While observing that the Respondent Commission does not have the power to fix rates and charges under Section 38(1)(iv) of The West Bengal Clinical Establishments (Registration, Regulation and Transparency) Act, 2017 under the guise of residuary powers, the Calcutta High Court held that permitting sections 38(1)(i) or (iii) or (v) to become pro-active and substitute the object of section 38(1)(iv) on the pretext of a vacuum, will amount to a darning and patchwork exercise of the fabric of section 38 of the Act which is not permissible.

“It is a well-established canon of construction that the Court should read a section as it is and not attempt to re-write the section to suit the parameters of the matter before it”, added the Court.

A Single Judge Bench of Justice Moushumi Bhattacharya, therefore, declared that the Advisories issued by the Commission to the extent of fixation of rates and charges to be made applicable for Clinical Establishments and all patients irrespective of Covid are without the authority of law and contrary to 2017 Act.

“Likewise, the impugned order dated 02.07.2021 is also declared to be irrational and violative of the petitioner’s rights under Article 19(1)(g) of the Constitution of India”, added the Bench.

Senior Advocate Ratnanko Banerji appeared for the Petitioner, whereas AAAG Samrat Sen appeared for the Respondent.

In a nutshell, a writ of mandamus was filed by the Petitioner seeking to direct the Respondent Commission to take back the orders under which 26 Advisories were issued, which also included fixation of rates and charges by Clinical Establishments (CEs) from patients in the State, which were meant for private hospitals, thus covering first Petitioner as well. It was pleaded that the Respondents have exceeded their jurisdiction by issuing such Advisories under section 38(1)(iv) of the 2017 Act.

After considering the submissions, the Bench observed that the statutory substratum of the Advisories and Order issued by the Commission, to the extent of the mandate under section 38(1)(iv), is absent.

With respect to the submission of the Respondent that the sections are in the nature of providing residuary powers to the Commission to monitor the functioning of the CEs, the Bench held that although the power under 38(1)(iii) includes unethical “trade practice” as defined in section 2(z)(i), the generality of the provision shown must, however, give way to and fit into the specific provision in section 38(1)(iv) which authorizes the Commission to fix rates and charges but subject to Regulations being framed for that purpose.

The High Court clarified that “Section 52 of the Act makes it clear that Commission is only a delegated authority of the State to make such regulations and, Sections 38(1)(iv) read with 52 provides a defined route for fixing the rates and charges which has not been followed in the present case. Hence, The Commission seeking recourse under other residuary provisions is impermissible in law.”

Therefore, observing that Section 38(1)(iv) does not have any gap and hence the Advisories have been issued in the absence of a statutory bulwark, the Bench stated that the Advisories are neither reasonable nor supported by the findings and conclusion of a specialized body of experts with domain knowledge.

“The fixation of rates and charges are simple actions which muscle through the specific provisions provided in the Act for taking steps without stopping by to consider whether the conditions precedent for the Advisories have been satisfied. The Advisories are shots in the dark, without rationale and smack of random thinking and eureka moments of a body which owes its rites of passage to the Act of 2017. The language used further emasculates the Advisories and the Order”, added the Bench.

Accordingly, the High Court concluded that the fixation of rates and charges is wholly arbitrary and unsupported by any investigation and consequential findings/recommendations of a High-Powered Committee as alleged.

Cause Title: Apollo Multi-speciality Hospitals Limited and Anr. v. West Bengal Clinical Establishment Regulatory Commission

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Calcutta High CourtJustice Moushumi Bhattacharya

Pankaj Bajpai