NEDURIMILLI JANARDHANA REDDY Vs. PROGRESSIVE DEMOCRATIC STUDENTS UNION

JUDGEMENT

(1.) Leave granted.

(2.) These two appeals are directed against the common judgment of the High Court delivered, among others, in two writ petitions, viz., W.P. Nos. 9824 and 9825 of 1992. The appellant who was one of the respondents in the said petitions was at the relevant time the Ghief Minister of the State of Andhra Pradesh. The High Court by its impugned decision has quashed the permission granted to a Society to start medical and dental colleges. The said Society was managed, among others, by the wife and brother of the appellant. In order to appreciate the controversy it is first necessary to refer to the relevant legal provisions. The establishment, recognition and conduct of educational institutions in the State are governed by the provisions of Andhra Pradesh Education Act, 1982 (hereinafter referred to as the "Act"). Section 2(12) of the Act defines "competent authority" to mean any person, officer or authority authorised by the State Gover-nment by notification to perform the functions of the competent authority under the Act for such area or for such purposes as may be specified in the notification. The competent authority so notified by the Government, is entrusted with several duties and functions under the various provisions of the Act. These provisions are contained in Ss. 20, 21, 24, 26 to 29, 31, 45, 49, 51, 60, 64, 69, 72, 79, 80 and 83. Under S. 20(3)(b, the competent authority is to prescribe adequate financial provision for the establishment of an educational institution. Under S.21(1, it is the competent authority which is empowered to grant recognition to the educational institution subject to such conditions as may be prescribed in regard to accommodation, equipment, appointment of teaching staff, syllabi, text books and other matters relating thereto. Under S.21(2, the competent authority is empowered to withdraw the recognition or to take such other action as is deemed necessary on the occurrence of the events mentioned therein. Under S. 24(2, the management of every educational institution is required to nominate a person to manage the affairs of the institution and intimate such nomination to the competent authority. Under Sec. 24(3}(a, the competent authority is empowered to suspend the management and appoint a special officer till the reconstitution of the management. Under S.24(3)(b) the competent authority can take action against the manager of the educational institution if it is satisfied that he alone is responsible for the lapses or irregularities of the institution. Under S. 24(4, the competent authority is even empowered to declare a person to be unfit to be manager of private educational institution and thereupon the management has to nominate another person as manager in his place. Under S. 26, private educational institutions cannot close down unless a notice of not less than one academic year has been given to the officer authorised by the competent authority in that behalf. Under S. 27, in case the private institution closes down or discontinues or its recognition is withdrawn, the management of the institution has to hand over to the competent authority the custody of all the properties, record and accounts of the institution in its possession. Under S. 31, the Government or the competent authority can authorise any officer not below such rank as may be prescribed, to exercise general powers of inspection over the working of any educational institution. Section 50 gives to the competent authority the right to cause an inspection of or an enquiry in respect of any educational institution, its accounts, its buildings, laboratories, libraries, workshops and equipment and also of the examinations, teaching and other work conducted or done by the institution and to cause an inquiry in respect of any other matter connected with the institution and advise the management on the action to be taken. The management has to report to the competent authority on the action taken within such time as the competent authority may direct. Under S. 51, every management has to furnish to the competent authority such returns, statistics and other information as the competent authority may, from time to time, require. When the management of an educational institution vests in the Government, it is the competent authority under S. 60(9) which pays to the person interested in the educational institution the amount payable under S. 60(8). Before the property of an education institution is requisitioned under S. 64, the Government may require that the permission of the competent authority has to be taken before the manager or any other person disposes of, structurally alters, leases or in any manner deals with the property of the institution until the expiry of such period not exceeding three months, as may be specified by the order of requisition. Again, under S. 69, it is the competent authority which has to pay the amount payable under the award of arbitrator when the property of the educational institution is acquired or requisitioned. Section 72 empowers the competent authority to authorize any authority to enter and inspect any property to be requisitioned or acquired, and to require any person to furnish such information relating to such property as may be specified in the order. While S. 79(2) requires a disciplinary inquiry against the delinquent employee of a private institution to be completed within two months from the date of the communication of charges to him, the proviso to