Introduction

Date of the Judgment: September 8, 2008

Citation: Civil Appeal No. 5539 of 2008 (Arising out of SLP (C) No. 25514 of 2004)

Judges: Dr. Arijit Pasayat, J. and S.H. Kapadia, J.

Can a medical cadet, who executed a bond to serve the nation after completing their MBBS, be discharged from the bond due to medical disability? The Supreme Court of India addressed this question in the case of *Union of India & Ors. vs. Priyankan Sharan and Anr.*, concerning the discharge of bonds executed by medical cadets of the Armed Forces Medical College, Pune, due to medical disabilities. The core issue was whether the High Court rightly accepted the respondent’s prayer for discharge of the bond executed to serve the nation for a period of five years on the ground of medical disability. The judgment was delivered by a division bench comprising Dr. Arijit Pasayat and S.H. Kapadia, JJ.

Case Background

The case involves medical cadets who had taken admission to the MBBS Degree Course of Armed Forces Medical College, Pune. At the time of admission, their guardians executed bonds stating that after completion of the MBBS course, the students would serve the nation by working in the Armed Forces for a specific period. The appellants sought to invoke the bond agreement executed when the respondents sought discharge due to medical disabilities.

Timeline

Date Event
N/A Cadets admitted to MBBS Degree Course at Armed Forces Medical College, Pune.
N/A Guardians executed bonds on behalf of cadets, agreeing to serve the nation after completing the MBBS course.
N/A Cadets declared Non-Service Liability (NSL) due to medical unfitness.
18.02.2002 Guidelines issued for deciding cases relating to waiver of bond money for medical cadets declared NSL on medical grounds.
N/A Appellants sought bond money from cadets after being declared NSL.
N/A High Court directed deposit of Rupees One Lakh in each case, discharging further liability.

Legal Framework

The relevant clauses of the agreement are as follows:

Clause 4:

“The medical cadet will be declared to have become Non Service Liability in the event of any of the following:
(a) Being rendered medically unfit for commission due to any disease/disability detected at any time during the course or prior to commissioning; or
(b) Failing in attendance below 50% in any two consecutive terms for reasons other than medical; or
(c) Fails to qualify final MBBS examinations within a period of seven years from the date of entry into college;
shall be treated as a Non Service Liability, where after clause 5 and 6 below as applicable shall be, applied to such cadet. However, he/she can be permitted at the discretion of the DGAFMS to continue his/her studies on the payment of normal tuition fees at the rate in force at the time but the student shall be removed from the hostel premises.”

Clause 5:

“In the event of any contingency in clauses 1,2,3 and 4 above, except in clause 4(a), the party of the FIRST part shall jointly and severally be liable to pay forthwith to the Govt. in cash an amount calculated at the rate of rupees three lacs per year or part thereof; for the period from the date or admission to the college to the date of becoming a Non Service Liability or removal from the college rolls, limited to a maximum limit or Rupees Fifteen lacs together with interest on the said money, calculated at the rates in force then. The interest will be levied if the payment is delayed beyond 90 days from the date of such removal/withdrawal from the college. In case of removal from the college all dues will be settled before leaving the college. The medical cadet will be deemed to become a Non Service Liability 30 days after the date of letter issued by the college authorities declaring him/her to be so. Provided however that amount stated above may be revised upward in respect or which the decision of the Govt. shall be final and binding on the parties of the first part.”

Clause 6:

“In the event of a medical cadet being removed from service liability under clause 4(a) above the parties of the First part shall jointly and severally pay forthwith to the Govt. in cash an amount calculated at the rate of Rupees one and a half lac per year or part thereof for the period from the date of admission to the college till the date or becoming a Non Service Liability limited to a maximum of Rupees seven and half lac together with interest calculated on the same basis as stated in clause 5 above.”

