Holding

The State Government could lawfully cancel the Essentiality Certificate because the appellant committed constructive fraud and the substratum on which the certificate was granted had disappeared, fitting within the excepted categories.

Summary

The Gujarat Sukh Sagar Medical College & Hospital Trust obtained an Essentiality Certificate in 2014 to establish a medical college in Jabalpur, Madhya Pradesh. Despite conditional permission for the 2016‑17 academic year, the Medical Council of India (MCI) repeatedly denied renewal of permission for three successive sessions due to gross deficiencies, leading the State to cancel the certificate in September 2019. The Trust challenged the cancellation, arguing that the State lacked statutory power to revoke the certificate and that the Chintpurni Medical College precedent barred such revocation. The Supreme Court held that, although the IMC Act and 1999 Regulations do not expressly empower the State to withdraw the certificate, the State may do so in the exceptional categories of fraud or loss of the substratum on which the certificate was issued. Finding that the Trust misrepresented its capability and that the substratum had disappeared, the Court classified the case as constructive fraud and upheld the State's revocation. Consequently, the appeal was dismissed and the High Court's order affirmed.

Issues considered

The State Government's authority to revoke an Essentiality Certificate absent an express provision in the IMC Act or 1999 Regulations.
Whether revocation falls within the 'excepted categories' of fraud or loss of substratum as articulated in Chintpurni Medical College.
If the appellant obtained the Essentiality Certificate by actual or constructive fraud on the State.
Whether the substratum for issuance of the Essentiality Certificate had disappeared due to failure to meet MCI standards.
The applicability of the term 'established' medical college to the present case and its impact on revocation power.
The relevance of Article 47 of the Constitution in the State's duty to ensure public health.

Legislation cited

Subjects

Essentiality CertificateMedical CollegeFraudConstructive fraudQuasi‑judicial functionGeneral Clauses ActArticle 47Public healthMedical Council of IndiaState power

Judgment

[2020] 11 S.C.R. 397 397

SUKH SAGAR MEDICAL COLLEGE & HOSPITAL A
v.
STATE OF MADHYA PRADESH & ORS.
(Civil Appeal No. 2843 of 2020)
JULY 31, 2020 B
[A. M. KHANWILKAR, DINESH MAHESHWARI AND
SANJIV KHANNA, JJ.]
Education/Educational Institutions – Essentiality Certificate
granted to appellant-Trust in 2014 for establishing a medical college
C
– Eventually, Conditional Letter of Permission granted for academic
year 2016-17 – However, renewal permissions not issued by MCI
for three successive academic sessions due to gross deficiencies –
Essentiality Certificate cancelled – Challenged by appellant –
Rejected – On appeal, held: Appellant failed to fulfil even the
minimum benchmark of standards specified by MCI allowing it to D
run the medical college – Even in Chintpurni Medical College and
Hospital & Anr. vs. State of Punjab & Ors. reported as [1976] 3
SCR 202, relied upon by the appellant, Supreme Court clarified that
the State Govt. can cancel/revoke/withdraw Essentiality Certificate
in exceptional cases – Appellant misrepresented the State Govt. by
E
giving a sanguine hope of ensuring installation of minimum
infrastructure, setting up a robust organisational structure for
running a medical college “in a time bound programme” –
Therefore, it is a case of constructive fraud played upon the State
Govt. and would come within the excepted category – Substratum
on the basis of which Essentiality Certificate was issued had F
completely disappeared – Order of the High Court upheld – Indian
Medical Council Act, 1956 – Medical Council of India Establishment
of Medical College Regulations, 1999 – General Clauses Act, 1897
– s.21 – Constitution of India – Art.47.
Words & Expressions – “established” – Meaning of – G
Discussed.
Dismissing the appeal, the Court
HELD: 1.1 At the outset, this Court may straightaway agree
with the dictum in Chintpurnic Medical College that the act of the
H
397
398 SUPREME COURT REPORTS [2020] 11 S.C.R.

A State in issuing Essentiality Certificate is a quasi-judicial function.
Having said that, it must follow that Section 21 of the 1897 Act
cannot be invoked and in absence of an express provision in the
IMC Act or the 1999 Regulations empowering the State
Government to revoke or cancel the Essentiality Certificate, such
a power cannot be arrogated by the State relying on Section 21.
B
That, however, does not deprive the State Government to revoke
or withdraw the Essentiality Certificate in case where (a) it is
secured by playing fraud on the State Government, (b) the
substratum for issuing the certificate has been lost or disappears
and (c) such like ground, where no enquiry is called for on the
C part of the State Government. Even in Chintpurni Medical College,
the Court has clarified that the State Government can cancel/
revoke/withdraw Essentiality Certificate in exceptional cases.
Chintpurni Medical College does not lay down in absolute terms
that the State cannot revoke the Essentiality Certificate once
granted for opening of a new medical college within the State.
D
The first excepted category is where the appellant had obtained
the Essentiality Certificate by playing fraud on the State
Government. Fraud vitiates any act or order passed by any quasi-
judicial authority, even if no power of review is conferred upon it.
As to when it would be a case of fraud played on the State
E Government, would depend on whether it was an attempt by the
appellant to present facts, so as to misrepresent the State. The
fraud can either be actual or constructive fraud. The actual fraud
is a concealment or false representation through an intentional
or reckless statement or conduct that injures another who relies
on it in acting, whereas the constructive fraud is unintentional
F
deception or misrepresentation that causes injury to another.
Indeed, in the present case, the State Government in its order
dated 5.9.2019 (withdrawing the Essentiality Certificate dated
27.8.2014) has adverted to several aspects including the
assessment report of the MCI and inspection report of the
G Committee. The substance of the reason weighed with the State
Government is that the appellant had failed to fulfil the
commitment given to the State at the relevant time- of providing
minimum infrastructure and fulfilment of the norms of MCI and
appointing the staff as per norms of MCI - for all this period and
H
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 399
MADHYA PRADESH & ORS.

was incapable in doing so despite repeated opportunities given A
since 2016 by the MCI. [Paras 13-15][415-C-E; 416-G; 417-B-
C, D, G-H; 418-A; 419-A-B]
Indian National Congress (I) v. Institute of Social
Welfare & Ors. (2002) 5 SCC 685 : [2002] 3 SCR 1040
– relied on. B
Chintpurni Medical College and Hospital & Anr. v. State
of Punjab & Ors. (2018) 15 SCC 1 : [1976] 3 SCR 202
– referred to.
Black’s Law Dictionary 6th& 11th Edition – referred to.
C
1.2 The totality of the situation reinforces the fact that the
appellant-College had failed and neglected to discharge its
commitment given to the State at the relevant time; and is
incapable of fulfilling the minimum norms specified by the MCI
for starting and running a medical college. It had thus
misrepresented the State Government at the relevant time by D
giving a sanguine hope of ensuring installation of minimum
infrastructure and setting up of a robust organisational structure
for running of a medical college “in a time bound programme”.
Therefore, it is a case of constructive fraud played upon the State
Government. For, even after lapse of over five years from the E
date of issuance of Essentiality Certificate (27.8.2014), the
appellant-College is not in a position to secure the requisite
permission(s) from the MCI and the Central Government to run
a medical college as per the scheme. The State Government whilst
discharging its role of parens patriae of the student community
cannot remain a mute spectator and expose them to a college, F
which is deficient in many respects. The fact that no renewal
permission has been granted by the MCI for three successive
academic sessions due to gross deficiencies in the appellant-
College, is itself indicative of the state of affairs in the appellant-
College, warranting a legal inference that the substratum on the G
basis of which Essentiality Certificate was issued to the appellant-
College had completely disappeared. For, even the first batch of
students admitted in the appellant-College could not pursue their
medical course and were eventually reallocated by the State
Government to other recognised private medical colleges within
H
400 SUPREME COURT REPORTS [2020] 11 S.C.R.

