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Association of Medical Super Speciality Aspirants and Residents v. Union of India

Civil Appeal · 2019 INSC 915Decided 19 Aug 2019
Civil Appeal No. 6379 of 2019
Justice L. Nageswara Rao · Justice Hemant Gupta

Background

Several associations of postgraduate and super-speciality medical trainees challenged "compulsory bond" conditions imposed by various state governments (including Andhra Pradesh, Goa, Gujarat, Himachal Pradesh, Karnataka, Kerala, Maharashtra, Odisha, Rajasthan, Tamil Nadu, Telangana and West Bengal) requiring doctors who availed subsidised government PG/super-speciality seats to serve the state for a fixed period, or pay a penalty and forfeit their original certificates/mark-sheets if they did not. The doctors argued these bonds were an unconscionable, unconstitutional restraint on their profession and contrary to the Contract Act and Specific Relief Act. A batch of connected writ petitions and appeals (arising from various High Court decisions, including the Calcutta High Court) were tagged together and heard jointly.

Decision Breakdown

The Supreme Court upheld the validity of compulsory service bonds, holding they are a reasonable condition attached to subsidised government medical education meant to address the shortage of specialist doctors in government hospitals, especially in rural and under-served areas, and do not violate Section 27 of the Contract Act (restraint of trade) since the obligation operates only for a defined period of employment and is not an unreasonable restraint on the practice of a profession. The Court held such bonds are not void as contracts of personal service forcing specific performance, but rather valid conditions backed by liquidated damages if breached, and are consistent with public interest in retaining trained specialists in government service. All the writ petitions and appeals were accordingly dismissed, with doctors who had executed such bonds held bound by their terms. The Court additionally urged the Union of India and the Medical Council of India to evolve a uniform national policy on compulsory service bonds given the inconsistency among different states' conditions.

Lesson Learnt

Doctors who accept subsidised seats in government postgraduate/super-speciality courses can be validly bound by service bonds requiring them to serve the state (or pay a penalty) after completing the course: such conditions are not an unconstitutional restraint on their profession, since they serve the public interest of ensuring trained specialists remain available in the public health system.

Official source (sci.gov.in)View Judgment (PDF)

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