REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

WRIT PETITION (CIVIL) No. 89 of 2018

CHINTPURNI MEDICAL COLLEGE  AND HOSPITAL & ANR.                     ... PETITIONER (S)

Versus

STATE OF PUNJAB & ORS.              ... RESPONDENT(S)

J U D G M E N T  

S.A. BOBDE, J.

1. Chintpurni Medical College started in the year 2011 in the

State of Punjab.  This college is affiliated to Baba Farid University.  It

made  an  application  to  the  Medical  Council  of  India  (hereinafter

referred to as ‘MCI’) under Section 10(A) of the Indian Medical Council

Act, 1956 (hereinafter referred to as ‘the IMC Act’) for establishing a

new Medical College.  The permission for the first batch was granted in

the year 2011-12 on 30.06.2011. For the subsequent academic years

i.e. 2012-13 and 2013-14, no renewal of permission was granted to the

petitioner  college,  since  the  petitioner  college  was  found  to  be

deficient in the inspections carried out by the MCI. For the academic

year 2014-15, petitioner was granted Letter of Permission (LOP) under

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the  orders  of  this  court  passed  in  W.P  (Civil)  No.469  of  2014.

Thereafter, no renewal of permission was granted to the petitioner for

the academic year 2015-16. Petitioner college applied for the grant of

recognition under section 11 of the IMC Act in the year 2015.  MCI in

order to determine whether the petitioner college fulfills the minimum

eligibility requirements for grant of recognition under section 11 of the

IMC Act, conducted three inspections. The First inspection was carried

out  on 16.12.2015 followed by second inspection  on 25/26.02.2016

and the third one on 16.03.2016.

2. In  all  the  three  inspections  carried  out  by  the  MCI,

petitioner college was found to be deficient. The MCI concluded the

college  was  deficient  to  the  extent  of  100%.   The  MCI,  therefore,

recommended to the Central Government, not to issue recognition to

the petitioner college under Section 11 of the IMC Act. The MCI also

made similar  recommendations in  respect of  other colleges.   Those

Medical Colleges approached this Court by way of filing a batch of Writ

Petitions.   This  Court  directed  the  matters  to  be  examined  by  the

Oversight  Committee  constituted  under  the  judgment  of  this  Court

delivered  by  the  Constitution  Bench  in  the  case  of  Modern  Dental

College and Research Centre v. State of Madhya Pradesh1.  Finally, the

Oversight  Committee  directed  the  MCI  to  conduct  inspections  and

further directed that if the Medical Colleges were found deficient, they

1  (2016) 7 SCC 353

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would be banned for a period of two years.  Such a direction was also

given  in  respect  of  the  petitioner  college.  MCI  conducted  fresh

inspection of the petitioner college on 07.03.2017 & again found the

petitioner college deficient & accordingly recommended to the Central

Government to debar the petitioner college from admitting students

against the allowed intake for two academic years i.e.  2017-18 and

2018-19.  The  Central  Government  by  its  order  dated  31.05.2017

debarred the petitioner college for a period of two academic years i.e.

2017-18 and 2018-19.  This order was questioned by the petitioner in

Writ Petition (Civil)  No. 423 of 2017. By order dated 10.5.2018, this

Court dismissed the Writ Petition (Civil) No.423 of 2017.

3. The present writ petition questions the withdrawal of the

Essentiality Certificate dated 07.12.2010 and 15.02.2011 issued to the

petitioner college by Respondent No. 1 under Section 10A of the IMC

Act read with the Establishment of Medical College Regulations, 1999

(Hereinafter  referred  to  as  “Regulations”)  framed  under  the  Act.

Regulations lay down the qualifying criteria for making an application

to open a Medical College.  One of the essential qualifications is that a

person  should  obtain  an  Essentiality  Certificate  from  the  State

Government where the college is proposed to be located in Form 2.

