Medical education – Closure/De-recognition of private medical college – Relocation of students – Liability for fees – Equitable apportionment – Interim directions under Art. 142 – Liability of defaulting institution – Rights of transferee colleges and students.

 APEX COURT HELD THAT 

EDUCATION LAW – Medical education – Closure/De-recognition of private medical college – Relocation of students – Liability for fees – Equitable apportionment – Interim directions under Art. 142 – Liability of defaulting institution – Rights of transferee colleges and students.

Students admitted to private medical college (SRMCH) for MBBS course during academic sessions 2013-2014 and 2014-2015 – MCI/NMC inspections revealed serious deficiencies in infrastructure, faculty and regulatory compliance leading to denial of renewal of recognition – Students relocated by judicial orders to recognised private medical colleges to save academic careers – Interim directions of Supreme Court permitted continuation of studies on payment of Government-rate fees – Transferee colleges sought reimbursement of differential fees and stipend amounts – Selvam Trust contended that liability could not be fastened without adjudication of deficiencies – Determination of liability.

Held : Present controversy confined not to legality of relocation but to fair and equitable apportionment of financial liabilities arising from extraordinary judicial intervention undertaken to protect academic interests of students. Since no material existed to show availability of Government quota seats in transferee colleges, all relocated students were deemed to have been accommodated against private/management quota seats and fee structure applicable to such seats governed determination of liability.

Students had consciously taken admission in private medical institution having substantially higher fee structure than Government colleges. Benefit of Government-rate fees granted pursuant to interim orders of Supreme Court was only emergent and temporary arrangement devised to protect students from losing academic years owing to deficiencies of institution. Such interim arrangement could not confer permanent financial windfall upon students.

Deficiencies found by MCI/NMC in infrastructure and faculty of SRMCH stood substantially affirmed upon dismissal of writ petition filed by institution challenging denial of renewal. Defaulting institution could not be permitted to derive benefit from its own wrong. Applying maxim Commodum ex injuria sua nemo habere debet, primary liability for financial consequences arising from relocation was fastened upon Selvam Trust/SRMCH.

Amounts secured by bank guarantees furnished by Selvam Trust with MCI/NMC and deposits made before Supreme Court together with accrued interest directed to be disbursed equally amongst transferee colleges. Students held liable to pay remaining outstanding fees at rates chargeable by SRMCH and not merely Government-rate fees. Transferee colleges permitted to approach NMC for recovery of remaining shortfall from passed-out students after adjusting amounts already paid by them to SRMCH.

Court clarified that observations in judgment would not prejudice independent claims or defences of Selvam Trust in appropriate proceedings.

(Paras 24 to 54)

HELD

Interim directions issued under Article 142 permitting students to continue MBBS course at Government-rate fees were emergent measures intended to preserve academic continuity and could not result in unjust enrichment of students admitted to private medical institution. (Paras 29 to 36)

Where relocated students were accommodated in private medical colleges against management/private quota seats, applicable fee structure of such category governed determination of liabilities. (Paras 25 and 26)

Defaulting institution whose deficiencies resulted in denial of renewal of recognition could not avoid primary liability for financial consequences arising from relocation of students. (Paras 37 to 42)

Students who completed medical course pursuant to protective interim orders of Supreme Court could not claim permanent benefit of highly subsidised Government-rate fees when they had originally contracted for admission in private medical college. (Paras 48 to 52)

Bank guarantee amount furnished by Selvam Trust and deposits made before Supreme Court directed to be released and distributed equally amongst transferee colleges towards reimbursement of fees. (Paras 44 to 47)

RESULT

Amounts covered by bank guarantees furnished by Selvam Trust with MCI/NMC and deposits made before Supreme Court with accrued interest directed to be distributed equally amongst three transferee colleges. Transferee colleges permitted to seek recovery of remaining fee shortfall from students through NMC mechanism after appropriate adjustments. Appeals closed.

EVIDENCE ACT, 1872 – Ss. 145, 157 & 159 – Appreciation of evidence – Hostile witness – Evidentiary value – Interested witness – Scope of reliance – CRIMINAL TRIAL – Benefit of doubt – Contradictions in medical evidence – Failure to prove genesis and occurrence of offence – Acquittal.

