MODERN DENTAL COLLEGE AND RESEARCH CENTRE AND OTHERSversusSTATE OF MADHYA PRADESH & ORS.

                        [2012] 2 S.C.R 685


- MODERN DENTAL COLLEGE AND RESEARCH CENTRE                             A
                 AND OTHERS
                                  v.
            STATE OF MADHYA PRADESH & ORS.
                         IA Nos. 57 & 59
                                IN                                      B
                (Civil Appeal No. 4060 of 2009)

                           APRIL 3, 2012
           [DEEPAK VERMA, DR. B.S. CHAUHAN,
                K.S. RADHAKRISHNf-N, JJ.]                               C

       Education/Educational Institutions: Medical and Dental
  Colleges - Private unaided medical/dental colleges in the
  State of Madhya Pradesh - Admission - Unfilled NRI seats -
  Whether unfilled NRI seats are to be transfeffed to general           o
  pool and be shared equally to be filled up oil the basis of the
  Common Entrance Test conducted by the State level
  Committee or the Common Entrance Test conducted by the
  association of Private Dental and Medical Colleges - Held: It
, is open to the unaided professional educational institutions          E
  to fill up unfilled NRI seats through the entrance test
  conducted by them subject to the conditions laid down in
  *lnamdar case - The policy of reservation should not be
  enforced by the State nor any quota or percentage of
  admissions could be carved out to be appropriated by the              F
  State in unaided educational institution - In the matter of filling
  up of unfilled NRI seats, the principles laid down in **TMA Pai
  and *lnamdar cases were not correctly applied in ***R.D. Gari
  - M.P. Admission Rules, 2008 - r.8 - Madhya Pradesh Niji
  Vyavsayik Shikshan Sanstha (Prave_sh Ka Viniyaman Avam                G
  Shulk ka Nirdharan) Adhiniyam, 2007.

       **TMA Pai Foundation and Others v. State of Karnataka
 . and Others (2002) a sec 481: 2002 (3) Suppl. SCR 587;
   **TMA Pai Foundation and Others v. State of Karnataka and
                             685                                        H
    686      SUPREME COURT REPORTS                 [2012) 2 S.C.R.

A   Others (1994) 4 SCC 728; **TMA Pai Foundation and Others
    v. State of Karnataka and Others (1995) 5 SCC 220: 1995
    (2) Suppl. SCR 608; AP (P) Engg. College Management
    Assn. v. Govt. of A.P. (2000) 10 SCC 565; *P.A. lnamdar and
    others V. State of Karnataka and others (2005) 6 sec 537:
8   2005 (2) Suppl. SCR 603 - relied on.

       Modern Dental College and Research Centre and Ors.
  v. State of Madhya Pradesh and Ors. (2009) 7 SCC 751:
  2009 (9) SCR 845; ***R.D. Gardi Medical College and Anr.
  etc. v. State of M.P. and Ors. (2010) 10 SCC 225: 2010 (12)
C SCR 692 - referred to.

                         Case Law Reference:

          2002 (3) Suppl. SCR 587 relied on          Para 3

D         2005 (2) Suppl. SCR 603 relied on          Para 3, 11
          2009 (9) SCR 845           referred to     Para 4
          2010 (12) SCR 692          referred to     Para 5,7,8,
                                                     12,13
E      . (1994) 4 sec 128            relied on       Para 10

          1995 (2) Suppl. SCR 608 relied on          Para 10

          (2000) 1o sec 565          relied on       Para 10

F         CIVIL APPELLATE JURISDICTION: I.A. No. 57 & 59.

                                    IN

          Civil Appeal No. 4060 of 2009.

G       From the Judgment ~ Order dated 15.05.2009 of the High
    Court of Madhya Pradesh at Jabalpur in W.P. No. 2732 of
    2009.