4. On 13.07.2017,  MCI making an unusual  request  wrote a

letter to the Secretary, Government of Punjab stating that it will take

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action only if the concerned college is closed down and the Essentiality

Certificate is withdrawn by the State Government.  The Government of

Punjab  by  letter  dated  24.7.2017 submitted  that  they  are  not  in  a

position  to  withdraw the Essentiality  Certificate for  several  reasons.

The State Government stated that  the doctor  –  patient  ratio  in  the

State of Punjab is 1:1440 approximately whereas the required ratio as

per  MCI  norms  is  1:1000.   They  said  that  they  are  committed  to

opening five new medical colleges in the State, it was not possible in

these circumstances to conclude that there is lack of essentiality.  They

further said that it would not be possible to absorb the students from

the  petitioner  college  and  this  will  adversely  affect  the  interest  of

students.  They requested for permission to facilitate shifting of the

students to medical colleges in the other states without insisting on the

withdrawal  of  Essentiality  Certificate.   The  State  thus  declined  to

withdraw the Essentiality Certificate.

5. However, for reasons which are not clear, the State relied

on  proceedings  of  an  earlier  show  cause  notice  dated  03.05.2017

calling upon the petitioner to show cause as to why the Essentiality

Certificate should not  be withdrawn,  to do just  the opposite.   They

passed an order dated 01.11.2017 and held that the college had made

hollow claims for removing deficiencies and had failed to show cause

why  the  Essentiality  Certificate  should  not  be  withdrawn.   Though

several  opportunities of  personal  hearing were afforded, the college

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had failed to rebut the findings of the inspection reports.  Having found

persistent deficiencies, the State Government directed the withdrawal

of the Essentiality Certificate.

6. At this juncture, we might make it clear that no fault can be

found  with  the  orders  of  the  State  Government  in  observing  the

deficiencies  in  the  functioning  of  the  petitioner  college.   These

deficiencies  have  resulted  in  the  Central  Government  order  dated

31.05.2017  debarring  the  petitioner  college  from  taking  any  fresh

intake  for  two  years.  As  stated  above,  this  Court  has  declined  to

interfere  with  such  an  order  and  accordingly,  Writ  Petition  (Civil)

No.423 of 2017 has been dismissed.

7. Shri  Mukul  Rohtagi,  learned  senior  counsel  for  the

petitioner, however contended that the State does not have the power

to withdraw the Essentiality Certificate once granted.  According to the

learned  senior  counsel,  the  Essentiality  Certificate  is  issued for  the

specific  purpose  of  certifying  the  need  for  opening  a  new  medical

college in a State.  Once such a need is certified and the college is

established,  there  is  no  power  conferred  by  the  IMC  Act  or  the

Regulations  to  withdraw such a  certificate except  on the  ground of

fraud.   

8. Before  going  into  the  merits  of  the  submission,  it  is

important  to  note  that  the  State  Government  appears  to  have

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withdrawn the Essentiality Certificate acting under dictation of the MCI.

This  is  obvious from the letter  dated 13.07.2017 referred to above.

This by itself would vitiate the withdrawal of the Essentiality Certificate

by the State, vide Anirudhsinhji Karansinhji Jadeja v. State of Gujarat2

and  Dipak Babaria v. State of Gujarat.3  The following passage from

Wade  and  Forsyth  in  Administrative  Law,  10th Edition  at  p.  269

succinctly states the vice in such an action:

“Closely  akin  to  delegation,  and  scarcely distinguishable from it  in  some cases,  is  any arrangement by which a power conferred upon one  authority  is  in  substance  exercised  by another.   The proper authority may share its power  with  someone  else,  or  may  allow someone else to dictate to it  by declining to act without their consent or by submitting to their wishes or instructions.  The effect then is that the discretion conferred by Parliament is exercised,  at  least  in  part,  by  the  wrong authority,  and  the  resulting  decision  is  ultra vires and  void.   So  strict  are  the  courts  in applying  this  principle  that  they  condemn some administrative arrangements which must seem quite  natural  and proper  to  those who make them.”

