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In This Issue

[No.57]                                                                            July 30, 2003

International
SEBI
Department of Company Affairs
CBEC Excise non Tariff
CBEC Customs Tariff
CBEC Customs non Tariff
RBI
DGFT
Department of Commerce
Department of Industrial Policy
Department of Health
Department of Justice
Ministry of Chemicals
Press Information Bureau
Supreme Court

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International Legal News

Cases

Source: Westlawinternational.com

  • Torts: News reporter was not public figure for purposes of defamation action based on professional activities.

An intermediate appellate court held, as a matter of first impression, that a news reporter was neither an all-purpose public figure, a limited-purpose public figure, nor an involuntary public figure, and was thus not required to prove malice, for the purposes of a defamation action based on her professional activities. The reporter, who alleged that she had been defamed by a letter to her employer from the president of an entertainment corporation about which she had written several articles, was not well-known to the general public and had never sought or received notoriety or public attention by reason of her journalistic achievements, and had no independent access to the media by which to counter the accusations made against her. She did not initiate the articles triggering the allegedly defamatory letter, and the articles were not written in an investigatory tone or in a manner intended to create public controversy or influence the public's perception of the corporation or its counsel. Finally, the reporter acquired no significant public recognition or media access as the result of articles which provoked the allegedly defamatory comments, and any public recognition she received resulted from a newspaper article detailing the corporation's reaction to her articles.

Finke v. Walt Disney Co.

  • Antitrust: Sale of business assets, including "any intangibles," did not include antitrust cause of action.

In the context of the agreement and the relationship of the parties, a sale of the assets, including "any intangibles," of a snowmobile racing circuit business to the seller's newly formed competitor did not include any antitrust or other commercial tort claims that the seller had against snowmobile manufacturers whose products gained exposure on the circuit. Therefore, the seller still had standing to bring such claims after the sale. The seller claimed that the buyer both participated in and benefited from the manufacturers' anticompetitive actions, in that it was a participant in a conspiracy to decrease the assets' market value and reduce the purchase price. In this case, the buyer would be incapable of pursuing a claim against its own co-conspirators or proving any injury from a reduction in the market value of the business.

Motorsports Racing Plus, Inc. v. Arctic Cat Sales, Inc.

  • Commercial Law: Arbitrator was immune from suit alleging he failed to disclose prior relationship with opposing attorney.

A disclosure requirement in an arbitration agreement, directing that the arbitrator disclose any past or present relationship with the parties or their counsel, was not an administrative act independent of the arbitration proceeding, but was a function of his position as an arbitrator. Accordingly, the arbitrator was immune from suit brought by a party to the arbitration, alleging that the arbitrator failed to disclose a prior relationship with the attorney for the adverse party. Further, even if arbitral immunity, which was not previously recognized in Texas, did not protect the arbitrator, the Texas Arbitration Act afforded the plaintiff with an exclusive remedy to contest the arbitration award on the theory that the arbitrator's impartiality was compromised. Therefore, the award could not be collaterally attacked by bringing a lawsuit against the individual arbitrator.

Blue Cross Blue Shield of Texas v. Juneau

  • Government: Statutes on voter registration and nomination of minor political party candidates are unconstitutional.

The Maryland Court of Appeals has invalidated several statutes on voter registration and the nomination of minor political parties' candidates. The case arose out of a Board of Elections' decision to subtract signatures from a petition submitted by a Green Party candidate for Congress. The Board concluded that the signatures were by inactive voters. The Court of Appeals invalided a dual registration system of active and inactive voters, a prohibition against counting the signatures of inactive voters for petition verification, and the requirement permitting minor political parties to nominate candidates only by a second petition in addition to petition for formation of the party. These provisions violate the state constitution.

Maryland Green Party v. Maryland Bd. of Elections

News

  • A canned meat company Hormel Foods has filed two legal challenges with the U.S. Patent and Trademark Office to try to stop SpamArrest from using its decades-old name Spam, for which it holds the trademark. Earlier this year SpamArrest, a Seattle software company specializes in blocking junk e-mail or "spam" has filed paper for registration of its corporate name.