     C.A. Sundaram, Dr. Rajeev Dhawan, Puneet Jain, Sushi!
H Kumar Jain, Pragati Neekhra, Suryanaryana Singh, B.S.
   MODERN DENTAL COLLEGE CENTRE v. STATE OF                    687
               MADHYA PRADESH

Banthia, Vikas Upadhyay, Gaurav Sharma, Prathia M. Singh,             A
Surbhi Mehta, Abhinav Mukerji, Amit Kumar, Avijit Mani Tripathi,
Sunil Kumar Jain, R.C. Kohli, Harish Pandey, Dharmendra
Kumar Sinha, Arun Kumar Beriwal, Sanjay K. Agrawal for the
appearing parties.
                                                                      B
     The Judgment of the Court was delivered by

       K.S. RADHAKRISHNAN, J. 1. We are in these
  applications called upon to decide the question as to whether
  the unfilled NRI seats are to be trani>ferred to general pool and   C
  be shared equally to be filled up on the basis of the Common
  Entrance Test conducted by the State level Committee -
  Vyavsayik Pariksha Mandal (VYAti'AM) or by the Common
  Entrance Test conducted by the Association of Private Dental
· and Medical Colleges (APDMC), so 'far as the private unaided        D
  medical/dental colleges in the State of Madhya Pradesh are
  concerned.

     2. Applicants, herein had filed Writ Petition No. 2732 of
2009 before the High Court of Madhya Pradesh (Jabalpur)
challenging the constitutional validity of Madhya Pradesh Niji        E
Vyavsayik Shikshan Sanstha (Pravesh Ka Viniyaman Avam
Shulk ka Nirdharan) Adhiniyam, 2007 (in short 'the Act) and
the Rules framed thereunder. The High Court vide its judgment
dated 15.5.2009 repelled the challenge to the Act and the Rules
but declared that the provisions of Rule 10(2)(iii) of 2009 as        F
ultra vires. The High Court also held that the Judgment would
not affect the Common Entrance Test already conducted by
VYAPAM for the year 2009-10. The above-mentioned Writ
Petition was disposed of along with other similar matters and
a common Judgment was delivered by the High Court.                    G.

     3. Aggrieved by the judgment in Writ Petition No. 2732 of
 2009, Civil Appeal No. 4060 of 2009 was filed by the applicants
 herein. While admitting the appeal, a Bench of this Court had
 prima facie found that the provisions of the Act handing over
 the entire selection process to the State Government or the          H
    688       SUPREME COURT REPORTS                    [20121 2 S.C.R.


A agencies appointed by the State Government for
  undergraduate, graduate and postgraduate medical/dental
  colleges and fee fixation was contrary to and inconsistent with
  the principles laid down by the eleven-Judges Bench Judgment
  in TMA Pai Foundation and Others v. State of Karnataka and
B Others [(2002) 8 SCC 481) (for short 'Pai Foundation1 and the
  Judgment in P.A. lnamdar and others v. State of Karnataka
  and others [(2005) 6 SCC 537) (in short 'lnamdaf1. The Court
  also observed that 2007 Act would become unconstitutional, if
  read literally, but an interim arrangement was made with regard
c to the admissions in the private unaided medical/dental
  colleges in the State of Madhya Pradesh for the year 2009-10;
  the operative portion of that order reads as follows:

          "We, therefore, direct that the admissions in the private
          unaided medical/dental colleges in the State of Madhya
D         Pradesh will be done by first excluding 15% NRI seats
          (which can be filled up by the private institutions as per para
          131 of lnamdar case), and allotting half of the 85% seats
          for admission to the undergraduate and post graduate
          courses to be filled in by an open competitive examination
E         by the State Government, and the remaining half by the
          Association of the Private Medical and Dental Colleges.
          Both the State Government as well as the Association of
          Private Medical and Dental Colleges will hold their own
          separate entrance examination for this purpose. As
F         regards "the NRI seats", they will be filled as provided
          under the Act and the Rules, in the manner they were done
          earlier."