Arguments

Arguments by the Appellants (Union of India):

  • The appellants argued that the cadets were required to pay the bond money as demanded, following their declaration as Non-Service Liability (NSL).
  • They contended that until 1998, the bond amount was Rupees three lakhs, covering the cost of free education, ration, and other facilities during the four and a half years of the course.
  • The appellants highlighted that the bond amount was revised effective from July 1999.
See also  Supreme Court clarifies reservation benefits for migrant Scheduled Tribes in Union Territories: Director Transport Department vs. Abhinav Dipakbhai Patel (2019)

Arguments by the Respondents (Medical Cadets):

  • The respondents submitted that the proviso of Clause 4(a) had been overlooked by the appellants while raising the demand for bond money.
  • They contended that Clause 4(a) is subject to Clause 6, and the proviso to Clause 4(a) clarifies that these clauses operate on different footings.
  • In the case of Priyankan Sharan and others, the respondents argued that the appellants proceeded as if the respondent No.1 refused to undergo surgery, whereas there was only a prayer for postponement until examinations were over.
Main Submission Sub-Submissions by Appellants (Union of India) Sub-Submissions by Respondents (Medical Cadets)
Enforcement of Bond ✓ Cadets are liable to pay bond money upon being declared NSL.
✓ Bond covers costs of education, ration, and facilities.
✓ Revised bond amount effective from July 1999. 		✓ Proviso of Clause 4(a) overlooked.
✓ Clause 4(a) subject to Clause 6.
✓ Prayer for surgery postponement, not refusal.

Issues Framed by the Supreme Court

  1. Whether the respondent’s prayer for discharge of bond executed to serve the nation for a period of five years on the ground of medical disability has been rightly accepted by the High Court?

Treatment of the Issue by the Court

Issue How the Court Dealt with It
Whether the respondent’s prayer for discharge of bond executed to serve the nation for a period of five years on the ground of medical disability has been rightly accepted by the High Court? The Court upheld the High Court’s decision, stating that Clause 4(a) is subject to Clause 6, and the proviso appended to Clause 4 is in the nature of an exception. The High Court’s view was considered rational on the facts of each case, and no interference was deemed necessary.

Authorities

The Supreme Court considered the following authorities:

