Holding

The State Government has a positive but non‑final role to determine the desirability and feasibility of the location of a medical or dental college when granting an essentiality certificate, must act reasonably and give reasons, and its decision is subject to final approval by the Medical Council of India and the Central Government.

Summary

The Supreme Court examined the role of the Andhra Pradesh Government in granting essentiality certificates required for establishing new medical or dental colleges under the Medical Council of India Act and its Regulations. The High Court had held that the State had no authority to decide the location of such colleges, but the Supreme Court reversed this, stating that the State does have a positive, though not final, role to assess the desirability and feasibility of the proposed location based on local needs and public interest. The Court emphasized that the State must exercise this power reasonably, provide cogent reasons, and act in accordance with natural‑justice principles, while the ultimate recommendation rests with the Medical Council of India and the Central Government. Consequently, the Supreme Court remitted the matters to a Division Bench of the Andhra Pradesh High Court for fresh consideration in line with its observations. The appeals were disposed of without costs.

Issues considered

What is the extent of the State Government's authority to grant essentiality certificates for new medical or dental colleges under the Medical Council of India Act and Regulations?
Can the State withhold an essentiality certificate on policy grounds concerning the location of a proposed college?
Must the State's decision on essentiality certificates be based on reasoned grounds and comply with natural‑justice requirements?

Legislation cited

Dental Council of India Act, 1948
Medical Council of India Act, 1956s. 10-A, s. 1OA, s. 1OB, s. 1OC, s. 33, s. 64
University Grants Commission Act, 1956

Subjects

essentiality certificatemedical college establishmentstate government powersdelegation of authoritynatural justicelocal needsMedical Council of Indiaadministrative law

Judgment

A GOVERNMENT OF ANDHRA PRADESH AND ANR.
v.
MED WIN EDUCATIONAL SOCIETY AND ORS.

NOVEMBER I I, 2003
B
[V.N. KHARE, CJ. AND S.B. SINHA, J.J

Medical Council Act, 1956-Section JO-A-Medical colleges-Permission
for establishment of-Role of State Government-State Government Granting
C essenliality certificate for proposed colleges-State Government responsible
to take over responsibility ofstudents of a college which fails to meet norms-
Held, the State Government can determine the ·locations where new colleges
should be established

Administrative Law-Delegation of power-Scope of-Power to State
D Government to assess desirability ofestablishment of a new medical col/ege-
Delegation of power made in view of practical difficulties faced by Central
Government and Medical Council-State Government to assess in a particular
format prescribed by Regulation-Held, is not excessive delegation ofpower-
Medical Council Act, 1956-Section JO-A.
E Under Section IO-A of the Indian Medical Council Act, 1956, the
Medical Council of India is the recommending authority in respect of
schemes filed for establishment of a new medical college in any State. The
Medical Council of India was facing difficulties in discharge of its functions
as there were cases where after grant of initial permission, the college could
F not provide the infrastructure, teaching and other facilities as a result
where of the students who had already been admitted suffered serious
prejudice. The Medical Council of India, being of the view that the State
Government has the manpower as well as the expertise in respect of local
conditions, introduced the concept of essentiality certificate. Under the
provisions of the Establishment of Medical Colleges Regulations, 1999 a
G particular form was prescribed in which essentiality certificate was to be
granted by the State Government. The said essentiality certificate in
prescribed form was to be a part of the scheme submitted by an applicant
before the Central Government. The State Governments, while granting
the essentiality certificate in the prescribed form had to give reasons
H 408
GOVT. OF ANDHRA PRADESH v. MEDW!N EDUCATIONAL SOCIETY 409
justifying the establishment of the proposed medical college. The said form A
also required the State Government to undertake that in case the applicant
fails to create infrastructure for the medical College, the State Government
would take over the responsibility of the students already admitted in the
college. Similar provisions also exist in respect of dental colleges.

The appellant-State Government, by two separate orders, identified B
certain locations where medical and dental colleges could be established.
It appointed a Committee for inviting applications from applicants
desirous of establishing medical and dental colleges and making
recommendations to the State Government for grant of essentiality
certificates to the eligible applicants. C
The respondents filed writ petitions before the High Court
questioning the two Government orders. It was argued by the respondents
that while granting an essentiality certificate, the Government is concerned
only with the question of desirability and feasibility of having the proposed
medical or dental college at the proposed locations but it cannot insist by D
way of policy decision or otherwise that the colleges should be located at
particular places.

Single Judge of the High Court allowed the writ petitions. On appeal,
a full Bench of the High Court held that the State Government could not
have withheld essentiality certificate on a policy consideration with regard E
to location of the medical college as the policy in the matter of
establishment of new medical/dental colleges rests with the Central
Government alone. It further held that the State Government cannot
provide a prior prescription of location by it to restrict the applications
to such locations alone. The appellants filed appeals before the Court F
Disposing of tli~'appeals, the Court

HELD: The High Court has committed a manifest error in holding
that the State Government has no role to play in the matter of
identifications of location of the sites where the medical colleges are G
proposed to be established. While granting an essentiality certificate
particularly having regard to the local needs, the State Government has
a positive say as regards the location for establishing of a medical college
or dental college. (429-F, GI

State of Maharashtra v. Indian Medical Association and Ors., (2002] 1 H
-,
410 SUPREME COUR1 REPORTS [2003] SUPP. 5 S.C.R.

A SCC 589; T.MA. Pai Foundation an.o Or;. v. State of Karnataka and Ors.,
(20021 8 SCC 481 and Islamic Academy of Education and Anr. v. State of
Karnataka and Ors., (20031 6 SCC 697, referred to.

Thirumuruga Kirupananda Variyar Thavathiru Sundara Swamigal
Medical Educational and Charitable Trust v. State of Tamil Nadu and Ors.,
B (19961 3 sec 15, distinguished.

