Allowed

Laxmi Megan Speciality Health Care Private Limited v. the State of Kerala

Kerala HC7 Sept 2021WP(C)/1985/2021

Case brief

AI extract

What is this about?

The High Court of Kerala set aside an order rejecting a petitioner's application for an Essentiality Certificate for a Medical College. The Court held the State failed to consider relevant documents and findings were erroneous.

What did the court decide?

The impugned Ext.P10 order set aside. Direction to reconsider the application within three months or order a fresh inspection.

Laxmi Megan Speciality Health Care Private Limited Vs… — Service and Employment | Kerala HC (2021)

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WP(C) NO. 1985 OF 2021

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE RAJA VIJAYARAGHAVAN V

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TUESDAY, THE 7^TH DAY OF SEPTEMBER 2021 / 16TH BHADRA, 1943

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WP(C) NO. 1985 OF 2021

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PETITIONER/S:

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LAXMI MEGAN SPECIALITY HEALTH CARE PRIVATE LIMITED REPRESENTED BY ITS CHAIRMAN AND MANAGING DIRECTOR, DR. M.V. SASIDHARAN, KANHANGAD 671 315, KASARAGOD DISTRICT.

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BY ADVS. P.K.VIJAYAMOHANAN SMT. AISWARYA V.S.

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RESPONDENT/S:

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1 THE STATE OF KERALA REPRESENTED BY THE PRINCIPAL SECRETARY TO GOVERNMENT, HEALTH AND FAMILY WELFARE DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM 695 001.

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2 THE DIRECTOR OF MEDICAL EDUCATION, MEDICAL COLLEGE P.O. THIRUVANANTHAPURAM 695 011.

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3 THE NATIONAL MEDICAL COMMISSION, REPRESENTED BY ITS SECRETARY, MINISTRY OF HEALTH AND FAMILY WELFARE, NEW DELHI 110 011.

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4 THE KERALA UNIVERSITY OF HEALTH SCIENCES, REPRESENTED BY ITS REGISTRAR, THRISSUR 680 596.

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BY ADVS.

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SRI.TITUS MANI

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SHRI.P.SREEKUMAR, SC, KERALA UNIVERSITY OF HEALTH SCIENCES

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SRI BIJOY CHANDRAN, SR GP

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 07.09.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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JUDGMENT

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The Laxmi Megan Speciality Healthcare Pvt. Ltd., the petitioner herein, is a private limited company established with the objective of conducting Hospitals, Nursing Homes and other Medical Institutions like Medical Colleges, Teaching Hospitals etc. They have approached this Court being aggrieved by Ext.P10 order as per which, the request for essentiality certificate for setting up of a Medical College at Kanjangad, Kasaragod was rejected by the Government.

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The facts of the case, in brief, are as follows:

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The petitioner contends that they have acquired about 40 acres of land at Pullur Village by the side of NH-47 and have established a hospital with bed capacity exceeding 300 at Kanhangad. They have completed the construction of 5 stories of the proposed 9 storied Medical College building as early as in the year 2012. The proposed teaching hospital building is completed to the extent of 3 floors of the 9 storied building. The local authority has assigned Door Nos. 417 (F) to 417(M) as is evident from Ext.P1 completion certificate and Exts.P2 to P7 ownership certificates.

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After qualifying for filing an application to establish a Medical College, the petitioner had submitted a formal application for issuance of an Essentiality certificate as early as in the year 2012. An inspection was conducted by the team deputed by the 2nd respondent on 26.11.2013 and

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Ext.P8 report was issued wherein it is stated that the petitioner owned the necessary land. It was also reported that the proposed project for the establishment of a Medical College, teaching hospital and other essentialities for intake of 150 students was adequate as per the MCI norms. In Ext.P8, the inspectors had opined that there is no objection to start a new Medical College as per the MCI norms. The recommendation was forwarded to the Government by Ext.P9 communication.

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The petitioner contends that when no action was taken by the Government, the petitioner approached this Court and filed W.P.(C) No. 5951/2018. Pursuant to directions issued by this Court, the application was taken up and the same was rejected without assigning any reasons.