A the State as per the obligation specified in the Essentiality
Certificate, after obtaining permission of the Central Government
in that behalf in November, 2019. This being a clear case of a
non-functioning college, warranted immediate intervention of the
State Government in larger public interest and also because the
substratum had disappeared. It would certainly come within the
B
excepted category, where the power of withdrawal of Essentiality
Certificate ought to be exercised by the State and more particularly
not being a case of an established college per se. [Paras 16-
18][419-E-H; 420-A-C, F]
1.3 The term “established” is not defined in the IMC Act
C or the 1999 Regulations. In the present case, however, the
appellant-College was at the threshold stage of only opening and
starting first year course for academic year 2016-17. It failed and
neglected to fulfil even the minimum benchmark of standards
specified by the MCI allowing it to run the medical college.
D Admittedly, no renewal permissions from the Central Government
were issued for the successive academic years. In that sense, it
is not a case of withdrawal of the Essentiality Certificate of an
“established” medical college as such. Had it been a case of well-
established and a running medical college having basic minimum
infrastructure as per the specifications of the MCI and State
E Government was to withdraw its Essentiality Certificate, that
matter would stand on a different footing than the case at hand,
where the college has miserably failed to ensure completion of
medical course even of the first batch for three successive
academic sessions from 2016-17 due to non-renewal of
F permission by the MCI. While dealing with the case of maintaining
standards in a professional college, a strict approach must be
adopted because these colleges engage in imparting training and
education to prospective medical professionals and impact their
academic prospects. [Paras 19, 21][420-G; 421-B-D, G]
G 1.4 Article 47 of the Constitution of India encompassed in
Directive Principles of State Policy, enjoins the State with a duty
to provide for and ensure good public health and a constant
endeavour to improve the same to effectuate the fundamental
right to life guaranteed by the Constitution to all. Thus

H
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 401
MADHYA PRADESH & ORS.

understood, the State’s duty under Article 47 is to act as an A
“enabler” for the wholesome exercise of right to life. A right to
have access to proper public health care would be of little value
if the State does not create the requisite conditions for proper
exercise of such right. Access to medical college and hospital is,
no doubt, a part of the said conditions. What is necessary in the
B
present factual matrix is for the State to assess the dire need of
medical infrastructure within the State or the locality, as the case
may be. The very fact that an Essentiality Certificate is issued in
the first place, in itself, is a testimony of the “essentiality” of such
infrastructure. The authority of the State to grant Essentiality
Certificate is both power coupled with a duty to ensure that the C
substratum of the spirit behind the Certificate does not disappear
or is defeated. The exercise of power and performance of duty
with responsibility and in right earnest must co-exist. The duty
under Article 47 is, in the constitutional sense, fundamental in
the governance of the State. This duty does not end with mere
D
grant of a certificate, rather, it continues upto the point when
essentiality of basic medical infrastructure is properly taken care
of within a reasonable time frame. This Court is conscious of the
view taken and conclusion recorded in Chintpurni Medical College.
Even though the fact situation in that case may appear to be similar,
however in a case such as the present one, where the spirit E
behind the Essentiality Certificate issued as back as on 27.8.2014
remained unfulfilled by the appellant-College for all this period
(almost six years), despite repeated opportunities given by the
MCI, as noticed from the summary/observation in the assessment
report, it can be safely assumed that the substratum for issuing
F
the Essentiality Certificate had completely disappeared. The
appellant-College is a failed institute thus far and is unable to
deliver the aspirations of the student community and the public
at large to produce more medical personnel on year to year basis
as per the spirit behind issuance of the subject Essentiality
Certificate dated 27.08.2014. To this extent, this Court G
respectfully departs from the view taken in Chintpurni Medical
College. The order of the High Court rejecting the subject writ
petition filed by the appellant-College is upheld. The appellant-
College is at liberty, as given by the High Court, to forthwith
remove all the deficiencies pointed out by the MCI in its order
H
402 SUPREME COURT REPORTS [2020] 11 S.C.R.

A dated 30.5.2019 and apply afresh for the Essentiality Certificate.
[Paras 23-25, 27][422-D-F, G; 423-A-B, G; 424-B-C]
Paschim Banga Khet Mazdoor Samity & Ors. v. State
of West Bengal & Anr. (1996) 4 SCC 37 : [1996]
2 Suppl. SCR 331 – relied on.
B Hind Charitable Trust Shekhar Hospital Private Limited
v. Union of India & Ors. (2015) 2 SCC 336 : [2014] 14
SCR 1367; Modern Dental College & Research Centre
v. State of Madhya Pradesh (2016) 7 SCC 353 : [2016]
3 SCR 579; Industrial Infrastructure Development
C Corporation (Gwalior) Madhya Pradesh Limited v.
Commissioner of Income Tax, Gwalior, Madhya Pradesh
(2018) 4 SCC 494 : [2018] 10 SCR 481; Ghaurul
Hasan & Ors. v. State of Rajasthan & Anr. AIR 1967
SC 107 : [ 1962] SCR 772; Hari Shankar Jain v. Sonia
Gandhi (2001) 8 SCC 233 : [2001] 3 Suppl. SCR 38;
D Government of Andhra Pradesh & Anr. v. Y.S.
Vivekananda Reddy & Ors. AIR 1995 AP 1 – referred
to.
Case Law Reference

E [1976] 3 SCR 202 referred to Para 2
[2014] 14 SCR 1367 referred to Para 12
[2016] 3 SCR 579 referred to Para 12
[2002] 3 SCR 1040 referred to Para 12
F [2018] 10 SCR 481 referred to Para 12
[1962] SCR 772 referred to Para 12
[2001] 3 Suppl. SCR 38 referred to Para 12
[1996] 2 Suppl. SCR 331 relied on Para 23
G CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2843
of 2020.
From the Judgment and Order dated 06.01.2020 passed by the
High Court of Madhya Pradesh, Principal seat at Jabalpur in W.P. No.
17946 of 2019.
H
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 403
MADHYA PRADESH & ORS.

