Holding

The State Government is not required to apply to itself for permission under Section 64, and the university's perspective plan is not strictly binding on the State, merely serving as a guideline.

Summary

The State of Maharashtra decided to establish a government medical college at Kolhapur, which was challenged by the Indian Medical Association on the ground that the State had not filed an application with the Maharashtra University of Health Sciences under Section 64 of the Act and that the decision contravened the university's perspective plan. The Supreme Court held that when the State itself decides to set up a government medical college, it is not a "management" under Section 64 and therefore need not apply to itself for permission; the decision itself amounts to an Essentiality Certificate. The Court further held that the perspective plan prepared by the university is not strictly binding on the State, serving only as a guideline, and that there was no material deviation from the plan in the present case. Consequently, the High Court order setting aside the State's decision was reversed and the appeal was allowed.

Issues considered

When does the State Government have to submit an application to the Maharashtra University of Health Sciences under Section 64 of the Maharashtra University of Health Sciences Act, 1998 for establishing a government medical college?
Does the perspective plan prepared by the University under Section 64 bind the State Government when it decides to establish a government medical college?
How should the term "management" in Section 64 be interpreted with respect to the State Government?

Legislation cited

Indian Medical Council Act, 1956s. IOA (1), s. IOA (2), s. IOA (3), s. IOA (4)
Maharashtra University of Health Sciences Act, 1998s. 2(21), s. 64, s. 65

Subjects

government medical collegeessentiality certificateperspective planSection 64management definitionstate governmentuniversity regulationArticle 371(2)(c)medical education

Judgment

A THE STATE OF MAHARASHTRA
v.
INDIAN MEDICAL A::SOCIATION AND ORS.

DECEM!IER 6, 200 I

B [V.N. KHARE AND B.N. AGRAWAL, JJ.]

Education :

Maharashtra Universiry qf Hea'th Sciences Act, 1998/The Establishment
qf New Medical Colleges, Opening qf Higher Courses qf Study and increase qf
c Adminion Capacity in Medical Col/.•ges Regularion, 1993-Secrions 64 and
2(21 )!Para 3.

Opening qf new Governmenr Medical College in State-Requirement
qf-To submit an applicarion to the :Jniversity for obtaining permission from
D State Government-Applicability-Hdd, when State Government decides to set
up a Govern1nent Medical College al a proposed location, it is not required to
sub111it an application .for obtaining p ennission.fron1 itself-Such perttiission is
required in case o.f private managen ent or persons other than State Gove17l-
tnent-Also such dec:i.\·ion o,f the Statt Govern111ent tantan1ounts to approval or
pern1ission under Section 64 and grnnt o,f Essentiality Certificate under JJ:ara
E 3-Further expression 'Managen1ent' occurring in Sec,:tion 64 does not include
the State Gnvenunent and defined 1n1'anilig n,f expression 'Manage111ent' under_
Section 2(21) cannot be assigned.

Per;pecrive plan prepared by 1he University--Binding on The State Gov-
ernnzent-When State Govenunent 1 lecides to set up a Govern111ent Medical
F
College at a proposed location-He/,/, as State Government is not nzanagement
under Section 64, perspective plan is not strictly binding on it-Such plan binds
the State Govenunent qua private 1nanagen1ent or anybody else excepting the.

-
State Governn1ent applying .for permission o.f the State Gnvernnzent to open a
Medical College --Also serves as a guideline to the State Governrner1t ·which it
G is expected to abide and any single deviation would not render State Govern-
1nentS decisions invalid.

Words and Phrases :

'Management'-Meaning qf 'n the contexr ·~f Sections 2(21) and 64 of
H the Maharashtra University Health Sciences Act, 1998.
474
STATE v. INDIAN MEDICAL ASSOCIATION 475
Appellant-State Government decided to set up a Government Medi- A
cal college. Aggrieved, respondents filed a petition. High Court held the
decision to be invalid as the State Government did not snbmit any applica-
tion to the University seekiug permission of the State Government for
establishing a Government medical college under Section 64 of the
Maharashtra University of Health Sciences Act, 1998 and also the said B
decision was contrary to the perspective plan prepared by the university.
Hence the present appeal.

Allowing the appeal, the Court

HELD : I.I. When the State Government resolves to set up a medical C
college at a proposed location, it is not required to submit any application
to itself for permission to establish a Government run medical college
through the University under Section 64 of the Maharashtra University of
Health Sciences Act, 1998. (487-C]

1.2. Under Para 3 of the Establishment of New Medical Colleges, D
Opening of Higher Courses of Study and Increase of Admission Capacity
in Medical Colleges Regulation, 1993 it is mandatory on the part of an ·
institution or a man:fgement desirous of establishing a medical college to
obtain Essentiality Certificate from the respective State Government or
the Union Territory Administration. The requirement of Essentiality Cer- E
tificate concerns with, among other requirements, the desirability of hav-
ing the proposed medical college at the proposed location and grant of
certificate that adequate clinical material is available as per Medical Council
at the proposed medical college, which are required to be decided by the
State Government. Thus, the State Government is the only authority un- F
der the Regulations to decide the location of a new proposed medical
college within the State. •"or that purpose, the State Government can
neither delegate its function to any other authority not create a statutory

