Ragesh R.K. v. Corporation Bank

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** **THE HONOURABLE MR. JUSTICE A.K.JAYASANKARAN NAMBIAR** **TUESDAY, THE 23RD DAY OF MAY 2017/2ND JYAISHTA, 1939** ## **WP(C).No. 16834 of 2017 (D)** **----------------------------** **PETITIONER : ---------------------** **RAGESH R.K., RAMANKULATH HOUSE, PADINJARE VEMBALLUR, KODUNGALLUR, THRISSUR, PIN -680 671.** ## **BY ADV. SRI.M.C.JOHN** **RESPONDENT : ------------------------** **CORPORATION BANK, KODUNGALLUR BRANCH, REPRESENTED BY BRANCH MANAGER, PARAKKOTTU BUILDINGS, CHANDAPURA WEST, THRISSUR. PIN -680 664** **BY ADV. SRI.B.VINOD, SC,** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23-05-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **sts** **WP(C).No. 16834 of 2017 (D) -----------------------------------------** ## **APPENDIX** **PETITIONER(S)' EXHIBITS ---------------------------------------** **EXHIBIT P1 TRUE COPY OF THE RELEVANT PAGE OF THE RC DATED 11.07.2013 EXHIBIT P2 TRUE COPY OF THE RELEVANT PAGES OF CREDIT SANCTION. EXHIBIT P3 TRUE COPY OF THE JUDGMENT 21.12.2016 EXHIBIT P4 TRUE COPY OF THE STATEMENT DATED 10.04.2017 EXHIBIT P5 TRUE COPY OF THE RELEVANT PAGES OF PASS BOOK EXHIBIT P6 TRUE COPY OF THE INVENTORY DATED 08.04.2017 EXHIBIT P7 TRUE COPY OF THE AUCTION NOTICE DATED 03.05.2017** **RESPONDENT(S)' EXHIBITS: NIL -----------------------------------------/TRUE COPY/ P.A.TO JUDGE sts** ## **P.B.SURESH KUMAR, J.** **----------------------------------------------W.P.(C) No.18634 of 2017 ----------------------------------------------Dated 27[th] June, 2017.** ## **J U D G M E N T** The petitioner is a native of Chattisgarh State. She got admission to M.D. course in the Government Medical College, Thiruvananthapuram under All India quota. Though the petitioner completed the course and passed the examinations, the original certificates furnished by the petitioner at the time of admission, including her Registration Certificate as a medical practitioner, are not returned on the ground that the petitioner had executed a bond to serve the State for a period of one year after completing the course or on default, to pay a sum of Rs.20,00,000/- by way of liquidated damages and that she has not discharged her bonded obligation to serve the State nor did she pay the liquidated damages agreed. According to the petitioner, she got admission under the All India quota and that therefore, she was not obliged under law to execute the WPC No.16834 of 2017 2 bond; that the bond has been executed by the petitioner under the mistaken impression that she was bound to execute the bond and that therefore, the certificates cannot be withheld for having not discharged the said bonded obligation. The petitioner, therefore, seeks a declaration that she is not liable to discharge the bonded obligation. She also seeks directions to the first respondent to release/return her original certificates. 2. Heard the learned counsel for the petitioner as also the learned Government Pleader. 3. The learned Government Pleader contended that the issue raised in the writ petition is covered against the petitioner by the decision of this Court in W.P.(C) No.31690 of 2016, wherein, it was held that even students who got admission under the All India quota are liable to execute the bond and discharge the bonded obligation. It is pointed out by the learned Government Pleader that Ext.P2 prospectus authorises the Principal of the College to withhold the certificates of the students who have not discharged the bonded obligation and it is in accordance with the said terms of WPC No.16834 of 2017 3 the prospectus that the original certificates of the petitioner are withheld. It is, however, conceded by the learned Government Pleader that the said judgment has not become final and W.A.No.2392 of 2016 preferred by the petitioners in the said case is pending consideration. 4. The learned counsel for the petitioner, relying on the decision of this Court in **Shireen v. State of Kerala** (2017 (2) KLT 691), contended that even if the petitioner is obliged to discharge the bonded obligation, the State can only enforce the bond by instituting proceedings for realization of the liquidated damages provided for therein and cannot withhold the original certificates of the petitioner on that ground. 5. It is seen that this Court in W.P.(C) No.31690 of 2016, relying on the provisions contained in Ext.P1 prospectus issued by the National Board of Examinations for the National Eligibility-cum-Entrance Test for Post Graduate courses, 2013, as also Ext.P2 prospectus issued by the Directorate of Medical Education, Government of Kerala for admission to Post Graduate Medical Degree/Diploma courses, 2013, found that WPC No.16834 of 2017 4 even candidates who secure admission under the All India quota are bound by the terms and conditions stipulated in Ext.P2 prospectus, including their obligation to serve the State for a period of one year or in default to pay a sum of Rs.20,00,000/- by way of liquidated damages. As such, the contention raised by the learned counsel for the petitioner that the petitioner is not bound to discharge the bonded obligation is only to be rejected. 6. The relevant portion of Ext.P2 prospectus relied on by the learned Government Pleader to justify the conduct of the Principal of the College in withholding the certificates of the petitioner reads thus: (g) The certificates which are to be submitted in the colleges at the time of admission will be released only after the completion of compulsory bonded service or in the case of bond violation, the liquidated damages are paid. The only question remaining to be considered, therefore, is whether the aforesaid clause which authorises the Principal of the college to withhold the certificates till the completion of the WPC No.16834 of 2017 5 compulsory bonded service or till the liquidated damages are paid in the case of bond violation is valid. In the context of the conduct of a self-financing Medical College in withholding the original certificates of a student for not fulfilling the similar bonded obligations, it was held by this Court in **Shireen v. State of Kerala** ( _supra)_ that agreements/bonds authorising the management to withhold the certificates of the students are void, as opposed to public policy. Paragraph 7 of the said judgment reads thus : “7. The case of the College is that