9. The issue which arises in the present W.P is:  

whether the State Government has the power to withdraw

an Essentiality Certificate once granted, and whether the power to do

so is ultra-vires the Act and the Regulations framed thereunder.

This issue needs to be decided since power assumed by

the  State  to  withdraw  an  Essentiality  Certificate  has  drastic 2 (1995) 5 SCC 302 3 (2014) 3 SCC 502

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consequences  on  Medical  Education  in  a  State,  which  can  only  be

controlled by and under the IMC Act.

Essentiality Certificate

10.  It would, therefore, be necessary to see the origin of the

requirement that a College must have an Essentiality Certificate before

it receives permission for its establishment.  The Legislative scheme

that  imposes  the  requirement  of  an  Essentiality  Certificate  is  as

follows:-

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Section  10A4 of  the  IMC  Act  requires  the  previous

permission  of  the  Central  Government  for  establishing  a  Medical

College or opening a new course of study or training. Every person or

Medical College must submit to the Central Government a scheme as

prescribed.  The Central Government then refers the scheme to the

MCI  for  its  recommendations.   The  Medical  Council  is  required  to 4 10.A  PERMISSION FOR ESTABLISHMENT OF NEW MEDICAL COLLEGE, NEW COURSE OF STUDY -  

(1) Notwithstanding anything contained in this Act or any other law for the time being in force:-

(a) no person shall establish a medical college or  (b) no medical college shall:-

(i) open a new or higher course of study or training (including a postgraduate course of study or training) which would enable a student of such course or training to qualify himself for the award of any recognised medical qualification; or  

(ii)  increase its  admission capacity in any course of  study or training (including a postgraduate course of study or training),

except with the previous permission of the Central Government obtained in accordance with the provisions of this section.  

Explanation 1-. For the purposes of this section, "person" includes any University or a trust but does not include the Central Government.  

Explanation 2.- For the purposes of this section "admission capacity" in relation to any course of study or training (including postgraduate course of study or training) in a medical college, means the maximum number of students that may be fixed by the Council  from time to time for being admitted to such course or training.  

(2) (a) Every person or medical college shall, for the purpose of obtaining permission under sub-section (1), submit to the Central Government a scheme in accordance with the provisions of clause (b) and the central  Government  shall  refer  the  scheme  to  the  Council  for  its recommendations.  

(b) The Scheme referred to in clause (a) shall be in such form and contain such particulars and be preferred in such manner and be accompanied with such fee as may be prescribed.  

(3) On receipt of a scheme by the Council under sub-section (2) the Council may obtain such other  particulars  as  may  be considered  necessary  by it  from the  person or  the medical  college concerned, and thereafter, it may –  

(a)  if  the  scheme  is  defective  and  does  not  contain  any  necessary  particulars,  give  a reasonable opportunity to the person or college concerned for making a written representation and it shall be open to such person or medical college to rectify the defects, if any, specified by the Council.  

(b) consider the scheme, having regard to the factors referred to in sub-section (7) and submit the scheme together with its recommendations thereon to the Central Government.  

(4) The Central  Govt. may after considering the scheme and the recommendations of the Council under sub-section (3) and after obtaining, where necessary, such other particulars as may be considered necessary by it from the person or college concerned, and having regard to the factors referred to in  sub-section (7),  either  approve 4 (with such conditions,  if  any,  as it  may consider necessary ) or disapprove the scheme, and any such approval shall be a permission under sub-section (1):  

Provided that no scheme shall be disapproved by the Central Government except after giving the person or college concerned a reasonable opportunity of being heard;  

Provided further that nothing in this sub section shall prevent any person or medical college whose scheme has not been approved by the Central Government to submit a fresh scheme and the provisions of this section shall apply to such scheme, as if such scheme has been submitted for the first time under subsection (1).  

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consider the scheme and satisfy itself by obtaining any particulars as

are necessary and after having the defects if any removed, make its

recommendations  to  the  Central  Government.   The  Central

Government, may on receipt of the scheme, approve it conditionally or

disapprove  the  scheme.   Approval  constitutes  permission  vide  sub-

section (4) of  Section 10A of the IMC Act.