Jaya Gokul Education Trust v. Commissioner and Secretary to the
Government, Higher Education Department, (2000) 7 SCC 231 and Unni
Krishnan, J. P. and Ors. v. State ofAndhra Pradesh and Ors., (1993) 1 SCC
C 645, cited.
1.2. Although the State Government has say in the matter as regards
the location for establishing of a medical college or dental colleges, it has
to exercise such power in reasonable manner. The factors which are
relevant for determination of such issues would be local needs and public
D interest. While rejecting such an application for grant of essentiality
certificate, the State must comply with the principles of natural justice
which would include assigning of sufficient and cogent reasons. The State
cannot act arbitrarily or capriciously. Its decisions must be informed by
reasons and based on relevant factors. (431-G-H; 432-A)
E 1.3. The State Government, say is not final and ultimately final
recommendations have to be made by the Medical Council of India and
the Dental Council of India as the case maybe, whereafter the final decision
has to be taken by the Central Government. (429-G)

F 2.1. By conferring power on the State Government to issue
essentiality certificate, it is idle to contend that the Central Governments
has abdicated its power in favour of the State Government in terms of
Entry 66, List I of the Seventh Schedule of the Constitution of India. The
Parliament is empowered to enact an Act for the purpose of ensuring co-
ordination and determination of standards in institutions of higher
G education or research and technical institutions. By reason of a provision
empowering the State Governments for grant of essentiality certificate,
the Central Government cannot be said to abdicate its power in favour
of the State Government. Thereby only a part of its function is required
to be carried out by the State Governments. (422-C-D)
H
oovr. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA, J.J 411
2.2. Keeping in view the practical difficulties faced by the Central A
Government or the statutory bodies likes the Medical Council of India or
the University Grants Commission, some power is sought to be delegated
to the State Government so as to make the Parliamentary statute
completely workable. Such 'play in the joint' is also desirable having
regard to the federal structure of the Constitution. [422-H; 423-A)
B
There are certain situations where the State may even make a
legislation subject to the Parliamentary legislation. The instant case stands
on a better footing in as much as the state Government has been assigned
only certain statutory functions by the Regulations framed under the
Parliamentary Act itself and in that view of the matter no exception thereto C
can be taken. [425-F, G)

State ofAndhra Pradesh v. K. Purushottam Reddy and Ors., JT [2003)
3 SC 15 and Dr. Preeti Srivastava and Anr. v. State ofMP. and Ors., [1999)
7 sec 120, referred to.
D
3. For the purpose of identifying the sites, Article 371-D of the
Constitution of India may not have any application. (429-H; 430-AI

CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 2609-2616
of 2002.
E
From the Judgment and Order dated 8.11.2000 of the Andhra Pradesh
High Court in W.A. No. 1326-1332 and 1629 of 1999.

WITH
C.A. No. 2608 and 2617 of 2002.
F
G.L. Sanghi, Mrs. K. Amareshwari, G. Prabhakar, Dr. A. Francis Julian,
Sumit Kumar, A. Mariarputham, P.Venkat Reddy, A. Raghunath, Mohd.
Wasay Khan, G. Ramakrishna Prasad, N. Ganpathy (NP), Maninder Singh,
Ms. Pratibha M. Singh, Angad Mirdha, Kirtiman Singh and Y. Rajagopala
Rao (NP) for the appearing parties. G
The Judgment of the Court was delivered by

S.B. SINHA, J. INTRODUCTION:

The role of the States Government in the matter of identification of H
412 SUPREME COURT REPORTS [2003) SUPP. 5 S.C.R.

A locations of proposed medical and dental colleges in the primal question
involved in this batch or appeals, which arise out of a common judgment and
order dated 8.11.2000 passed by a Full Bench of the Andhra Pradesh High
Court in writ Appeal Nos. 13261332 and 1629 of 1999.

FACTUAL BACKGROUND
B
As the said question is required to be answered keeping in view
interpretation of the provisions of the Medical Council of India Act, Dental
Council of India Act and the Regulations framed thereunder, it is not necessary
to take into consideration the factual matrix of the matter in great details.
C Suffice it to point out that by reason of two Government orders being G.O.
Ms. No. 128 dated 30.4.1998 and G.O. Ms. No. 214 dated 23.6.2000, the
Government of Andhra Pradesh approved 13 locations for establishment of
medical colleges and 18 for dental colleges. The said orders were issued in
terms of recommendations of a committee comprising of Justice S. V. Maruthi,
a the then sitting judge of the Andhra Pradesh High Court, Vice-Chancellor
D of the NIR University of Health Sciences and the Director of Nizams Institute
of Medical Sciences. The sitting judge of the Andhra Pradesh High Court as
a Chairperson of the committee was nominated by the Government of Andhra
Pradesh in consultation with the Chief Justice of the said High Court. A
notification was issued in this behalf in terms whereof the said Committee
became entitled to call for the applications and make recommendations to the
E State Government for granting essentiality certificates to the eligible applicants.
Pursuant thereto or in furtherance thereof, applications were called for and
upon taking into consideration the merits ofrespective cases, recommendations
were made by the said Committee to the State Government for its consideration
as per the guidelines issued in the Medical Council of India Act and the
F Dental Council of India Act.

WRIT PETITIONS:

A large number of writ petitions were filed before the Andhra Pradesh
High Court questioning the aforementioned two Government orders. In the
G writ petitions, inter alia, the question as regard the validity and legality of
constitution of the said committee to go into the question of locations of
medical or dental colleges was raised. The Government of Andhra Pradesh's
jurisdiction to constitute such committee was also questioned having regard
to the provisions contained in the Parliamentary Acts. It was contended that
keeping in view the scheme of the Parliamentary Act together with the
H Regulations made thereunder, the Parliament having occupied and taken over
oovr. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA, J.] 413
the entire legislative field, the same could not be encroached upon by the A
State only because essentiality certificate is required to be issued by it as per
condition no. 3 of qualifying criteria contained in the Regulations. It was
urged that while granting an essentiality certificate, the State Government is
concerned only with the question of desirability and feasibility of having the
proposed medical colleges at the proposed locations but it cannot insist by B
way of policy decision or otherwise that the colleges should be located at
particular places.