Saurabh Mishra, AAG for Madhya Pradesh, Dushyant Dave, A
Vikas Singh, Sr. Advs., Sankalp Kochar, Mayank Pandey, Sunny
Choudhary, Gaurav Sharma, Dhawal Mohan, Prateek Bhatia, Advs. for
the appearing parties.
The Judgment of the Court was delivered by
A. M. KHANWILKAR, J. B

1. Leave granted.
2. The seminal question in this appeal is: whether the State
Government had unjustly revoked the Essentiality Certificate granted to
Gyanjeet Sewa Mission Trust1 for establishing a medical college at C
Jabalpur in the State of Madhya Pradesh, being contrary to the decision
of a two-Judge Bench of this Court in Chintpurni Medical College
and Hospital & Anr. Vs. State of Punjab & Ors.2?
3. Shorn of unnecessary details, the Government of Madhya
Pradesh, on an application made by the appellant-Trust, issued the stated D
Essentiality Certificate as prescribed in Form-2 appended to the Medical
Council of India Establishment of Medical College Regulations, 19993.
The same reads thus: -
“Government of Madhya Pradesh
Medical Education Department, Bhopal E
F.No. F-5-56/2014/1/55 Date: 27.08.2014

To,
The Chairman, F
GhyanjeetSewa Mission Trust,
SukhSagar Medical College & Hospital Jabalpur
Jabalpur
Sir, G

The desired certificate is as follows: -
1
For short, “the appellant-Trust” or “the appellant-College”
2
(2018) 15 SCC 1
3
For short, “the 1999 Regulations” H
404 SUPREME COURT REPORTS [2020] 11 S.C.R.

A 1. No. of institutions already existing in the 6 Autonomous Medical Colleges
State. 7 Private Medical Colleges
2. No. of seats available or No. of doctors being 1770 MBBS Seats
produced annually.
3. No. of doctors regi stered wit h the State Not Updated
Medical Council.
4. No. of doctors in Government service. Not Updated
5. No. of Government posts vacant and those in Not Updated
B rural/difficult areas.
6. No. of doctors registered with Employment Not Updated
Exchange.
7. Doctor population ratio in the State. The population of State is 7,26,27000 as
per 2011 census. The population of
Jabalpur Division, where the Medical
College is proposed is 24,63,289
8. How the establishment of the college would By increasing qualified Medical Doctors in
C resolve the problem of deficienci es of the state of Madhya Pradesh.
qualified medical personnel in the State and
improve the avail ability of such medical
manpower in the State.
9. The restrictions imposed by the State No restrictions. The admission will be
Government, if any, on students who are not made t hrough M.P. Professional
domiciled in the State from obtaining Examinations Board.
admissions i n the State, be specifi ed.
10. Ful l justification for opening of the proposed For opening of the proposed Medical
D college. College, the applicant is a Regist ered Trust,
possessing 27.27 acres of land with 300
bedded running hospital and adequate
planning & time bound programme.
The Applicant is developing St aff Quarters,
Nurses Quarters, Boys & Girls Hostel along
with ample Administrative Block, Parking
Space, Sports Ground and having well
E managed funds to run the Medical
College & Hospital.
The Hospital woul d serve the growing
population of Jabalpur. People will get
modern health treatment under one roof.
The opening of medical college will give
150 trained & educated Medical
Professionals to the society every year,
F who will contribute in serving the public
at large. Thus, opening up of a Medical
College and Hospital i n Jabalpur would
not only bridge the huge gap but will
definitely contribute on its part for the
service of needy patients of Jabalpur, in
particular and the state at large.
11. Doctor-patient ratio proposed t o be achieved Marginally increased
G The Ghyanjeet Sewa Mission Trust, has applied for establishment
of a new Medical College at Jabalpur. On careful consideration of the
proposal, the Government of Madhya Pradesh has decided to issue an
essentiality certificate to the [sic] applicant for the establishment of a
Sukh Sagar Medical College & Hospital Jabalpur with 150 seats in MBBS
Programme under following conditions: -
H
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 405
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

1. Institute will fulfil the norms of MCI before inspection of A
Medical Council of India.
2. Institute will appoint the staff as per norms of MCI.
3. Government will neither bear any financial burden nor provide
grant to the institute.
4. Institute will follow all the rules/conditions of MCI and B
State/Central Government.
5. Institute will admit the student only after written permission
from Central Government, MCI and State Government.
6. Institute will admit the students by adopting transparent
procedure as decided by admission and fee regulatory committee C
appointed by the State Government.
7. Institute will charge the fee as decided by the State Government
(admission and fee regulatory committee). No other fee will be admissible.
It is certified that: -
i. The applicant owns and manages a 300 bedded hospital. D
j. It is desirable to establish a Medical College in the public interest.
k. Adequate clinical material as per the Medical Council of India
norms is available.
It is further certified that in case the applicant fails to create
infrastructure for the medical college as per MCI norms and E
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.
By order in the name of Governor of Madhya Pradesh. F

Sd/-
27.08.2014
(Sanjeev Shrivastava)
G
Deputy Secretary
Govt. of Madhya Pradesh
Medical Education Deptt.
Dated /08/2014"
H
(emphasis supplied)
406 SUPREME COURT REPORTS [2020] 11 S.C.R.

A 4. After issuance of the aforementioned Essentiality Certificate,
the appellant-Trust submitted a scheme to the Medical Council of India4,
for establishment of a new medical college at Jabalpur in the name and
style of Sukh Sagar Medical College & Hospital with annual intake of
150 students in MBBS course for the academic year 2016-17. The MCI
after due inspection had submitted a negative report to the Central
B
Government due to gross deficiencies, including fake records regarding
the patients and resident staff, as a result of which the Ministry of Health
and Family Welfare, Government of India vide letter dated 10.6.2016,
rejected the proposed scheme. However, in light of the directions dated
13.6.2016 issued by the Supreme Court Mandated Oversight Committee
C (OC)5, the Ministry of Health and Family Welfare issued a letter on
20.8.2016 in supersession of its earlier letter, according permission to
the appellant-Trust for establishing a medical college on certain conditions
mentioned therein. This permission was valid for a period of one year, to
be renewed on yearly basis subject to the verification of the achievement
of annual targets as indicated in the scheme submitted by the Trust and
D
revalidation of performance Bank Guarantee. It was made clear that
the process of renewal of permission will continue till such time the
establishment of medical college and expansion of hospital facilities were
to be completed and a formal recognition of the medical college is granted
in furtherance thereof. It was also made clear to the Trust that the next
E batch of students in MBBS course for the academic year 2017-18 be
admitted in the college only after obtaining prior permission of Central
Government and fulfilling conditions stipulated by the SCMOC referred
to in paragraph 2 of the Letter of Permission (LoP). The MCI inspected
the college and found that the undertaking given by the management
was breached and violated, as a result of which the Central Government
F
debarred the college for academic years 2017-18 and 2018-19.
5. It is an admitted position that for the subsequent academic
years i.e. 2017-18, 2018-19 and 2019-20, no renewal of permission was
accorded to the appellant-College. The latest assessment report of the
MCI dated 3rd and 4th January, 2019, would indicate that the appellant-
G College was unable to rectify the deficiencies pointed out by the Inspecting
Committee of the MCI. The deficiencies noted in the assessment report
read thus: -