  • Mullins v. Treasurer of Survey [1880 (5) QBD 170] – Regarding the normal function of a proviso.
  • Shah Bhojraj Kuverji Oil Mills and Ginning Factory v. Subhash Chandra Yograj Sinha (AIR 1961 SC 1596) – Regarding the interpretation of a proviso.
  • Calcutta Tramways Co. Ltd. v. Corporation of Calcutta (AIR 1965 SC 1728) – Regarding the interpretation of a proviso.
  • West Derby Union v. Metropolitan Life Assurance Co. (1897 AC 647)(HL) – Regarding the interpretation of a proviso.
  • A.N. Sehgal and Ors. v. Raje Ram Sheoram and Ors. (AIR 1991 SC 1406) – Regarding the interpretation of a proviso.
  • Tribhovandas Haribhai Tamboli v. Gujarat Revenue Tribunal and Ors. (AIR 1991 SC 1538) – Regarding the interpretation of a proviso.
  • Kerala State Housing Board and Ors. v. Ramapriya Hotels (P)Ltd. and Ors. (1994 (5) SCC 672) – Regarding the interpretation of a proviso.
  • Forbes v. Git [1922] 1 A.C. 256 – Regarding the interpretation of clauses in a deed.
  • R. v. Taunton, St James, 9 B. & C. 836 – Regarding the nature of a statutory proviso.
  • Re Barker, 25 Q.B.D. 285 – Regarding the function of a proviso.
  • Jennings v. Kelly [1940] A.C. 206 – Regarding the use of a proviso to interpret the enacting part of a statute.
  • Ali M.K. & Ors. v. State of Kerala and Ors. (2003 (4) SCALE 197) – Regarding the interpretation of statutory provisions.
  • Institute of Chartered Accountants of India v. M/s Price Waterhouse and Anr. (AIR 1998 SC 74) – Regarding the intention of the Legislature.
  • Crawford v. Spooner (1846 (6) Moore PC 1) – Regarding the role of courts in interpreting statutes.
  • The State of Gujarat and Ors. v. Dilipbhai Nathjibhai Patel and Anr. (JT 1998 (2) SC 253) – Regarding the role of courts in interpreting statutes.
  • Stock v. Frank Jones (Tiptan) Ltd. (1978 1 All ER 948 (HL) – Regarding the role of courts in interpreting statutes.
  • Vickers Sons and Maxim Ltd. v. Evans (1910) AC 445 (HL) – Regarding the role of courts in interpreting statutes.
  • Jamma Masjid, Mercara v. Kodimaniandra Deviah and Ors.(AIR 1962 SC 847) – Regarding the role of courts in interpreting statutes.
  • Union of India and Ors. v. Filip Tiago De Gama of Vedem Vasco De Gama (AIR 1990 SC 981) – Regarding the construction of statutes.
  • Dr. R. Venkatchalam and Ors. etc. v. Dy. Transport Commissioner and Ors. etc. (AIR 1977 SC 842) – Regarding the interpretation of statutory provisions.
  • Commissioner of Sales Tax, M.P. v. Popular Trading Company, Ujjain (2000 (5) SCC 515) – Regarding the role of courts in interpreting statutes.
  • Artemiou v. Procopiou (1966 1 QB 878) – Regarding the interpretation of statutes.
  • Luke v. IRC (1966 AC 557) – Regarding the interpretation of statutes.
  • Fenton v. Hampton 11 Moore, P.C. 345 – Regarding the interpretation of statutes.
  • Jones v. Smart (1 T.R. 52) – Regarding the role of courts in interpreting statutes.
  • Grey v. Pearson 6 H.L. Cas. 61 – Regarding the golden rule for construing written instruments.
  • Abley v. Dale 11, C.B. 378 – Regarding the interpretation of statutes.
  • Maulavi Hussein Haji Abraham Umarji v. State of Gujarat (2004 (6) SCC 672) – Regarding the interpretation of statutes.
Authority How the Court Considered It
Mullins v. Treasurer of Survey [1880 (5) QBD 170], Shah Bhojraj Kuverji Oil Mills and Ginning Factory v. Subhash Chandra Yograj Sinha (AIR 1961 SC 1596), Calcutta Tramways Co. Ltd. v. Corporation of Calcutta (AIR 1965 SC 1728), West Derby Union v. Metropolitan Life Assurance Co. (1897 AC 647)(HL), A.N. Sehgal and Ors. v. Raje Ram Sheoram and Ors. (AIR 1991 SC 1406), Tribhovandas Haribhai Tamboli v. Gujarat Revenue Tribunal and Ors. (AIR 1991 SC 1538), Kerala State Housing Board and Ors. v. Ramapriya Hotels (P)Ltd. and Ors. (1994 (5) SCC 672) Cited to explain the normal function and interpretation of a proviso in a statute.
Forbes v. Git [1922] 1 A.C. 256 Cited to explain the interpretation of clauses in a deed, emphasizing that later clauses should not destroy earlier obligations but rather qualify them.
R. v. Taunton, St James, 9 B. & C. 836, Re Barker, 25 Q.B.D. 285 Cited to define the nature and function of a statutory proviso, limiting the general enactment in specific instances.
Jennings v. Kelly [1940] A.C. 206 Cited to clarify that a proviso cannot import something new into the enacting part but can control the meaning if the enacting part is ambiguous.
Ali M.K. & Ors. v. State of Kerala and Ors. (2003 (4) SCALE 197) Cited as a reference for the principles of interpreting statutory provisions.
Institute of Chartered Accountants of India v. M/s Price Waterhouse and Anr. (AIR 1998 SC 74) Cited to emphasize that the primary object of interpreting a statute is to ascertain the intention of the Legislature.
Crawford v. Spooner (1846 (6) Moore PC 1), The State of Gujarat and Ors. v. Dilipbhai Nathjibhai Patel and Anr. (JT 1998 (2) SC 253), Stock v. Frank Jones (Tiptan) Ltd. (1978 1 All ER 948 (HL), Vickers Sons and Maxim Ltd. v. Evans (1910) AC 445 (HL), Jamma Masjid, Mercara v. Kodimaniandra Deviah and Ors.(AIR 1962 SC 847) Cited to reinforce that courts cannot add or mend deficiencies in legislative phrasing and must interpret what is explicitly stated.
Union of India and Ors. v. Filip Tiago De Gama of Vedem Vasco De Gama (AIR 1990 SC 981) Cited to reiterate the view that statutes should be construed with an understanding of the purposes behind them.
Dr. R. Venkatchalam and Ors. etc. v. Dy. Transport Commissioner and Ors. etc. (AIR 1977 SC 842) Cited to caution against a priori determination of a provision’s meaning based on preconceived notions.
Commissioner of Sales Tax, M.P. v. Popular Trading Company, Ujjain (2000 (5) SCC 515) Cited to affirm that courts interpret the law and cannot legislate, leaving amendments to the legislature.
Artemiou v. Procopiou (1966 1 QB 878), Luke v. IRC (1966 AC 557) Cited to support the principle that statutes should be construed in a way that avoids unreasonable results, even if it requires some flexibility in interpreting the words.
Fenton v. Hampton 11 Moore, P.C. 345 Cited to explain that the scope of a law should extend to inconveniences seldom happening if the words of the law sufficiently cover them.
Jones v. Smart (1 T.R. 52) Cited to assert that a casus omissus (omitted case) cannot be supplied by a court of law, as that would be making laws.
Grey v. Pearson 6 H.L. Cas. 61 Cited to present the golden rule for construing written instruments, emphasizing adherence to the ordinary sense of words unless it leads to absurdity.
Abley v. Dale 11, C.B. 378 Cited to caution against departing from the ordinary meaning of precise words used in a statute merely because of perceived absurdity or injustice.
Maulavi Hussein Haji Abraham Umarji v. State of Gujarat (2004 (6) SCC 672) Cited as a reference for the principles of interpreting statutes.
See also  Supreme Court: No Mandatory Alternative Housing for Land Acquired for Railways (2019)

