RAJIV GANDHI NATIONAL UNIVERSITYOF LAW,

PUNJAB

LAW OF TORT & CONSUMER PROTECTION ACT, 2019

TOPIC: CASE COMMENT
CASE: INDIAN MEDICAL ASSOCIATION v. V.P. SHANTHA AND
ORS.

SUBMITTED BY: SUBMITTED TO:

DEEPALI DR. JASWINDER KAUR

ROLL NO.- 21011 ASST. PROFESSOR

SECTION-A OF LAW,

SEMSTER-II RGNUL, PUNJAB

 AKNOWLEDGEMENT
The success and final outcome of this project required a lot of guidance and
assistance from many people and I am extremely privileged to have got this all
along the completion of my project. All that I have done is only due to such
supervision and assistance and I would not forget to thank them.

I shall always remain obliged to the Vice Chancellor of RGNUL, Dr. G.S.
Bajpai for providing me an opportunity to showcase my project and skills in an
esteemed university like RGNUL.

I respect and thank Dr. Jaswinder Kaur, for providing me an opportunity to do

the project work in RGNUL and giving us all support and guidance, which
made me complete the project duly. I am extremely thankful to her for
providing such a nice support and guidance, although she had busy schedule
managing the corporate affairs.

I am thankful to and fortunate enough to get constant encouragement, support

and guidance from all Teaching staff who helped us in successfully completing
our project work. I extend my thanks to all the staff members of the IT lab and
library who supported my research process.

Deepali

2
 BONAFEDE CERTIFICATE
This certificate is to declare that this case comment on ‘Indian Medical
Association v. V.P. Shantha and Ors.’ is an original work of Deepali who is a
Bonafede student of the Rajiv Gandhi National Institute of Law, Punjab.

Deepali

3
 Table of Contents
AKNOWLEDGEMENT............................................................................................................2

BONAFEDE CERTIFICATE....................................................................................................3

Introduction:..............................................................................................................................5

Background and the Facts of the Case:.....................................................................................6

Issues Involved:..........................................................................................................................7

Arguments Raised by the Respondent:.......................................................................................7

Related Cases:............................................................................................................................8

Judgment:...................................................................................................................................8

Analysis:...................................................................................................................................10

Conclusion:..............................................................................................................................11

References................................................................................................................................12

4
 Case Comment

Indian Medical Association Petitioner;

Versus

V.P. Shantha & Ors.1 Respondent.

Writ Petition No. 16 of 1994 & SLP(C) Nos. 6885 and 6950/92

Date of Judgement: 13/11/1995

At, Hon’ble Supreme Court of India, by the hon’ble Justice Kuldip Singh, the hon’ble Justice
S.C. Agarwal & the hon’ble Justice B.L. Hansaria

For the Petitioner: Shri K. Parasaran, Shri Harish Salve, Shri A.M. Singhvi, Shri
Krishnamani and Shri S. Balakrishnan.

For the Respondent: Shri Rajeev Dhavan

Introduction:

As a result of the rising number of medical negligence cases, numerous complaints have been
made in consumer courts demanding compensation under the Consumer Protection Act of
1986. There was some uncertainty over whether doctors, hospitals, and medical practitioners
come within the definition of 'service' as defined in Section 2(1)(o) of the Act, recognising
patients as 'consumers' with the right to seek compensation through the consumer courts.

Section 2(1)(o) of the Act defines service as:

“Service of any description which is made available to potential users and includes the
provision of facilities in connection with banking, financing insurance, transport, processing,
the supply of electrical or other energy, board or lodging or both, housing construction,
entertainment, amusement or the purveying of news or other information, but does not
include the rendering of any service free of charge or under a contract of personal service.”2

1
1996 AIR 550, 1995 SCC (6) 651.
2
The Consumer Protection Act, 1986. s. 2(1)(o).

5
The definition neither expressly includes nor expressly excludes medical services. In the
exclusionary section of the definition, an interpretation could be adopted that brought medical
services that were not provided free of charge within the scope of 'service.' Another issue to
consider was whether such services were provided under a 'contract of personal service' that
could be excluded.