-
authority under a State Act. If it does so, it would be repugnant to the
Central Act. However, it is true that the State Government in order to
maintain inter or intra regional imbalances within the State and to remove
G
the chances of arbitrariness can lay down guide lines or prepare a perspec-
tive plain for its own guidance for selecting locations for a proposed new
medical college within the State. [481-B-G]

1.3. Another object behind the necessity to obtain the Essentiality H

•..
476 SUPREME COURT llEPORTS (2001] SUPP. 5 S.C.R.
A Certificate from the State Governme1 ti under para 3 of the Regulations is
that in the event a private management becomes incapable of setting up
the proposed medical college or imp:crt education !herein, such a Certifi-
cate by the State Government casts ai 1obligation on the State Government
to take over the affairs of such a priv 1te medical college and discharge the
B obligations of the private manageme1 ti. (491-H; 482-A-B]

1.4. Section 64 provides for procedure for obtaining permission by
the State Government for setting u11 a new medical college and confers
exclusive power on the State Government for grant of permission to a
management to establish a new medi :al college. This power is substantially
c the power of the State Government to grant Essentiality Certificate to a
management or an institution who intends to establish a new medical
college at a proposed location. Sectk n 64 of the Act read with para 3 of the
Regulations shows that the requirement of Essentiality Certificate or ap-
proval by the State Government is required when a private management
D or any other person other than the State Government intends to set up a
medical college. The State Government being the authority to accord
approval for setting up a medical c• il!ege within the State cannot apply to
itself for grant of approval when it proposes to establish a new medical
college within the State. Its decis ·.on to set up a ~overnment medical
E college tan ta mounts to an ·approva I of permission as contemplated under
Section 64 of the Act and grant of Essentiality Certificate to the extent of
location of the proposed medical c1 ·liege which is required to be furnished
under para 3 of the Regulation. [4:13-C-F]

1.5. The language of Section 64 is plain and simple. The expression
F
'management' occurring in Sectkn 64 shows that it refers to a private
management other than the State I ;overnment when it seeks permission of
the State Government to open a new medical college within the State.
Further more Section 2 of the Acl shows that it starts with the words "in

G
this Act, unless the context otherwise requires ...... ". If the expression
"management" occurring in Section 64 of the Act is given defined meaning
contained in Section 2(21), it wculd mean the State Government is re-
quired to 2.pply to itself for grant or permission to set up a government
medical college through the Unhersity and also for grant of Essentiality
-
Certificate under para 3 of the Re ~ulation. Therefore, the defined meaning
H of the expression "management'' cannot be assigned to the expression
STATE v. INDIAN MEDICAL ASSOCIATION 477
"management" occurring in Section 64 of the Act. In the instant case, the A
context does not permit or requires to apply the defined meaning to the
word "management" occurring in Section 64 of the Act. However, after the
government run medical college is established, necessarily there has to be
management or body of persons to run the affairs of the medical college
and for such a situation the expression "management" as defined in Sec· B
lion 2(21), is contemplated under Section 65 of the Act. (485-D-E]

K. Balakrishna Rao and Ors. v. Haji Abdulla Sail and Ors., [1980] 1
SCC 321 and Printers (Mysore) Ltd. and Anr. v. Assistant Commercial Tax
Officer and Ors.. (1994] 2 SCC 434.
c
1.6. There cannot be two laws • one for the State Government and
other for private management. But the complia.nce of requirement of law
either by a private management or by the State Government depends upon
the object and purpose for which legislature has enacted the law. If viewed
in this light, it is manifest that anyone else excepting the State Government
D
or Union Territory, disirons of setting np a new medical college, is required
to obtain Essentiality Certificate from the State Government as regards
the desirability of proposed location where the medical college is intended
to be established. It is within the exclusive domain of the State Govern-
ment to approve the proposed location where the new medical college is to
be established. Similarly, under Section 64 of the Act, the State Govern-. E
ment has exclusive power to grant or refuse permission to set up a new
medical college which is substantially a grant of Essentiality Certificate
under para 3 of the Regulations. The State Government while granting an
Essentiality Certificate or permission to establish a new medical college
acts as a sovereign and discharges its constitutional obligation. In this F
context, if the argument of the appellant is accepted, it woulcl mean the
State Government is required to apply to itself for permission when it
decides to set up a new government run medical college when the State
Government is the authority to grant permission to set up a new medical
college at a proposed location. Further, the argu111ent that the State Gov- G
ernment when it decides to set up a new government run medical college is
required to submit an application to the University for grant of permission
by the State Government would be repugnant to the object behind para 3
of the Regulations and legislative intent for which Section 64 of the Act has
been enacted. [486-B-G] H
478 SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A Superintendent & Legal Rememl rancer, State cf West Bengal v. Corpo-
ration of Calcutta, [1967] 2 SCR 170, distinguished.