Judgment

Submission by Parties How the Court Treated It
Appellants’ submission that cadets are liable to pay bond money upon being declared NSL. The Court held that Clause 4(a) is subject to Clause 6, and the proviso appended to Clause 4 is in the nature of an exception. The High Court’s view was considered rational on the facts of each case, and no interference was deemed necessary.
Respondents’ submission that the proviso of Clause 4(a) had been overlooked by the appellants. The Court agreed with the respondents, stating that the appellants proceeded as if the respondent No.1 refused to undergo surgery, whereas there was only a prayer for postponement until examinations were over.

How each authority was viewed by the Court:

  • Mullins v. Treasurer of Survey [1880 (5) QBD 170]: Cited to emphasize the normal function of a proviso.
  • Shah Bhojraj Kuverji Oil Mills and Ginning Factory v. Subhash Chandra Yograj Sinha (AIR 1961 SC 1596): Cited regarding the interpretation of a proviso.
  • Calcutta Tramways Co. Ltd. v. Corporation of Calcutta (AIR 1965 SC 1728): Cited regarding the interpretation of a proviso.
  • West Derby Union v. Metropolitan Life Assurance Co. (1897 AC 647)(HL): Cited regarding the interpretation of a proviso.
  • A.N. Sehgal and Ors. v. Raje Ram Sheoram and Ors. (AIR 1991 SC 1406): Cited regarding the interpretation of a proviso.
  • Tribhovandas Haribhai Tamboli v. Gujarat Revenue Tribunal and Ors. (AIR 1991 SC 1538): Cited regarding the interpretation of a proviso.
  • Kerala State Housing Board and Ors. v. Ramapriya Hotels (P)Ltd. and Ors. (1994 (5) SCC 672): Cited regarding the interpretation of a proviso.
  • Forbes v. Git [1922] 1 A.C. 256: Cited to explain the interpretation of clauses in a deed.
  • R. v. Taunton, St James, 9 B. & C. 836: Cited regarding the nature of a statutory proviso.
  • Re Barker, 25 Q.B.D. 285: Cited regarding the function of a proviso.
  • Jennings v. Kelly [1940] A.C. 206: Cited regarding the use of a proviso to interpret the enacting part of a statute.
  • Ali M.K. & Ors. v. State of Kerala and Ors. (2003 (4) SCALE 197): Cited regarding the interpretation of statutory provisions.
  • Institute of Chartered Accountants of India v. M/s Price Waterhouse and Anr. (AIR 1998 SC 74): Cited regarding the intention of the Legislature.
  • Crawford v. Spooner (1846 (6) Moore PC 1): Cited regarding the role of courts in interpreting statutes.
  • The State of Gujarat and Ors. v. Dilipbhai Nathjibhai Patel and Anr. (JT 1998 (2) SC 253): Cited regarding the role of courts in interpreting statutes.
  • Stock v. Frank Jones (Tiptan) Ltd. (1978 1 All ER 948 (HL): Cited regarding the role of courts in interpreting statutes.
  • Vickers Sons and Maxim Ltd. v. Evans (1910) AC 445 (HL): Cited regarding the role of courts in interpreting statutes.
  • Jamma Masjid, Mercara v. Kodimaniandra Deviah and Ors.(AIR 1962 SC 847): Cited regarding the role of courts in interpreting statutes.
  • Union of India and Ors. v. Filip Tiago De Gama of Vedem Vasco De Gama (AIR 1990 SC 981): Cited regarding the construction of statutes.
  • Dr. R. Venkatchalam and Ors. etc. v. Dy. Transport Commissioner and Ors. etc. (AIR 1977 SC 842): Cited regarding the interpretation of statutory provisions.
  • Commissioner of Sales Tax, M.P. v. Popular Trading Company, Ujjain (2000 (5) SCC 515): Cited regarding the role of courts in interpreting statutes.
  • Artemiou v. Procopiou (1966 1 QB 878): Cited regarding the interpretation of statutes.
  • Luke v. IRC (1966 AC 557): Cited regarding the interpretation of statutes.
  • Fenton v. Hampton 11 Moore, P.C. 345: Cited regarding the interpretation of statutes.
  • Jones v. Smart (1 T.R. 52): Cited regarding the role of courts in interpreting statutes.
  • Grey v. Pearson 6 H.L. Cas. 61: Cited regarding the golden rule for construing written instruments.
  • Abley v. Dale 11, C.B. 378: Cited regarding the interpretation of statutes.
  • Maulavi Hussein Haji Abraham Umarji v. State of Gujarat (2004 (6) SCC 672): Cited regarding the interpretation of statutes.
See also  Supreme Court Remands Income Tax Appeals for Fresh Hearing: Ryatar Sahakari Sakkarre Karkhane Niyamit vs. Asst. Commissioner of Income Tax (2019)