These issues were addressed in a series of decisions issued by various High Courts and
National Consumer Courts, which provided contrasting and contradictory interpretations.
Many Writ Petitions and Special Leave Petitions were then filed against these decisions and
judgments before the Supreme Court.

The Supreme Court issued a landmark decision in the case of Indian Medical Association v
V.P. Shantha3 in 1995, bringing the medical profession within the definition of a "service" as
defined in Section 2(1)(o) of the Consumer Protection Act, 1986 and clarifying previous
decisions.

Background and the Facts of the Case:

A series of decisions resulted in judicial confusion and contradictions regarding the scope and
application of the Act in cases of medical negligence.

A Division Bench of the Andhra Pradesh High Court held in Dr. A.S. Chandra v. Union of
India 4that service rendered for consideration by private medical practitioners, private
hospitals, and nursing homes is 'service' for the purposes of Section 2(1)(o) of the Act, and
the persons availing such services are 'consumers' for the purposes of Section 2(1)(d) of the
Act.

In the case of Dr. C.S. Subramanian v. Kumarasamy & Anr 5, a Division Bench of the Madras
High Court held that services rendered to a patient by a medical practitioner or by a hospital
in the form of diagnosis and treatment, both medicinal and surgical, would not be considered
a 'service,' and thus a patient cannot be considered a 'consumer' within the meaning of the
Act. It did, however, recognize paramedical services as falling under the definition of
'service.'

3
Supra note 1.
4
(1992) 1 Andhra Law Times 713.
5
(1994) 1 MLJ 438.

6
Different approaches were taken by the National Commission in its various judgments. In its
judgement and order dated December 15, 1989, it held that persons who seek medical
treatment in Government hospitals are not "consumers," and that because the payment of
taxes by the public would not constitute "consideration," the service would essentially be
rendered free of charge, falling within the exclusionary part of the Act's definition of
"service." The National Commission ruled on April 21, 1992, that the activity of providing
medical assistance for payment carried out by hospitals and members of the medical
profession falls within the scope of the term "service."

A series of appeals, special leave petitions, and Writ Petitions were filed against the
contradictory decisions of the High Courts and subordinate courts due to the lack of
uniformity in judicial interpretation. In the current case of Indian Medical Association v V.P.
Shantha6, these were heard together and decided by the Supreme Court.

Issues Involved:

1. Whether a medical practitioner, hospital, or nursing home can be regarded as

rendering ‘service’ under Section 2(1)(o) of the Consumer Protection Act, 1986?
2. Under what circumstances can the service render at a hospital/nursing be regarded as
‘service’ under Section 2(1)(o) of the Consumer Protection Act, 1986?

Arguments Raised by the Respondent:

The arguments that were raised by the respondent were:

1) The first argument was that COPRA deals with occupational services and the medical
profession being a professional service should not be covered in this act.
2) Section(1)(g) contains a certain basis on which services can be held to be deficient.
But as the basis is limited, these have less application in medical service.
3) Medical services are contract of personal services which are not a part of Section(1)
(o) and thus are a part of exclusionary services.
4) Service does not include medical service and is thus not in the purview of the Act.

6
supra note 1.

7
Related Cases:

The court based its decision on the English case of Bolam v. Friern Hospital Management
Committee7, which established the Bolam test for medical negligence.

The Court relied heavily on the case of Lucknow Development Authority v. M.K. Gupta8,
which broadly construed the definition of 'service.' It was decided that "the main clause itself
is very broad." It is applicable to any service made available to prospective users. The words
"any" and "potential" are important. Both have a large amplitude."

The case of Dharangdhara Chemical Works Ltd. v State of Saurashtra 9 was cited, which
distinguished between a 'contract of service' and a 'contract for services,' holding that a
'contract of service' implies a master-servant relationship and entails an obligation to obey
orders in the work to be performed as well as its mode and manner of performance.

Some other cases relied upon by the Respondent are The High Commissioner for India v.
I.M. Lall10, Ram Kissendas Dhanuka v. Satya Charan Law 11, and Dr. S.B. Dutt v. the
University of Delhi12.