4
For short, “the MCI”
5
H For short, “the SCMOC”
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 407
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

“… A
1. No orientation & basic course undergone by MEU.
2. One Lecture theatre for college lacking, hospital Lecture
Theatre not gallery type.
3. In Central Library: B
- Number of books less by 798
- Indian Journals less by 14
- Foreign Journals less by 06
4. Hostel accommodation less by 176 (Required 360 – C
available 224).
5. Biometric device not yet installed.
6. Bed Occupancy 3.65% (15 patients on 410 beds).
7. Minor surgeries, normal deliveries, caesarean section D
– Nil
8. Ba, IVP – Nil, CT Scan not installed.
9. Number of admissions only 2, casualty attendance one (01).
10. Cytopathology Nil, Static X-ray in casualty – Nil
E
11. Separate casualty for OBGY not available.
12. Defibrillators total 04 in OT block and are being shared between
various theatres.
13. No patients in ICCU, ICU, SICU, NICU and PICU.
F
14. 01 mobile 60 mA, 01 Static 800 mA, CT not available in
Radiology department.
15. No mannequins available in Pharma department.
16. No accommodation available for students in RHTC,
Students go to RHTC but not in UHTC. G
17. Deficiency of Faculty 88.03% (103/117)
18. Deficiency of Residents 90.9% (60-66)
…”
(emphasis supplied) H
408 SUPREME COURT REPORTS [2020] 11 S.C.R.

A Resultantly, the Board of Governors in Supersession of MCI, vide
letter dated 30.5.2019, declined to accept the request for renewal of
permission for admission to 150 students in MBBS course for the
academic year 2019-20.
6. In this backdrop, the Additional Secretary, Medical Education
B Department of Government of Madhya Pradesh, issued a show-cause
notice dated 7.8.2019, calling upon the appellant to show cause as to
why the Essentiality Certificate issued in favour of the appellant-Trust
should not be cancelled.
7. The appellant assailed the said show-cause notice by filing a
C writ petition before the High Court of Madhya Pradesh, Principal Seat
at Jabalpur6, being Writ Petition No. 17946/2019. During the pendency
of the said writ petition, the appellant submitted response to the show-
cause notice and questioned the authority of the State Government to
revoke the Essentiality Certificate, mainly relying on the decision of this
Court in Chintpurni Medical College (supra).
D
8. Additional Secretary, Medical Education Department,
Government of Madhya Pradesh, after giving due opportunity to the
appellant and considering its response to the show-cause notice, eventually
proceeded to pass an order directing cancellation/revocation/withdrawal
of the Essentiality Certificate dated 27.8.2014. It is apposite to advert to
E the reasons that weighed with the authority in cancelling the Essentiality
Certificate. The authority has taken into account that the appellant had
failed to remove the deficiencies pointed out by the MCI from time to
time and no renewal of permission was granted for academic years
2017-18, 2018-19 and 2019-20 on that count. Thus, the appellant had
F failed to provide even the minimum clinical material for running of a
medical college, contrary to the conditions specified in clause numbers
1, 2 and 4 of the Essentiality Certificate. In substance, the college had
failed and neglected to provide for the minimum standards specified by
the MCI for running of a medical college, despite several opportunities
given in that regard since academic year 2016-17. The deficiencies (as
G noted in the assessment report of the MCI), were gross and had even
jeopardised the academic career of the first batch of 150 students admitted
in the college during academic year 2016-17. It had also come to the
notice of the State authorities that the College had declined to impart
education to those students who had not deposited fees, which was again
6
H For short, “the High Court”
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 409
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

in violation of the conditions specified in the Essentiality Certificate. A
During a joint meeting between the Collector, Jabalpur, management of
the College and students, convened on 19.7.2019, the grievances of the
students were considered and direction was issued to the management
to take corrective measures within ten days and provide the basic
minimum facilities to the students and resume the classes. However,
B
that did not happen. In the concluding part of the order dated 5.9.2019,
therefore, it is noted as follows:-
“…..
(xvii) Also regarding the Sukh Sagar Medical College & Hospital,
the acts of not providing proper infrastructure facilities for the C
study of medical students, lack of necessary academic staff for
teaching the course, non-availability of clinical material due to the
very less numbers of patients to be admitted in the hospital, and
the fact of not granting recognition by the MCI for the Sessions
2017-18, 2018-19 and 2019-20 due to the different deficiencies,
misbehaving with the students, are the gross violation of the D
conditions and basis conditions of grant of Essentiality
Certificate issued by the State Government. In this regard,
due to the failure of College Management in taking
necessary action continuously for a period of 3 years, it is
itself clear that they have been completely failed in serving E
the main objective of issuance of Essentiality Certificate
i.e. providing better medical facility to the patients and
increasing the numbers of medical professionals. On the
other hand, in the lack of necessary facilities required for
the medical training of the students admitted in the session
2016-17, their future has gone in dark. Therefore, Show Cause F
Notice (SCN) issued by the State Government to the Sukh Sagar
College, is in accordance with law.
(xviii) In W.P. No. 17946/2019, Sukhsagar Medical College &
Hospital vs. State of M.P. & Ors., the Hon’ble High Court has
directed the Competent Authority to decide the present case after G
taking into cognizance all the aspects related to the present case.
In this continuation, the Report of Collector, Jabalpur and the
different objections submitted by the Sukh Sagar Medical College
Management, were examined in detail and pointwise examination
was made in compliance of the directions issued by the Hon’ble H
410 SUPREME COURT REPORTS [2020] 11 S.C.R.

A Supreme Court in the matter of Chintpurni Medical College &
Hospital (supra). On the basis of detailed examination of all the
points, the decision to be taken by the Government is in accordance
with the interim order passed by the Hon’ble High Court in W.P.
No. 17946/2019.
B Therefore, after due consideration, the State Government
has decided that the Essentiality Certificate (Desirability
& Feasibility Certificate) issued to the Sukh Sagar Medical
College & Hospital, Jabalpur vide Letter No. F 5-56/2014/
1/55 dated 27th August, 2014 of the Department, is hereby
cancelled with immediate effect.
C
This order, shall subject to the final order passed by the Hon’ble
High Court, Jabalpur, in W.P. No. 17946/2019 titled as Sukhsagar
Medical College & Hospital vs. State of M.P. & Ors.
…”
D (emphasis supplied)
9. The appellant, therefore, amended the pending writ petition
and challenged the order dated 5.9.2019 passed by the Additional
Secretary, cancelling the Essentiality Certificate (dated 27.8.2014).
Before we advert to the impugned decision of the High Court, in passing,
E it is relevant to note that the students who were admitted in the first
batch for academic year 2016-17, had filed a writ petition before the
High Court being Writ Petition No. 12682/2019 for issuing direction to
the State Government to accommodate the students of appellant-College
in some other recognised Government/private colleges in the State, in
F light of the conditions specified in the Essentiality Certificate, which was
still in vogue. The High Court had disposed of the said writ petition on
9.7.2019 with direction to the State authorities to consider the
representation of the concerned students and take necessary measures
as per law. Eventually, after the Essentiality Certificate was cancelled
by the State Government vide order dated 5.9.2019, the concerned
G students belonging to the first batch of 2016-17 came to be adjusted/
reallocated in six recognised private colleges within the State of Madhya
Pradesh as per the permission granted by the Ministry of Health and
Family Welfare, Government of India vide letter dated 25.11.2019.

