Concessional land for charitable hospitals can lawfully carry free-treatment obligations as a valid public-purpose condition.

Government land allotted at concessional rates for charitable hospital use may carry enforceable public-purpose conditions, including free treatment for economically weaker patients. The Court treated such obligations as consistent with the charitable character of the grant and the public welfare objective of the allotment, and held that an express reservation allowing alteration of terms also supported the condition. It further held that the requirement was regulatory rather than a fresh restriction on the right to carry on business, so no separate legislative enactment was needed. The earlier Social Jurists ruling was treated as applicable to similarly situated institutions and as reinforcing the same public-law obligation.

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Issues: (i) Whether the Government could require hospitals that had obtained land at concessional rates for charitable purposes to provide free treatment to 10% of IPD patients and 25% of OPD patients belonging to economically weaker sections; (ii) whether such a condition could be imposed in the case of allotments containing a clause reserving power to alter terms and conditions; (iii) whether the free-treatment requirement amounted to an impermissible restriction on the right to carry on occupation, trade or business; (iv) whether the earlier decision in Social Jurists governed the controversy.

Issue (i): Whether the Government could require hospitals that had obtained land at concessional rates for charitable purposes to provide free treatment to 10% of IPD patients and 25% of OPD patients belonging to economically weaker sections

Analysis: The concessional allotment of Government land was part of a policy meant for charitable institutions and for the public good. The Court held that hospitals, especially those enjoying State largesse at concessional rates, are bound by the charitable character of the allotment and by the public welfare objective underlying the grant. Medical institutions cannot claim a purely commercial entitlement when the land was given for charitable use and with a non-profit orientation. The requirement of free treatment was treated as consistent with the original purpose of the grant and with the obligation of the medical profession to serve the needy.

Conclusion: The Government could validly impose the free-treatment condition.

Issue (ii): Whether such a condition could be imposed in the case of allotments containing a clause reserving power to alter terms and conditions

Analysis: For the institutions covered by the later allotments, the Court relied on the governing land-disposal rules and the express reservation permitting alteration of terms and conditions. Since the land was not allotted at market rates but at predetermined concessional rates, the institutions remained subject to the public-purpose framework and to the Government's authority to regulate the terms on which such public land was held.

Conclusion: The condition was permissible even in the presence of the reserving clause.

Issue (iii): Whether the free-treatment requirement amounted to an impermissible restriction on the right to carry on occupation, trade or business

Analysis: The Court held that the stipulation did not amount to a new restriction requiring a separate legislative enactment. It was not a curtailment of the right to practise a profession but an enforcement of the existing charitable and public-interest obligations attached to the grant of land and to the medical profession itself. In the Court's view, the measure was regulatory and rooted in executive power, public policy, constitutional duties relating to health, and the ethical obligations of the profession.

Conclusion: The condition did not violate Article 19(1)(g) or require a fresh statute under Article 19(6).

Issue (iv): Whether the earlier decision in Social Jurists governed the controversy

Analysis: The Court treated the earlier decision, as affirmed in the dismissal of the special leave petitions by a reasoned order, as binding on similarly situated institutions. It held that the prior ruling and the Government's subsequent order merely crystallised the same public-law obligation flowing from the allotment policy and land-use conditions.

Conclusion: The earlier decision applied and supported the impugned policy.

Final Conclusion: The free-treatment requirement was upheld as a valid incident of concessional allotment of land for charitable hospital purposes, and the High Court's contrary view was set aside.

Ratio Decidendi: Where Government land is allotted at concessional rates for charitable hospital use, the State may enforce a free-treatment obligation as part of the public-purpose conditions of the grant and as a valid regulatory measure, without a separate legislative enactment.

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