sub-sec. (3)(b) thereof gives power to the competent authority to extend the said period up to two months more. Section 80 gives power to the aggrieved employee to appeal to the competent authority. Under S. 85, retrenchment of any employee can be effected by the competent authority with the approval of the next higher authority. If, however, the management of the educational institution has to effect such retrenchment it has to take the approval of the competent authority. We have referred to the powers and functions of the competent authority under the Act in extenso, to bring out the important position which it occupies in the scheme of the Act. It is clear from the said provisions of the Act, that the scheme of the Act cannot be carried out without the constitution of the competent authority and in particular, no educational institution can be established without its formation. In considering the applications made for establishing educational institutions the prescribed authority has to have due regard that there is adequate financial provision for continued and efficient maintenance of the educational institutions as prescribed by the competent authority under S. 20(3)(b). It is further the competent authority alone which can grant recognition to the educational institutions under Sec. 21 of the Act. Even if under Sec. 20(1) a private educational institution is established in accordance with the rules made under the Act, the said rules cannot displace the competent authority or entrust the powers and functions of the competent authority to any other authority. It is true that S. 20(1) of the Act states that no private educational institution shall be established except in accordance with the provisions of the Act or the rules made thereunder. However, the rules made under the Act can only appoint an authority to accept the application for establishment of an educational institution and to grant permission therefor. But while granting permission, the prescribed authority has, among other things, to take into consideration under Sec. 20(3)(b) as stated above, the requirement of adequate financial provision for continued and efficient maintenance of the institution as prescribed by the competent authority. The power granted to the State Government under clauses (xi) and (xii) of S. 99 to make rules with regard to the establishment or maintenance and administration of educational institutions and the grant of recognition to educational institutions and the conditions therefor cannot again be utilised for displacing the competent authority and its functions and powers under the Act. Any exercise of such power will be a fraud upon the statute apart from rendering such rules as ultra vires the Act. It is against this backdrop of the legal status of the competent authority and its functions and powers that we have to examine whether the reliance placed by the State Government on the Andhra Pradesh Unaided Private Medical and Dental Colleges (Establishment, Management and Admission) Rules, 1992 (hereinafter referred to as the Rules") for defending its action in establishing an Expert Committee under the Rules to grant sanction for medical and dental colleges is correct or not.

(3.) The Rules in question, as the preface thereof shows, are purported to be made in exercise of the powers conferred by Ss. 20 and 21 read with S. 99 of the Act and they relate to the grant of permission for establishment of unaided private medical and dental colleges under private sector in the State. Rule 3 of the said Rules requires that a notification shall be issued in daily newspapers calling for applications in the prescribed form from the Societies desirous of establishing colleges under the private sector and specifying the last date for submitting the applications. The Societies have to make the applications to the Director of Medical Education. The applications have to specify the place at which the college is proposed to be established, and separate applications have to be submitted in respect of each place. Every such application has to be accompanied by (a) a copy of the Constitution and Bye-laws/memorandum and Articles of Association of the Society with the particulars of the executive members thereof, (b) a list of members of the Society as on the date of making the application, (c) evidence of the financial viability of the Society and other requirements as prescribed in Annexure-I thereof, (d) in case the college is proposed to be located in private accommodation, evidence to show the Societys ownership or its right to be in exclusive possession of the site and buildings, (e) in case the Society proposes to use a Government Hospital and its infrastructure facilities, it has to give an undertaking to Government to pay such charges as may be prescribed by Government; in addition, the Societys willingness to have its own infrastructure facilities after the maximum period of five years for which the Government may permit the use of such facilities, (f) evidence of other infrastructure facilities available, (g) non-refundable application fee of Rs. 20,000/- for Medical College/Rs. 10,000/- for Dental College, (h) consent letters of the persons who have given their willingness to serve on the teaching staff of the College. Rule 4 provides for constitution of a committee which is also called by the Government as Expert Committee, consisting of the (i) Director of Medical Education, (ii) eminent person from the medical field, and (iii) a representative of the University of Health Sciences, to scrutinize the