Judgment of the High Court:

A learned Single judge of the High Court allowed the writ applications,
holding inter alia, that the function of the committee being quasi-judicial in C
nature, a sitting judge of the High Court ought not to have associated and
functioned as head of such committee having regard to the doctrine of
separation of powers. It was further observed that participation of the Vice-
Chancellor of the NIR University was also not desirable. It was, however,
held that having regard to the provisions contained in Article 3710 of the D
Constitution of India, the Presidential Order issued thereunder had an
overriding effect over the provisions of the Parliamentary Acts and in that
view of the matter, the State Government had a say in the matter of detennining
t!te locations for establishment of medical and dental colleges.

The appeals taken thereagainst were placed before a Full Bench of the E
Andhra Pradesh High Court which were disposed of by a judgment and order
dated 8.11.2000 holding:

"For the foregoing reasons, we are of the considered view and hold
(i) that the State is at liberty, while considering the grant of essentiality
certificate under paragraph 3 of the 'qualifying criteria' set out in the F
scheme for establishment of colleges, to consider the feasibility and
desirability of establishing the proposed institutions in the proposed
locations in terms of the factors set out in Form II of the Establishment
of the New Medical Colleges Regulations, 1999. The other cognate
factors are outside the domain of the State Government, having not G
been delegated to it. (ii) The grant or refusal of the essentiality
certificate by the State government constitutes but a tentative or
provisional determination of the issue. It is the Medical or Dental
Council which is empowered and obligated to independently consider
the feasibility of recommending the grant of permission to the Centre
for the establishment of medical college or dental college. (iii) Denial H
414 SUPREME COURT REPORTS [2003] SUPP. 5 S.C.R.

A of grant of essential certificate by the State by itself is not sufficient
for the Counci I to refuse the recommendation for grant of permission
to establish a college. (iv) Article 371D does not empower the State
to withhold essentiality certificate on a policy consideration with regard
to location, (v) The State cannot provide a prior prescription of location
by it to restrict the applications to such locations alone. The State is
B bound to consider the applications proposing locations other than the
locations even if prima f acie identified by the State for grant of
essentiality certificate; we, however, hold that the State is at liberty
to consider the grant of essentiality certificate within the parameter's
set out in view of the observations made in the judgment. (vi) The
c State is obligated to record reasons for grant or refusal to grant an
essentiality certificate. Recording of reasons ensures that the same
has been arrived on the basis of the germane, relevant and rational
parameters within the jurisdiction and domain of the State Government.
(vii) The scheme for establishment of colleges can be submitted
without the State calling for the applications."
D
The Full Bench, however, while disagreed with the view of the learned
Single Judge to the effect that the vice-Chancellor of the University should
not associate himself with the functioning of the committee, left the question
as regard justifiability or otherwise of participation of a sitting judge of the
E court in such committee open, for being decided in an appropriate case. The
Full Bench gave the aforementioned directions, inter a/ia, observing that the
Government of Andhra Pradesh had not followed any discernible principle in
the matter of identification of various locations. It was opined that as no
principle had been evolved, it was possible that a few deserving and qualified
institutions might have failed to apply for essentiality certificate. It was further
F observed that as a large number of new locations had been successively
added by the State Government by various notifications, the consideration of
existing applications and the consequent grant or refusal of essentiality
certificates could not have been on a rational basis founded on a holistic view
of the relevant parameters. The Full Bench remarked:

G "... Random consideration of applications in such dynamic and fluid
state of specification on locations, cannot but result in imperfect
consideration, leading to erroneous conclusions, inter se the various
applicants or even per se."

The Full Bench of the High Court relying on or on the basis of the
H decisions of this Court in Jaya Gokul Education Trust v. Commissioner and
GOVT. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA, J.] 415

Secretary to Government, Higher Education Department, [2000] 7 sec 231 A
and Thirumuruga Kirupananda Variyar Thavathiru Sundara Swamigal Medical
Educational & Charitable Trust v. State of Tamil Nadu and Ors., [1996] 3
SCC 15, further observed that the State cannot withhold the essentiality
certificate on any policy consideration as the policy in the matter of
establishment of a new medical college now rests with the Central Government
alone. It, however, held that the legislative field having been covered by the B
Central enactment, the State has no power under Article 371D or a prerogative
to identify the locations within the State for establishment of new medical
and dental colleges.

SUBMISSIONS:
c
The learned Solicitor General appearing on behalf of the Medical Council
of India and Mr. G.L. Sanghi, learned Senior counsel appearing on behalf of
the Government of Andhra Pradesh would urge that the High Court committed
a manifest error in arriving at a conclusion that the State has absolutely no
say in the matter inasmuch as it while granting an essentiality certificate is D
not only required to apply its mind with regard to its local needs but also
have to take the responsibility of transferring students of other medical colleges
in the event affiliation granted to the medical college is withdrawn or not
extended. Relying on the decision of this Court in State of Maharashtra v.
Indian Medical Association and Ors., [2002] I SCC 589, the learned counsel
would contend that grant of essentiality certificate by the State Government E
or the Union Territory Administration, as the case may be, being mandatory,
the requirement of desirability of having the propcsed medical colleges at the
proposed locations in terms of para 3 of the Regulations constitutes an
important factor and , thus, the same, by necessary implication, is required
to be determined by the State Government. The learned counsel would contend F
that the desirability of establishing medical college at the proposed location
and the availability of adequate clinical material as per the Parliamentary
Legislation are also required to be decided by the State Government. The
Medical Council of India or the Dental Council of India, it was submitted,
are only concerned with the standard of education. The learned counsel would,
therefore, contend that the State Government's jurisdiction as regard the G
location of the proposed medical college is implicit having regard to the
requirement of grant of essentiality certificate.

Drawing our attention to Section 64 of the Act, it was urged that the
power of the State Government to grant permission to set up a new medical H
416 SUPREME COURT REPORTS [2003) SUPP. 5 S.C.R.

A college is substantially the same for granting essentiality certificate to a
management or an institution who intends to establish a new medical college
at a proposed location. It was submitted that the said provision is to be read
with para 3 of the Regulation.