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Challenging the said order, the petitioner filed W.P.(C) No.11600/2018. This Court, after considering the facts and circumstances, took note of the fact that no reason was assigned by the Government while rejecting the application and that the application had not been considered on merits. By judgment dated 2.7.2018, the order rejecting the application filed by the petitioner was set aside and directions were issued to the respondent to consider the application preferred by the petitioner taking note of the documents accompanying the same.

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The petitioner contends that in terms of the directions so issued, the application was taken up and the same was rejected by order dated

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20.7.2018, essentially on the ground that while granting essentiality certificate, the Government is required to give an undertaking that due to deficiency of infrastructure, if the Central Government bans the grant of fresh admissions, the Government has the responsibility to accommodate the students in other colleges.

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The above order was challenged by the petitioner before this Court in W.P.(C) No.27152/2018. This Court, by judgment dated 8.3.2019, took the view that in view of the law laid down by the Apex Court in Thirumuruga Kirupananda Variyar Thavathiru Sundara Swamigal Medical Educational and Charitable Trust v. State of Tamil Nadu & Others ' [(1996) 3 SCC 15], and in Chintpurni Medical College and Hospital and Another v. State of Punjab and Others [AIR 2018 SC 3119], the State Government was duty-bound to take into account the relevant facts while considering an application for issuance of Essentiality certificate and the same having not been done, the order is liable to be set aside. The Government was directed to consider the application submitted by the petitioner taking into account the vital requirements that are to be undertaken under Form No.2 of the Medical Council of India Establishment of Medical College Regulations, 1999 concerning the issuance of Essentiality certificate and to take a decision within a time frame.

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In purported compliance to the directions so issued, the Government took up the application and rejected the same by Ext.P10 order.

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The above order is under challenge in this writ petition.

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According to the petitioner, an inspection was conducted by a team of Doctors and Ext.P11 report was submitted before the Government. In Ext.P11, in several columns, nothing whatsoever is entered and all that is written is ‘NA’. Under the head Cardinal deficiencies (if any), it is stated thus:

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(j) Cardinal deficiencies (if any)

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Infrastructure 70% completed. Photos attached

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Equipments Not ready

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Clinical materials (adequate) 24 hr. Lab functionalities in hospital.

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Faculty and residents (Separately)

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Academic training (Details to be attached)

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Any other matter (Detailed plan and project attached. Planning to complete the works after obtaining NOC.

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The petitioner contends that Ext.P8 inspection report and Ext.P9 recommendation clearly shows that the petitioner was operating a hospital with 300-bed capacity from 26.11.2013. Exts.P12 site plan and Ext.P13 possession certificate would reveal that the petitioner is in possession of 30.15 Acres. Ext.P11 report also reveals that insofar as the infrastructure is concerned, 70%

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have been completed and clinical materials are adequate.

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However, while passing Ext.P10 order, the 1st respondent has deliberately misread the aforesaid documents and have concluded as follows:

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The claim that 25.3 Acres is earmarked is not supported by relevant documents upon inspection, no active construction is happening in the land. Even foundation has not been laid for the Medical College.

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Equipments or human resources are not available for pre-clinical subjects.

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300 bedded hospitals present since one year only. On inspection day, only about 100 patients were present.

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Only basic equipments are available in the hospital. Facilities and equipments lacking in Central Sterile Supply Department, Blood Bank, Central Labs etc.

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Available clinical material on the day of inspection is inadequate.

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Teaching faculty were not present during inspection. Faculty position is grossly inadequate.

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In this connection, DME has reported that it will be difficult to start the proposed Medical College in the coming academic year (2021-2022) as the minimum requirements stipulated by National Medical Commission for issuing Letter of Permission are not at all fulfilled. The Medical College and Collegiate hospital attached to the College require lot of further important developments.