Judgment:

Issue 1. Whether a medical practitioner, hospital, or nursing home can be regarded as

rendering ‘service’ under Section 2(1)(o) of the Consumer Protection Act, 1986?

Keeping in mind the broad scope of the definition of "service" in the main part of Section
2(1)(o), the Supreme Court ruled in favour of the respondent.

It rejected the petitioners' argument that services rendered by a member of a "profession"

would not be covered by the Act. Despite the fact that medical practitioners are subject to the
disciplinary control of Medical Councils of India and are governed by the Indian Medical
Council Act, they are not immune from a claim for damages based on negligence.

The Court did not agree with the submission that a determination of deficiency in medical
service under Section 2(1)(g) cannot be based on any fixed norms. It was discovered that a
deficiency in service could be caused by obvious errors attributable to medical practitioners,
7
 [1957] 1 W.L.R. 582.
8
1994 AIR 787.
9
AIR 1957 SC 264.
10
(1948) L.R. 75 I.A. 225.
11
(1949) L.R. 77 I.A. 128.
12
1959 SCR 1236.

8
such as removing the wrong limb or performing an operation on the wrong patient, among
other things. The Court determined that a determination of deficiency in service is to be made
by applying the Bolam test, which was established in the English case of Bolam v Friern
Hospital Management Committee13 for tortious action for damages for negligence. According
to the Bolam test, a medical practitioner must bring to his task a reasonable level of skill and
knowledge, as well as exercise a reasonable level of care. When a patient consults him, he
owes a duty of care in deciding whether to take on the case, deciding what treatment to use,
and administering that treatment. A breach of any of these duties gives the patient the right to
sue for negligence.

Issue 2. Under what circumstances can the service render at a hospital/nursing be

regarded as ‘service’ under Section 2(1)(o) of the Consumer Protection Act, 1986?

The Supreme Court proceeded to consider the exclusionary part of Section 2(1)(o), holding
that the definition of 'service' is broad enough to include services rendered by medical
practitioners. The exclusionary clause excludes services rendered (i) for free; or (ii) under a
personal service contract.

Concerning (i), it was determined that doctors and hospitals/nursing homes that provide
services without charging each person who uses them would not be covered by the Act. This
would fall under the exclusionary portion of the service definition. Medical services rendered
for a fee, on the other hand, are covered by Section 2(1)(o).

The Court then considered a situation in which free medical services are provided only to
those who cannot afford to pay for them, and concluded that such services would
unquestionably fall within the scope of the Act because these expenses are covered by the
income received from paying patients.

In relation to (ii), the court reiterated the distinction between a "contract of service" and a
"contract for service." The fundamental difference is that in the former, the employer has
some control over the employee's work, whereas in the latter, the independent contractor is
not subject to the employer's control and is free to exercise discretion. The court ruled that
because there are no master-servant relationships, the contract between the medical
practitioner and his patient cannot be considered a contract of personal service. Because it is a
contract for services, it is not covered by the exclusionary clause.

13
Supra note 7.

9
The Court finally concluded that “Service rendered to a patient by a medical practitioner
(except where the doctor renders service free of charge to every patient or under a contract
of personal service), by way of consultation, diagnosis, and treatment, both medicinal and
surgical, would fall within the ambit of ‘service’ as defined in Section 2(1) (o) of the Act.”

Analysis:

The decision in this case clarified the scope and ambit of 'services' as defined in Section 2(1)
(o) of the Act in relation to the provision of medical services. Prior to this decision, the
prevalent view was that medical practitioners were held liable for misconduct and negligence
primarily under tort and the Indian Medical Councils Act, or in some cases under provisions
of the Indian Penal Code, 1860. By bringing the medical profession under the purview of the
Consumer Protection Act of 1986, this case provided aggrieved patients with a faster and
more cost-effective alternative remedy by allowing them to approach consumer courts for
appropriate relief.