 

APEX COURT HELD THAT 

EVIDENCE ACT, 1872 – Ss. 145, 157 & 159 – Appreciation of evidence – Hostile witness – Evidentiary value – Interested witness – Scope of reliance – CRIMINAL TRIAL – Benefit of doubt – Contradictions in medical evidence – Failure to prove genesis and occurrence of offence – Acquittal.

Appellant convicted under Ss.302 and 323 IPC and Ss.3(2)(v) & 3(1)(x) of Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989 on allegation that he assaulted deceased with stone owing to earlier incident of deceased eloping with appellant’s sister – Prosecution case rested mainly on testimony of mother of deceased (PW1) and accompanying witness (PW3) – PW3 turned hostile and denied material part of prosecution story including informing PW1 about incident – Other witnesses also turned hostile regarding alleged Panchayat said to be genesis of dispute – Medical evidence contained serious discrepancies regarding date and time of postmortem and cause of death – Independent witnesses from busy public road not examined – Conviction confirmed by High Court – Sustainability.

Held : Conviction unsustainable. Though evidence of hostile witness is not effaced from record and can be relied upon to extent found dependable, same principle equally permits use of hostile testimony to discredit prosecution case and support acquittal where such testimony inspires credibility when read with remaining evidence. In present case, testimony of hostile witness PW3 demolished foundational prosecution story relating to occurrence of incident and informing PW1. Evidence of PW4 and PW5 further destroyed prosecution version regarding Panchayat and motive for offence.

Evidence of interested witness, though not liable to mechanical rejection, requires careful scrutiny. Where testimony of such witness suffers from contradictions and remains unsupported by reliable corroboration, Court must exercise heightened caution. Sole testimony of PW1, mother of deceased, could not be safely relied upon in view of material inconsistencies and hostile evidence of other witnesses.

Medical evidence also rendered unreliable owing to irreconcilable discrepancies in postmortem report regarding date and timing of autopsy and unexplained contradictions in medical records. Postmortem report by itself is not substantive evidence and requires credible corroboration through testimony of medical expert. In absence of satisfactory explanation by doctor, evidentiary value of medical evidence stood seriously diminished.

Where alleged incident occurred on busy public road with constant vehicular movement and yet prosecution failed to examine any independent witness, prosecution story became doubtful. Genesis and motive of crime not proved. Prosecution failed to establish occurrence beyond reasonable doubt. Concurrent findings of Trial Court and High Court held perverse and liable to be set aside.

Masalti v. State of U.P., AIR 1965 SC 202; Bhaskarrao v. State of Maharashtra, (2018) 6 SCC 591; Khujji v. State of M.P., (1991) 3 SCC 627; Koli Lakhmanbhai Chanabhai v. State of Gujarat, (1999) 8 SCC 624; Bhagwan Singh v. State of Haryana, (1976) 1 SCC 389; Himanshu v. State (NCT of Delhi), (2011) 2 SCC 36; Ghulam Hassan Beigh v. Mohammad Maqbool Magrey, (2022) 12 SCC 657, relied on.

(Paras 5 to 10.4)

HELD

Postmortem report is not substantive evidence by itself and can only corroborate testimony of medical expert. Where medical witness fails to explain material discrepancies in postmortem report, evidentiary value of medical evidence stands seriously impaired. (Paras 6 and 6.1)

Evidence of hostile witness is admissible and may be relied upon not only for sustaining conviction but also for discrediting prosecution case and supporting acquittal where testimony appears credible and is corroborated by surrounding circumstances. (Paras 8.3 to 9)

Evidence of related or interested witness requires cautious scrutiny, particularly where testimony suffers from contradictions and lacks corroboration from independent evidence. (Paras 7.4 to 8.2)

Failure of prosecution to examine independent witnesses despite alleged occurrence taking place on busy public road and contradictions in prosecution evidence rendered very occurrence of incident doubtful. (Paras 7.1 to 7.3 and 10)

Concurrent findings of conviction based on weak, contradictory and unreliable evidence liable to be interfered with by Supreme Court. (Paras 10 to 10.4)

RESULT

Appeal allowed. Judgments of Trial Court and High Court set aside. Appellant acquitted of all charges under IPC and SC/ST Act and directed to be released forthwith unless required in any other case.

