Summary
The Supreme Court upheld Delhi’s requirement that the respondent hospitals receiving government land on charitable or concessional terms provide completely free treatment to twenty-five per cent OPD patients and ten per cent IPD patients. The requirement enforced existing grant, policy and public-law obligations rather than a new restriction on professional freedom. High Court judgments invalidating it were set aside, with strict compliance and reporting directed.
Issues
- Whether the free-treatment obligation could be enforced despite absence of an express percentage clause in certain leases.
- Whether the direction infringed professional freedom or required fresh legislation, and whether Social Jurists applied to similarly situated hospitals.
Provisions considered
- Section 2, Charitable Endowments Act, 1890Relief of the poor and medical relief fall within charitable purposes; the imposed obligations accord with that definition. (¶¶ 46, 67)
- Rules 5 and 20, Delhi Development Authority (Disposal of Developed Nazul Land) Rules, 1981Predetermined-rate allotments for non-profit public institutions carried public-benefit obligations; the two research hospitals also faced the reserved power to alter allotment conditions. (¶¶ 57, 58, 72, 73, 74)
- Articles 19(1)(g),19(6),21 and 162, Constitution of IndiaFree-treatment directions enforced existing obligations associated with government land and public health; they did not impose a new Article 19(6) restriction requiring legislation. Executive implementation was permissible. (¶¶ 52, 60, 63, 80, 83, 85, 86, 87, 95)
- Regulations 1.1.2,1.2.1 and 1.8, Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002The professional duties of service to humanity and priority to patients’ medical interests reinforced the charitable-treatment obligation. (¶¶ 53, 54, 55, 85)
Held
- Charitable status is directed to public benefit and cannot exclude the poor. Where a charitable intention exists but its mode is unspecified, the Court can enforce it through the cy-pres principle. (¶¶ 43, 44, 45, 46)
- All four respondent hospitals received government land at concessional or lower predetermined rates. Their leases must be read with the underlying charitable policies and rules; omission of an express percentage clause did not remove the existing public-benefit obligation. (¶¶ 57, 58, 68, 70, 71, 74, 77, 78, 79)
- The two research institutions were additionally subject to clause 7 reserving alteration of allotment conditions. Their governmental allotments were not open-market auction purchases. (¶¶ 57, 58, 68, 73, 74)
- The specified free treatment gave concrete form to existing grant, charitable, professional and public-law duties. It was not a new restraint on medical practice under Article 19(6), and fresh legislation was unnecessary in these circumstances. (¶¶ 83, 84, 85, 86, 95)
- Social Jurists applied to similarly situated institutions, including nonparties. The Court also examined the present hospitals’ merits afresh; the prior contempt dismissal did not defeat the obligation, and the inquiry and opportunity to respond refuted unilateral-imposition objections. (¶¶ 103, 104, 105, 107, 108)
- Eligible patients must receive the prescribed OPD and IPD treatment entirely free, including medicines and consumables. Hospitals may meet costs through their resources, donations, sponsorships or endowments. (¶¶ 101, 102, 109)
- The respondent and similarly situated hospitals must scrupulously comply with the 2 February 2012 conditions; violations were directed to attract stern action and lease cancellation. Delhi must submit a compliance report within one year. (¶ 109)
- Retention of a dead body to secure unpaid hospital bills was condemned as illegal; police were directed to register a case when such conduct is reported against the responsible management and doctors. (¶ 65)
Result
Appeals allowed; High Court judgments quashed. Free-treatment requirements upheld. Strict compliance, lease cancellation for violation and a Delhi-government compliance report within one year directed. Parties bear their own costs.