The learned counsel appearing on behalf of the respondents, however,
B submit that the State Government has a limited role to play in the matter of
identification of locations which is confined to the question as to whether
proper infrastructure of starting a medical college as per the Regulations are
available or not. The State, it is urged, cannot have any manner of say in such
matters on the basis of a policy decision or otherwise as the ultimate decision
C in relation thereto rests with the Central Government in terms of the provisions
of the Act and the Regulations framed thereunder. In any event, such a
decision on the part of the State Government being quasi judicial in nature,
it cannot act arbitrarily or whimsically nor in relation thereto, political
considerations can be allowed to have any role to play. It was urged that in
the matter of discharge of limited statutory functions under the Parliamentary
D Act and the Regulations framed thereunder, the State cannot take shelter
under Article 371 D of the Constitution of India. Its decisions, it was submitred,
must be informed by sufficient and cogent reasons as the same are subject to
judicial review by the High Court.

ISSUES:
E
The issue which arises for consideration is:

(I) What is the proper, assigned and available role of the State
Government in the matter of grant of essentiality certificate for
establishment of Medical or Dental college, especially in the context
F of the operative constitutional, legislative and statutory provisions;"

Statutory provisions and the procedure laid down thereunder:

"Education", including 'Technical Education', 'Medical Education' and
'Universities' is the subject-matter of Entries 63, 64, 65 and 66 of List I of
G the Seventh Schedule of the Constitution of India.
For the purpose of disposal of these appeals, we would refer only to the
relevant provisions of Medical Council of India Act ("the Act") as the
provisions of the Dental Council of India Act are in pari materia therewith.

H The Medical Council oflndia Act, 1956 was enacted to provide for the
GOVT. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA, J.] 417

reconstitution of the Medical Council of India, and the maintenance of a A
Medical Register for India and for matters connected therewith'.

This Court in Unni Krishnan, J.P. and Ors. v. State ofAndhra Pradesh
and Ors., [1993] I SCC 645 made certain observations as regard making of
appropriate statute having regard tp the provisions contained in the relevant
· entries in List I of the Seventh Schedule of the Constitution. Pursuant to or B
in furtherance of the said observations, Sections I OA, 1OB and I OC were
inserted by the Parliament by reason of the Medical Council of India
(Amendment) Act, 1993.

Section I OA of "The Act" mandates that save and except with the
previous permission of the Central Government obtained in accordance C
therewith no person shall establish a medical college. For the said purpose
the person or medical college concerned shall file a scheme before the Central
Government which shall be referred to the Council for its recommendations.
Clause (b) of sub-section (2) of Section 1OA of "The Act" provides that the
scheme referred to in clause (a) shall be in such form and contain such D
particulars and be preferred in such manner and be accompanied with such
fees as may be prescribed. The Council upon fulfilment of the requirements
of the said Act and the Regulations framed thereunder is to submit its
recommendations to the Central Government having regard to the factors
enumerated in sub-section (7) of Section 10-A of the Act. Section lOB provides
for non-recognition of medical colleges in certain cases. Section 1OC provides E
for time for seeking permission for certain existing medical colleges.

By reason of the said Amendment Act, 1993, the regulation making
power contained in Section· 33 was also amended by inserting the following
clauses:
F
"(fa) the form of the scheme, the particulars to be given in such
scheme, the manner in which the scheme is to be preferred and the
fee payable with the scheme under clause (b) of sub-section (2) of
Section 10-A;

(fb) any other factors under clause (g) of sub-section (7) of Section G
10-A;

(fc) the criteria for identifying a student who has been granted a
medical qualification referred to in the Explanation to sub-section (3)
of Section I0-B."
H
418 SUPREME COURT REPORTS (2003] SUPP. 5 S.C.R.

A The Central Government pursuant to or in furtherance of the said power
made a regulation known as Establishment of New Medical Colleges, Opening
of Higher Courses of Study and Increase of Admission Capacity in Medical
Colleges Regulation, 1993. In terms of the scheme framed thereunder the
eligibility criteria and the qualifying criteria were laid down. The Medical
B Council of India thereafter with the previous sanction of the Central
Government in exercise of the power conferred by Section IOA read with
Section 33 of "The Act" made new Regulations known as Establishment of
Medical College Regulations, 1999.
We may, however, hasten to add that although the Government orders
C were issued by the appellant-State in terms of 1993 Regulations, for the
purpose of disposal of these appeals, it may be necessary for us also to take
into consideration the relevant provision; of the 1999 Regulations.
Regulation 3 prohibits any person from establishing a medical college
except with the prior permission from the Central Government by submitting
a Scheme provided therein. The scheme is an elaborate one. Paragraph I of
D the scheme provides for Eligibility Criteria. Paragraph 2 provides for
Qualifying Criteria. Paragraph 3 provides for Form and Procedure. Paragraph
4 provides for Application Fee. Paragraph 5 provides for Registration.
Paragraph 6 provides for Evaluation by Medical Council of India. Paragraph
7 provides for Report of the Medical Council of India. Paragraph 8 provides
E for Grant of Permission.
The 1999 Regulations also prescribed a form of application being Form-
! to be filled giving particulars of the applicant seeking permission of the
Central Government to establish a new Medical College. Form 2 has been
prescribed for grant of Essentiality Certificates by the State.
F The Government of Andhra Pradesh issued G.O.Ms. No. 128 dated
30.4.1998 specifying five locations where medical colleges as also dental
colleges can be established. Similarly G.O.Ms. No. 214 dated 23.6.2000
provided for proposal for setting up medical and dental colleges at five different
places as mentioned therein. The Committee thereafter issued notification
G calling for applications. Pursuant to or in furtherance of such notification, the
persons desirous of establishing medical colleges filed applications before
the Government of Andhra Pradesh for grant of essentiality certificates.
It is not in dispute that one of the qualifying criteria to render an
association eligible for permission to set up a new medical and dental college
H is to the following effect:
GOVf. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA, J.] 4 J9

of having the proposed medical college/dental college at the proposed A
location has to be obtained by the applicant from the respective State
Governments or the Union territory Administration and that the
adequate clinical material is available as per Medical Council oflndia's
requirements."