       4. The Court also observed that the solution arrived at
G might not be perfect, but it had only tried to find out a best via
  media for admissions· for the academic year 2009-10.
  However, it was recommended that the same might also be
  considered for future sessions. The order passed by the Court
  is reported in Modern Dental College and Research Centre
H and Ors, v. State of Madhya Pradesh and Ors. [(2009) 7 SCC
  751]. (in short Modern Dental College)
   MODERN DENTAL COLLEGE CENTER v. STATE OF                689
     MADHYA PRADESH [K.S. RADHAKRISHNAN, J.]
        5. The above arrangement indicates that 15% of the total A
 sanctioned intake in the unaided Private Medical and Dental
 Colleges was set apart for giving admission to NRI students
 and the remaining 85% seats would be filled up equally through
 the examination conducted by the State and the Common
 Entrance Test conducted by the Colleges. Controversy now is B
 only with regard to unfilled NRI seats due to lack of sufficient
·NRI students, and in what manner those seats have to be filled
 up. State, has maintained the stand that those unfilled seats
 would also go to the general pool and be shared by both the
 State and the Colleges equally. Such a stand was taken by the c
 State on the basis of the interpretation placed by this Court in
 filling up the unfilled NRI seats in its judgment dated 30.9.2010
 in R.D. Gardi Medical College and Anr. etc. v. State of M.P.
 and Ors. (2010) 10 SCC 225 (in short Gardi Medical College),
 wherein, while interpreting Rule 8 of the M.P. Admission Rules,
                                                                   0
 2008 the two-Judges Bench of this Court observed as follows:
     "A plain reading of the above leaves no manner of doubt
     that unfilled NRI seats had to be transferred to the general
     pool to be filled up on the basis of the merit of the
     candidates in the State-level common entrance test E
     conducted by the Madhya Pradesh Vyavsayik Pariksha
     Mandal or by any other agency authorised by the State
     Government for that purpose. The unfilled seats in the NRI
     quota were, therefore, to be treated as a part of the general
     pool and once that was done the share of the college in F
     terms of the order passed by this Court would be 50% out
     of the said seats. The High Court has, in that view, rightly
     held that while the management was justified in filling up
     5 unfilled seats in NRI quota, the remaining 5 could not
     have been filled up otherwise than on the basis of the G
     entrance test referred to in Rule 8."
  Court, in the above case, was dealing with the admissions for
. the academic year 2010-11.
      6. The State Government while framing the Madhya            H
    690      SUPREME COURT REPORTS                   [2012] 2 S.C.R.


A   Pradesh Private Medical and Dental Under Graduate Course
    Entrance Examination Rules, 2011 incorporated Rule 5 with
    regard to unfilled NRI seats with specific reference to the above-
    mentioned judgment dated 30.9.2010. The Rule reads as
    follows:
B
          "RESERVATION: Every Institution shall be allowed to fill
          up to 15% of the sanctioned seats by NRI candidates only,
          in the manner prescribed by the admission and Fee
          Regulatory Committee. These NRI seats shall be filled up
          through a separate counselling. NRI seats remaining
c         vacant shall be merged into the counselling of Non NRI
          Candidates, as per Hon'ble Supreme Court Order in Civil
          Appeal No. 8429-8430/2010 dated 30.9.2010."

          7. The applicants, noticing that the judgment dated
D 30.9:2010 in Gardi Medical College would seriously affect the
    rights of unaided educational institutions in the matter of filling
    up of unfilled NRI seats, filed IA Nos. 51-52 of 2011 in Civil
    Appeal No. 4060 of 2009 for appropriate modification I
    clarification of the orders passed by two-Judges Bench in
E   Modern Dental College as well as R.D. Gardi Medical
    College. The applications came up for hearing before two-
    Judges Bench of this Court on 1.8.201,1<and this Court passed
    the following order:

          "We are of the opinion that there appears to be some
F         conflict between the observations made in para 28 of the
          judgment of the two-Judges Bench rendered in the case
          of R.D. Gardi Medical College and Another. etc. v. State
          of M.P. and Ors. [(2010) 10 SCC 225], quoted below:

G               28. A plain reading of the above leaves no manner
                of doubt that unfilled NRI seats had to be
                transferred to the general pool to be filled up on the
                basis of the merit of the candidates in the State-,.
                level common entrance test conducted by the
H               Madhya Pradesh Vyavsayik Pariksha Manda! or by
 MODERN DENTAL COLLEGE CENTER v. STATE OF                 691
   MADHYA PRADESH [K.S. RADHAKRISHNAN, J.]

          any other agency authorised by the State A
          Government for that purpose. The unfilled seats in
          the NRI quota were, therefore, to be treated as a
          part of the general pool and once that was done the
          share of the College in terms of the order passed
          by this Court would be 50% out of the said seats. B
          The High Court has, in that view, rightly held that
          while the management was justified in filling up 5
          unfilled seats in NRI quota, the remaining 5 could
          not have been filled up otherwise than on the basis
          of the entrance test referred to in Rule 8.           c
    and the observations made in para 27(1 ), quoted below,
    of T.M.A. Pai Foundation and others v. State of Karnataka
    and others [(1995) 5 sec 220] which is a three Judge
    Bench decision:
                                                                   D
           "27(1) So far as NRI quota is concerned, it is fixed
           at fifteen per cent for the current academic year. It
           shall be open to the management to admit NRI
           students and foreign students up to the aforesaid
           specified percentage, it shall be open to them to E .
           admit students on their own, in the order of merit,
           within the said quota. This direction shall be a
           general direction and shall operate in the case of
           all the States where admissions have not been
           finalized. It is, however, made clear that by virtue of F
           this direction, no student who has already been
           admitted shall be disturbed or removed."

