article 14
of the Constitution and was opposed to Regulation 9 of 2000 Regulations. A
chart was appended showing similarity between Clause 2 of PGET-2014
which was subject matter of the decision in Vishal Goyal (supra) and the
present Clause 4.1. In its written submissions MCI also relied upon 2000
Regulations and specially Regulation 9 thereof. It was further submitted:
 “It is important to note that there are primarily two types of
courses at post-graduate level i.e. post-graduate diploma
courses and post graduate degree courses. On a close reading
of Regulation 9(IV) and 9(VII) the distinction between post
graduate diploma course and post-graduate degree course is
apparent. It needs to be emphasized that as per Regulation 9
6
 AIR 1955 SC 334 = 1955 (1) SCR 1215
8
and the amendments made therein from time to time,
reservation of seats for in-service candidates is only permissible
in post-graduate diploma courses. Further, there is no provision
under the IMC Act, 1956 and the Regulations framed
thereunder which permits reservation in post-graduate degree
courses.”
10. State of Karnataka in its written submissions sought to justify the
action but did not explain how the decision in Vishal Goyal (supra) would
not be applicable in the present case. It was however submitted:-
“The State of Karnataka has 11615 Public Health Care
Institutions managed by the Health and Family Department of
the State. It is the objective of the State to provide secondary
and tertiary care services too within the reach of common
public. This objective is sought to be fulfilled by setting up of
new State of the art institutions and strengthen the existing
institutions through provisions of equipments, up-gradation of
infrastructure and recruitment of skilled man power. Today,
there are 3435 posts of specialists about which 1312 are vacant,
underlying the deficiency of skilled medical professional to
address the health care needs of the State. In the medical and
dental educational institutions out of 2700 posts of specialists,
517 are vacant highlighting the deficiency of skilled medical
teachers to address the medical teachers’ needs of the State. 16
out of 39 medical colleges in Karnataka are run by the State.
There are 970 senior resident posts in these medical colleges,
524 of which are vacant. The State has to ensure that these
posts are filled up at any given point of time as stipulated by
Medical Council of India. If these remain vacant for want of
specialist, de-recognition looms large with the risk of
jeopardizing the future of both undergraduate and post-graduate
candidates’ studying in these colleges. The posts of senior
resident need to be filled by fresh post graduates passing out
every year. There is a huge requirement of specialists to run
these institutions. Hence the State Government has to ensure
9
availability of adequate number of post graduates to fill these
posts.”

11. The decision of this Court in Dr. Pradeep Jain (supra) had considered
the Judgments rendered in Kumari N. Vasundara v. State of Mysore and
Another7
, Minor P. Rajendran v. State of Madras and Others8
, Minor A.
Peeriakaruppan v. State of Tamil Nadu and Others9
 and D.N. Chanchala
v. The State of Mysore and Others10 as well as the decision in Dr. Jagadish
Saran and others v. Union of India11 and finally concluded:
“…. We unreservedly condemn wholesale reservation made by
some of the State Government on the basis of institutional
preference for students who have passed the qualifying
examination held by the university or the State excluding all
students not satisfying this requirement, regardless of merit.
We declare such wholesale reservation to be unconstitutional
and void as being in violation of Article 14 of the Constitution.”
12. During the course of its Judgment in Dr. Pradeep Jain (supra) this
Court also considered the impact of submissions from the concerned States
as advanced in various Judgments that were considered in paragraphs 14 to
16, which submissions were similar to the ones advanced before us by the
State either in the reply or in the written submissions. Para 22 of the
7
 (1971) Suppl. SCR 381 = (1971) 2 SCC 22
8
 1968 (2) SCR 786
9
 1971 (2) SCR 430 = (1971) 1 SCC 38 = AIR 1971 SC 2303
10 (1971) Suppl SCR 608 = (1971) 2 SCC 293
11 (1980) 2 SCC 768= 1980 (2) SCR 831
10
decision in Dr. Pradeep Jain (supra) finally summed up the matter as
regards post graduate courses as under:-
“22. ….. The Medical Education Review Committee has also
expressed the opinion that “all admissions to the post-graduate
courses in any institution should be open to candidates on an
all-India basis and there should be no restriction regarding
domicile in the State/Union Territory in which the institution is
located”. So also in the policy statement filed by the learned
Attorney General, the Government of India has categorically
expressed the view that:
“So far as admission to the institutions of postgraduate
colleges and special professional colleges
is concerned, it should be entirely on the basis of
all-India merit subject to constitutional
reservations in favour of Scheduled Castes and
Scheduled Tribes.”