H
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 411
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

10. Reverting to the impugned judgment, summarily rejecting the A
subject writ petition filed by the appellant, by a speaking order, the High
Court proceeded to hold that the decision in Chintpurni Medical College
(supra) does not completely forbid the State Government from exercising
power to revoke the Essentiality Certificate. The High Court also held
that the State Government acted within the excepted categories referred
B
to in the reported decision of this Court. Inasmuch as, the State
Government has taken into account the fraud played by the college in
securing the Essentiality Certificate, the inability of the college to provide
for the minimum standards of infrastructure and other facilities specified
by the MCI for running of a medical college and also complete loss of
substratum and larger public interest, as reasons for revocation of C
Essentiality Certificate by the State. While rejecting the writ petition,
however, the High Court gave liberty to the appellant to remove the
deficiencies pointed out by the MCI in its order dated 30.5.2019 and
apply afresh for the Essentiality Certificate to the State Government
and if the same is refused thereafter, the appellant was free to question
D
such decision being a fresh cause of action. The writ petition has been
disposed of by the High Court with these observations.
11. We have heard Mr. Dushyant Dave, learned senior counsel
for the appellant, Mr. Vikas Singh, learned senior counsel for the Medical
Council of India and Mr. Saurabh Mishra, learned Additional Advocate
General for the State of Madhya Pradesh. E

12. At the outset, we deem it apposite to closely analyse the two-
Judge Bench decision of this Court in Chintpurni Medical College
(supra). For, much emphasis has been placed on the said decision as
involving similar fact situation. Even in that case, the medical college
had started in the year 2011 in the State of Punjab. The permission for F
the first batch was granted in the year 2011-12. For subsequent academic
years i.e. 2012-13 and 2013-14, no renewal of permission was granted
to the college, as it was found to be deficient during the inspection carried
out by the MCI. For the academic year 2014-15, however, a Letter of
Permission (LoP) was granted in terms of order of this Court in Hind G
Charitable Trust Shekhar Hospital Private Limited vs. Union of India
& Ors. 7. Thereafter, no renewal of permission was granted to the
petitioner for the academic year 2015-16. The college had applied for
grant of recognition under Section 11 of the Indian Medical Council Act,
7
(2015) 2 SCC 336
H
412 SUPREME COURT REPORTS [2020] 11 S.C.R.

A 19568 in the year 2015. During the inspection carried out by the MCI,
deficiencies to the extent of 100% came to be noted. Despite that, in
terms of the decision of this Court in Modern Dental College &
Research Centre vs. State of Madhya Pradesh9, the scheme submitted
by the college was processed further. The SCMOC directed the MCI to
conduct inspection and in case the college was found deficient, it was to
B
be banned for a period of two years. The MCI conducted inspection of
the concerned college on 7.3.2017 and found it deficient, thus
recommended to the Central Government to debar the college from
admitting students against the allowed intake for two academic years
i.e. 2017-18 and 2018-19. The above decision was unsuccessfully
C challenged by the concerned college by way of a writ petition. In the
meantime, the State Government decided to withdraw the Essentiality
Certificate issued to the concerned college. That decision was challenged
by way of a separate writ petition before this Court. While considering
that challenge, the Court examined the scheme of the provisions of the
IMC Act and the purpose for which Essentiality Certificate was required
D
to be issued by the State Government. It noted that the same has been
made condition precedent at the time of submitting the scheme for grant
of Letter of Intent (LoI)/Letter of Permission (LoP) to start a new
medical college. It noted that the State Government is required to certify
by way of Essentiality Certificate, its approval for establishment of a
E medical college with a specified number of seats in public interest, and
further that such establishment is feasible. Thus, an Essentiality
Certificate from the State Government mentioning therein that it is
essential to have a medical college, as proposed by the applicant, is to
prevent the establishment of a college where none is required or to prevent
unhealthy competition between too many medical colleges. Further, the
F
only purpose of the Essentiality Certificate is to enable the Central
Government acting under Section 10-A of the IMC Act to facilitate the
competent authority to take an informed decision for permitting the
opening or establishment of a new medical college and once the college
is established, its functioning and performance and even the derecognition
G of its courses is governed by the provisions of the IMC Act and not any
other law. Having said that, in paragraph 17, the Court observed as
follows: -

8
For short, “the IMC Act”
9
H (2016) 7 SCC 353
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 413
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

“17. It would be impermissible to allow any authority including a A
State Government which merely issues an essentiality certificate,
to exercise any power which could have the effect of terminating
the existence of a medical college permitted to be established by
the Central Government. This the State Government may not do
either directly or indirectly. Moreover, the purpose of the
B
essentiality certificate is limited to certifying to the Central
Government that it is essential to establish a medical college. It
does not go beyond this. In other words, once the State
Government has certified that the establishment of a
medical college is justified, it cannot at a later stage say
that there was no justification for the establishment of the C
college. Surely, a person who establishes a medical college upon
an assurance of a State Government that such establishment is
justified cannot be told at a later stage that there was no justification
for allowing him to do so. Moreover, it appears that the power
to issue an essentiality certificate is a power that must be
D
treated as exhausted once it is exercised, except of course
in cases of fraud. The rules of equity and fairness and promissory
estoppel do not permit this Court to take a contrary view.”
(emphasis supplied)
The Court then went on to hold that the State Government is E
designated by the 1999 Regulations only for the purpose of Essentiality
Certificate to justify the establishment of a medical college within its
territories and that too when approached by a person seeking to establish
a medical college. There is no direct conferral of any power of general
inspection on the State and neither can such a power be read into the
Regulations nor be implied as necessary to carry out an expressly F
conferred power which does not exist. While rejecting the argument of
the State about the inherent right of the State to withdraw the Essentiality
Certificate, in paragraph 24, the Court observed thus: -
“24. The learned counsel for the State of Punjab submitted that
since the essentiality certificate certifies the availability of adequate G
clinical material for the proposed medical college, as per the
Regulations, the State has the necessary power of inspection of
the college even after its establishment to ensure that there is
adequate clinical material. This submission must also be
rejected since the State is enjoined to certify adequate H
414 SUPREME COURT REPORTS [2020] 11 S.C.R.