BHARATIYA NAGARIK SURAKSHA SANHITA, 2023 – Ss. 473 & 477 – Remission/Premature release – Life convict – CBI investigated case – Requirement of concurrence of Central Government – Non-speaking order rejecting remission – Validity – Reformative theory of punishment – Heinousness of offence – Scope of judicial review.

 

APEX COURT HELD THAT 

CONSTITUTION OF INDIA – Arts. 72 & 161 – BHARATIYA NAGARIK SURAKSHA SANHITA, 2023 – Ss. 473 & 477 – Remission/Premature release – Life convict – CBI investigated case – Requirement of concurrence of Central Government – Non-speaking order rejecting remission – Validity – Reformative theory of punishment – Heinousness of offence – Scope of judicial review.

Petitioner convicted for offences under Ss.120-B/302 IPC in murder case investigated by CBI and sentenced to life imprisonment – Petitioner underwent more than twenty-two years of incarceration – State of Uttarakhand recommended premature release/remission – Ministry of Home Affairs rejected proposal by cryptic communication merely stating non-concurrence without assigning reasons – Co-accused in same case already granted premature release by State of Uttar Pradesh – Validity of rejection order.

Held : Any order affecting personal liberty, particularly rejection of remission or premature release, must be supported by cogent reasons and must disclose due application of mind. Recording of reasons is safeguard against arbitrariness and integral facet of fairness, transparency and accountability in administrative decision-making. Mere statement that competent authority “does not concur” with proposal for remission, without disclosure of reasons, renders order ex facie non-speaking and unsustainable in law. Such cryptic rejection violates principles of natural justice and frustrates effective judicial review.

Executive discretion in matters of remission, though broad, is not uncanalised and must be exercised on relevant, rational and non-discriminatory considerations. Heinousness or gravity of offence cannot, by itself, constitute sole ground for denial of remission, since such factors stand exhausted at stage of sentencing itself. Remission is distinct executive function concerned with prisoner’s conduct, reformation and prospects of reintegration into society. Criminal justice system founded on reformative theory cannot permanently incarcerate individual solely in shadow of past crime.

Where prisoner had undergone more than twenty-two years of incarceration, exhibited good conduct in prison, received favourable recommendation from State Government and co-accused in same case had already been prematurely released, denial of similar benefit without cogent distinguishing reasons was arbitrary and violative of constitutional fairness.

Court further observed that conflicting judicial opinions within same High Court create uncertainty and emphasized corresponding duties of Bar and Bench to maintain consistency in precedent and avoid per incuriam decisions.

Laxman Naskar v. State of W.B., (2000) 7 SCC 626; State (NCT of Delhi) v. Prem Raj, (2003) 7 SCC 121; Satish v. State of U.P., (2021) 14 SCC 580; Mohd. Giasuddin v. State of A.P., (1977) 3 SCC 287, relied on.
Radheshyam Bhagwandas Shah v. State of Gujarat, (2022) 8 SCC 552, held per incuriam in view of Bilkis Yakub Rasool v. Union of India, (2024) 5 SCC 481.

(Paras 5 to 10)

HELD

Order rejecting remission or premature release must contain reasons and reflect application of mind; absence of reasons renders order arbitrary and violative of principles of natural justice. (Paras 5 to 5.4)

Power of remission is executive in character and distinct from judicial sentencing. Remission reduces period of incarceration without altering conviction or sentence imposed by Court. (Paras 6 to 6.4)

Gravity or heinousness of offence cannot be sole ground to deny remission, as reformative theory underlying modern penology requires assessment of prisoner’s conduct, rehabilitation and prospects of reintegration into society. (Paras 7 to 7.3)

Where State Government recommended premature release, prisoner had undergone more than twenty-two years of incarceration with good conduct and co-accused had already obtained remission, denial of parity without rational distinguishing basis was arbitrary. (Paras 8 to 8.4)

RESULT

Impugned letter dated 09.07.2025 issued by Ministry of Home Affairs rejecting premature release/remission quashed. Petitioner held entitled to benefit of premature release/remission. Since petitioner already on interim bail, surrender dispensed with and respondents directed to treat petitioner as prematurely released/remitted. Writ Petition allowed

MOTOR VEHICLES ACT, 1988 – Ss. 146, 147, 166 and 168 – Compensation – Medical expenses – Mediclaim policy – Deduction of Mediclaim reimbursement from MACT compensation – Permissibility – Distinction between statutory and contractual benefits – “Double benefit” principle – Scope.