2.1. The perspective plan pn pared by the University under the
Maharashtra University of Health Sc ences Act, 1998 for educational devel-
opment for the location of higher Iear :ling is not strictly binding on the State
B Government when the State Government resolves to set up a Government
run Medical College within the State in view of the fact that the State is not
the "Management" under Section 64 of the Act. [487-D-E; 493-A]

2.2. State Government exercises considerable control over the run-
C ning of .the affairs of the Universif y and inasmuch as the University is
prohibited from framing any statuf es laying down the qualifications, re-
cruitment, terms of office and couditions of service of employees and
officers of the Government run ins· itutions. So the perspective plan pre-
pared by the University under the A ct is binding on the State Government
qua those who are applicants for grant of permission to open a new
D
medical college under Section 64 o! the Act. The State Government being
not an applicant for grant of perm ssion under Section 64 of the Act, the ·
perspective plan prepared by the University is not binding on it when it
takes a decision to establish a new Government medical college. However,
the perspective plan prepared by the University may not be strictly bind-
E ing on the State Government whe" it decides to set up its own medical
college, but such a perspe<live pb n serves as a guideline indicating the
desirability of setting up a medica college by the State Government in a
particular region or area on accou 1t of either its backwardness or lack of
medical facilities in that region or area. Such a guideline helps the State
F Government in finding out locatic ns when it decides to set up a medical
college within the State. The State Government is expected to comply with
the perspective plan as far as possible. However, any single deviation from ii
such a guideline by the State Gove :nment when it decides to set up its own
medical college within the State W<•uld not make its decision invalid. Jn the
G instant case, there is no deviation frnm the perspective plan prepared by
the University. [489-D; F-H; 490-1•-D]

Dlzananjay R. Kulkarni and Ors. v. State of Maharashtra and Ors.,
[1999] 2 Maharashtra Law Jou .-nal, 323 and Union of India v. Satish
Pana/a/, [2001] ITR (249), 221, dhapproved.
H

I
STATE v. INDIAN MEDICAL ASSOCIATION [KHARE, J.] . 479
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 6I67 of 2001. A

From the Judgment and Order dated 13.7.2001 of the Bombay High
Court in W.P. No. 3798 of 2000.

Harish N. Salve, Solicitor General, S. Ganesh, U.U. Lalil, Kumbhoni,
S.V. Deshpande, Maninder Singh, Ms. Pratibha M. Singh, Ms. Kavita Wadia, B
Ms. Sunita Sharma, for D.S. Mahra, A.P. Kot\e, M.D. Samel, Rajan Narain,
Sajan Narain, S.M. Jadhav for the appearing parties.

The Judgment of the Court was delivered by

V. N. KHARE, J. This appeal which is directed against the judgment of c
Bombay High Court passed in the writ petition gives rise to following two
ques~ions for our decisions- (1) whether the State Government is required 10
submit an application lo the Maharashtra University of Health Sciences (here-
inafter referred to 'the University') under Section 64 of the Maharashtra
University of Health Sciences Act, 1998 (hereinafter reforrcd lo as the 'Act') D
for obtaining permission fron1 itself, when it decides to establish a govern111cnt
run medical college within the State; and (2) whether the perspective plan
prepared by the University under the Act for educational development for the
location of higher learning is binding on the Slate Government when the State
Govcrn1nent resolves to set up a government run medical .college within the E
State.

The aforesaid questions arose in the context of the decision taken on
30.8.2000 by the government of Maharashtra lo set up a government medical
college al Kohlapur. This decision of the government was challenged by the
respondents through a Public Interest Litigation before the High Court of F
Bo1nbay at Aurangabad. The challenge in the writ petition was, inter alia, on
the ground that the Stale Government having nol submilled any application lo
the University as required under Section 64 of the Act, the decision taken by
the State Govcrnrnent to set up a government run medical college at Kohlapur
is invalid, a;.d, that, the resolution of the Stale Government Lo set up govern- G
men\ run medical college al Kohlapur being contrary lo the perspective plan
prepared by the University, the impugned decision was illegal. The High Court
was of the view that the State Gove· nmenl having not submillcd any applica-
tion for permission of the State Governtnent tu the University for establishing
a government rnn mcJical college al Kohlapur as required under Section 64 H
48() SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A of the Act, the impugned decision of the government is invalid and further the
decision of the State Government to set up a medical college at Kohlapur being
contrary to the perspective plan prepared by the University which is binding
on the State Government, the impugned decision suffers from legal infirmity.
Consequently, the decision of the State Government to set up a government run
B medical college at Kohlapur was set aside and the writ petition was allowed.
It is against the said judgment, the State of Maharashtra has preferred this
appeal.

Coming to the first question, the setting up a medical college and the
medical education in our country is governed by the Indian Medical Council
C Act, 1956 and Regulations framed thereunder. In the year 1993, Section IOA,
!OB and IOC were inserted in the Indian Medical Council Act by amending
Act 31of1993. Sub-section (I) of Section IOA provides that no person shall
establish a medical college or no medical college shall open a new or higher
course of study or training or increase its admission capacity in any course of
D ·. study or training except with the previous permission of the Central Govern-
ment obtained in accordance with· the provisions of the Act. Sub-section (2)
thereof provides that every person or medical college desirous of opening a
medical college shall submit to the Central Government a scheme in accord-
ance with the provisions of the Act and the Central Government shall refer the
scheme to the Medical Council for its recommendation. Sub-section (3) of
E Section IOA further provides that on receipt of a scheme by the Medical
Council, 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 consider the scheme, having regard to the factors referred to in sub-
section (7), and submit the scheme together with its recommendations thereon
F to the Central Government. Sub-section (4) of Section IOA enables the Central
Government either to approve or disapprove the scheme. Section 33 of the Act
empowers the Medical Council to make Regulation for carrying out the pur-
poses of the Act. The Medical Council, in exercise of power conferred by
Section 33 read with Section IOA of the Act, has framed Regulation known
as 'The Establishment of New Medical Colleges, Opening of Higher Courses
G
of Study and Increase of Admission Capacity in Medical Colleges Regulation,
1993 (hereinafter referred to as the 'Regulation'). The Regulation provides the
eligibility and qualifying criteria for setting up a medical college. Para 3 of the
Regulation runs as under :
-
H "that Essentiality Certificate regarding tile desirability and feasibility
STATE v. INDIAN MEDICAL ASSOCIATION [KHARE, l.] 481
. of having the proposed medical college at the proposed location has A
been obtained and that the adequate clinical material is available as per
Medical Council of India requirements has been obtained by the
applicant from the respective State Government or the Union Territory
• Administration."