11. The power to permit the establishment of a Medical College

is  thus  conferred  on  the  Central  Government  by  the  IMC  Act.  The

regulations  referred  to  above,  framed  in  the  exercise  of  powers

conferred  under  Section  10A  read  with  Section  33  of  the  IMC  Act

(5) Where, within a period of one year from the date of submission of the scheme to the Central  Government under sub-section (1), no order passed by the Central Government has been communicated to the person or college submitting the scheme, such scheme shall be deemed to have been approved by the Central Government in the form in which it had been submitted, and accordingly, the permission of the Central Government required under sub-section (1) shall also be deemed to have been granted.  

(6) In computing the time-limit specified in sub-section (5), the time taken by the person or college concerned submitting the scheme, in furnishing any particulars called for by the Council, or by the Central Government, shall be excluded.

(7) The Council, while making its recommendations under clause (b) of sub-section (3) and the Central Government, while passing an order, either approving or disapproving the scheme under sub-section (4), shall have due regard to the following factors, namely:-

(a) whether the proposed medical college or the existing medical college seeking to open a new or higher course of study or training, would be in a position to offer the minimum standards of medical education as prescribed by the Council under section 19A or, as the case may be under section 20 in the case of postgraduate medical education.

(b) whether the person seeking to establish a medical college or the existing medical college seeking to  open  a  new or  higher  course  of  study  or  training  or  to  increase  it  admission capacity has adequate financial resources;

(c) whether necessary facilities in respect of staff, equipment, accommodation, training and other facilities to ensure proper functioning of the medical college or conducting the new course or study or training or accommodating the increased admission capacity, have been provided or would be provided within the time-limit specified in the scheme.  

(d) whether adequate hospital facilities, having regard to the number or students likely to attend such medical college or course of study or training or as a result of the increased admission capacity, have been provided or would be provided within the time-limit specified in the scheme;

(e) whether any arrangement has been made or programme drawn to impart proper training to students likely to attend such medical college or course of study or training by persons having the recognised medical qualifications;

(f) the requirement of manpower in the field of practice of medicine; and  (g) any other factors as may be prescribed.  (8)  Where  the  Central  Government  passes  an  order  either  approving  or  disapproving  a

scheme under this  section,  a copy of  the order shall  be communicated to the person or  college concerned.

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prescribe the qualifying criteria.  These criteria lay down the eligibility

to  apply  for  permission  to  establish  a  Medical  College.  One  of  the

criteria is that the person who is desirous of  establishing a medical

college should obtain an Essentiality Certificate as prescribed in Form 2

of the Regulations, certifying that the State Government/Union Territory

Administration have no objection for the establishment of the proposed

Medical  College  at  the  proposed  site  and  availability  of  adequate

clinical material5.

12. Form  2  in  which  the  Essentiality  Certificate  must  be

obtained  indicates  the  facts  which  are  considered  relevant  for

determining  whether  the  establishment  of  a  proposed  college  is

justified.  These factors are:-

(1) Number of institutions already existing in the State. (2) Number of seats available or No. of doctors being   

produced annually. (3) Number of doctors registered with the State Medical  

Council. (4) Number of doctors in Government Service. (5) Number of Government posts vacant and those in   

rural/difficult areas. (6) Number  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

5 (3) that Essentiality Certificate in Form 2 regarding No objection of the State Government/Union Territory Administration for the establishment of the proposed medical college at the proposed site and availability of adequate clinical material as per the council regulations, have been obtained by the person from the concerned State Government/Union Territory Administration.

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personnel in the State and 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. (11) Doctor-patient ratio proposed to be achieved.