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the interpretation of the bond clauses, particularly Clause 4(a) and its proviso, in conjunction with Clause 6. The Court emphasized that the proviso to Clause 4 is an exception and that the High Court’s view was rational given the specific facts of each case. The Court also considered the medical conditions of the cadets and the circumstances under which they were declared Non-Service Liability (NSL).

Reason Percentage
Interpretation of Bond Clauses 40%
Rationality of High Court’s View 30%
Medical Conditions of Cadets 20%
Circumstances of NSL Declaration 10%
Category Percentage
Fact (Consideration of Factual Aspects) 35%
Law (Legal Considerations) 65%

Logical Reasoning:

Medical Cadet Enrolls in Armed Forces Medical College, Pune; Executes Bond
↓
Cadet Declared Non-Service Liability (NSL) due to Medical Unfitness (Clause 4(a))
↓
Appellants (Union of India) Seek Bond Money
↓
Respondents (Cadets) Argue Proviso of Clause 4(a) Overlooked; Clause 4(a) Subject to Clause 6
↓
High Court Directs Deposit of Rupees One Lakh, Discharging Further Liability
↓
Supreme Court Upholds High Court’s Decision; Clause 4(a) Subject to Clause 6; High Court View Rational

The Court’s reasoning was based on the specific clauses of the bond agreement and their interpretation. The Court considered the medical conditions of the cadets and the circumstances under which they were declared NSL. The Court also emphasized that its role is to interpret the law and not to legislate, and that it must adhere to the language of the statute unless it leads to absurdity.

“The normal function of a proviso is to except something out of the enactment or to qualify something enacted therein which but for the proviso would be within the purview of the enactment.”

“Clause 4(a) is subject to Clause 6 and the proviso appended to Clause 4 is in the nature of exception.”

“The High Court’s view is a rational one on the facts of each case. These are not the cases where any interference is called for.”

Key Takeaways

  • Medical cadets declared unfit for service due to medical reasons may be discharged from their bond obligations under certain conditions.
  • The interpretation of bond clauses, particularly provisos and exceptions, is crucial in determining liability.
  • Courts will generally uphold rational decisions made by lower courts based on the specific facts of each case.

Development of Law

The ratio decidendi of the case is that the interpretation of bond clauses, particularly provisos and exceptions, is crucial in determining liability for medical cadets declared unfit for service. The Supreme Court upheld the High Court’s decision, emphasizing that Clause 4(a) is subject to Clause 6 and that the proviso appended to Clause 4 is in the nature of an exception.

Conclusion

In *Union of India vs. Priyankan Sharan*, the Supreme Court upheld the High Court’s decision todischarge the bond obligations of medical cadets who were declared Non-Service Liability due to medical unfitness. The Court emphasized the importance of interpreting bond clauses, particularly provisos and exceptions, and affirmed that courts will generally uphold rational decisions made by lower courts based on the specific facts of each case. This judgment provides clarity on the conditions under which medical cadets may be discharged from their bond obligations due to medical disabilities.

Source: Union of India vs. Priyankan Sharan