A perusal of para 3 of the Regulation shows that it is mandatory on the part
B
of an institution or a management desirous of establishing a medical college
to obtain Essentiality Certificate from the respective State Government or the
Union Territory Administration, as the case may be. The requirement ofEssen-
tiality Certificate provided under para 3 of the Regulation concerns with among
other requirements the desirability of having the proposed medical college at C
the proposed location. The desirability of having medical college at the pro-
posed location under para 3 of the Regulation is required to be decided by the
State Government. Excepting the desirability oflocation of the proposed medical
college and certificate that adequate clinical material is available as per Medi-
cal Council of India at the proposed medical college are to be decided by the D
State Government and all other aspects regarding establishment of a new
,, medical college and imparting of the education therein are covered by the
Central Act and Regulations framed thereunder. In other words, in the matter
of establishment of a medical college and medical education the field, that is
open where a State Government has any role to play is only in regard to decide E
the desirability of the location of the proposed medical college and grant of
certificate that adequate clinical material is available as per Medical Council
at the proposed medical college. Thus, the State Government is the only
authority under the Regulations to which we are concerned to decide the
location of a new proposed medical college within the State. The State
F
Government, therefore, is the only judge to decide where the proposed
medical college is to be located. For that purpose, the State Government neither
can delegate its function to any other authority nor can create a statutory
authority under a State Act. If it does so, it would be repugnant to the Central
Act. However, it is true that the State Government in order to maintain inter
or intra regional imbalances within the State and to remove the chances of G
arbitrarin .ss can lay down guidelines or prepare a perspective plan for its own
guidance for selecting locations for a proposed new medical college within the
State.

Another object behind the necessity to obtain the Essentiality Certificate H
482 SUPREME COURT REPORTS [2001) SUPP. 5 S.C.R.
A from the State Government under para 3 of the Regulations is that in the event
a private management becomes incapable of setting up the proposed medical
college or impart education therein, such a Certificate by the State Government
casts an obligation on the State Government to take over the affairs of su.ch a
private medical college and discharge the obligations of the private manage- •
B mcnl. It is in these context, Section 64 of the Act is required to be read and
understood. Section 64 of the Act runs as under:

"64. Procedure for permission.- (I) the University shall prepare a
perspective plan for educational development for the location of insti-
tutions of higher learning in a manner ensuring equitable distribution
c of facilities of Health Sciences Education having due regard, in par-
ticular, to the needs of unserved and under-developed areas within the
jurisdiction of the University. Such plan shall be prepared by the
Academic Council and shall be placed before the Senate through the
Management Council and shall be updated every five years.
D (2) No application for opening a new college or institution of
higher learning which is not in conformity with such plan, shall be
considered by the University.

(3) The management seeking permission lo open a new college or
institution of higher learning shall apply in the prescribed form to the
E
Registrar of University before the last day of October of the year
preceding the year from which the permission is sought.

(4) All such applications received within the aforesaid prescribed
time limit shall be scrutinised by the Planning Board and be forwarded
F to the government with the approval of the Management Council on
or before the last day of December of the year, with such recommen-
dations (duly supported by relevant reasons) as are deemed appropri-
ate by the Management Council.

(5) Out of the applications recommended by the University, the
G Govcrn1nent 1nay grant pennission to such institutions as it may
consider right and proper in its absolute dis-:-rcuon, taking into account
the Govcrnn1ent's budgetary resour;,;esi the suitability of the manage-
1ncnts seeking pennission to open new institutions and the State level
priorities with regard to location of instit.utions of Health Sciences
H learning.
STATE v. INDIAN MEDICAL ASSOCIATION [KHARE, J.] 483
Provided however that, in exceptional cases and for the reasons A
to be recorded in writing, any application not recommended by the
University may be approved by the State Government for starting a
new college or institution of Health Sciences learning .
•
(6)No application shall be entertained directly by the Government
for the grant of permission for opening a new college or institution of
B
Health Sciences learning.