13. The concerned State Government is required to certify that

it has decided to issue an Essentiality Certificate for the establishment

of a Medical College with a specified number of seats in public interest,

and further that such establishment is feasible.  Importantly, the State

Government is required to certify that if the applicant fails to create an

infrastructure for the Medical College as per the MCI norms and fresh

admissions  are  stopped  by  the  Central  Government,  the  State

Government  shall  take  over  the  responsibility  of  those  seats  that

already  admitted  in  the  College  with  the  permission  of  the  Central

Government.   An  amendment  to  the  notification  also  requires  a

declaration that the applicant owns and possesses adequate land on

which non-agricultural  use of  the land is  permitted and on which a

Medical College can be established. It further requires a declaration to

the effect that the Hospital  and Medical College have been granted

completion certificate / building use certificate. 14. The Essentiality Certificate thus certifies that it is essential

having regard to specified factors that the opening of  the proposed

college is essential in the State, in public interest.  Further, that the

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applicant has the necessary land and building for running it.  What is

significant  to  note  is  that  the  law  requires  that  an  applicant  must

possess  an  Essentiality  Certificate  from  the  State  Government

mentioning therein that it  is  essential  to have a Medical  College as

proposed  by  him.   The  purpose  is  interalia to  prevent  the

establishment  of  a  college  where  none  is  required  or  to  prevent

unhealthy competition between too many Medical Colleges. 15. Thus, the Legislative scheme for permission to establish a

Medical College prescribes, as a qualifying criterion, that the applicant

must have an Essentiality Certificate issued by the State Government.

The  State  Government  certifies  the  justification  for  establishing  a

proposed Medical College as a part of the Legislative scheme under the

Act.   It  does  not  do  so  under  any  other  law  including  a  State

enactment.   The  only  purpose  of  the  Essentiality  Certificate  is  to

enable the Central Government acting under Section 10A to take an

informed decision for permitting the opening or establishment of a new

Medical College.  Once the college is established, its functioning and

performance and even the de-recognition of its courses is controlled

only by the provisions of the IMC Act and not any other law.  The IMC

Act, which is a Legislation under Entry 66 of List-I of Seventh Schedule

of  the  Constitution  of  India  is  a  complete  code  which  governs  the

establishment,  functioning,  including  maintenance  of  standards  of

education  and  even   

de-recognition of  Medical  Colleges vide Section 19 of  the Act.   The

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States are denuded of the Legislative Power to legislate on medical

education under Entry 25 of the Concurrent List since Parliament has

exercised its power under Entry 66 and enacted the IMC Act vide  Dr.

Preeti Srivastava v. State of Madhya Pradesh6. 16. It would be impermissible to allow any authority including 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  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 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 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.   

6 (1999) 7 SCC 120

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17. In this case, the reasons given by the State for rescinding

the  Essentiality  Certificate  are  not  relevant  or  germane  to  the

establishment of a Medical College.  They refer to the deficiencies in

the  functioning  of  a  Medical  College  for  a  particular  period.

Deficiencies by their nature are curable and can be removed. To allow

the State Government to withdraw an Essentiality Certificate and say

that it is no more essential that there should be a college at all, would

lead to gross arbitrariness since logically the existence of the Medical

College would again be justified if the deficiencies are removed.  The

question  of  justified  existence  of  a  college  and  the  irregular/illegal

functioning of an existing college belong to a different order of things

and cannot be mixed up.  A certificate constitutes a solemn statement

by an authority certifying certain conditions of things.  Persons acting

on  such  certificates  are  entitled  to  assume that  the  certificate  will

ensure  and  not  be  pulled  out  from under  their  feet  for  extraneous

reasons.   We  find  that  none  of  the  reasons  for  withdrawing  the

Essentiality Certificate pertain to factors which are certified as true in

the prescribed Form 2, reproduced above. Challenge to Conditions Introduced in Form 2 by the State 18. It is argued mainly on behalf of the State Government that

the  specified  conditions  which  are  imposed  in  the  Essentiality

Certificate empower the State Government to withdraw an Essentiality

Certificate and the certificate has been withdrawn in exercise of the

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powers reserved under following conditions incorporated in Essentiality