since the petitioners have not fulfilled their bonded obligation, the College is entitled to withhold their certificates. The petitioners do not admit their liability. In other words, the certificates of the petitioners are withheld by the College for enforcing a disputed liability. Even assuming that the agreement/bond executed by the petitioners in favour of the College authorising the College to withhold their certificates is not void for want of consideration, the question arises is whether the certificates of the petitioners can be withheld for enforcing a disputed liability. This question assumes importance in the light of the large number of similar litigations instituted before this Court in the recent past. A bond is only an instrument by which a person obliges or binds himself to another for payment of a sum of money or in the performance of any other act. It is fundamental that if a person WPC No.16834 of 2017 6 does not fulfil the bonded obligation, he is liable to pay the amount agreed upon and if he does not pay the amount agreed upon, in a country where rule of law prevails, the payment has to be enforced through a court of law. It cannot be said that non-payment of the amounts covered by the bond will always be without any basis. In some cases, it may be without any basis, but in some others, it may be due to some reason which the person concerned believes to be a justifiable reason for non payment. The sustainability or otherwise of the reason, on the basis of which the liability under the bond is denied, has to be examined by the court through the process of which the payment is to be enforced. If the practice of withholding the documents as a means to realise the disputed amounts is permitted to be adopted, the person affected would be compelled to forgo the defences, if any, available to him. Further, education has always been, and continues to be one of the most important needs of mankind. Every citizen has a right to education and State is under an obligation to establish educational institutions to enable the citizens to enjoy the said right. The recent change in the social and economic fabric of the country has, however, created a situation where it is inevitable for the State to permit private educational institutions to meet the requirements in the field of education. Education is essentially a charitable activity. As such, even when private bodies establish educational institutions, the object shall be charity and not profit. Of course, reasonable revenue surplus can be generated by the institutions for the development of education and expansion of the institutions. Certificates of education/qualification are very important documents as far as students are concerned. Non availability WPC No.16834 of 2017 7 of the certificates establishing educational qualifications may result in deleterious consequences as far as students are concerned, for, the same are the first and foremost documents insisted for employment and higher studies. It is trite that whatever tends to injustice of operation, restraint of legal rights, whatever tends to the obstruction of justice and whatever is against the morals can be said to be against public policy. In other words, matters which concern the public good and the public interest connotes the public policy. [See **P.Rathinam v. Union of India** (1994)3 SCC 394]. It is also trite that the principles governing public policy are capable, on proper occasion, of expansion or modification and the court in a given case is empowered to declare a practice as opposed to public policy in consonance with public conscience and in keeping with public good and public interest. [ _See_ **Central Inland Water Transport Corporation v. Brojo Nath Ganguly** [(1986) 3 SCC 156] and **State of Rajasthan v. Basant Nahata** [(2005) 12 SCC 77]. The agreements obtained by the College from the petitioners authorising them to withhold the certificates of the petitioners for payment of the amounts covered by the bonds, if any, executed by the petitioners, cannot be accepted as an approved social conduct and the same, in that sense, is unethical. Further, agreements of that nature are against public good and public interest as well. In the circumstances, even assuming that the agreement/bond executed by the petitioners in favour of the College authorising them to withhold their certificates is not void for want of consideration, the same is void as opposed to public policy, in the light of Section 23 of the Indian Contract Act.” WPC No.16834 of 2017 8 It is seen that the said decision has been confirmed in appeal. As in the said case, in the instant case also, the petitioner disputes her liability to discharge the bonded obligation and the respondents rely on the provision contained in the prospectus to withhold her original certificates. True, the issue is covered against the petitioner by the decision of this Court in W.P.(C) No.31690 of 2016. The petitioner, admittedly, is not a party to the said writ petition. As such, though this Court cannot take a different stand without doubting the correctness of the said decision, the petitioner is not bound by the said decision. She is entitled to challenge this judgment following the decision of this Court in W.P.(C) No.31690 of 2016 in appeal. If the appellate court does not accept the case of the petitioner, she is entitled to take it up before the Apex Court as well. The question is, should her certificates be withheld till the litigation is over. My answer is 'no'. According to me, in so far as the petitioner disputes the liability, the State can enforce the bonded obligations only by instituting appropriate proceedings and they cannot withhold the certificates of the petitioner in the WPC No.16834 of 2017 9 light of the provision contained in the prospectus and thereby coerce her to discharge the bonded obligation. The judgment of this Court in in **Shireen v. State of Kerala** ( _supra)_ should certainly come to the rescue of the petitioner. In the result, the writ petition is allowed in part and the first respondent is directed to release the original certificates of the petitioner forthwith. It is made clear that this judgment will not preclude the State from instituting appropriate proceedings for realising the liquidated damages from the petitioner in accordance with law. Sd/- ## **P.B.SURESH KUMAR, JUDGE.** tgs (true copy)