The Court, therefore, referred the matter to a larger Bench.
However, by the time year 2011-2012 came to a close hence,
the larger Bench could not resolve the apparent conflict and G
hence, a two Judges Bench of this Court disposed of both IA
Nos.51 and 52 vide its order dated 23.9.2011.

    8. The same issue, has again been cropped up, now for
the academic year 2012-13, hence, it is necessary to clarify     H
    692       SUPREME COURT REPORTS                 [2012] 2 S.C.R.


A the order dated 27.5.2009 in Modern Dental College and the
  judgment of this Court dated 30.9.2010 in R.D. Gardi Medical
  College as to how the unfilled NRI seats be filled up. For the
  said purpose, the applicants have filed IA Nos.57-59 of 2011,
  which came up for hearing before two-Judges Bench of this
B Court on 9.12.2011 and the Court ordered that the applications
  be placed before the Constitution Bench.

        9. Since main issue referred to Constitution Bench is not
  likely to come up for hearing shortly and the issue projected in
  I.As with regard to unfilled seats is of urgent nature, thus, they
C have been considered by us. Hence, these applications have
  come up before us for consideration vide order passed by
  Hon'ble the Chief Justice of India.

       10. We have heard learned senior counsel - Shri C.A.
D S,undaram and Dr. Rajeev Dhawan and learned counsel for the
  State of Madhya Pradesh - Shri B.S. Banthia. We may at the
  outset point out that in the instant applications, we are
  concerned only with the question as to how and in what manner
  the unfilled NRI seats be filled up for the year 2012-13 till the
E appeal is finally disposed of, which issue, in our view, is no
  more res integra. This Court had earlier in various judgments
  dealt with the purpose and object of creating NRI quota and the
  manner in which those quota had to be filled up. A three-Judges
  Bench of this Court in TMA Pai Foundation and Others v. State
F of Kamataka and Others (1994) 4 sec 728 had an occasion
  to consider how, the vacant seats, in the NRI quota be filled up
  and ordered as follows:                   '                 ·

          "So far as NRI quota is concerned, we fixed the same as
          15% last year. We fixed NRI quota in respect of minorities'
G         institutions as 5%. Although the NRI quota should not,
          normally, be more than 5% but keeping in view the ·
          reduction in the fee structure, we fix the same as 10% (of
          the total seats) for this year. We further make it clear that
          in case any in the NRI quota remains unfilled, the same
H         can be filled by the Management at its discretion."
   MODERN DENTAL COLLEGE CENTER v. STATE OF                    693
     MADHYA PRADESH [K.S. RADHAKRISHNAN, J.]

  Later another three-Judges Bench of this Court in TMA Pai A
  Foundation and Others v. State of Karnataka and Others
  (1995) 5 sec 220 had also endorsed the same view holding
  that it would be open to the Management to admit NRI students
  and foreign students within that quota and in case they were
  not able to get the NRI or foreign students upto the aforesaid       a
  specified percentage, it would be open to them to admit
  students on their own, in the order of merit, within the said .
· quota. The operative portion of the order with regard to NRI
  quota for the year 1995-96 was as follows:

     (1) So far as NRI quota is concerned, it is fixed at fifteen C
     per cent for the current academic year. It shall be open to
     the management to admit NRI students and foreign
     students within this quota and in case they are not able
     to get the NRI or foreign students upto the aforesaid
     specified percentage, it shall be open to them to admit D
     students on their own, in the order of merit, within the said
     quota. This direction shall be a general direction and .
     shall operate in the case of all the States where
     admissions have not been finalized. It is, however, made
     clear that by virtue of this direction, no student who has E
     already been admitted shall be disturbed or removed."