A perusal of Section 64 shows that it provides for procedure for obtain-
ing permission by the State Government for setting up a new medical college
and confers exclusive power on the State Government for grant of permission c
to a management to establish a new medical college. The power of the State
Government to grant permission to set up a new medical college under Section
64 of the Act is substantially the power of the State Government to grant
Essentiality Certificate to a management or an institution who intends to estab-
lish a new medical college at a proposed location. If Section 64 of the Act is
D
read along with para 3 of the Regulations it would show that the requirement
of Essentiality Certificate or approval by the State government is required when
a private management or any other person other than the State government
intends to set up a medical college. The Stale Government being the authority
to accord approval for setting up a medical college within the State cannot
apply Lo itself for grant of approval when it proposes to establish a new medical E
college within the State. It's decision to set up a government run medical
college tantamounts to an approval or permission as contemplated under Sec-
tion 64 of the Act and grant of Essentiality Certificate to the extent of location
of the proposed medical college which is required to be furnished under para
3 of the Regulation. The language of Section 64 is plain and simple. The F
expression 'management' occurring in Section 64 shows ttiat it refers to a
private management other than the State Government when it seeks permission
of the State Government to open a new medical college within the State ..

Shri S. Ganesh, learned senior advocate appearing for the respondents
brought to our notice the definition of the expression 'management' as con- G
tained in sub-section (21) of Section 2 of the Act, which runs as under:

"Section 2. In this Act, unless the context otherwise requires,-

xxx xxx xxx H
484 SUPREME COURT REPORTS (2001] SUPP. 5 S.C.R.

A (21) 'Management' means the trustees, or tbe managing or governing
body, by whatever name called, of any trust registered under the
Bombay Public Trusts Act, 1950 Born. XXIX of 1950 or any society
registered under the Societies Registration Act, 1860 21of1800 under
the management of which one or more colleges or recognised institu-
B tions or other institutions are conducted and admitted to the privileges
of the University.

Provided that, in relation to any college or institution established
or maintained by the Central Government or the State Government or
a local authority such as a Zilla Parishad, municipal council or munici-
c pal corporation, it means, respectively, the Central Government or the
State Government or the concerned local authority that is the Zilla
Parishad, municipal council or municipal corporation, as the case may
be."

D On the strength of the said definition of the expression 'management', it was
urged that the word 'management' occurring in Sect.ion 64 of the Act shall also
includes the State Government and as and when the State Government proposes
to set up or establish a government run medical college, it has also to apply.
to the University for grant of permission by the Stale government. The question
E then arises whether the expression 'management' occurring in Section 64 of
the Act would also include the Stote Government and the State Government
is required to submit an application to the University for obtaining approval
from itself as and when the State Government decides to establish a govern-
ment run medical college within the State.

F Jn K. Balakri.vlma Rao and Ors. v. Haji Abdulla Sail and Ors., [ 1980}
SCC 321, it was held that a definition clause does not necessarily in any
statute apply in all possible contexts in which the word which is defined may
be found therein. In Printers (Mysore) Ltd. and An1: v. Assistant Conunerial Tax
Officer and Ors., [1994] 2 SCC 434, it was held that it should be remembered
G that the provisions which define certain expressions occurred in the Act opens
with the words "in this Act unless the context otherwise requires" which shows
that wherever the word so defined occurred in the enactment, it is not manda-
tory that one should mechanically attribute to the said expression the meaning
assigned to it in the definition clause. Ordinarily, where the context does not
permit or where. the context requires otherwise, the meaning assigned to it in
STATE v. INDIAN MEDICAL ASSOCIATION [KHARE, J.] 485
the said definition need not be applied. A

A bare perusal of Section 2 of the Act shows that it starts with the words

. "in this Act, unless the context otherwise requires .... ". Let us find out whether
in the context of the provisions of Section 64 of the Act the defined meaning
of the expression "management" c_an be assigned to the word 'management in
B
Section 64 of the Act. In para 3 of the Regulations, the Essentiality Certificate
is required to be given by the State Government and permission to establish
a new medical college is to be given by the State government under Section
64 of the Act. If we give the defined meaning to the expression "management"
. occurring in Section 64 of the Act, it would mean the State Government is ·
required to apply lo itself for grant of permission to set up a government c
medical college through the University. Similarly it would also mean the State
Government applying to itself for grant of Essentiality Certificate under para
3 of the Regulation. We are afraid the defined meaning of the expression
"management" cannot be assigned to the expression "management" occurring
in Section 64 of the Act. In the present case, the context does not permit or D
requires to apply the defined meaning to the word 'management' occurring in
Section 64 of the Act. However, arter the government run medical college is
established, necessarily there has to be management or body of persons to run
the affairs of the medical college and for such a situation the expression
'management' as defined in Section 2 (21), is contemplated under Section 65 E
of the Act. In the context of the provisions of Section 65 of the Act, the
management of the government run medical college has to apply for grant of
affiliation to the University which may be the State Government. It is not
disputed that the State Government (Management) did apply for grant of
affiliation to the University which was granted. We are, therefore, of the
F
opinion that the defined meaning of the expression 'management' cannot be
assigned or attributed to the word 'management' occurring in Section 64 of the
·Act. The word 'management' if read in the context of the provisions of Section
64 of the Act, means any one else excepting the State Government applying
to a State Government for permission to establish the proposed medical college
at proposed location to be decided by the State Government.
G

Shri Ganesh, learned senior advocate, then urged that if we take a view
that the word 'management' occurring in Section 64 of the Act refers to a
private management or anyone else excepting the State Government, it would
mean there are two laws - one for private management desirous of setting up H
486 SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A a new medical college and the other for the State Government when it decides
to establish a new medical college in the State which is not permissible under