Certificate dated 07.12.2010:- “vii.  The  inspection  of  the  institute  shall  be carried out on yearly basis upto the completion of  the  study  of  first  batch  of  the  students. Thereafter,  the  inspection  shall  be  periodical after three years. …… xi. The Punjab Government will have the right to  withdraw  the  Essentiality  Certificate/No objection  Certificate  if  the trust/society/applicant  failed  to  meet  any  of the conditions contained therein…..7”

19. Shri  Rohtagi,  learned  senior  counsel  submitted  that

Condition Nos. (VII) and (XI) reproduced (supra) have been introduced

by  the  State  Government  on  their  own;  they  are  not  in  Form  2

prescribed under the Regulations.  In other words, the MCI Act and the

Regulations do not confer any power on the State Government to carry

out  the  inspection  of  the  medical  college  or  to  withdraw  the

Essentiality Certificate, and the State has attempted to arrogate these

powers  to  itself.   According  to  the  learned  senior  counsel,  these

conditions are ultra-vires the provisions of the Act and the Regulations.  

20. Relying on the Condition No.(VII), the learned counsel for

the  State  of  Punjab,  Ms.  Uttara  Babbar  submitted  that  the  State

Government  has  the  power  to  carry  out  inspections,  since  it  is

responsible for the students of the college which is shut down by the

MCI or otherwise. If such inspections reveal any deficiencies, the State

7 Essentiality Certificate dated 07.12.2010.

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is  entitled  to  withdraw the Essentiality  Certificate.   This  submission

cannot be accepted, the IMC Act and the Regulations under which the

State  Government  has  purported  to  issue  Essentiality  Certificate

confers the power of inspection on any medical institution, college or

hospital where any medical education is given, on Visitors/Inspectors

appointed by MCI under Sections 178 and 189 of IMC Act.

21. The learned counsel for the State has not pointed out any

power of inspection which is conferred on a State Government/Union

Territory Administration either by the Act or by the Regulations.  The

State  Government  is  designated  by  the  Regulations  only  for  the

purpose  of  issuing  an  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

817.  INSPECTION  OF  EXAMINATIONS  (1)  The  Committee  shall  appoint  such  number  of  medical inspectors  as it  may deem requisite to inspect any medical  institution,  college, hospital  or other institution where medical education is given, or to attend any examination held by any University or medical  institution  for  the  propose  of  recommending  to  the  Central  Government  recognition  of medical qualifications granted by the University or medical institution.  

(2) The medical inspectors shall not interfere with the conduct of any training or examination, but shall report to the committee on the adequacy of the standards of medical education including staff, equipment, accommodation, training facilities prescribed for giving medical education or on the sufficiency of every examination which they attend.  

(3) …… 918. VISITORS AT EXAMINATIONS  (1) The Council may appoint such number of visitors as it may deem requisite  to  inspect  any  medical  institution,  college,  hospital  or  other  institution  where  medical education is given, or to attend any examination held by any University or medical institution for the purpose of granting recognised medical qualifications.  

(2) Any person, whether he is a member of the Council or not may be appointed as a visitor under this section but a person who is appointed as an inspector under section 17 for any inspection or examination shall not be appointed as a visitor for the same inspection or examination.  

(3) …..  (4) ..…

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implied as necessary to carry out an expressly conferred power which

doesn’t exist.  In fact, it might be difficult to even construe that the IMC

Act has delegated any powers to the State Government including that

of issuing of an Essentiality Certificate.  The IMC Act merely requires an

applicant  to  obtain  an  Essentiality  Certificate  from  the  State

Government  to  justify  the  establishment  of  a  medical  college.

However, the Act prescribes the form in which such a certificate must

be obtained from  the State.   Significantly, the form does not confer

any  power  of  inspection.  The  mere  requirement  of  an  Essentiality

Certificate  by  the  State  as  a  qualifying  criterion  cannot  imply  the

delegation of a power which must be express and clear.  It is, therefore,

clear that such power has been arrogated by the State without any

justification and is likely to lead to a conflict with the power meant to

be  exercised  by  the  Central  Government  and  potentially,  result  in

conflicting  inspection  reports.   The  condition  imposed  by  the  State

Government is therefore ultra-vires the IMC Act and the Regulations.