The Supreme Court relied on a series of English decisions and scholarly works in developing
a rational approach to medical professional liability in order to provide proper protection to
patients by conferring 'consumer' status on them. Medical negligence is considered a type of
deficiency in service under consumer protection laws, similar to liability under tort law. It
necessitates, that professionals have a minimum level of competence and exercise reasonable
care in the performance of their duties.

However, the system of liability established in this case does not punish all acts of a doctor
that cause injury, but only those that are the result of negligence. It has been held in many
ensuing decisions that “the only assurance which such a professional can give or can be
understood to have given by implication is that he is possessed of the requisite skill in that
branch of profession which he is practicing and while undertaking the performance of the
task entrusted to him, he would be exercising his skill with reasonable competence.”14

A doctor cannot be held liable for negligence if he performs his duties with reasonable skill
and competence. Only in the event of a deficiency in the performance of services, when his
conduct falls short of the established standards, may an aggrieved patient invoke the Act's
remedies by filing a complaint with the appropriate Consumer Forum. It should be noted that
the provisions allowing a complainant to approach the consumer courts do not preclude his or

14
Jacob Mathew v State of Punjab & Another, (2005) 6 SCC 1.

10
her right to seek necessary relief in a civil court.15 The Act only provides an alternative, low-
cost, and expedited remedy for adjudicating such medical negligence claims.

Conclusion:

By subjecting the medical profession to the Consumer Protection Act, this landmark decision
introduced a significant interpretation of medical negligence liability. Patients' rights were
recognised with the awarding of consumer status, which allows them to file complaints in
cases of deficiency in the provision of medical services.

However, the medical community has criticised this decision for making the medical
profession vulnerable to frivolous lawsuits, many of which are filed to harass doctors or to
avoid payment of medical bills. While it is critical to protect the integrity of this profession,
the rising number of cases of medical negligence is cause for concern. The Supreme Court's
interpretation of "service" seeks to protect the interests and welfare of patients, which is
paramount.

15
Consumer Protection Act, 1986. s.3.

11
 References
Act Cited:

 The Consumer Protection Act, 1986.

Web Sources:

 https://indiankanoon.org/doc/723973/
 “Case Analysis: VP Shanta v/s Indian Medical Association.” Case Analysis: VP
Shanta v/s Indian Medical Association, www.legalserviceindia.com,
https://www.legalserviceindia.com/legal/article-6010-case-analysis-vp-shanta-v-s-
indian-medical association.html#:~:text=The%20court%20held%20that
%20the,covered%20by%20the%20exclusionary%20part Accessed 20 Apr. 2022.
 “Indian Medical Association v VP Shantha - Law Times Journal Medical.” Law
Times Journal, lawtimesjournal.in, 18 July 2021, https://lawtimesjournal.in/indian-
medical-association-v-vp-shantha/. Accessed 20 Apr. 22.
 Desai, Diyaa Kuntal, and View all posts by Diyaa Kuntal Desai. “Indian Medical
Association v. VP Shantha - Indian Law Portal.” Indian Law Portal,
indianlawportal.co.in, 5 Oct. 2020, https://indianlawportal.co.in/indian-medical-
association-v-vp-shantha/#_ftn11. Accessed 20 Apr. 22.

Cases Cited:

 Indian Medical Association v. V.P. Shantha and Ors [1996] AIR 550, [1995] SCC (6)
651.
 Dr. A.S. Chandra v. Union of India [1992] 1 Andhra Law Times 713.
 Dr. C.S. Subramanian v. Kumarasamy & Anr [1994] 1 MLJ 438.
 Bolam v. Friern Hospital Management Committee [1957] 1 W.L.R. 582.
 Lucknow Development Authority v. M.K. Gupta [1994] AIR 787.
 Dharangdhara Chemical Works Ltd. v State of Saurashtra AIR 1957 SC 264.
 The High Commissioner for India v. I.M. Lall [1948] L.R. 75 I.A. 225.
 Ram Kissendas Dhanuka v. Satya Charan Law [1949] L.R. 77 I.A. 128.
 Dr. S.B. Dutt v. the University of Delhi [1959] SCR 1236.

12