We are therefore of the view that so far as admissions to
post-graduate courses, such as MS, MD and the like are
concerned, it would be eminently desirable not to provide for
any reservation based on residence requirement within the State
or on institutional preference. But, having regard to broader
considerations of equality of opportunity and institutional
continuity in education which has its own importance and
value, we would direct that though residence requirement
within the State shall not be a ground for reservation in
admissions to post-graduate courses, a certain percentage of
seats may in the present circumstances, be reserved on the basis
of institutional preference in the sense that a student who has
passed MBBS course from a medical college or university, may
be given preference for admission to the post-graduate course in
the same medical college or university but such reservation on
the basis of institutional preference should not in any event
exceed 50 per cent of the total number of open seats available
for admission to the post-graduate course…..”
11
13. In Vishal Goyal (supra) the challenge was to the validity of Clause 2.1
of the Information Bulletin for PGET-2014. The eligibility conditions as
laid down in said Clause 2.1 are identical to those stipulated in the present
clause, namely, Clause 4.1 of PGET-2018. Paragraphs 4, 10 to 13 and 15 of
the decision in Vishal Goyal (supra) were as under:
“4. The said Clause 2.1 of the two Information Bulletins, which
is identically worded for admissions to postgraduate medical
and postgraduate dental courses, is extracted hereinbelow:
“2.1. No candidate shall be admitted to a professional
educational institution unless the candidate possesses the
following qualifications or eligibility to appear for the
entrance test namely:
(a) He is a citizen of India who is of Karnataka
origin and has studied MBBS/BDS degree in a
medical/dental college situated in Karnataka or
outside Karnataka, and affiliated to any university
established by law in India recognised by Medical
Council of India and the Government of India.
Explanation.—‘A candidate of Karnataka Origin’
means a candidate found eligible under clause (i)
or (ii) below, namely:
(i) A candidate who has studied and passed in
one or more government recognised educational
institutions located in the State of Karnataka for a
minimum period of TEN academic years as on the
last date fixed for the submission of application
form, commencing from 1st standard to
MBBS/BDS and must have appeared and passed
either SSLC/10th standard or 2nd PUC/12th
12
standard examination from Karnataka State. In
case of the candidate who has taken more than one
year to pass a class or standard, the years of
academic study is counted as one year only.
Documents to be produced, namely:
(1) SSLC or 10th standard marks card.
(2) 2nd PUC or 12th standard marks card of the
candidate.
(3) Candidates Study Certificate: A study certificate
from the Head of educational institution where he or
she had studied. Further, School Study Certificates
should be countersigned by the Block Education
Officer (BEO)/Deputy Director of Public
Instructions (DDPI) concerned COMPULSORILY
in the proforma prescribed.
(4) Qualifying degree certificate and all phases
marks card.
(5) Domicile certificate issued by the Tahsildar in
the prescribed proforma (Annexure I); and if
claiming reservation benefits: Caste/Caste Income
Certificate issued by Tahsildar concerned, for SC/ST
in Form D, Category 1 in Form E and 2-A, 2-B, 3-A
and 3-B in Form F.
(6) MCI/DCI State Council Registration Certificate.
(7) Attempt Certificate issued by the college
Principal concerned.
(ii) The candidate should have studied and
passed 1st and 2nd years Pre-University
Examination or 11th and 12th standard
examination within the State of Karnataka from an
educational institution run or recognised by the
State Government or MBBS/BDS from a
professional educational institution located in
Karnataka and that either of the parents should
13
have studied in Karnataka for a minimum period of
10 years.
Documents to be produced, namely:
(1) SSLC or 10th standard marks card.
(2) 2nd PUC or 12th standard marks card of the
candidate.
(3) Qualifying degree certificate and all phases
marks card.
(4) Domicile certificate issued by the Tahsildar in
the prescribed proforma (Annexure I).
(5) If claiming reservation benefits: Caste/Caste
Income Certificate issued by Tahsildar concerned,
for SC/ST in Form D, Category 1 in Form E and 2-
A, 2-B, 3-A and 3-B in Form F; and
(6) (a) A study certificate for either of the parent
having studied for at least 10 years in Karnataka
from the Head of the educational institution where
he/she had studied. Further, school study certificates
should be countersigned by the Block Educational
Officer (BEO)/Deputy Director of Public
Instructions (DDPI) concerned COMPULSORILY
in the proforma prescribed (Annexure III).