  • President Bush on Wednesday has opposed to extending marriage rights to gays. In a news conference Bush told reporters that "I believe marriage is between a man and a woman, and I think we ought to codify that one way or another." The stand taken by President Bush comes at time when courts in US have started recognizing gay marriage rights. U.S. Supreme Court in its recent decision struck down state laws banning sodomy. Canada courts also have recently recognized gay marriages. In addition, the Massachusetts high court is expected to issue a ruling soon on whether the state can allow gay marriages. President's comments were welcomed by conservative groups, but drew criticism from gay rights advocates.

  • Ford Motor Co. has filed a suit against Philadelphia-based Pep Boys to settle a dispute over use of the name 'Futura' on an upcoming vehicle. Pep Boys have accused the automaker of infringing on the auto parts chain's trademarked brand name for tires. Ford wants the matter to be settled by a judge and approve its use of name 'Futura'. Ford had introduced the Futura sedan in April at the New York International Auto Show. The car is scheduled for initial production in 2005 and eventually will replace the aging but once extremely popular Taurus, which Ford plans to phase out in the next few years.

  • Napster, a music downloading site will be relaunched around Christmas, as has been announced by its new owner Roxio. Napster was closed down in 2001 after a prolonged battle with the record industry over copyright infringement allegations. It will now emerge as a legal, paid music service Napster 2.0.

  • Maryland has become the first state in U.S. to adopt a specialized court in an effort to respond to the increased complexity of business and technology cases. Other states, including New York and California, have also created specialized courts or tracks to address complex business litigation, but none except Maryland has embraced "high tech" as a component of the specialized case management system.

  • Malaysian government has promised to change the country's laws to discourage men from divorcing their wives by means of electronic messages and increasing fines and jail sentences for men who pronounce the talak - or declaration of divorce - by electronic means, such as e-mail, fax or text message. This promise came after an Islamic court declared that a man had ended his marriage after he had send a message to his wife on mobile telephone.

SEBI

Secondary Market Division

  • Change in Status and Constitution of the Stock Brokers in Cash and Derivatives Segments of the Exchanges under Rule 4 (c) of the SEBI (Stock Brokers and Sub-Brokers) Rules, 1992 

SMD Circular No. MIRSD/MSS/Cir- 30/ 13289/03 Dated 09.07.2003 : Rule 4 (c) of the SEBI (Stock Brokers and Sub-Brokers) Rules, 1992 prescribes that in case of any change in the status and constitution, the stock-broker shall obtain prior approval of the SEBI to continue to buy, sell or deal in securities in any stock exchange. For a particular type of change, some exchanges seek approval while some others do not. As a clarifications SEBI has specified the circumstances which would mean change in status and constitution under rule 4 (c) of the SEBI (Stock Brokers and Sub-Brokers) Rules, 1992 and hence would require prior approval of the SEBI.   

Regulation

  • Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 

Notification No. SO816(E) Dated 17.07.2003 : SEBI has issued Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 to be effective from 17.07.2003

Department of Company Affairs
  • Amendment to Notification No. S.O.1280(E) dated the 28th December, 2001 

Notification No. S.O.815(E) Dated 17.07.2003 : In the said notification, for serial No.2 and the entries thereto, the following has been substituted, 

“2. Joint Secretary and Financial Adviser, 

Department of Company Affairs - Member” .

CBEC Excise non Tariff
  • Central Excise (Advance Rulings) Amendment Rules, 2003

Notification No. 59/2003 NT Dated 23.07.2003 : In the Central Excise (Advance Rulings) Rules, 2002, FORM - AAR (CE) has been substituted.

  • Enforcement Date of section 133(i) and (ii) of Finance Act, 2002

Notification No. 58/2003 NT Dated 22.07.2003 : Central Government has appointed the 15th day of August, 2003, as the date on which the insertion and omission as respectively specified in the said clauses shall take effect.