22. It was submitted by the learned counsel appearing for the

State of Punjab that since the Essentiality Certificate requires the State

Government  to  assume  responsibility  of  the  students  in  case  the

college closes down, the State must be held to have an inherent right

to  withdraw  the  Essentiality  Certificate.   This  argument  must  be

rejected  as  fallacious  since  the  consequence  of  withdrawing  the

Essentiality Certificate can only be that the college closes down, and

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the  State  must  bear the  burden of  accommodating the  students  in

another institution.

23. The learned counsel for the State of Punjab submitted that

since the Essentiality Certificate certifies the availability of adequate

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  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

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 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  it’s

continued existence is completely hollow and unfounded.

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Condition No. XI

24. It  was further contended by the learned counsel  for  the

State that the power to issue a certificate carries a power to withdraw

the  same in  a  like  manner  as  contemplated  by  Section  21  of  The

General  Clauses  Act,  1987.   Section  21  of  the  said  Act  reads  as

follows:-

“21. Power to issue, to include power to add to, amend,  vary  or  rescind  notifications,  orders, rules  or  bye-laws.  –  Where,  by  any  [Central Act]  or  Regulations  a  power  to  [issue notifications]  orders,  rules  or  bye-laws  is conferred,  then that power includes a power, exercisable in the like manner and subject to the like sanction and conditions (if any), to add to, amend, vary or rescind any [notifications] orders, rules or bye-laws so [issued].”

25.  Section  21  has  no  application  to  a  certificate  since  a

certificate is neither a notification, nor an order, or rule or bye- law as

contemplated by that Section.   This Court has on several  occasions

held that where a statutory authority is enjoined to perform a quasi

judicial function such as that of grant of registration to a political party

or issue a certificate under the Income Tax Act,   Section 21 has no

application and confers no power to review such an Act because the

party has violated a provision of the constitution of law, vide  Indian

National  Congress  (I)  vs.  Institute  of  Social  Welfare10 and  Industrial

10 (2002) 5 SCC 685

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Infrastructure  Development  Corporation  (Gwalior)  M.P.  Ltd.  vs.

Commissioner of Income Tax, Gwalior11.

26. In the Indian National Congress (I) case (supra), this Court

held that where the law requires that an authority before arriving at a

decision must make an enquiry, such a requirement of law makes the

authority a quasi judicial authority.  Also when the authority is required

to act according to rules and not dictated by policy or expediency, the

authority performs the quasi judicial function and not an administrative

function.   

27. On the above test, the function of the State Government in

granting  an  Essentiality  Certificate  must  be  construed  as  a  quasi

judicial  function.   The  Government  is  required to,  while  issuing the

certificate in Form 2, to determine the justification and feasibility of

opening the proposed college in the State.  Towards this purpose, it is

bound to enquire and determine the existence of several factors such

as the number of existing institutions, the number of doctors becoming

qualified  annually,  the  number  of  doctors  registered  with  the  State

Medical Council and employed in Government Service, registered with

employment  exchange  etc.   It  must  also  determine  the  doctor

population in the State, the doctor - patient ratio to be achieved and

the  impact  of  the  proposed  college  on  the  availability  of  medical

manpower in the State.  The issuance of certificate must therefore be 11 (2018) SCC Online SC 126

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construed to be a quasi judicial act.  The upshot is that such an act is

not liable to be construed as an “order” contemplated by Section 21 of

the General Clauses Act.  Not being an order, and certainly not being a

notification, rule or bye-law, Section 21 has no application whatsoever.