The statutory requirements as laid down in the Act and the Regulations B
are, therefore, required to be complied with beiore application filed by the
person or association for setting up medical college is taking up for
consideration.

It is not in dispute that the Medi~al Council of India on receipt of such
application from the Central Government verifies the contents thereof, inter C
alia, by conducting physical inspection of the institution for the purpose of
making a recommendation to the Central Government for issuance of Letter
of Intent to the applicant towards establishing a medical college. A further
inspection is carried out for making recommendations for renewal of the
pennission, in the event the same is granted by the Central Government on D
an annual basis.

However, in the matter of implementation of the statutory scheme for
grant of permission and annual renewal, the Medical Council of India
experienced difficulties and it came across cases where the colleges despite
grant of initial pennission could not provide the infrastructure, teaching and E
other facilities as a result whereof the students who had already been admitted
suffered serious prejudice. Only with a view to overcome the. said situation,
the 1999 Regulations provided for grant of essentiality certificate which is in
the following fonnat:

"Fonn-2 F
Subject: Essentiality Certificate
No.
Government of- - - - - - -
The Department of Health,
G
Dated, the _ _ _ _ _ _ __
To
(applicant),

H
420 SUPREME COURT REPORTS 12003] SUPP. 5 S.C.R.

A Sir,
The desired certificate is as follows:
(I) No. of institutions already existing in the State.

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

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

(4) No. of doctors in Government Service

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

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

(7) Doctor population ratio in the State.

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

(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.

{10) Full justification for opening of the proposed college.
E
(11) Doctor-patient ration proposed to be achieved. The (Name of the
person) has applied for establishment of a medical
college at . On careful consideration of the proposal,
the Government for _____ has decided to issue an
F essentiality certifica;e to the applicant for the establishment of a
Medical College with (no.) seats. It is certified that:

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

{b) It is desirable to establish a medical college in the public interest;
G
{c) Establishment of a medical college at ____ by (the name of
Society/Trust) is feasible.

(d) Adequate clinical material as per the Medical Council of India
norms is available. It is further certified that in case the applicant
H fails to create infrastructure for the medical college as per MCI
GOVT. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.Et SINHA,J.] 421

norms and fresh admissions are stopped by the Central A
Government, the State Government shall take over the
responsibility of the students already admitted in the College
with the permission of the Central Government.

Yours faithfully,

(Signature of the Competent Authority)" B
Grant of the said certificate in the prescribed form, therefore, emantes
from the scheme framed under the Parliamentary legislation. The said form is
a part of the Regulations which are required to be considered in the light of
the Parliamentary Acts.
c
By reason of clause 11 (d), a responsibility has been cast upon the State
Government to give an undertaking that in case the applicant who seeks to
establish a medical college, fails to create infrastructure for the medical college
~. as per the norms laid down by the Council and in the event the fresh
admissions are stopped by the Central Government, the State Government D
shall be obligated to take over the responsibility of the students already
admitted in the college. Such an undertaking on the part of the State
Government is unequivocal and unambiguous. The Central Government and
the Medical Council of India in the aforementioned premise opined that the
selection of locations for establishment of a medical college is a matter which
is required to be dealt with by the respective State Governments and not by E
the Medical Council of India.

The High Court in paragraph 13 of the impugned judgment noticed the
aforementioned submission of the Medical Council oflndia as regard delegation
of power to the State Government under Regulations 1993 read with the F
scheme framed thereunder, having regard to the limited manpower and
resources available to the Medical Council and the Dental Council on the one
hand vis-a-vis the plentitude of resources including the expertise in the matter
of local conditions in the State on the other. The High Court did not advert
to this aspect of the matter.
G
In view of the aforementioned statutory provisions, there cannot be any
doubt or dispute that an essentiality certificate to set up a medical college at
the proposed site and adequate clinical material by a person is required to be
obtained in Form-2 appended to the said Regulations, which lays down the
following conditions:
H

".
422 SUPREME COURT REPORTS (2003] SUPP. 5 S.C.R.

A "(I} to (7) xxx xxx xxx

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

(9) xxxxxxxxx
B
(I 0) Full justification for opening of the proposed college."

By conferring such a power on the State Government, it is idle to
contend that the Central Government has abdicated its powers in favour of
C the State in terms of Entry 66, List I of the Seventh Schedule of the Constitution
of India. The Parliament is empowered to enact an Act for the purpose of
ensuring coordination and determination of standards in institutions for higher
education or research and scientific and technical institutions. By reason of
such a provision the Central Government cannot be said to abdicate its power
in favour of the State. Thereby only a part of its function is required to be
D carried out by the State.
It is not necessary for us to delve deep into the matter as regard the
scope and extent of the legislative fields, as the said question has been dealt
with by this Court earlier.

E In Thirumuruga (supra), a two-judge Bench was considering the
provisions of the 1993 Regulations. In the tact situation obtaining therein, it
was observed:

" ... For the purpose of granting the essentiality certificate as required
under the qualifying criteria prescribed under the scheme, the State
F Government is only required to consider the desirability .and feasibility
of having the proposed medical college at the proposed location. The
essentiality certificate cannot be withheld by the State Government on
any policy consideration because the policy in the matter of
establishment of a new medical college now rests with the Central
Government alone."
G
The contentions which have been raised before this Court were not
raised therein and furthermore, the requirements contained in terms of the
1999 Regulations did not fall for consideration therein.

It is interesting to note that keeping in view the pr!lctical difficulties
H
GOVT OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA, J.] 423

faced by the Central Government or the statutory bodies like the Medical A
Council of India or the University Grants Commission, some power is sought
to be delegated to the State so as to make the Parliamentary statute completely
workable. Such 'play in the joint' is also desirable having regard to the federal
structure of our Constitution.