A clinical material only at the time of proposal of the medical
college and not after it is established. But we find from the
submissions that the State has misinterpreted the term “adequate
clinical material” completely. According to the State, “adequate
clinical material” means “people” i.e. doctors, patients, staff, etc.
Whereas, the term is understood in the field of medical education
B
to mean data about number of admissions, number of discharges,
number of deaths, number of surgeries, number of procedures,
X-rays and laboratories investigations. Thus, what the State is
required to certify is the data available in the region to justify the
establishment of the proposed medical college. Obviously, for the
C purpose of justifying the existence of a medical college, the State’s
claim that it must have the right to inspect a college after it is
established to see whether there are adequate numbers of doctors,
patients, etc. to justify its continued existence is completely hollow
and unfounded.”
D (emphasis supplied)
The Court then noted the argument of the State about the existence
of its power ascribable to Section 21 of the General Clauses Act, 1897 10.
In that regard, the Court noted that the certificate is neither a notification
nor an order or rule or bye-law as contemplated by Section 21 of the
E 1897 Act. Further, the act of issuance of Essentiality Certificate by the
State is a quasi-judicial function. It is neither a legislative nor an
executive function as such, so as to attract Section 21 of the 1897 Act.
Further, advisedly, there is no provision in the IMC Act or the 1999
Regulations empowering the State to revoke or cancel the Essentiality
Certificate once granted by it in respect of an established medical college.
F In absence of an express provision in that regard and issuance of an
Essentiality Certificate being a quasi-judicial function, Section 21 of
the 1897 Act will be of no avail. In other words, the State had no power
to withdraw the Essentiality Certificate once granted in respect of an
established college. At the same time, the Court following earlier decisions
G of this Court observed that even in such a situation, the State would be
competent to withdraw the certificate, where it is obtained by fraud or in
circumstances where the very substratum on which the Essentiality
Certificate was granted disappears or any other reason of the like nature.
For that, the Court has referred to the decisions of this Court in Indian
10
For short, “the 1897 Act”
H
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 415
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

National Congress (I) vs. Institute of Social Welfare & Ors. 11 , A
Industrial Infrastructure Development Corporation (Gwalior)
Madhya Pradesh Limited vs. Commissioner of Income Tax, Gwalior,
Madhya Pradesh12, Ghaurul Hasan & Ors. vs. State of Rajasthan
& Anr.13 and Hari Shankar Jain vs. Sonia Gandhi14and of the High
Court of Andhra Pradesh in Government of Andhra Pradesh & Anr.
B
vs. Y.S. Vivekananda Reddy & Ors.15.
13. At the outset, we may straightaway agree with the dictum in
Chintpurni Medical College (supra) that the act of the State in issuing
Essentiality Certificate is a quasi-judicial function, which view is
supported by the analogy deduced from the reported decisions referred
to above. Having said that, it must follow that Section 21 of the 1897 Act C
cannot be invoked and in absence of an express provision in the IMC
Act or the 1999 Regulations empowering the State Government to revoke
or cancel the Essentiality Certificate, such a power cannot be arrogated
by the State relying on Section 21. That, however, does not deprive the
State Government to revoke or withdraw the Essentiality Certificate in D
case where (a) it is secured by playing fraud on the State Government,
(b) the substratum for issuing the certificate has been lost or disappears
and (c) such like ground, where no enquiry is called for on the part of the
State Government. In Indian National Congress (I) (supra), the Court
while dealing with similar argument to assail the decision of the Election
Commission to review its order registering the political party, observed E
as follows: -
“33. However, there are three exceptions where the
Commission can review its order registering a political party. One
is where a political party obtained its registration by playing
fraud on the Commission, secondly, it arises out of sub- F
section (9) of Section 29-A of the Act and thirdly, any like
ground where no enquiry is called for on the part of the
Election Commission, for example, where the political party
concerned is declared unlawful by the Central Government
under the provision of the Unlawful Activities (Prevention) G
Act, 1967 or any other similar law.”
11
(2002) 5 SCC 685 (emphasis supplied)
12
(2018) 4 SCC 494
13
AIR 1967 SC 107
14
(2001) 8 SCC 233
15
AIR 1995 AP 1 H
416 SUPREME COURT REPORTS [2020] 11 S.C.R.

A And again, in paragraphs 41(3) and 41(4), while summing up the
judgment, the Court held as follows: -
“41. To sum up, what we have held in the foregoing paragraph is
as under:
1. xxx xxx xxx
B
2. xxx xxx xxx
3. However, there are exceptions to the principle stated in
paragraph 2 above where the Election Commission is not deprived
of its power to cancel the registration. The exceptions are these:
C (a) where a political party has obtained registration by
practising fraud or forgery;
(b) where a registered political party amends its
nomenclature of association, rules and regulations
abrogating therein conforming to the provisions of
D Section 29-A(5) of the Act or intimating the Election
Commission that it has ceased to have faith and
allegiance to the Constitution of India or to the
principles of socialism, secularism and democracy or
it would not uphold the sovereignty, unity and
integrity of India so as to comply with the provisions of
E
Section 29-A(5) of the Act; and
(c) any like ground where no enquiry is called for on the
part of the Commission.
4. The provisions of Section 21 of the General Clauses Act cannot
F be extended to the quasi-judicial authority. Since the Election
Commission while exercising its power under Section 29-A of the
Act acts quasi-judicially, the provisions of Section 21 of the General
Clauses Act have no application.”
(emphasis supplied)
G As noted earlier, even in Chintpurni Medical College (supra),
the Court has clarified that the State Government can cancel/revoke/
withdraw Essentiality Certificate in exceptional cases, by observing thus:-
“36. We may not be understood to be laying down that under no
circumstances can an essentiality certificate be withdrawn. The
H
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 417
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

State Government would be entitled to withdraw such A
certificate where it is obtained by playing fraud on it or any
circumstances where the very substratum on which the
essentiality certificate was granted disappears or any other
reason of like nature.”
(emphasis supplied) B
In other words, we hold that Chintpurni Medical College (supra)
does not lay down in absolute terms that the State cannot revoke the
Essentiality Certificate once granted for opening of a new medical college
within the State. The observations in paragraph 36 of the reported
decision also reiterate this position and make it amply clear that in C
exceptional circumstances referred to therein, the State is free to do so.
14. The core issue in the present appeal, therefore, is whether the
decision of the State Government, dated 5.9.2019, falls within one of the
excepted categories. The first excepted category is where the appellant
had obtained the Essentiality Certificate by playing fraud on the State D
Government. It is well-settled that fraud vitiates any act or order passed
by any quasi-judicial authority, even if no power of review is conferred
upon it, as held in paragraph 34 of the decision in Indian National
Congress (I) (supra) in the following words: -
“34. Coming to the first exception, it is almost settled law that E
fraud vitiates any act or order passed by any quasi-judicial authority
even if no power of review is conferred upon it. In fact, fraud
vitiates all actions. In Smith v. East Elloe Rural Distt. Council
[(1956) 1 All ER 855], it was stated that the effect of fraud would
normally be to vitiate all acts and orders. In Indian Bank v. Satyam
Fibres (India) (P) Ltd. [(1996) 5 SCC 550] it was held that a F
power to cancel/recall an order which has been obtained by forgery
or fraud applies not only to courts of law, but also to statutory
tribunals which do not have power of review. Thus, fraud or forgery
practised by a political party while obtaining a registration, if comes
to the notice of the Election Commission, it is open to the G
Commission to deregister such a political party.”
As to when it would be a case of fraud played on the State
Government, would depend on whether it was an attempt by the appellant
to present facts, so as to misrepresent the State. The fraud can either be
actual or constructive fraud. The actual fraud is a concealment or false
H
418 SUPREME COURT REPORTS [2020] 11 S.C.R.