CBEC Customs Tariff

  • Anti Dumping Duty on D (-) Para Hydroxy Phenyl Glycine Methyl Potassium Dane Salt

Notification No.117/2003 Dated 24.07.2003 : Anti-Dumping Duty has been imposed on D (-) Para Hydroxy Phenyl Glycine Methyl Potassium Dane Salt originating in, or exported from, the People¹s Republic of China and Singapore

  • Rescission of Notification No. 70/2001 dated 26.06.2001 relating to Anti-Dumping Duty on Strontium carbonate originating in, or exported from, the People's Republic of China 

Notification No. 116/2003 Dated 22.07.2003 : Central Government has rescinded the Notification No. 70/2001-Customs, dated the 26th June, 2001, except as respects things done or omitted to be done before such rescission. 

  • Rescission of Notifications mentioned 

Notification No. 115/2003 Dated 22.07.2003 : Central Government, has rescinded the following Notifications. 

(i) No. 137/2000-Customs, dated the 19th October, 2000, published in the Gazette of India vide G.S.R. 804 (E), dated the 19th October, 2000;

(ii) No. 82/2002-Customs, dated the 13th August, 2002, published in the Gazette of India vide G.S.R. 563 (E), dated the 13th August, 2002. 

  • Rate of special additional duty specified as nil in respect of goods produced and manufactured by a special economic zone unit 

Notification No. 114/2003 Dated 22.07.2003 : Central Government, having regard to the maximum sales tax, local tax or any other charges for the time being leviable on the like goods on their sale or purchase in India, has specified the rate of special additional duty as nil in respect of goods produced and manufactured by a special economic zone unit and brought to any other place in India for the purpose of sale.

  • Exemption to castor oil from customs and additional duty 

Notification No. 113/2003 Dated 22.07.2003 : Central Government, has exempted castor oil cake falling under item 23 06 9017 of the First Schedule to the Customs Tariff Act, when manufactured from indigenous castor oil seeds on indigenous plant and machinery by a unit in special economic zone, which was in existence prior to the 1st day of November, 2000 and brought to domestic tariff area in accordance with the provisions of Export and Import Policy, from the whole of the duty of customs leviable thereon under the said First Schedule and the additional duty, if any, leviable thereon under section 3 of the Customs Tariff Act.

  • Limit For Payment Of Agency Commission On Exports - Reg. 

Circular No. 64/2003 Dated 21.07.2003 : It is observed that RBI has not revised its earlier instructions as regards the limit of payment of agency commission. Therefore, it is clarified that the field formations may continue to permit export benefits on f.o.b. value without deducting agency commission if such commission is upto the limit of 12.5% of f.o.b. value. Agency commission exceeding this limit should be deducted from the f.o.b. value for granting export benefits under Drawback/DEPB/Advance Licences /DFRC Schemes. 

  • Customs Procedure For Export Of Container Cargo From Icds/Cfss In India To Bangladesh And Nepal Through Lcss- Reg. 

Circular No. 61/2003 Dated 18.07.2003 : It has been decided that, the provision contained at Para 3 to the Board’s Board’s Circular No.18/2002-Cus. dated 13.03.2002 may be substituted as under:-

“ (3) “the facility for movement of export cargo from ICDs / CFSs to Nepal and Bangladesh mentioned above shall be available if cargo is moved through LCSs at Petrapole & Gede in Indo-Bangladesh border and Raxaul & Nautanwa (Sonauli) at Indo Nepal border”. 

  • Eligibility of 'Ethylene Oxide Sterilizer' Under Notification No. 21/2002-Cus.

Circular No. 59/2003 Dated 16.07.2003 : It is clarified that Ethylene Oxide Sterilizers are eligible for examination under the said notification as Ethylene Sterilizer and ethylene oxide Sterilizer in technical/trade parlance refer to the same type of sterilizer which uses Ethylene Oxide as a sterilizing agent. 