In State of Andhra Pradesh v. K. Purushotham Reddy and Ors., [2003] B
3 SC 15, this Court had an occasion to consider the .provisions of the
University Grants Commission Act, 1956 vis-a-vis the Andhra Pradesh State
Council of Higher Education Act, 1988. The validity of the State Act was
upheld by this Court noticing that the powers and functions of the Council
stood curtailed insofar as they are not only to function in accordance with C
the guidelines issued by the University Grants Commission but its duty is to
assist the Commission in respect of determination and maintenance of standards
and suggest remedial action of higher education in the State. Keeping in view
the provisions of the Parliamentary Act and the said Act it was observed:

"Once it is held that the duties and functions of the Councils are D
compartmentalised and they have to act in accordance with the
guidelines issued by the UGC from time to time, it is preposterous to
suggest that the Council acts on its own and/or at the instance of the
Government in the field of cooperation and determination of standards
in institutions of higher education as an independent body. Keeping
in view the fact that the Commission itself on the request of the E
Central Government constituted a committee and laid down the
parameters within which the Council can function and subjected
themselves to the restriction of working within the guidelines issued
by the UGC, we fail to understand as to how it can be contended that
both the Commissioneraie Act as also the Council Act provide for p
same powers and functions. The modifications made in the 1988 Act
vis-a-vis the Commissionerate Act cannot _be said to be so slight as
has been opined by the High Court so as to arrive at a conclusion
that the 1988 Act still suffers from 'the same vices. Having regard to
the provisions of the 1988 Act and particularly Section 11 thereof we
have no doubt in our mind that the purpose of the said Act, and the G
powers and function thereof vis-a-vis the Commissionerate Act are
absolutely distinct and different. In no way the 1988 Act can be said
to have an upper hand over the UGC Act.
It is not a case where the State Council of Higher Education were
to act independently irrespective of the standard of education set H
424 SUPREME COURT P EPORTS [2003] SUPP. 5 S.C.R.

A forth by the University Grants Commission. Its powers and functions,
as indicated hereinbefore, are absolutely different from that of 1986
Act."

It was further observed:

B "... Once the powers and functions of"the Council is found to be
subject to the guidelines issued by the UGC and the perspective plan
prepared by it would be subject to its approval, the question of
standard of education set up by the State Act cannot be said to be
leading to wipe out or appreciably abridge the central field.

C The 1988 Act expressly states that the same would be subject to
the Central Act. It emphasizes that the provisions thereof are for the
purpose of filling up of the gaps and to control effectively a large
number of universities within which, having regard to their sheer
number, the UGC itself would not be in a position to have effectively
control over them. If the UGC has an overall control over the State
D Council, the Central field is not entrenched upon. In a situation of this
nature the doctrine of pith and substance must also be held to be
applicable. We must also take notice of the fact that the State of Tamil
Nadu as also the State of West Bengal in terms of the National
Education Policy, 1986 as also the recommendations of the Committee
E framed by the University Grants Commission enacted similar Acts."

However, in Dr. Preeti Srivastava and Anr. v. State of MP. and Ors.,
[1999] 7 sec 120, it is held:

"35. The legislative competence of Parliament and the legislatures of
F the States to make laws under Article 246 is regulated by the Vllth
Schedule to the Constitution. In the Vllth Schedule as originally in
force, Entry 11 of List II gave to the State an exclusive power to
legislate on

"education including universities, subject to the provisions of Entries
G 63, 64, 65 and 66 of List I and Entry 25 of List III".

Entry 11 or List II was deleted and Entry 25 of List Ill was amended
with effect from 3-1-1976 as a result of the Constitution 42nd Amendment
Act of 1976. The present Entry 25 in the Concurrent List is as follows:

"25. Education, including technical education, medical education and
H
GOVf. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA, J.) 425

universities, subject to the provisions of Entries 63, 64, 65, and 66 of A
List I; vocational and technical training of labour."

Entry 25 is subject, inter alia, to Entry 66 of List I. Entry 66 of List
I is as follows.:

"66. Coordination and determination of standards in institutions for B
higher education or research and scientific and technical institutions:"

Both the Union as well as the States have t.he power to legislate on
education including medical education, subject, inter alia, to Entry 66
of List I which deals with laying down standards in institutions for
higher education or research and scientific and technical institution as C
also coordination of such standards. A State has, therefore, the right
to control education including medical education so long as the field
is not occupied by any Union legislation. Secondly, the State cannot,
while controlling education in the State, impinge on standards in
institutions for higher education. Because this is exclusively within
the purview of the Union Government. Therefore, while prescribing D
the criteria for admission to the institutions for higher education
including higher medical education, the State cannot adversely affect
the standards laid down by the Union of India under entry 66 of List
I. Secondly, while considering the cases on the subject it is also
necessary to remember that from 1977, education, including, inter E
alia, medical and university education, is now in the Concurrent List
so that the Union can legislate on admission criteria also. If it does
SQ, the State will not be able to legislate in this field, except as
provided in Article 254."

The aforementioned decisions have been referred to with a view to p
show that there are certain situations where the State may even make legislation
subject to the Parliam~ntary legislation.

The instant case stand on a better footing inasmuch as the State
Government has been assigned only certain statutory functions by the
Regulations framed under the Parliamentary Act itself and in that view of the G
matter no exception thereto can be taken.

Th°is aspect of the matter has been considered in the State of
Maharashtra v. Indian Medical Association and Ors., [2002] I SCC 589 where
in a two-judge Bench of this Court of which one of us Khare, CJ! (as he then
was) was a member observed: ~ · H
426 SUPREME COURT REPORTS [2003) SUPP. 5 S.C.R.