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The petitioner states that the findings in Ext.P10 are absolutely incorrect and even against the earlier reports. This would clearly show the total non-application of mind by the Government. It is in the afore circumstances

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that the petitioner has approached this Court seeking the following reliefs:

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i) To issue a writ of certiorari quashing Ext.P10 as there are errors apparent on the face of Ext.P10 and it infringes the constitutional guarantees under Article 14 and 19 (1)(g) of the Constitution of India;

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ii) To issue a writ of mandamus, order or other appropriate direction to the 1st respondent to issue an Essentiality Certificate to the petitioner for starting the proposed Medical College at Pullur in Kasaragod District for the Academic year 2022-2023;

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iii) To issue a direction to the 4th respondent University to issue the Consent of Affiliation to the proposed Medical College of the petitioner, after being satisfied that the required infrastructure facilities are there, on necessary inspection.

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A statement has been filed by the 1st respondent wherein it is stated that Ext.P11 report reveals serious deficiency in infrastructure, equipment, faculty etc. It is pointed out that the petitioner has not been running the hospital for a minimum of two years with all the departments mentioned in the regulations of 2020. It is further stated that when the issuance of the Essentiality certificate was recommended in 2013 as per Ext.P8, there was no other Medical College in Kasargod District. Now the Government Medical College is coming up and is awaiting approval and the Tata Trust has also set up a new hospital in Government land. Besides the Government Colleges, there are 19 self-financing Medical Colleges functioning in the State and a Deemed to be University and the total intake of students is much more than 4500 seats. It is further stated that two self-financing Medical Colleges had to stop admission when it was found that they lacked infrastructure. In the said circumstances,

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the Government had to accommodate the students in other self-financing Medical Colleges in the State as per the terms of undertaking given by the State while issuing the Essentiality certificate. In view of the above, the Government is not in a position to issue an Essentiality certificate to the petitioner, particularly when the report reveals that the infrastructure, amenities and other facilities are below the minimum requirement. It is further stated that the doctor-patient ratio in the State is equivalent to the standards of developed countries. The high rate of doctor population in the State leads to unhealthy and unethical practices. The employability of doctors passing out of ill-equipped self-financing Medical Colleges is a matter of great concern. It is further stated that it is by now settled that issuance of Essentiality certificate is not merely a ministerial job. Going by the provisions of the establishment of Medical College Regulations, 1999, Essentiality certificate from the State Government is a qualifying criteria for applying for the letter of permission from the Government of India to start a Medical College. While issuing an Essentiality certificate, a proper evaluation regarding the essentiality to establish a Medical College is to be done. It is further stated that even if the petitioner is in possession of the land as claimed by them unless the petitioner satisfies the requirements as stipulated in the 2020 Regulations, they are not entitled to the certificate as requested.

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A reply affidavit has been filed reiterating the contentions raised in the writ petition. It is further stated that the assertion in the statement that the

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petitioner hospital is not having the clinical facilities are against facts. It is stated that the 3rd and 4th floor of the hospital was taken by the District Administration for shifting the Gynecology department and Ext.P16 certificate was issued by the District Medical Officer recognizing the outstanding commitment and dedication by allowing infrastructure (OPD, IPD, Operation Theatre and ICU) for full operation of Obstetrics and Gynecology Department, District Hospital, Kanhangad, during the period from 4.10.2020 to 1.12.2020 when the District Hosptial, Kanhangad was completely converted to COVID Hospital. It is further stated that the petitioner has satisfied the requirements to apply for the establishment of the Medical College as per the Establishment of Medical College Regulations, 2020 and all that is lacking is the Essentiality Certificate from the State Government.

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I have considered the submissions advanced and have carefully gone through the records.

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The short question before this Court is as to whether Ext.P10 order passed by the Government can be sustained under law.