  

MOTOR VEHICLES ACT, 1988 – Ss. 146, 147, 166 and 168 – Compensation – Medical expenses – Mediclaim policy – Deduction of Mediclaim reimbursement from MACT compensation – Permissibility – Distinction between statutory and contractual benefits – “Double benefit” principle – Scope.

Claimants injured in motor vehicle accident received reimbursement of medical expenses under Mediclaim policy and also claimed compensation under Motor Vehicles Act before Motor Accident Claims Tribunal – Conflict of judicial opinion among various High Courts as to whether Mediclaim amount is deductible from compensation awarded under head of medical expenses – Reference considered.

Held : Amount received under Mediclaim/medical insurance policy is not deductible from compensation awarded under Motor Vehicles Act even where compensation includes medical expenses. Mediclaim policy is contractual in nature and benefit flowing therefrom is consequence of premiums paid by insured over period of time. Compensation under Motor Vehicles Act, on other hand, is statutory entitlement arising from wrongful act causing accident and is governed by principle of just compensation.

Principle against “double benefit” applies only where two payments compensate same loss from same source or within same legal sphere. Benefits which are independent in nature and arise from separate contractual or statutory foundations are not liable to deduction. Mediclaim reimbursement cannot be treated as windfall or unjust enrichment since claimant receives such amount only because of prior contribution by payment of premiums.

If Mediclaim amount were deducted from MACT compensation, it would unjustly benefit insurer of offending vehicle and simultaneously deprive claimant of fruits of prudence and financial planning. Mediclaim and compensation under MVA operate in distinct domains; one arises from private contract while other flows from beneficial legislation enacted for protection of motor accident victims.

Benefits such as provident fund, gratuity, pension and insurance proceeds which accrue independently of accident are not deductible from compensation under Motor Vehicles Act. Same principle applies to Mediclaim reimbursement.

Helen C. Rebello v. Maharashtra SRTC, (1999) 1 SCC 90; United India Insurance Co. Ltd. v. Patricia Jean Mahajan, (2002) 6 SCC 281; Sebastiani Lakra v. National Insurance Co. Ltd., (2019) 17 SCC 465, followed.
Reliance General Insurance Co. Ltd. v. Shashi Sharma, (2016) 9 SCC 627, distinguished.

(Paras 7 to 15)

HELD

Compensation under Motor Vehicles Act is statutory in nature whereas Mediclaim reimbursement flows from contractual obligation arising out of payment of premiums by insured. These benefits occupy separate legal fields and one cannot be deducted from the other. (Paras 7.3.1 to 7.3.3 and 15)

Doctrine against double benefit applies only where same loss is compensated twice from same source or within same sphere. Independent contractual entitlements cannot be adjusted against statutory compensation payable under beneficial legislation. (Paras 7.1 and 7.2)

Mediclaim reimbursement is result of claimant having paid premiums over years and cannot be treated as pecuniary advantage flowing from accident itself. Deduction thereof would unjustly enrich insurer of offending vehicle. (Paras 9 to 11)

Courts and counsel are duty-bound to ensure consistency in precedents and avoid conflicting judicial opinions, particularly where divergent views exist within same High Court. (Paras 12 to 14)

RESULT

Appeal dismissed. Held that Mediclaim/medical insurance amount is not deductible from compensation awarded under Motor Vehicles Act. Matter remanded to High Court for determination in accordance with law declared by Supreme Court.

CENTRAL SALES TAX ACT, 1956 – Ss. 3, 4, 9, 14 and 15 – U.P. VALUE ADDED TAX ACT, 2008 – Inter-State sale – Natural gas – Production Sharing Contract (PSC) – Gas Sales and Purchase Agreement (GSPA) – Situs of sale – Legislative competence – Fiscal federalism – State taxation – Levy of VAT by State of U.P. – Validity.