A "A perusal of para 3 of the l'egulation shows that it is mandatory
on the part of an institution or a ma11agement desirous of establishing
a medical college to obtain Essentiality Certificate from the respective
State Government or the Union Territory Administration, as the case
may be. The requirement of Essentiality Certificate provided under
para 3 of the Regulation concerns with among other requirements the
B desirability of having the proposed medical college at the proposed
location. The desirability of having the medical college at the proposed
location under para 3 of the Regulation is required to be decided by
the State Government. Excepting the desirability of location of the
proposed medical college and certificate that adequate clinical material
c is available as per the Medical Council of India at the proposed
medical college, which are to be decided by the State Government all
other aspects regarding establishment of a new medical college and
imparting of the education therein are covered by the Central Act and
Regulation framed thereunder. In other words, in the matter of
establishment of a medical college and medical education, the field
D that is open where a State Government has any role to play is only
in regard to decide the desirability of the location of the proposed
medical college and grant of certificate that adequate clinical material
is available as per the Medical Council at the proposed medical college.
Thus, the State Government is the only authority under the Regulation
E with which we are concerned to decide the location of a new proposed
medical college within the State. The State Government, therefore, is
the only judge to decide where the proposed medical college is to be
located. For that purpose, the State Government can neither delegate
its function to any other authority nor can it create a statutory authority
under a State Act. If it does so, it would be repugnant to the Central
F Act. However, it is true that the State Government in order to maintain
inter-or intra regional imbalances within the State and to remove the
chances of arbitrariness, can lay down guidelines or prepare a
perspective plan for its own guidance for selecting locations for a
proposed new medical college within the State."
G Yet again r:eferring to the provisions of Section 64 of the Act, this
Court held that there is another object behind the necessity of obtaining
the essentiality certificate from the State Government under para 3 of
the Regulations stating: .

"A perusal of Section 64 shows that it provides for procedure for
H

-
GOVT. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA,J.] 427

obtai11ing pennission by the State Government for setting up a new A
medical college and confers exclusive power on the State Government
for grant of pennission to a management to establish a new medical
college. The power of the State Government to grant pennission to set
-up a new medical college under Section 64 of the Act is substantially
the power of the State Government to grant Essentiality Certificate to B
a management or an institution who intends to establish a new medical
college at a proposed location. If Section 64 of the Act is read along
with para 3 of the Regulation it would show that the requirement of
Essentiality Certificate or approval by the State Government is required
when a private management or any other person other than the State
Government intends to set up a medical college ..." C
The role of the State in the matter of establishment of professional
colleges by the minority community as also private agencies came up for
consideration before a eleven-Judge Bench of this Court in T.MA. Pai
Foundation and Ors. v. State of Karnataka and Ors., [2002] 8 SCC 481. The
court no uncertain tenn held that the right· to establish and administer D
educational institutions although is available to all citizens under Articles
19(1 )(g) and 26 and to the minority under Article 30 of the Constitution but
the same are subject to reasonable restrictions.

In T.MA Pai (supra) a distinction was made between minority and non-
minority professional medical colleges as regard percentage for admission of E
students can be reserved by the management but it was held that the rest
have to be filled up on the basis of counselling by the State agencies.
Interpretation of the aforementioned finding in T.MA. Pai (supra) in para 68
of the judgment vis-a-vis other authorities came up for consideration before
a Constitution Bench of this Court in Islamic Academy of Education and Anr. p
v. State of Karnataka and Ors., [2003] 6 SCC 697. Before the Constitution
Bench, inter alia, the following questions were raised:

"(3) whether private unaided professional colleges are entitled to fill
in their seats, to the extent of I 00%, and if not, to what extent;
and G
(4) whether private unaided professional colleges are entitled to
admit students by evolving their own method of admission."

Dealing with the said question, the Chief Justice of India speaking for
himself, Variava, Balakrishnan and Pasayat, JJ, observed:
H
428 SUPREME COURT REPORTS [2003] SUPP. 5 S.C.R.

A " ... It is provided that in cases of non-minority professional colleges
"a certain percentage of seats" can be reserved for admission by the
management. The rest have to be filled up on the basis of counselling
by State agencies. The prescription of percentage has to be done by
the Government according to local needs. Keeping this in mind
provisions have to be made for the poorer and backward sections of
B the society. It must be remembered that, so far as medical colleges are
concerned, an essentiality certificate has to be obtained before the
college can be set up. It cannot be denied that whilst issuing the
essentiality certificate the respective State Governments take into
consideration the local needs. These aspects have been highlighted
c in a recent decision of this Court in State of Maharashtra v. Indian
Medical Association. 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 there
in...."
D
One of us, (Sinha, J.) however, keeping in view that therein not only
cases of medical colleges but also professional colleges were in question,
observed that grant of the essentiality certificate may not be the sole criteria..
It was further noticed that in the case of State of Maharashtra (supra), the
E expression 'technical education' occurring in Article 371(1)(c) of the
Constitution of India as regard distinction between medical education and
technical education did not come up for consideration therein. It was, however,
held:

"Local needs:

F It is difficult to define precisely what would constitute "local needs".
Mr. Venugopal refers to the Medical Council of India Regulations,
1999 for the purpose of showing the requirements necessary to be
considered by the State Government for the grant of essentiality
certificate. The State Government alone would be in a position to
G determine local needs which may be based, for instance, in the case
of doctors, on the ratio of doctors to the population of the State.
Other factors such as the percentage of the relevant minority in the
State, the number of minority professional colleges belonging to that
particular linguistic/religious minority in the State, percentage of poorer
and backward sections in the State, total number of professional
H colleges therein, contends Mr. Venugopal, would be relevant factors.
GOVT. OFANDHRA PRADESH v. MEDWJN EDUCATIONAL SOCIETY[S B. SINHA, J.] 429

This may be so but similarly there are many more factors that would A
contribute to local needs. The criteria laid down in MCI Regulations
no doubt provide for some guidelines for the purpose of determination
of local needs but the same cannot be said to be exhaustive. Local
needs would vary from State to State. Even development of a backward
area may be a local need. Absence of good educational institutions B
in particular area may also be a local need. The State may, in pursuit
of its policy for the development of the people, consider it expedient
to encourage entrepreneurs for establishing educational institutions
in remote and backward areas for the benefit of the local people. Local
needs, therefore, cannot be defined only with reference to the State
as a unit. For good reasons the State may not like to establish C
professional colleges or institutions only in their capitals.