(b) The candidates study certificate for
having studied both 1st and 2nd PUC or 11th and
12th standard in Karnataka issued by the Head of
the educational institution.
(7) MCI/DCI State Council Registration Certificate.
(8) Attempt Certificate issued by the college Principal
concerned.”
 …………
10. We have considered the submissions of the learned counsel
for the parties and we find that the basis of the judgment of this
14
Court in Pradeep Jain case is Article 14 of the Constitution
which guarantees to every person equality before the law and
equal protection of the laws. As explained by this Court in paras
12 and 13 of the judgment in Nikhil Himthani v. State of
Uttarakhand: (SCC pp. 244-45)
“12. Article 14 of the Constitution guarantees to
every person equality before law and equal
protection of laws. In Jagadish Saran v. Union of
India, Krishna Iyer, J., writing the judgment on
behalf of the three Judges referring to Article 14 of
the Constitution held that equality of opportunity
for every person in the country is the constitutional
guarantee and therefore merit must be the test for
selecting candidates, particularly in the higher
levels of education like postgraduate medical
courses, such as MD. In the language of Krishna
Iyer, J.: (SCC pp. 778-79, para 23)
‘23. Flowing from the same stream of equalism is
another limitation. The basic medical needs of a
region or the preferential push justified for a
handicapped group cannot prevail in the same
measure all the highest scales of speciality where
the best skill or talent, must be handpicked by
selecting according to capability. At the level of
PhD, MD, or levels of higher proficiency, where
international measure of talent is made, where
losing one great scientist or technologist in-themaking
is a national loss, the considerations we
have expanded upon a important lose their
potency. Here equality, measured by matching
excellence, has more meaning and cannot be
diluted much without grave risk.’
13. Relying on the aforesaid reasons in Jagadish
Saran v. Union of India, a three-Judge Bench of
this Court in Pradeep Jain case held that
excellence cannot be compromised by any other
15
consideration for the purpose of admission to
postgraduate medical courses such as MD/MS and
the like because that would be detrimental to the
interests of the nation and therefore reservation
based on residential requirement in the State will
affect the right to equality of opportunity under
Article 14 of the Constitution….”
In Magan Mehrotra v. Union of India and Saurabh
Chaudri v. Union of India also, this Court has approved the
aforesaid view in Pradeep Jain case that excellence cannot be
compromised by any other consideration for the purpose of
admission to postgraduate medical courses such as MD/MS and
the like because that would be detrimental to the interests of the
nation and will affect the right to equality of opportunity under
Article 14 of the Constitution.
 11. Mr Mariarputham is right that in Saurabh Chaudri v.
Union of India this Court has held that institutional preference
can be given by a State, but in the aforesaid decision of
Saurabh Chaudri, it has also been held that decision of the
State to give institutional preference can be invalidated by the
court in the event it is shown that the decision of the State is
ultra vires the right to equality under Article 14 of the
Constitution. When we examine sub-clause (a) of Clause 2.1 of
the two Information Bulletins, we find that the expression “A
candidate of Karnataka origin” who only is eligible to appear
for entrance test has been so defined as to exclude a candidate
who has studied MBBS or BDS in an institution in the State of
Karnataka but who does not satisfy the other requirements of
sub-clause (a) of Clause 2.1 of the Information Bulletin for
PGET-2014. Thus, the institutional preference sought to be
given by sub-clause (a) of Clause 2.1 of the Information
Bulletin for PGET-2014 is clearly contrary to the judgment of
this Court in Pradeep Jain case.
12. To quote from para 22 of the judgment in Pradeep Jain
case: (SCC p. 693)
16
“22. … a certain percentage of seats may in the
present circumstances, be reserved on the basis of
institutional preference in the sense that a student
who has passed MBBS course from a medical
college or university, may be given preference for
admission to the postgraduate course in the same
medical college or university….”
13. Sub-clause (a) of Clause 2.1 of the two Information
Bulletins does not actually give institutional preference to
students who have passed MBBS or BDS from colleges or
universities in the State of Karnataka, but makes some of them
ineligible to take the entrance test for admission to postgraduate
medical or dental courses in the State of Karnataka to which the
Information Bulletins apply.