-
law, and relied upon a decision in the case of Superintendent & Legal
Remembrancer. State qf Wesr Bengal v. Cmporarinn of Calcutta, [1967] 2 SCR
170. We do not dispute with the broad abstract preposition of Jaw submitted
B by Shri S Ganesh, learned senior advocate. At the outset, it may be made clear
that there cannot be two Jaws - one for the State Government and the other for
private management. But the compliance of requirement of Jaw either by a
private management or by the State Government depends upon the object and
purpose for which legislature has enacted the Jaw. If viewed in this light, it is
manifest that anyone else excepting the State Government or Union Territory,
c desirous of setting up a new medical college, is required to obtain Essentiality
Certificate from the State Government as regards the desirability of proposed
location where the medical college is intended to be established. It is within
the exclusive domain of the State Government to approve the proposed location
where the new medical college is to be established. Similarly, under Section
D 64 of the Act, it is the State Government who has exclusive power to grant or
refuse permission Lo set up a new medical c0llcge. The grant of approval or
permission as contemplated under Section 64 of the Act is nothing but substan-
tially a grant of Essentiality Certificate under para 3 of the Regulations in so
-
far it relates to location of the proposed medical college. The State Government
E while granting an Essentiality Certificate or permission to establish a new
1nedica1 college acts as a sovereign and discharges its constitutional obligation.
In this context, if the argument of learned counsel for the appellant is accepted,
it would mean the State Government is required to apply to itself for permission
when it decides to set up a new government run n1edical college when the State
F Government is the only authority to grant permission to set up a new medical
college at a proposed location. Further, the argument that the State Government
when it decides to set up a new government run medical college is required
to submit an application to the University for grant of permission by the State
Government would be repugnant to the object behind para 3 of the Regulations
G ·and legislative intent for which Section 64 of the Act has been enacted.

Coming to the decision in Superintendent & Legal Re1nen1brance1; State
<?{West Bengal v. Corporation o{Calcurta (supra), cited by learned counsel for
the respondents, only this much safely can be stated th~t its reliance by the
appellant's counsel is totally misplaced. In the said c~se, the State of West
H Bengal was carrying ·an commefcial activities as ow~er and occupier of a
STATE v. INDIAN MEDICAL ASSOCIATION [KHARE, J.] 487
market at Calcutta without obtaining licence as required under Section 218 of A
the Calcutla Municipal Act, 1951. In that context, it was held by this Court that
the State Government was required to take licence under Section 218 of the
Calcutta Municipal Act. In the present case, neither para 3 of the Regulations
nor under Section 64 of the Act the State Government is required to take
permission from itself when it takes a decision to establish a new government B
run medical college and, therefore, reliance of the said decision is of no help
to the case of the respondents.

For the aforesaid reasons, we are of the view that when the Government
by a resolution decides to establish a new government run medical college
within the State, it is not required to submit any application to the University C
under Section 64 of the Act for grant of permission by itself.

Coming to the second question whether the perspective plan as prepared
by the University was binding on the State government when it decided to
establish a government run medical college within the State, Shri Harish N. D
Salve, learned Solicitor General, appearing for the appellant advanced three
arguments. His first argument is that Article 371 (2) (c) does not provide for
medical education and it is restricted only to technical education and, therefore,
Article 371 (2) (c) has no application in the present case. The second argument
is that when the State Government decides to establish its own medical college,
and the State Government not being a 'management' within the meaning of E
'n1anagement' occurring in Section 64 of the Act, and not required to submit
any application to the University and, as such, any perspective plan prepared
by the University is not binding on it. According tofom the perspective plan
is binding on the State Government qua private management who is required
to submit an application for permission of the State Government to open a new F
medical college. The third argument is that, in any event of the matter,
there was a substantial compliance of the perspective plan when the State
Government decided to establish a government run medical college at

-
Kolhapur. Whereas, learned counsel for the respondents brought to our notice
Article 371 (2) (c) of the Constitution of India and on the strength of the said G
provisions it was urged that a perspective plan prepared by the University under
Section 64 of the Act being under the mandate of Article 371 (2) (c) of the
Constitution and, therefore, was binding on the State Government and any
decision by the State Government contrary to the perspective plan would be
rendered invaM. H
488 SUPREME COURT REPORTS [2001] SUPP. 5 S.C.R.
A The first argument of learned Solicitor General is that the expression
'technical education' occurring in Article 371 (2)(c) of the Constitution is
distinct and different from 'medical education' and, therefore, Article 371 (2)
(c) of the Constitution has no application when the University prepared a
perspective plan under section 64 of the Act. We are not deposed to go into
B the said argument although the argument appears to be attractive. So far as the
second and third· arguments are concerned, it is necessary to ·.look into the
. provisions of the Act. Section 5 (ww) of the Act provides that the University
shall comply with and carry out any directives issued by Government from time
to time, with reference to the powers, duties and responsibilities of the Univer-
sity. Section 7 (2) of the said Act provides that the University shall adopt
c Government policy and orders or directions issued from time to time, in regard
to the reservation for Scheduled Castes, Schedtlled Tribes and Other Backward
Classes for appointment to different posts of teachers and non-teaching officers
and employees and for the purpose of admission of students in the affiliated
or conducted colleges. Sub-section (3) thereof further provides that the Uni-
D versity shall adopt general policy of Government in regard to the welfare of
various categories of weaker sections of the society and minorities as directed
by the Government, from time to time. Section 9 (l) provides that without prior
approval of the Government, University shall not create any new posts of .
teachers, officers or other employees; revise pay, allowances, post-retirement
E benefits and other benefits of its teachers, officers and other employees, divert
any earmarked funds received for any purpose other than that for which it was
received and incur expenditure on any developmental work form the funds
received from the Government or take any decision regarding affiliated col-
leges resulting in increased financial liability, direct or indirect, for the Gov-
ernment. Sub-section (4) of Section 9 further provides that in case of failure
F of the University to exercise powers or perform duties specified in Section 5
or where the University has not exercised such powers or performed such
duties adequately, or where there has been a failure to comply with any order
issued by government, the Government may, on making such enquiry as it may