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The power to permit the establishment of a Medical College is conferred on the Central Government by the Medical Council of India Act. Section 10A of the MCI Act, 1956 provides for the grant of permission for the establishment of a new Medical College, a new course of study etc. It was in the exercise of the powers conferred under Section 10A read with Section 33 of

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the MCI Act that the Establishment of Medical College Regulations, 1999, was framed. The Regulations prescribe the qualifying criteria. Regulation 3 of the Regulations, 1999 provides that a person shall establish a medical college only after obtaining prior permission from the Central Government by submitting a Scheme annexed with the regulations. One of the criteria is that the person who is desirous of establishing a Medical College should obtain an Essentiality Certificate as prescribed in Form No.2 of the Regulations, certifying that the State Government/Union Territory Administration has no objection to the establishment of the proposed Medical College at the proposed site and availability of adequate clinical material. In other words, the State Government is required to certify that it has decided to issue an Essentiality Certificate for

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the establishment of a Medical College with a specified number of seats in the public interest and further that such establishment is feasible. Clause 6 of the Scheme provides that the Medical Council will evaluate the application in the first instance in terms of the desirability and prima facie feasibility of setting up the medical college at the proposed locations. Thereafter it shall assess the capability of the applicant to provide the necessary sources and infrastructure for the scheme. While evaluating the application, the Council may seek further information, clarification or additional documents from the applicant as considered necessary and shall carry out a physical inspection to verify the information supplied by the applicant.

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It would be apposite at this juncture to refer to Form-2 of the

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scheme regarding the non-objection of the State Government/ Union Territory

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Administration.

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Form-2

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Subject: Essentiality Certificate

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No.

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Government of _____

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The Department of Health,

Dated, the __

(applicant),

Sir,

The desired certificate is as follows:

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(1) No. of institutions already existing in the State.

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(2) No. of seats available or No. of doctors being produced annually

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(3) No. of doctors registered with the State Medical Council.

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(4) No. of doctors in Government Service

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(5) No. of Government posts vacant and those in rural/difficult areas.

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(6) No. of doctors registered with Employment Exchange.

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(7) Doctor population ratio in the State.

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(8) How the establishment of the college would resolve the problem of deficiencies of qualified medical personnel in the State and improve the availability of such medical manpower in the State.

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(9) The restrictions imposed by the State Government, if any, on students who are not domiciled in the State from obtaining admissions in the State be specified.

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(10) Full justification for the opening of the proposed college.

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(11) Doctor-patient ratio proposed to be achieved.

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The (Name of the person)_________has applied for establishment of a

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medical college at__________. On careful consideration of the proposal, the Government for_________has decided to issue an essentiality certificate to the applicant for the establishment of a Medical College with__________(no.) seats.

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It is certified that:

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(a) The applicant owns and manages a 300 bedded hospital which was established in _________.

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(b) It is desirable to establish a medical college in the public interest;

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(d) Adequate clinical material as per the Medical Council of India norms is available.

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It is further certified that in case the applicant fails to create infrastructure for the medical college as per MCI norms and fresh admissions are stopped by the Central Government, the State Government shall take over the responsibility of the students already admitted in the College with the permission of the Central Government.

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Yours Faithfully

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(Signature of the Competent authority )

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( emphasis supplied )

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At this juncture, for the sake of completeness, it needs to be borne

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in mind that as per the Establishment of Medical College Regulations, (Amendment), 2020, the qualifying criteria were further amended.

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20. In V.N. Public Health and Educational Trust v. State of

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Kerala [AIR 2021 SC 2673], the Apex Court while rejecting the submission that

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issuance of essentiality Certificate is a ministerial Act had occasion to observe as follows in Paragraph 19 of the Judgment.

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Whether issuance of an Essentiality Certificate is only a Ministerial Act:-

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This Essentiality Certificate in the prescribed form is crucial for avoiding cases where the colleges despite grant of initial permission could not provide the infrastructure, teaching and other facilities as 22 a result whereof the students who had already been admitted suffered serious prejudice.