A representation through an intentional or reckless statement or conduct
that injures another who relies on it in acting, whereas the constructive
fraud is unintentional deception or misrepresentation that causes injury
to another. The actual or constructive fraud as predicated in Black’s
Law Dictionary16 is as follows: -
B “actual fraud. A concealment or false representation through an
intentional or reckless statement or conduct that injures another
who relies on it in acting. – Also termed fraud in fact; positive
fraud; moral fraud.”
“constructive fraud. 1. Unintentional deception or
misrepresentation that causes injury to another. 2. Fraud in law.
C Fraud that is presumed under the circumstances, without regard
to intent, usu. through statutorily created inference. • Fraud may
be presumed, for example, when a debtor transfers assets and
thereby impairs creditors’ efforts to collect sums due. This type
of fraud arises by operation of law, from conduct that, if sanctioned,
D would (either in the particular circumstance or in common
experience) secure an unconscionable advantage, irrespective of
evidence of an actual intent to defraud. – Also termed legal fraud;
fraud in contemplation of law; equitable fraud; fraud in
equity.”
It may be also useful to advert to the meaning of “actionable
E
fraud” in the Sixth Edition of the same Law dictionary, as follows: -
“Actionable fraud. Deception practiced in order to induce another
to part with property or surrender some legal right. A false
representation made with an intention to deceive; such may be
committed by stating what is known to be false or by professing
F knowledge of the truth of a statement which is false, but in either
case, the essential ingredient is a falsehood uttered with intent to
deceive. To constitute “actionable fraud,” it must appear that
defendant made a material representation; that it was false; that
when he made it he knew it was false, or made it recklessly without
G any knowledge of its truth and as a positive assertion; that he
made it with intention that it should be acted on by plaintiff; that
plaintiff acted in reliance on it; and that plaintiff thereby suffered
injury…. Essential elements are representation, falsity, scienter,
deception, reliance and injury.”
16
H Black’s Law Dictionary 11 th Edition
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 419
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

15. Indeed, in the present case, the State Government in its order A
dated 5.9.2019, has adverted to several aspects including the assessment
report of the MCI and inspection report of the Committee. The substance
of the reason weighed with the State Government, as can be culled out
from the stated order, is that the appellant had failed to fulfil the
commitment given to the State at the relevant time - of providing minimum
B
infrastructure and fulfilment of the norms of MCI and appointing the
staff as per norms of MCI - for all this period and was incapable in doing
so despite repeated opportunities given since 2016 by the MCI. Further,
even though the appellant was granted conditional Letter of Permission
(LoP) for academic year 2016-17, it had failed to remove the deficiencies,
as a result of which not even the first batch could pursue or complete C
the medical course in the appellant-College. The concerned students
kept on making earnest representation to the State authorities to rescue
them from the hiatus situation in which they were trapped. Indisputably,
the concerned students (admitted in the first batch of 2016-17) were
eventually reallocated to another recognised college after November,
D
2019, as no renewal of permission to the appellant-College was
forthcoming for three successive academic sessions i.e. 2017-18, 2018-
19 and 2019-20.
16. Such circumstances reckoned by the State, by no stretch of
imagination, can be disregarded as irrelevant, intangible or imaginary.
Rather, the totality of the situation reinforces the fact that the appellant- E
College had failed and neglected to discharge its commitment given to
the State at the relevant time; and is incapable of fulfilling the minimum
norms specified by the MCI for starting and running a medical college.
It had thus misrepresented the State Government at the relevant time by
giving a sanguine hope of ensuring installation of minimum infrastructure F
and setting up of a robust organisational structure for running of a medical
college “in a time bound programme”. Therefore, it can be safely deduced
that it is a case of constructive fraud played upon the State Government.
For, even after lapse of over five years from the date of issuance of
Essentiality Certificate (27.8.2014), the appellant-College is not in a
position to secure the requisite permission(s) from the MCI and the G
Central Government to run a medical college as per the scheme.
17. The State Government whilst discharging its role of parens
patriae of the student community cannot remain a mute spectator and
expose them to a college, which is deficient in many respects. The fact
H
420 SUPREME COURT REPORTS [2020] 11 S.C.R.

A that no renewal permission has been granted by the MCI for three
successive academic sessions due to gross deficiencies in the appellant-
College, is itself indicative of the state of affairs in the appellant-College,
warranting a legal inference that the substratum on the basis of which
Essentiality Certificate was issued to the appellant-College had completely
disappeared. For, even the first batch of students admitted in the appellant-
B
College could not pursue their medical course and were eventually
reallocated by the State Government to other recognised private medical
colleges within the State as per the obligation specified in the Essentiality
Certificate, after obtaining permission of the Central Government in that
behalf in November, 2019.
C 18. The Essentiality Certificate was issued on the representation
of the appellant-College that it would give 150 fully trained and qualified
doctors each year to the State, thereby improving the doctor-patient
ratio and provide healthcare to the nearby population in the attached
hospital. All this has become a mirage due to the failure of the appellant-
D College to get permission of Central Government for four successive
academic sessions starting from 2016-17 till 2019-20. Not even one doctor
has been produced by the appellant-College after issuance of the
Essentiality Certificate nor the hospital attached to the college is provided
with minimum standards specified by the MCI and is found to be grossly
deficient. On a comprehensive view of the state of affairs, the fulfilment
E of MCI norms and other allied conditions must be understood as an
implied imperative for the consideration/continuation of Essentiality
Certificate. For, there can be no deviation from the standards. This being
a clear case of a non-functioning college, warranted immediate
intervention of the State Government in larger public interest and also
F because the substratum had disappeared. It would certainly come within
the excepted category, where the power of withdrawal of Essentiality
Certificate ought to be exercised by the State and more particularly not
being a case of an established college per se.
19. The term “established” is not defined in the IMC Act or the
G 1999 Regulations. The common parlance meaning of this expression, as
predicated in the Black’s Law Dictionary 11th Edition, reads thus: -
“established, 1. Having been brought about or into existence.
2. Having existed for a long period; already in long-term use.
3. Proven; demonstrated beyond doubt. 4. Known to do a
H particular job well because of long experience with good results.
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 421
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