28. Moreover, no provision of the IMC Act confers any power on

the State  Government  or  Union  Territory  Administration  to  issue an

Essentiality Certificate.  What the Regulations do, as discussed above,

is lay down that an Essentiality Certificate is the qualifying criterion for

making an application for opening a medical college.  In that sense, the

provision  recognizes  an  Essentiality  Certificate  issued  by  the  State

Government.   It  is  nobody’s  case  that  the  State  Government  is

conferred with the power or duty to issue such a certificate under any

State law.  In any case, in view of the fact that the field is occupied by

a parliamentary law i.e.  IMC Act,  1956,  a State law even if  already

existing would have no efficacy in the field.  As a consequence, the

executive power of the State under Article 162 cannot be invoked.  

29.  The Essentiality Certificate,  therefore,  must be taken to

have been issued under the IMC Act read with Regulations and not in

exercise of any independent power of the State.  Significantly, where

no power to issue certificate is shown to have been conferred by the

IMC  Act  or  the  Regulations,  it  would  be  futile  to  enquire  if  a

corresponding power to withdraw the same has been conferred on the

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State.  Even assuming that a power to issue such a certificate has been

impliedly  conferred  by  the  Regulations  under  the  Act,  certainly,  no

power to withdraw the same has been so conferred.  Such a power

cannot be arrogated relying on Section 21 of the General Clauses Act.

30. A  similar  question  arose  in  Industrial  Infrastructure

Development case  (supra)  where  the  Commissioner  of  Income  Tax

cancelled  a  registration  certificate  because  it  contained  an  error

apparent  from  the  record.  This  Court  held  that  the  certificate  was

issued as  a  result  of  the  quasi  judicial  order  and could  have  been

withdrawn only when an express power is vested in the authority to do

so.   In  that  case,  this  Court  noted two earlier  decisions  in  Ghaurul

Hasan  vs.  State  of  Rajasthan12 and  Hari  Shanker  Jain  vs.  Sonia

Gandhi13,  where  it  was  held  that  a  certificate  of  registration  of

citizenship issued under Section 5(1)(c) of  the Citizenship Act,  1955

cannot be cancelled by the authority granting registration by taking

recourse to Section 21 of the General Clauses Act.    

31. In  Government  of  Andhra  Pradesh  vs.  Y.S.  Vivekanand

Reddy14,  the  High  Court  was  called  upon  to  consider  whether  the

consent given by the State Government to the lessee to enter into sub-

leases could be withdrawn by invoking Section 21 of General Clauses

Act.  A full bench of the Andhra Pradesh High Court, per S.S.M. Quadri, J

12 AIR 1967 SC 107 13 (2001) 8 SCC 233 14 AIR 1995 AP 1

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(as His Lordship then was) held that the power to withdraw the consent

could have been exercised only  as long as it  was capable of  being

rescinded since this exercise had to be subject to like conditions, as

contemplated  by  Section  21.   Therefore,  the  Court  held  since  the

lessee, acting on consent had executed a sub-lease and the sub-lessee

had already commenced mining operations, the consent had worked

itself  out  and cannot  be withdrawn at  that  stage as  the  conditions

existing at the time of giving consent have changed.   

32. We are  of  the  view that  the  case  before  us  presents  a

similar  situation  where  the  petitioner  college  has  acted  on  the

Essentiality  Certificate  and  has  established  a  college  which  has

functioned; may be deficiently.   The conditions having changed since

the grant of the Essentiality Certificate, Section 21 is not available in

the absence of any power to withdraw conferred by the IMC Act.   

33. In view of the above, we find that Condition No.(XI) is ultra-

vires the provisions of the IMC Act and Regulations.  In the result, the

order dated 01.11.2017, issued by Respondent No. 1- State of Punjab,

withdrawing the Essentiality Certificate is quashed and set aside and

Condition Nos.(VII) and (XI) are declared illegal.

34. Accordingly, the Writ Petition is allowed.

35. We may not be understood to be laying down that under

no circumstances can an Essentiality Certificate be withdrawn.  The

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State Government would be entitled to withdraw such 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.  

….………………………………..J. [S.A. BOBDE]

….………………………………..J.  [L. NAGESWARA RAO]

NEW DELHI  JULY 03, 2018

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