G
deem fit, issue a directive to the University for proper exercise of such powers
or performance of such duties or comply with the order and it shall be the duty
of the University to comply with such direction. Clause (8) of Section 48 of
the Act provides that the Statutes of the University may provide qualifications,
-
recruitment, workload, cod~ of conduct, terms of office, duties and conditions
of service, including periodic assessment of teachers, officers and other em-
H ployees of the University and the affiliated colleges, except those colleges or
STATE v. INDIAN MEDICAL ASSOCIATION [KHARE, J.] 489
institutions maintained by the State or Central Government. Sub-section (6) of A
Section 49 thereof provides that the Chancellor, either suo motu or on the
advice of the Government, may, direct the University to make provisions in
Statutes in respect of any matter specified by him. Section 74 of the said Act
lays down that no management of a college or recognised institution shall be
allowed to close down the college or recognised institution without prior B
permission of the State Government.

We shall now examine Section 64 of the Act for the purpose whether the
perspective plan prepared by the University is binding on the State Government
when it resolves to set up a government run medical college within the State
in light of provisions of the Act stated hereinbefore and other relevant provi- C
SlOilS.

The aforesaid noted provisions of the Act show that the State Govern-
ment exercises considerable control over the running of the affairs of the
University and inasmuch as the University is prohibited from framing any
D
statutes laying down the qualifications, recruitment, terms of office and con-
ditions of service of employees and officers of the Government run institutions.
We have already held in preceding paragraphs of this judgment that the defined
meaning of the expression 'management' cannot be assigned to the expression
'management' occurring in Section 64 of the Act and as and when the State
Government decides to set up a government run medical college, it is not E
required to submit any application to the University for grant of permission by
'
itself. We have also held that under para 3 of the Regulation the State Govern-
ment is not required to grant Esscntiality Certificate to itself and its decision
to set up a government run medical college at a proposed location substantially
is an Essentiality Certificate to the extent it relates to the proposed location of F
the medical College. In that view of the matter, the perspective plan prepared
by the University under the Act is binding on the State Government qua those
who are applicants for grant of permission to open a new medical college under
Section 64 of the Act. The Stale Governme•ll being not an applicant for grant

- of permission under section 64 of the Act, the perspective plan prepared by the
University is not binding on it when it takes a decision to establish a new
Government medical college. However, the perspective plan prepared by the
G

University may not strictly binding on the State Government when it decides
to set up its own medical college, but such a perspective plan serves as a
guideline indicating therein the desirability of setting up a medical college by H
490 SUPREME COURT REPORTS [2001) SUPP. 5 S.C.R.
A the Slate Government in a particular region or area on account of either its
backwardness or lack of medical facilities in that" region or area. Such a
guideline helps the State Government in finding out locations when it decides
to set up a medical college within the State in three ways. Firstly, such a
guideline excludes the possibility of an element of arbitrariness in determining
B the location of the proposed medical college; secondly, it helps the State
Government while arriving at a decision of desirability of having a medical
college in a particular area or region on account of its backwardness or lack
of medical facilities and thirdly, such a guideline would also be in a true spirit
of Article 371 (2) (c) of the Constitution if it is held that Article 371 (2) (c)
is applicable to the medical education also. The State Government is expected
c to comply with the perspective plan as far as possible. However, any single
deviation from such a guideline by the State Government when it decides to
set up its own medical college within the State would not make its decision
invalid. In any case, in the present case, we do not find any deviation from the
perspective plan prepared by the University. The recommendations of the
D perspective plan for the year 2000-2001 are thus:

" ... The tribal areas in Khandesh and Western Maharashtra and in
Vidarbha need special consideration. Therefore it is suggested that
permission to start any new college has to be considered only for
E Vidarbha and Marathawada. Under any circumstances not more than
I college for each region (Vidarbha and Marathwada) with an intake
capacity of I 00 per annum be permitted."