5. (Of a church or religion) officially recognised and sponsored A
by the government.”
In the present case, however, the appellant-College was at the
threshold stage of only opening and starting first year course for academic
year 2016-17. It failed and neglected to fulfil even the minimum
benchmark of standards specified by the MCI allowing it to run the B
medical college. Admittedly, no renewal permissions from the Central
Government were issued for the successive academic years. In that
sense, it is not a case of withdrawal of the Essentiality Certificate of an
“established” medical college as such. Had it been a case of well-
established and a running medical college having basic minimum
infrastructure as per the specifications of the MCI and State Government C
was to withdraw its Essentiality Certificate, that matter would stand on
a different footing than the case at hand, where the college has miserably
failed to ensure completion of medical course even of the first batch for
three successive academic sessions from 2016-17 due to non-renewal
of permission by the MCI. D
20. Be that as it may, there would be legitimate expectation amongst
the stakeholders, after issuance of Essentiality Certificate by the State
Government, that the applicant-college shall fulfil the basic norms
specified by the MCI in a time bound manner, so as to open the medical
college and operate it as per the norms. That, however, has not happened E
in the present case since August, 2014 until the issuance of subject show-
cause notice in August, 2019 and passing of the impugned order of
withdrawal of Essentiality Certificate. The fact that the applicant has
made certain investments for starting the medical college, by itself, cannot
be the basis to undermine power of the State Government coupled with
duty to ensure that the medical college is established in terms of the F
Essentiality Certificate within a reasonable time.
21. While dealing with the case of maintaining standards in a
professional college, a strict approach must be adopted because these
colleges engage in imparting training and education to prospective medical
professionals and impact their academic prospects. Thus, the future of G
the student community pursuing medical course in such deficient colleges
would get compromised besides producing inefficient and incompetent
doctors from such colleges. That would be posing a bigger risk to the
society at large and defeat the sanguine hope entrenched in the
Essentiality Certificate issued by the State. H
422 SUPREME COURT REPORTS [2020] 11 S.C.R.

A 22. Indeed, the fact that the Essentiality Certificate given to the
appellant-College stands withdrawn, it does not follow that the need to
have a new medical college in the concerned locality or the State ceases
to exist. For, the raison d’etre behind Essentiality Certificate, amongst
others, is likely improvement of doctor-patient ratio and access to
healthcare for the population in the attached hospital. As a matter of
B
fact, the need would get bigger due to the failure of the new medical
college to fulfil the scheme in a time bound manner in right earnest.
That entails in enhancing the mismatch of demand and supply ratio of
doctors required to achieve the medical manpower of the State. It would
not be in public interest nor appropriate for the State Government to
C remain a mute spectator and not move into action when the college
miserably fails to translate the spirit behind the Essentiality Certificate
within a reasonable time. By no stretch of imagination, five years period,
to fulfil the minimum requirement and standards specified by the MCI,
can be countenanced.
D 23. Article 47 of the Constitution of India encompassed in Directive
Principles of State Policy, enjoins the State with a duty to provide for
and ensure good public health and a constant endeavour to improve the
same to effectuate the fundamental right to life guaranteed by the
Constitution to all. Thus understood, the State’s duty under Article 47 is
to act as an “enabler” for the wholesome exercise of right to life. A
E right to have access to proper public health care would be of little value
if the State does not create the requisite conditions for proper exercise
of such right. Access to medical college and hospital is, no doubt, a part
of the said conditions. In Paschim Banga Khet Mazdoor Samity &
Ors. vs. State of West Bengal & Anr.17, this Court observed that it is
F the “Constitutional obligation of the State to provide adequate
medical services to the people. Whatever is necessary for this purpose
has to be done.”
24. What is necessary in the present factual matrix, as discussed
above, is for the State to assess the dire need of medical infrastructure
G within the State or the locality, as the case may be. The very fact that an
Essentiality Certificate is issued in the first place, in itself, is a testimony
of the “essentiality” of such infrastructure. The authority of the State to
grant Essentiality Certificate is both power coupled with a duty to ensure
that the substratum of the spirit behind the Certificate does not disappear
17
H (1996) 4 SCC 37
SUKH SAGAR MEDICAL COLLEGE & HOSPITAL v. STATE OF 423
MADHYA PRADESH & ORS. [A. M. KHANWILKAR, J.]

or is defeated. The exercise of power and performance of duty with A
responsibility and in right earnest must co-exist. Notably, the duty under
Article 47 is, in the constitutional sense, fundamental in the governance
of the State. This duty does not end with mere grant of a certificate,
rather, it continues upto the point when essentiality of basic medical
infrastructure is properly taken care of within a reasonable time frame.
B
Any future application for such certificate, be it by the present appellant
(in terms of directions in this judgment) or by a different applicant, must
be dealt with accordingly, and supervision of the State must continue to
ensure that the purpose and substratum for grant of such certificate
does not and has not disappeared.
25. We are conscious of the view taken and conclusion recorded C
in Chintpurni Medical College (supra). Even though the fact situation
in that case may appear to be similar, however, in our opinion, in a case
such as the present one, where the spirit behind the Essentiality Certificate
issued as back as on 27.8.2014 has remained unfulfilled by the appellant-
College for all this period (almost six years), despite repeated opportunities D
given by the MCI, as noticed from the summary/observation in the
assessment report, it can be safely assumed that the substratum for
issuing the Essentiality Certificate had completely disappeared. The State
Government cannot be expected to wait indefinitely, much less beyond
period of five years, thereby impacting the interests of the student
community in the region and the increased doctor-patient ratio and denial E
of healthcare facility in the attached hospital due to gross deficiencies.
Such a situation, in our view, must come within the excepted category,
where the State Government ought to act upon and must take corrective
measures to undo the hiatus situation and provide a window to some
other institute capable of fulfilling the minimum standards/norms specified F
by the MCI for establishment of a new medical college in the concerned
locality or within the State. Without any further ado, we are of the view
that the appellant-College is a failed institute thus far and is unable to
deliver the aspirations of the student community and the public at large
to produce more medical personnel on year to year basis as per the spirit
behind issuance of the subject Essentiality Certificate dated 27.08.2014. G
To this extent, we respectfully depart from the view taken in Chintpurni
Medical College (supra).
26. To complete the record, we may mention the argument of the
appellant that the attached hospital of the appellant has now been taken
H
424 SUPREME COURT REPORTS [2020] 11 S.C.R.

A over by the State Government recently for providing treatment to Covid
patients. That, however, will be of no avail to answer the matter in issue.
We do not intend to dilate on this argument any further.
27. Taking overall view of the matter, in the facts of the present
case, we uphold the order of the High Court rejecting the subject writ
B petition filed by the appellant-College, whereby it had assailed the order
of the State Government dated 5.9.2019, withdrawing the Essentiality
Certificate dated 27.8.2014. At the same time, we reiterate the liberty
given by the High Court to the appellant-College to forthwith remove all
the deficiencies pointed out by the MCI in its order dated 30.5.2019 and
apply afresh for the Essentiality Certificate to the State Government
C and if that request is refused, to pursue appropriate remedy as per law
being a fresh cause of action.
28. The appeal is accordingly dismissed being devoid of merits.
No order as to costs. Pending applications, if any, are also disposed of.
D
Divya Pandey Appeal dismissed.

E

F

G

H