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Medical Council of India Regulations as well as Kerala University Health Sciences Statutes very emphatically mandate that the consent of affiliation can only be given after the Institution fulfills the essential requirements. The contention of the Appellant that the absence of Essentiality Certificate is not one of the factors for consideration and is extraneous to the decisionmaking process cannot be accepted. Whilst granting the Essentiality Certificate, the State Government undertakes to take over the obligations of the private educational institution in the event of that institution becoming incapable of setting of the institution or imparting education therein. Such an undertaking on the part of the State Government is unequivocal and unambiguous. An Essentiality Certificate by the State Government legitimizes a medical college declaring it fit to impart medical education and gives accouchement to the expectation amongst the stakeholders that the Applicant College shall fulfill basic norms specified by the MCI to start and operate a medical college. Bearing in mind that the question of justified existence of a college and irregular/illegal functioning of an existing college belong to a different order of things and cannot be mixed up. We come to the conclusion that the issuance/re-issuances of an essentiality certificate is not in any way a ministerial job and while dealing with a case of maintaining standards in a professional college, strict approach must be adopted as these colleges are responsible for ensuring that medical graduate has the required skill set to work as a doctor in the country. Poor assessment system; exploding number of medical colleges; shortage of patients/clinical materials; devaluation of merit in admission, particularly in private institutions; increasing capitation fees; a debilitated assessment and

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accreditation system, are problems plaguing our Medical Education system. Allowing such deficient colleges to continue to function jeopardizes the future of the student community and leading to incompetent doctors to graduate from such colleges and ultimately pose a bigger risk to the society at large defeating the very purpose of the Essentiality Certificate issued by the State. The State would be deterring from its duty if it did not conduct an inspection from time to time to ensure that the requisite standards as set by the MCI are met before issuing/renewing the Essentiality certificate. That is by no stretch of imagination ‘merely a ministerial job’. Considering especially that while issuing the Essentiality Certificate the State Govt undertakes that should the Medical College fail to provide the requisite infrastructure and fresh admissions are stopped by the Central Government, the State Government shall take over the responsibility of the students already admitted in the College.

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Same is the position with respect of CoA by the University. The First Statute of KUHS prescribes that University may appoint a Commission to inspect the proposed site to make a physical verification of the existing facilities and suitability of proposed site. The grant of affiliation is dependent upon fulfillment of all the conditions that are specified in Clause X(I) of First Statutes or that may be specified which includes staff, infrastructure facility, hospital, internet, library, playground, hostel, etc. Thus, even grant of CoA by the University also cannot be said to be merely a ministerial act.

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In view of above, we are of the considered opinion that grant of EC by the State Government and CoA by the University is not simply a ministerial act and we do not find any merit in the argument of the appellant in this regard.

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21. Reverting back to the factual matrix, the essentiality certificate was refused by Exhibit P10 order citing the following reason:

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The present inspection report highlights the grossly inadequate clinical materials. It may be noted that the Hon’ble High Court had ordered the

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closure of two medical colleges in the state recently mainly due to lack of clinical materials. So if the essentiality certificate is issued based on the present inspection report, it will adversely affect the future of the students. In addition, DME has categorically stated that the Collegiate Hospital attached to the proposed college requires lot of further development. By considering these facts, the application read above seeking essentiality Certificate to establish new Medical College in Kasargod District by Laxmi Megan Speciality health Care Private Limited Kanjangad, Kasargod deserves no merit for consideration and is summarily rejected.

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I have already adverted to the inspection proforma in para 9 of the judgement and the conclusion arrived at by the 1st respondent in para 11 of the judgment.

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Exhibits P1 to P7 and P13 would reveal that the petitioner is in possession of property of over 30 acres much in excess of 20 acres which is required as per the regulations. Exhibits P8 and P9 reports of the year 2013 also state that the required land is possessed by the petitioner. In that view of the matter, the conclusion of the 1st respondent in the order that the claim of 25.3 acres which has been earmarked is not supported by relevant documents is evidently not correct. There is no mention of any inadequacy of land in Exhibit P11 report. In the impugned order, it is seen recorded that no active construction is happening in the land and even the foundation stone for the medical college has not been laid. This is a clearly erroneous finding since even in the inspection report it is seen stated that the 70 % structure is completed. Another reason for rejection is that the three hundred bedded hospital is

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functioning only for a period of one year. This conclusion is clearly erroneous and is falsified by Exhibit P9 report of the Director of the Directorate of Medical Education dated 13/12/2013 wherein it is stated that even in the year 2013, the 300 bedded hospital was in possession of the petitioner and there is no objection in starting a medical college. When in Ext.P11 report, it is stated that clinical material is adequate, the 1st respondent in the order states that the clinical material on the date of inspection is inadequate.