ESSENTIALilY CERTIFICATE:

Although local needs, thus, may have to be determined keeping
in view the factors enumerated therein but it must also be noticed that D
no essentiality certificate is required to be given by the State in
relation to engineering and other professional colleges. While laying
down the law based on interpretation of a Constitution as well as a
judgment, we cannot take a myopic view and hold that 'local needs'
must be referable to the medical education. Furthermore, it may be
difficult to give a restrictive meaning to the expression 'local needs' E
i.e. keeping the same confined to the area where the educational
institution is ought to be established inasmuch as the right of minority
extends to the entire State and, thus, the local needs may also have
direct nexus having regard to the need of the State."

The upshot of the aforementioned discussions is that, in our opinion, F
the High Court has committed a manifest error in holding that the State has
no role to play in the matter of identification of location of the sites where
the medical colleges are proposed to be established. While granting an
essentialitY certificate particularly having regard to the local needs, the State,
in our considered view, has a positive role to play but the same would not G
mean that the State Government's say is final as ultimately final
recommendations have to be made by the Medical Council of India and the
Dental Council of India, as the case may be, whereafter the final decision has
to be taken by the Central Government.

We may, however, hasten to add that for the purpose of identifying the H
430 SUPREME COURT REPORTS [2003] SUPP. 5 S.C.R.

A sites Article 3710 of the Constitution of India may not have any application.
Mr. Sanghi, learned Senior Counsel, appearing on behalf of the State of
Andhra Pradesh conceded to the aforementioned legal position.

CIVIL APPEAL NOS. 2608 OF 2002

B We may now proceed to determine the issues raised in Civil Appeal
Nos. 2608 of2002.

The appellant intended to set up a medical college at Jedcherla within
the Telengana region of the State of Andhra Pradesh. It filed a writ petition
questioning an order of the State Government dated 21.10.1997 whereby and
C whereunder the application filed by the appellant herein for grant of essentiality
certificates was rejected, stating:

"The Government have examined the above matter in detail. Since the
High Court of AP have ruled that the admission in private Medical
College shall be restricted to local area only in accordance with the
D Presidential Order with effect from the next academic year and since
there is already one minority institution for the nine Districts of
Telengana region (erstwhile Camania University area) and another
minority institution in the same area will cause regional imbalance as
there is no minority institution elsewhere in the State, the Government
E hereby reject your request for grant of Essentiality Certificate for M.B.
Christian Medical College at Jedcherla". The contention raised on
behalf of the State was that having regard to the provisions contained
in Article 3710 of the Constitution of India, it is not bound by the
recommendations made by the Committee. Taking umbrage under
Article 3710, it was contended that if the appellant is given essentiality
F certificate, the regional balance of that area would be disturbed and
on that basis the said application was rejected.

The learned counsel appearing on behalf of the appellant has pointed
out that despite the aforementioned stand taken by the State before the High
Court as also before us essentiality certificate has been granted to other
G minority institutions in Nellore which is within the Telengana region.

The learned Single Judge although disposed of the said application, the
contention raised by the appellant was not specifically considered. The Full
Bench of the High Court also did not direct the State Government to issue
H an essentiality certificate as was prayed for, evidently in view of its finding
GOVT. OF ANDHRA PRADESH v. MEDWIN EDUCATIONAL SOCIETY[ S.B. SINHA, J.] 43 J

that legislative field is covered by the Parliamentary Act and the final authority A
to decide the same vests in the Medical Council of India and the Central
Government.

CIVIL APPEAL No. 2617 OF 2002:

In Civil Appeal No. 26 I 7 of 2002, the appellant proposed to set up a B
medical colfege at Warangal. The committee constituted by the State made
recommendations in favour of the appellant whereafter essentiality certificate
vide GOHs dated 4.12.1998 was issued. The first respondent, however, filed
a writ petition before the Andhra Pradesh High Court questioning the issuance
of the aforementioned GOMs.
c
The learned Single Judge having regard to its finding that the constitution
of Justice S. V. Maruthi Committee was illegal, allowed the writ petition of the
first respondent, despite holding that the State Government has power to
identify the locations of medical colleges. The appellant herein preferred an
appeal thereagainst. However, the said appeal was dismissed by the Full D
Bench by directing the State Government to issue fresh notification.

The High Court, therefore, did not go into the contentions.raised by the
parties on merits of the matter.

Having regard to our findings aforementioned, to the effect that the E
State has a jurisdiction to grant an essentiality certificate, the questions as
to whether such essentiality certificate has been justifiably refused in the case
of the Governing Conference of Mennonite Brathern Church of India and
whether the High Court was right in allowing the writ petition filed by the
respondent of Civil Appeal No. 2617 of 2002 are, in our opinion, required to
be considered afresh. F
Although the State has a say in the matter as regard location for
establishing of a media college or dental college, it has to exercise such power
in a reasonable manner. The factors which are relevant for determination of
such issues would be local needs and public interest. The question as to
whether the medical college is being set up by a minority institution or a non- G
minority institution must be considered in the light of the observations made
in TMA. Pai (supra) and Islamic Academy of Education (supra). While
rejecting such an application for grant of essentiality certificate, the State
must comply with the principles of natural justice which would include
assigning of sufficient and cogent reasons. H
432 SUPREME COURT REPORTS [2003] SUPP. 5 S.C.R.

A In short, the State cannot act arbitrarily or capriciously. Its decisions
must be informed by reasons and based on relevant factors.

We are, therefore, of the opinion that the matters involved in the
aforementioned two appeals are required to be considered afresh by a Division
Bench of the Andhra Pradesh High Court in accordance with law and in the
B light of the observations made hereinbefore.

We may observe that we have not considered the merit of the matter
keeping view of the fact that the appellant hetein had filed application for
grant of essentiality certificate long time back. We would request the High
Court to consider the desirability of disposal of these appeals expeditiously.

These appeals are disposed of on :he above tem1s. No costs.

B.K.M. Appeals disposed of.