…………
15. In the result, we allow the writ petitions, declare sub-clause
(a) of Clause 2.1 of the two Information Bulletins for
postgraduate medical and dental courses for PGET-2014 as
ultra vires Article 14 of the Constitution and null and void. The
respondent will now publish fresh Information Bulletins and do
the admissions to the postgraduate medical and dental courses
in the government colleges as well as the State quota of the
private colleges in accordance with the law by the end of June
2014 on the basis of the results of the entrance test already held.
We also order that the general time schedule for counselling and
admissions to postgraduate medical courses in our order dated
14-3-2014 in Fraz Naseem v. Union of India12 will not apply to
such admissions in the State of Karnataka for the academic year
2014-2015. Similarly, the general time schedule for counselling
and admissions for postgraduate dental courses will not apply to
such admissions in the State of Karnataka. The parties shall
bear their own costs.”
12 (2014) 11 SCC 453
17
14. Paragraphs 13 and 15 of the Judgment of this Court in Vishal Goyal
(supra) are clear that the Information Bulletin for PGET-2014 did not
actually give institutional preference to students who had passed
MBBS/BDS from Colleges or universities in State of Karnataka but made
some of them ineligible to take the entrance test for admission to PostGraduate
Medical or Dental Course in State of Karnataka and that said
clause was held ultra vires Article 14 of the Constitution and declared null
and void. The relevant clause under consideration, namely, Clause 4.1 of the
Information Bulletin for PGET-2018 is identical in substance to the one that
was considered in Vishal Goyal (supra). The matter is thus no longer resintegra
and is completely covered by the decision in Vishal Goyal (supra).
In the circumstances, we respectfully follow the decision of this Court in
Vishal Goyal (supra) and hold Clause 4.1 of the Information Bulletin
(PGET-2018) which was published on the website on 10.03.2018 to be
invalid to the extent it disqualifies petitioners and similarly situated
candidates who completed their MBBS/BDS Degree Courses from colleges
situated in Karnataka from competing for admission to Post-Graduate
Medical/Dental Courses in Government Medical Colleges and against
government quota seats in non-governmental institutions 
18
15. This writ petition stands allowed in the aforesaid terms. State of
Karnataka and Respondent Nos.2 and 3 are directed to suitably modify and
amend the Information Bulletin in question in keeping with the observations
made in this Judgment and re-publish the Calendar of Events in terms of
this Judgment and complete the entire process within the timeline stipulated
by the concerned regulatory authorities.
...…..…………….J.
 (Arun Mishra)
...……….……….J.
(Uday Umesh Lalit)
New Delhi
April 4, 2018

Karnataka Public Service Commission ("KPSC") pursuant to Notification dated 3.11.2011 for filling up 362 posts of the Group 'A' and Group 'D' in the State of Karnataka - There were complaints of mal-practices and irregularities in the conduct of examinations as well as the interviews. It was inter alia alleged that there were demands of bribes from candidates. - If the High Court finds that the written examination is free from any blemish, the High Court may consider restoration of the result of the written examination and further selection process to be conducted. It will also be open to the High Court to direct re-evaluation of scripts of all the candidates or to sustain the cancellation of result of the written examination so that fresh selection can be held. We do not express any opinion on merits of the rival contentions which will be open to be gone into by the High Court. The High Court may take a decision in the matter at the earliest preferably within a period of three months from the date the High Court is moved.

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOs. 3543-3555 OF 2018
(Arising out of S.L.P.(C) Nos. 7166-7178 of 2018)
AVINASH C. & ORS. APPELLANT(S)
 VERSUS
STATE OF KARNATAKA & ORS. RESPONDENT(S)
O R D E R
1. We have heard learned counsel for the parties
who have entered appearance. Having regard to the
nature of the order proposed, we do not consider it
necessary to issue notice to all the parties who are
not represented.
2. The matter arises out of Selection conducted by
the Karnataka Public Service Commission ("KPSC")
pursuant to Notification dated 3.11.2011 for filling up
362 posts of the Group 'A' and Group 'D' in the State
of Karnataka. Examinations were conducted on
22.04.2012. Written tests for mains were conducted
between 15.12.2012 and 16.01.2013. Interviews were
held between 01-04-2013 and 27.05.2013.
3. There were complaints of mal-practices and
irregularities in the conduct of examinations as well
as the interviews. It was inter alia alleged that there
were demands of bribes from candidates. The FIR was
2
lodged against Chairman, Member and some officials of
the KPSC. On receipt of the interim report of CID
dated 10th September, 2013, the State Government on 15th
December,2013 directed annulment of evaluation of
written examination as well as the personality test.
