India, High Court of Kerala, 10 March 2022, WP(C) 25046 of 2021
Case overview
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Outcome of the decision
General Summary
The Writs were filed by private laboratories consequent to the order passed by the Kerala Government to slash RT-PCR test prices down in view of the case of Devi Scans (P) Ltd. vs State of Kerala, 2022 (1) KLT 476, (Devi Scans Case) which raised questions on the authority of the government to decide the price of RT-PCR tests unilaterally. The Court in the present case emphasized that the State did what as necessary to ensure the general public was not affected and further found that the government could not be a mute witness during a pandemic. Hence the matter is not just about price reduction but about controlling the pandemic for which powers stem from laws. Due to the contradictory finding to the Devi Case the High Court forwarded the matter to the Chief Justice for constituting an appropriate bench to hear the pleas of the private labs against the slashing of the test prices.
Facts of the case
Aggrieved by the orders passed by the Kerala Government regarding slashing the RT-PCR test prices, private laboratories filed writs before the Kerala High Court challenging the validity of such orders particularly considering a judgement given by the Kerala High Court in Devi Scans Case.
Type of measure challenged
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Individual / collective enforcement
Nature of the parties
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Private individualDefendant(s)
Public
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Reasoning of the deciding body
The judgement of the Devi Scans Case was examined and disagreed with in the present case. The Court stated that the State was doing what was necessary to ensure that public interest was upheld during the peak of the COVID-19 pandemic. In this process the State had sufficient power to take steps to control the price fixation of RT-PCR tests to avoid exorbitant pricing or fluctuations in pricing. This power flows from the Travancore Cochin Public Health Act, 1955, the Epidemic Diseases Act, 1897, Disaster Management Act, 2005 and the Kerala Epidemic Diseases Ordinance, 2020. Due to this contrary view from the Devi Scans Case, the matter was recommended for being decided by the Chief Justice. In Devi Scans (P) Ltd. v. State of Kerala [2022 (1) KLT 476], the Court after considering the provisions of the Travancore Cochin Public Health Act, 1955, the Epidemic Diseases Act, 1897, Disaster Management Act, 2005 and also the Kerala Epidemic Diseases Ordinance, 2020 concluded that none of the statutory provisions relied on by the State authorizes the issuance of an order controlling the price at which the private laboratories should carry out the RT-PCR tests. The Devi Scans petition was disposed of with the following orders:
"31. In the result, Exts.P10 and P11 are set aside. The 1st respondent is directed to take a fresh decision regarding the price at which the RT-PCR tests shall be conducted by the private laboratories in the State after discussing with the owners or representative of such private laboratories, within three weeks from the date of receipt of a copy of this judgment. To facilitate the process of discussion and taking a decision, the order setting aside Exts.P10 and P11 is kept in abeyance for one month. However, the above direction to keep in abeyance Ext.P11 should not be understood to be a permission to take coercive action against the petitioners or similarly situated persons. The writ petitions are disposed of as above.”
In other words, after finding that the State Government had no source of power to decide the price of RTPCR tests, the Court in Devi Scans directed the State Government to pass appropriate orders in discussion with the private laboratories Management.
Conclusions of the deciding body
Claim was neither upheld nor rejected. The Court recommended the case to be placed before the Chief Justice. Suggestion was made in the judgment for reviewing the source of power of the State Government to regulate the price of RT-PCR tests and in turn re-examining the decision laid out in Devi Scans case.
Fundamental Right(s) involved
Fundamental Right(s) instruments (constitutional provisions, international conventions and treaties)
Rights and freedoms specifically identified as (possibly) conflicting with the right to health
General principle applied
Balancing techniques and principles (proportionality, reasonableness, others)
The case is not just only about a decrease in the price of the RT-PCR Tests but deals with action to be taken for stopping the spread of any dangerous epidemic disease. Testing of persons to ascertain whether they are affected by the epidemic is also an ancillary step for stopping the spread of the disease. In order to ensure that the general public was not affected, one of the steps taken by the State Government was to control the price of RT-PCR tests. Further, there was a sufficient source of power to the State Government to regulate the price of RT-PCR tests. This could also be seen as the initial costs for RT-PCR tests was originally fixed as Rs.4,500/-. Thereafter, it was reduced to Rs.2700, then to Rs. 1,700/-. The ultimate people affected by the fluctuation in the price of RT-PCR are the poor citizens of India. This shows that, some of the Petitioners in these cases itself quoted reduced rate for RT-PCR tests. In such a situation, a detailed consideration of these aspects by a Division Bench is necessary, especially about the source of power of the State Government to regulate the price of RT-PCR tests, for which a reconsideration of Devi Scans case is necessary. Therefore, has case to be placed before the Chief Justice for appropriate orders, in accordance to law.
