Summary
After MBBS students of a derecognised private medical college (SRMCH) were relocated under Supreme Court orders to three private colleges and completed their course paying only Government-rate fees, the Court apportioned the resulting fee shortfall. It placed the primary liability on the defaulting college's trust and released the trust's bank guarantee with the MCI/NMC and its deposit in Court to the transferee colleges. It held the students could not keep the windfall of interim Government-rate fees and allowed the colleges to recover the balance, at SRMCH rates, through the NMC.
Issues
- Whether students relocated from a derecognised private medical college to private colleges under interim orders are liable to pay fees at Government rates or at private-college rates.
- Whether the transferred students should be classified against Government or management quota in the transferee colleges.
- How the fee shortfall of the transferee colleges is to be apportioned between the students and the trust running the defaulting college.
- Whether the bank guarantee furnished by the trust with the MCI/NMC could be applied towards the transferee colleges' dues.
Held
- The question of classifying the transferred students against Government quota did not arise, as there was no material showing vacant Government quota seats in the transferee colleges; all were presumed to have been accommodated against private/management seats, whose fee structure governs liability. (¶ 26)
- Payment of Government-rate fees under the Court's interim orders, and under the directions in Hind Charitable Trust for the 2014-15 admissions, was an interim arrangement to meet an emergency; students who had chosen a private college with a higher fee structure cannot retain that benefit permanently, as it would amount to unjust enrichment. (¶¶ 32, 33, 35, 36, 52)
- The deficiencies found by the MCI/NMC in SRMCH stood affirmed by the dismissal of the college's writ petition against non-renewal; on the principle that no one may benefit from his own wrong, the primary liability for the transferee colleges' dues falls on the trust running the defaulting college, subject to permissible adjustments, without prejudice to the trust's rights in other proceedings. (¶¶ 28, 37, 38, 42, 53)
- No overriding charge or exclusive lien of the MCI/NMC over the trust's bank guarantee was shown; the NMC may pursue any levy against the institution in accordance with law, and the guarantee amount and the trust's deposit in Court, with interest, were directed to be paid to the three transferee colleges in equal shares. (¶¶ 43, 44, 45, 46)
- As the transferee colleges agreed to accept fees at SRMCH rates, and the funds released did not cover their dues, the students, who had undertaken to abide by the Court's final directions on fees, must make good the shortfall computed at SRMCH rates, giving credit for amounts paid at admission to SRMCH; recovery is to be through representations to the MCI/NMC. (¶¶ 49, 52, 53)
Result
Interlocutory applications of the transferee colleges disposed of and appeals closed. MCI/NMC to release the trust's bank guarantee amount (about Rs.10 crores) equally to the three transferee colleges within three months; the trust's deposit in the Registry with interest to be divided equally and disbursed, colleges to furnish bank details within two weeks. Colleges may make representations to the MCI/NMC to recover student-wise shortfall at SRMCH rates; students who comply are entitled forthwith to their course-completion documents.