It may be stated that the State while maintaining regional imbalances is also
required to maintain intra regional imbalances being the welfare State. In the
F light of the aforesaid recommendations, the State Government in a decision
dated 30.8.2000 stated that out of 34 medical colleges in the State, II colleges
are government colleges and since the year 1989-90, no government medical
college was opened. It was further stated therein that in the Western Ghat there

G
are 62 Talukas in hilly area where the residents of said Talukas have to face
difficult conditions and the students coming from that area arc lower in terms
of merit than the other students of the State. It was, therefore, decided 'to keep
-
20% seats reserved for residents of said 62 Talukas in the proposed Govern-
ment Medical College al Kolhapur. The private medical colleges where 50%
seats are payment seats, the component of free seats in Government Medical
1-1 Colleges in rest of Maharashtra area is lowest, which would be clear from the
STATE v. INDIAN MEDICAL ASSOCIATION [KHARE, J.] 491

following table: A

Availability of Medical Seats as per population in three
Development regions of Maharashtra State.

Region No. of Govt. No. of Population No. of Seats per
Colleges Seats (Yr. 2000) 10,000 population B

ROM 5 650 5,74,89,865 0.113

Marathawada 3 250 1,56,81,205 0.159

Vidarbha 3 400 1,97 ,88,331 0.202 c
While the State Government took decision to establish government run medical
college at Kolhapur it took decision to set up one Government run medical
college in Vidarbha region and the second government medical college in
Marathawada region in conformity with the perspective plan. Shri Maninder
Singh, learned counsel representing Medical Council of India stated before us D
that the medical council shall complete all the formalities within three months
and send its report to the Central Government immediately thereafter. Learned
Solicitor General stated that as suun as the approval of the Central Government
is received the State Government shall immediately would take steps to open
Government medical colleges in those regions. In vie"". o,f the said statements, E
· we do not find that there was any deviation from the perspective plan prepared
by the University because both the Vidarbha and Marathawada have been
provided for government run medical college - one in each region. We, there-
fore, find that there was substantial compliance of the perspective plan pre-
pared by the University.
F
Learned counsel for the respondents strongly relied upon the decision of
the Bombay High Court in the case of Dhananiay R Kulkarni and Ors. v. State
~f Maharashtra and Ors., [ 1999] 2 Maharashtra Law Journal, 323, wherein it
was held that the perspective plan prepared by the University was binding on
the State Government. In Dhanw~iay 's case (supra), the management of a G
private institution was applicant for setting up a Bachelor of Computer Science
course. The University found that the location of the proposed institution was
contrary to the perspective plan and. therefore, <lid not recommend the san\e.
However, the State Government granted permission. It is in that context, the
High Court held that the perspective plan was binding on the State Government H.
492 SUPREME COURT REPORTS [200 I] SUPP. 5 S.C.R.
A also, which is not the case here. In the present case, we are concerned with
setting up of a government run medical college which is not a private manage-
ment within the meaning of 'management' occurring in Section 64 of the Act
read with para 3 of the Regulation and, therefore, reliance of the decision in
Dhananjay's case (supra) is totally misplaced.
B
Lastly, it was urged that since in Dhananjay Kulkarni's case (supra), no
appeal was filed by the State government and in fact the State Government bas
accepted the said judgment and therefore, this appeal deserves to be dismissed.
Learned counsel also relied upon a decision of this Court in Union of India v.
Satish Pana/al Shah, (200 I) !TR (249), 221 in support of his argument. We do
c not find any merit in this submission. We have already held that the decision
in Dhananiay Kulkarni's case (supra) related to a private management and has
nothing to do with the setting up of a new government run medical college and,
therefore, the decision in Dhanmiiay Kulkarni's case (supra) has no application
in the present case. In that view of the matter acceptance of the judgment in
D Kulkarni's case by the State Government does not affect the maintainability of
the present appeals. Further, the reliance of the decision in Union of India v.
Satish Pana/al Shah (supra) is totally misplaced .

To sum up, what we have held hereinbefore are these :
E
(A) That, the decision of the State Government to establish a govern-
ment run medical college at a proposed location tantamounts to an
Essentiality Certificate under para 3 of the Regulations to the extent
of location of the medical college;

F (B) That, the defined meaning of expression 'management' cannot be
assigned to the expression 'management' occurring in Section 64 of
the Act;

(C) That, the expression 'management' occurring in Section 64 of the
G Act does not include the State Government;

(D) That, when the State Government resolves to set up a medical
college at a proposed location, it is not required to submit l\ny appli-
cation to itself for permission to establish a Government run medical
H college through the Ur.iversity under Section 64 of the Act;
STATE v. INDIAN MEDICAL ASSOCIATION [KHARE, J.] 493
(E) That, any perspective plan prepared by the University is not strictly A
binding on the State Government when it resolves to set up a govern-
ment medical college at a proposed location in view of the fact that the
State is not the 'management' under Section 64 of the Act;

(F) Thal, the perspective plan prepared by the University. binds the
State Government qua private management or anybody else excepting
B
the State Government applying for permission of the State Govern-
ment to open a medical college;

(G) That, any perspective plan prepared by the University serves as a
guideline to the State Government as and when the State Government C
decides to set up a new government run medical college within the
State and the Stale Government. is expected to abide by the said
guidelines, as far as possible;

(H) Thal, in the present case, there was substantial compliance of the
perspective plan prepared by the University; and, D

(I) That, the decision in the present appeal is confined to the question
of establishment of a government run 1nedical college in the State.

For the aforesaid reasons, we are of the view that the present appeal
deserves to succeed. Consequently, the judgment under appeal is set aside and E
the appeal is allowed. There shall be no order as to costs.

N.J. Appeal allowed.