 Similar order was also passed by this Court in AP (P) Engg.
 College Management Assn. v. Govt. of A.P. (2000) 10 SCC
 565. The operative portion of the order of the two-Judges Bench       F
 reads as follows:

     "4. After hearing learned counsel for the parties, we direct
     that the State of Andhra Pradesh shall allow the 5% NRI
     quota in the private engineering colleges in the State of
     Andhra Pradesh to be filled up in the manner earlier              G
     directed by this Court and to permit the management of
     the private engineering colleges to fill up the unfilled NRI
     quota, at its own discretion, subject, however, to the criteria
     of merit, qualification and fee structure - as prescribed by
     the Government not only for the current academic year but         H
    694      SUPREME COURT REPORTS                     [2012] 2 S.C.R.

A         also for successive academic years, till the main matter
          1is decided by this Court in the pending cases."

          11. We may also in this connection refer to the judgment
     of the seven-Judges Bench in P.A. lnamdar v. State of
B Maharashtra [(2005) 6 SCC 537], wherein this Court had dealt
     with the rights of unaided minority and non-minority educational
     institutions and held that the State cannot regulate or control
     admissions, so as to compel them to give up a share of the
     available seats to the candidates chosen by the State, as if it
     was filling up, the seats available, to be filled up at its discretion
C in such private institutions. Court held that would amount to
     nationalization of seats, such imposition of quota of State seats
     or enforcing reservation policy of the State on available seats
  - in unaided professional institutions are acts constituting serious
     encroachment on the right and autonomy of private professional
D educational institutions. It was also ordered that such
     appropriation of seats can also not be held to be a regulatory
   . measure in the interest of the minority within the meaning of
     Article 30(1) or a reasonable restriction within the meaning of
     Article 19(6) of the Constitution.
E
           lnamdar having said so dealt with NRI seats as well. In
     Para 131 of judgment, the Court had only dealt with the question
     as to how NRI seats had to be filled up: First, it was ordered
     that the seats should be utilized bona fide by NRls only and for
F their children or wards. Further, it was ordered that within quota,
     merit should not be given a complete go-bye. Further, it was
     also ordered that the amount of money, in whatever form
     collected from such NRls, should be ulilized for benefiting
     students such as from economically weaker sections of the
G society, whom, on well defined criteria, the educational
     institution might admit on subsidized payment of their fee.

         Further, In para 132 of the lnamdar, it had also been clearly
    held that the policy of reservation should not be enforced by the .
    State nor any quota or percentage of admissions could be ·
H
  MODERN DENTAL COLLEGE CENTER v. STATE OF                    695
    MADHYA PRADESH [K.S. RADHAKRISHNAN, J.]

carved out to be appropriated by the State in a minority or non-      A
minority unaided educational institution.

       12. We are of the considered view that the above principles
laid down by a larger Benches of this Court, in the matter of
filling up of NRI seats were not correctly understood or applied      B
by this Court in R.D. Gardi Medical College while interpreting
Rule 8 of the M.P. Admission Rules, 2008. The finding recorded
in R.D. Gardi Medical College that the unfilled seats in NRI
quota in unaided professional colleges should be treated as a
part of the general pool and be shared equally by the State and       C
the unaided professional colleges goes contrary to the
principles laid down by the eleven-Judges Bench in Pai
Foundation, lnamdar as well as the Judgments rendered by
the three Judges Bench in Pai Foundation referred to earlier.
The wrong interpretation given by in R.D. Gardi Medical
College is seen incorporated in Rule 5 of the Madhya Pradesh          D
Private Medical and Dental Under Graduate Course Entrance
Examination Rules 2011 as well, which in our view cannot be
legally sustained.

      13. We are, therefore, inclined to allow both the               E
applications and over rule the direction given by the two learned
Judges of this Court in R.D. Gardi Medical College and.hold
that it is open to the unaided professional educational
institutions to fill up unfilled NRI seats for the year 2012-13 and
for the succeeding years through the entrance test conducted          F
by them till the disposal of the appeal subject to the conditions
laid down in lnamdar strictly on the basis of merits.

      14. IA Nos. 57 and 59 of 2011 in Civil Appeal No. 4060
of 2009 are allowed to the extent mentioned above and
disposed of on the basis of the above modifications and               G
clarifications.

D.G.                    Interlocutory Applications disposed of.

                                                                      H