 APEX COURT HELD THAT 

CONSTITUTION OF INDIA – Arts. 245, 246, 248, 265, 269, 286 – Seventh Schedule, List I Entry 92-A and List II Entry 54 – CENTRAL SALES TAX ACT, 1956 – Ss. 3, 4, 9, 14 and 15 – U.P. VALUE ADDED TAX ACT, 2008 – Inter-State sale – Natural gas – Production Sharing Contract (PSC) – Gas Sales and Purchase Agreement (GSPA) – Situs of sale – Legislative competence – Fiscal federalism – State taxation – Levy of VAT by State of U.P. – Validity.

Respondent-company extracted natural gas from KG-D6 Basin situated off coast of Andhra Pradesh under Production Sharing Contract entered with Union of India pursuant to New Exploration and Licensing Policy – Gas supplied to buyers under Gas Sales and Purchase Agreements – Delivery point fixed at Gadimoga, Andhra Pradesh – Gas thereafter transported through pipelines to various States including Uttar Pradesh – State of U.P. levied VAT treating transaction as intra-State sale on ground that gas being fungible and unascertained goods became ascertainable only upon delivery at buyers’ plants in Uttar Pradesh – High Court quashed assessment holding transaction to be inter-State sale – Validity.

Held : Constitutional scheme relating to fiscal federalism maintains strict demarcation between taxing powers of Union and States and overlapping taxation is constitutionally impermissible. Article 269 read with Entry 92-A of Union List confers exclusive legislative competence upon Parliament in respect of taxes on sale or purchase of goods in course of inter-State trade and commerce. Once transaction falls within ambit of Section 3 of Central Sales Tax Act, State Legislature lacks competence to levy VAT under Entry 54 of State List.

Inter-State sale under Section 3(a) CST Act is established where movement of goods from one State to another is occasioned by covenant or incident of contract of sale. In present case, GSPA specifically provided for delivery of gas at Gadimoga, Andhra Pradesh and transportation thereafter pursuant to agreements entered by buyers with transporters. Movement of gas from Andhra Pradesh to Uttar Pradesh was integral consequence of contract of sale and therefore transaction constituted inter-State sale.

Co-mingling of natural gas during transportation or minor variation in quantity does not alter inter-State character of transaction. Subsequent processing or re-metering at Auraiya, Uttar Pradesh was legally irrelevant since transfer of title, possession and risk had already occurred at delivery point in Andhra Pradesh. State of Uttar Pradesh could not disregard genuine contractual arrangements under GSPA and GTA in absence of any finding that agreements were sham transactions.

Constitutional provisions relating to taxation are to be construed in manner preserving exclusivity of legislative fields and preventing multiple taxation. Stability and certainty in fiscal regime are essential in matters involving international consortiums and foreign investment.

State of Bombay v. United Motors (India) Ltd., (1953) 1 SCC 514; Bengal Immunity Co. Ltd. v. State of Bihar, (1955) 1 SCC 763; Hoechst Pharmaceuticals Ltd. v. State of Bihar, (1983) 4 SCC 45; Synthetics and Chemicals Ltd. v. State of U.P., (1990) 1 SCC 109; Jindal Stainless Ltd. v. State of Haryana, (2017) 12 SCC 1, referred to.

(Paras 1, 24 to 54 and findings of High Court approved)

HELD

Taxation powers under Constitution are mutually exclusive and any construction resulting in overlapping of taxing jurisdictions must be avoided. (Paras 26 to 37)

Article 265 mandates that levy and collection of tax must be supported by legislative competence and authority of law. (Paras 44 to 46)

Article 269 and Section 3 CST Act govern inter-State sales and once movement of goods from one State to another is occasioned by contract of sale, State VAT legislation cannot be invoked. (Paras 47 to 54)

Where natural gas was delivered at Gadimoga in Andhra Pradesh and movement to Uttar Pradesh occurred pursuant to pre-existing contractual obligations under GSPA and GTA, transaction constituted inter-State sale not amenable to levy of VAT by State of U.P.

RESULT

Appeals against judgment of High Court dismissed. Assessment orders levying VAT by State of Uttar Pradesh on transactions relating to supply of natural gas held unsustainable.