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Thus there appears to be considerable merit in the submission of the learned counsel that the 1st respondent has misdirected himself while passing the impugned order. The 1st respondent was required, before proceeding to consider the request for issuance of an Essentiality certificate, to consider whether the petitioner was in possession of the required land, infrastructure, faculty, clinical materials etc. The authority was duty-bound to take into account all relevant factors while taking a decision. The order passed ought to reveal that it was upon a proper self-direction as to the essential facts that the authority concerned had proceeded to consider the request made by the petitioner. However, in the instant case, it appears that instead of meticulously analysing the report submitted by the inspecting body and the records and materials presented by the petitioner, the impugned order has been passed by misreading/ignoring the materials. I have no doubt in my mind that the 1st respondent has failed to take note of the relevant aspects and passed an order in a very casual manner. I am unable to sustain the order.

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In view of the discussion above, the petitioner is entitled to succeed. Exhibit P10 order will stand set aside. There will be a direction to the 1st respondent to reconsider the application in tune with the provisions of the MCI Act, 1956 and the regulations as amended. If the 1st respondent deems it necessary, he may order a fresh inspection by a committee of experts. Orders shall be passed afresh after adverting to all records and in the light of the law laid down by the Apex Court in V.N. Public (supra) expeditiously, in any event, within a period of three months from today.

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This writ petition is disposed of.

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Sd/-

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RAJA VIJAYARAGHAVAN V

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JUDGE

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PETITIONER EXHIBITS

EXHIBIT P1	TRUE COPY OF COMPLETION CERTIFICATE NO. 1683/13 DATED 12.03.2013 ISSUED BY THE SECRETARY PULLUR PERIYA GRAMA PANCHAYAT.
EXHIBIT P2	TRUE COPY OF THE OWNERSHIP CERTIFICATE NO. 494/2021/JC3 DATED 16.01.2021 ISSUED BY THE PANCHAYATH IN RESPECT OF BUILDING NO. 99 IN WARD NO. 9.
EXHIBIT P3	TRUE COPY OF THE OWNERSHIP CERTIFICATE NO. 494/2021/JC3 DATED 16.01.2021 ISSUED BY THE PANCHAYATH IN RESPECT OF BUILDING O. 100 IN WARD NO. 9.
EXHIBIT P4	TRUE COPY OF THE OWNERSHIP CERTIFICATE NO. 494/2021/JC3 DATED 16.01.2021 ISSUED BY THE PANCHAYATH IN RESPECT OF BUILDING O. 101 IN WARD NO. 9.
EXHIBIT P5	TRUE COPY OF THE OWNERSHIP CERTIFICATE NO. 494/2021/JC3 DATED 16.01.2021 ISSUED BY THE PANCHAYATH IN RESPECT OF BUILDING NO. 102 IN WARD NO. 9.
EXHIBIT P6	TRUE COPY OF THE OWNERSHIP CERTIFICATE NO. 494/2021/JC3 DATED 16.01.2021 ISSUED BY THE PANCHAYATH IN RESPECT OF BUILDING O. 103 IN WARD NO. 9.
EXHIBIT P7	TRUE COPY OF THE OWNERSHIP CERTIFICATE NO. 494/2021/JC3 DATED 16.01.2021 ISSUED BY THE PANCHAYATH IN RESPECT OF BUILDING O. 104 IN WARD NO. 9.
EXHIBIT P8	TRUE COPY OF THE INSPECTION REPROT DATED 28.11.2013 OF THE INSPECTION TEAM OF THE 2ND RESPONDENT.
EXHIBIT P9	TRUE COPY OF THE LETTER NO. B4/39753/2011/DME DATED 13.12.2013 OF THE DME TO THE 1ST RESPONDENT.
EXHIBIT P10	TRUE COPY OF THE GO (RT) NO. 2432/2020/H &