The KPSC however, published the select list. The State
Government withdrew the requisition for appointments on
14.08.2014.
4. The above order was challenged by the successful
candidates before the Karnataka Administrative
Tribunal. The Tribunal vide order dated 19th October,
2016 quashed the decision of the State Government and
directed appointment of the selected candidates. Some
selected candidates have been given appointments.
5. The order of the Tribunal was challenged before
the High Court. The High Court by the impugned order
set aside the order of the Tribunal. The High Court
concluded thus:
"55. Resultantly, these writ petitions
eminently deserve to be allowed and
accordingly:
a) Writ Petition Nos. 13617-13627/2017 &
14529/2017 and Writ Petition No. 11342/2017
are allowed;
b) Common order dated 19.10.2016 passed by
the Karnataka State Administrative
Tribunal, Bangalore, in Applications No.
6268/2014 to 6395/2014 c/w 6432/2014 to
6444/2014, 6446/2014 to 6459/2014,
6597/2014 & 6598/2014, 7464/2014, 7941/2014
to 7946/2014, 7950/2014 to 7966/2014,
7967/2014, 7968/2014, 7969/2014, 9112/2014
to 9126/2014, 9592/2014 to 9610/2014 and
3
8298/2015, is quashed.
c) Un-Official Note, Un-Official Note No.
139 CASu 139 SaLoSa 2016 dated 17.3.2017,
issued by Deputy Secretary, DPAR Services,
Government of Karnataka, is quashed;
d) Official Memorandum, Official
Memorandum No. 19457 DMA 32 KaMAS 2016-17
dated 27.03.2017, issued by Director,
Municipal Administration, Bengaluru, is
quashed;
e) All orders of appointment/s issued
pursuant to Final Select List dated
21.03.2014 prepared by KPSC are declared
illegal and shall stand quashed; and
f) Government Order, Government Order No.
CaaSuE 53 SaLoSa 2014, Bangalore dated
14.8.2014, withdrawing requisitions issued
to KPSC for selection of Gazetted
Probationers for 2011, and to close
selection process, is sustained."
6. The High Court observed that appointment of
ineligible, inefficient or persons of questionable
integrity has serious adverse impact on the working of
the Government and is anathema to the rule of law.
Best selection to Government service was the mandate of
the Constitution. No right accrued to candidates merely
by being in the select list. Thus, the Tribunal was in
error in directing appointment of persons validity of
whose selection was seriously doubted by the
Government.
7. We find that the High Court has referred to
material on record in the form of call details between
candidates and members of the KPSC. All the members who
interviewed the candidates awarded exactly the same
4
marks to particular candidates. There was no objective
assessment by individual members. There appeared to be
extraneous reasons in awarding the marks. 566
candidates were awarded same marks which appeared to be
pre-determined. Digital video recorder in the KPSC
building was replaced to destroy evidence. In this
view of the matter, we do not find any ground to
interfere with the view of the High Court that the
selection could not have been sustained. If the
selection is found to be tainted in any manner, it is
always open to the concerned authority to annul such
selection to maintain purity of the selection process.
It may not always be necessary to segregate tainted and
untainted candidates when the process itself is
tainted. Moreover, at pre-appointment stage, decision
to cancel the selection process can be interfered only
if it is patently arbitrary, malafide or illegal. In
the present case, the High Court has rightly applied
these parameters and found no case for interference
with the decision to annul the selection.
8. Learned counsel for some of the parties
submitted that the written examination is not vitiated
by any irregularity and the same can be sustained.
Interviews can be held again.
9. Since this contention does not appear to have
been raised before the High Court we permit this
contention to be now raised by either of the parties by
5
moving the High Court within two weeks from today. If
such an application is moved, the High Court may
examine the same on merits. If the High Court finds
that the written examination is free from any blemish,
the High Court may consider restoration of the result
of the written examination and further selection
process to be conducted. It will also be open to the
High Court to direct re-evaluation of scripts of all
the candidates or to sustain the cancellation of result
of the written examination so that fresh selection can
be held. We do not express any opinion on merits of
the rival contentions which will be open to be gone
into by the High Court. The High Court may take a
decision in the matter at the earliest preferably
within a period of three months from the date the High
Court is moved.
The appeals are disposed of in the aforesaid
terms.
…...…................J.
(ADARSH KUMAR GOEL)
...….…................J.
(ROHINTON FALI NARIMAN)
NEW DELHI,
APRIL 4, 2018