The Supreme Court has ruled that transferred MBBS students cannot continue paying government medical college fees after being shifted to private medical colleges.
The case involved 122 students relocated from Odisha’s Sardar Rajas Medical College after the institution lost recognition over regulatory deficiencies.
The Court held that continuing subsidised fees in private colleges would amount to “unjust enrichment.”
The Selvam Educational and Charitable Trust, which managed SRMCH, has been directed to bear the primary financial burden, with nearly ₹14 crore ordered for release.
The National Medical Commission may now help recover any remaining MBBS fee dues while ensuring eligible students receive their academic certificates.
New Delhi: The Supreme Court has ruled that MBBS students who were shifted from a private medical college in Odisha after the institution lost recognition cannot continue to claim subsidised government medical college fee rates after completing their studies in other private colleges.
A bench of Justice Vikram Nath and Justice Sandeep Mehta delivered the judgment on May 14, 2026, in Soumya Ranjan Panda & Ors. v. Subhalaxmi Dash & Ors., resolving a dispute that had continued for more than a decade over relocation of MBBS students from Sardar Rajas Medical College, Hospital and Research Centre (SRMCH), Odisha.
The Court held that students who originally took admission in a private medical college under a higher fee structure could not permanently benefit from paying only government medical college fees after being shifted to other private institutions under interim court orders.
The bench observed that allowing such an arrangement to continue would amount to “unjust enrichment.”
The case arose after inspections by the Medical Council of India, now succeeded by the National Medical Commission, found serious deficiencies in infrastructure, faculty availability, and regulatory compliance at SRMCH during the 2013–14 and 2014–15 academic sessions.
As a result, renewal of recognition was denied, putting the academic future of two MBBS batches at risk. The institution was run by the Selvam Educational and Charitable Trust.
The matter first reached the Orissa High Court, which directed relocation of students. The issue later came before the Supreme Court.
In interim orders dated January 8 and January 12, 2016, the Supreme Court modified the relocation framework and directed Odisha authorities to transfer students through a state-supervised counselling process.
A total of 124 students were affected by the relocation process.
Of the 124 affected students, one withdrew before counselling. The remaining 123 underwent online counselling conducted by the Directorate of Medical Education and Training, Odisha, after which 122 students took provisional admission.
The students were relocated to three private medical colleges in Bhubaneswar:
Kalinga Institute of Medical Sciences
Institute of Medical Sciences and SUM Hospital
Hi-Tech Medical College and Hospital
Each of the first two colleges admitted 41 students, while the third admitted 40.
Under interim directions, the relocated students paid fees at government medical college rates of approximately ₹30,000 per year instead of the substantially higher fees charged by private medical colleges.
The Court traced this subsidised fee arrangement to an earlier Supreme Court case involving medical admissions.
In September 2014, in Hind Charitable Trust v Union of India, the Supreme Court temporarily allowed certain private medical colleges awaiting renewal of recognition to admit students while charging fees equivalent to government medical colleges. The same interim framework later applied to the affected SRMCH students.
The transferee colleges later approached the Supreme Court, stating that they had provided teaching, infrastructure, clinical exposure, and stipends for several years while receiving only a fraction of their actual fee entitlement.
The colleges informed the Court that even if fees were calculated not at their own rates but at the original SRMCH fee structure, outstanding dues still came to approximately ₹16.2 crore.
The bench noted that no material showed availability of government quota seats in the transferee institutions, and therefore treated all relocated students as occupying private or management quota seats for fee determination.
The Court held that the students had voluntarily joined a private medical college and could not later claim permanent entitlement to subsidised government-rate fees simply because interim judicial protection had been granted.
The Court observed:
“This, in our opinion, would amount to unjust enrichment of these transferee students while being conscious of the fact that they had to face a chaotic situation of being transferred to different medical colleges mid-session.”
At the same time, the Court clarified that students would not be liable to pay the higher fee structures of the transferee colleges. Instead, their liability would be limited to the fee structure applicable at SRMCH, the institution where they originally took admission.
The Court placed primary responsibility on the Selvam Educational and Charitable Trust, holding that the crisis arose because SRMCH failed to maintain mandatory standards for medical education.
Invoking the legal maxim commodum ex injuria sua nemo habere debet, meaning no one should benefit from their own wrong, the bench held that the defaulting institution could not escape liability.
The judgment also recorded that SRMCH had collected ₹4.25 lakh per student from the 2014–15 batch even though only ₹30,000 per student was legally chargeable under the Supreme Court’s interim directions. Authorities had subsequently directed the institution to refund the excess amount of ₹3.95 lakh per student.
To compensate the three transferee colleges, the Court directed release of approximately ₹14 crore secured from the Selvam Trust.
This amount includes:
Around ₹10 crore in bank guarantees furnished before MCI/NMC
₹2 crore deposited before the Supreme Court in 2016
Accrued interest on the deposit, bringing the court-held amount to approximately ₹3.58 crore
The Court directed that the secured funds be released to the three colleges in equal shares within three months.
Since the total recoverable amount at SRMCH rates exceeds the released funds, the Court allowed the transferee colleges to approach the National Medical Commission with student-wise calculations of any remaining shortfall.
The NMC has been directed to create an appropriate mechanism for recovery after accounting for payments already made by students to SRMCH.
By the time the fee dispute reached final adjudication, the affected students had already completed their MBBS course.
The Court clarified that students who comply with the fee determination must receive their academic certificates and course completion documents without delay.
The appeals and connected applications were disposed of.
(Rh/MSM)