applications received and forward them to the Government. The rule also provides that it is the Government which will select the Society for the establishment of medical or dental college at a particular place from amongst the applicants for that place and accord permission to the selected Society with such conditions as may be deemed necessary including the number of seats allowed. Rule 5 provides that the Society so selected will make its own arrangements to obtain affiliation from the University Of Health Sciences and to obtain recognition of Medical or Dental Council of India after fulfilling the conditions laid down for them for the purpose. Rule 6 states that no financial aid or grant shall be given by the Government for the establishment or management of the college or for any other purpose. Rule 7 provides that the Society shall appoint a committee for the management of the College consisting of not more than 9 members and the committee shall include two nominees of Government and one nominee of the University of Health Sciences. Rule 8 provides for the qualification for the teaching staff and the teacher-student ratio as per the standards laid down by University of Health Sciences and Medical or Dental Council of India. Rule 9 empowers a committee constituted by the managing committee to select the staff for appointment in the College. Rule 10 requires the Government to arrange to review the functioning of the college every year or at such other intervals as may be considered necessary and based on such review to issue such directions as may be necessary for the proper functioning or improvement in the functioning of the College. It also gives power to the Government to cancel the permission given to the College in case the managing committee fails to comply with the given directions. It further prohibits the transfer of college from one place to another. It provides that the number of admissions shall be limited to the number of seats authorised and shall not be exceeded without prior approval of the Government and Medical or Dental Council of India. It also prevents the change of ownership and management of the College without prior permission of the Government. Rule 11 enjoins that the fee structure of the College shall be as specified by the Government by an order from time to time. The last rule, viz., Rule 12 provides for admission, and states that admission to the colleges shall be as per the provision in Section 3-A of the Andhra Pradesh Educational Institutions (Regulation of Admission and Prohibition of Capitation Fee) Act, 1983 as amended by the Andhra Pradesh Educational Institutions (Regulation of Admission and Prohibition of Capitation Fee) (Amendment) Act, 1992 and the Andhra Pradesh Professional Educational Institutions (Regulation of Admission into Undergraduate Professional Courses through Common Entrance Tests) Rules, 1989. Annexure I referred to in Rule 3 refers separately to Medical and Dental Colleges and documentary evidence required to be enclosed with the application for the said colleges. In case of Medical College, it requires documentary evidence of (i) owning a minimum of 50 acres of land without encumbrances and buildings for the College/Teaching Hospital/Hostels, etc. OR availability of 50 acres of land and resources of Rs. 5 crores in cash, assets, securities etc., to finance the construction of the required buildings as envisaged by the Medical Council of India and the University of Health Sciences, for maintenance thereof and for additions and alterations thereto according to requirement from time to time, [ii] availability of resources by way of bank balances, securities, liquid assets, etc. for procuring Medical equipment, Laboratory equipment, Library Books, Furniture etc. and their maintenance/ replacement, [iii] availability of resources to meet recurring expenditure towards personnel employed, electricity and telephone etc., and [iv] a sketch plan of the site already owned or proposed to be acquired and its location in relation to other land marks in the area for locating the College/Teaching Hospital/Hostels and also rough sketch plan of the buildings already available or proposed to be constructed thereon showing the location of each room/hall with dimensions and the use to which it is proposed to be utilised. In case of Dental College, the Annexure I refers to [i] the requirement of owning a minimum of 10 acres of land without encumbrances and buildings for the College/Teaching Hospital/Hostels, etc. OR availability of 10 acres of land and resources of Rs. one crore in cash, assets, securities etc., to finance the construction of required building as envisaged by the Dental Council of India and the University of Health Sciences, for maintenance thereof and for additions and alterations thereto according to requirement from time to time, [ii] availability of resources by way of bank balances, securities, liquid assets, etc. for procuring Medical equipment, Laboratory equipment, Library Books, Furniture etc. and their maintenance/replacement, [iii] availability of resources to meet recurring expenditure towards personnel employed, electricity and telephones etc., and [iv] a sketch plan of the site already owned or proposed to be acquired and its location in relation to other land marks in the area for locating the College/Teaching Hospital/Hostels and also rough sketch plan of the buildings already available or proposed to be constructed thereon showing the location of each room/hall with dimensions and the use to which it is proposed to be put.