  • Misuse of Non-Quota Entitlement Against Export of Garments to Russia by 63 Indian Exporters

Circular No. 58/2003 Dated 16.07.2003 : Considering that exports of garments to Russia against non-quota entitlement were made by the 63 exporters specified in Public Notice dated 6.2.2003 by claiming/availing export incentives under Drawback and other export promotion schemes, it has been decided that export incentives in respect of 63 Indian exporters as specified in Public Notice dated 6.2.2003, for exports to Russia made against non-quota entitlement should not be released until completion of final investigation by Ministry of Textiles and AEPC in the matter. In this regard Ministry of Textiles has also being requested to forward the outcome of investigations firm-wise against each of the 63 exporters for taking a final decision in the matter. 

  • Anti Dumping Duty 

Notification No. 109/2003 Dated 14.07.2003 and No. 107/2003 Dated 11.07.2003 : Anti Dumping Duty has been Imposed On Import of Ammonium Nitrate and Titanium dioxide Anatase Grade

  • Amendment to Notification No. 50/96-Customs, Dated The 23rd July, 1996

Notification No. 108/2003 Dated 14.07.2003 : In the said notification, for the words “Ministry or Department”, wherever they occur, the words “Ministry or Department or Council of Scientific and Industrial Research under the New Millennium Indian Technology Leadership Initiative Scheme” have been substituted.

CBEC Customs Non Tariff
  • Customs (Advance Rulings) Amendment Rules, 2003

Notification No. 54/2003-N.T. Dated 23.07.2003 : In the Customs (Advance Rulings) Rules, 2002, FORM-AAR(CUS) annexed thereto, has been substituted.

  • Special Economic Zones (Customs Procedures) Regulations, 2003

Notification No. 53/2003-N.T. Dated 22.07.2003 : Board has made the the Special Economic Zones (Customs Procedures) Regulations, 2003 to be effective from 15th day of August, 2003. 

  • Special Economic Zones Rules, 2003

Notification No. 52/2003-N.T. Dated 22.07.2003 : Board has made the Special Economic Zones Rules, 2003 to be effective from 15th day of August, 2003. 

  • Special Economic Zone

Notification No. 44/2003- NT to No. 51/2003- NT Dated 22.07.2003 : Madras Special Economic Zone, Visakhapatnam Special Economic Zone, Madras Special Economic Zone, SEEPZ Special Economic Zone, Mumbai, NOIDA Special Economic Zone, Kandla Special Economic Zone and Surat Special Economic Zone have been Specified As A "Special Economic Zone"

  • Chapter XA Be Inserted In The Customs Act, 1962 On 15th Aug. 2003

Notification No. 43/2003- NT Dated 22.07.2003 : Central Government has appointed the 15th day of August, 2003, as the date on which Chapter XA as proposed by the section 126 of the Finance Act, 2002, shall be inserted in the Customs Act, 1962 (52 of 1962)

RBI

  • Resurgent India Bonds - Forward Contracts - Clarification 

Circular No. A.P.(DIR Series) Circular No. 6 Dated 23.07.2003 : Attention has been invited to authorised dealers to paragraph 2 of Schedule II to Notification No. FEMA 25/RB-2000 dated May 3, 2000, which lists out the exposure for which forward cover can be offered by authorised dealers to Non-Resident Indians/Overseas Corporate Bodies. Banks have been advised that no forward cover should be offered to Non-Resident Indians/Overseas Corporate Bodies holding Resurgent India Bonds.

  • Foreign Technology Collaboration – Royalty Payment – Liberalisation 

Circular No. AP (DIR) Circular No. 5 Dated 21.07.03 : Attention of authorised dealers has been drawn to the Government policy on payment of royalty under Foreign Technology Collaboration. Presently, only wholly owned subsidiaries are allowed to pay royalty to offshore parent companies abroad without any restriction on the duration of payment under the automatic route. All cases of payment of royalty under the automatic route will continue to require prior registration with Reserve Bank in terms of Rule 5 read with item 14 of Schedule III of the Foreign Exchange Management (Current Account Transactions) Rules, 2000. 

  • Merchanting Trade Transactions – Clarifications - Short Term Credit 

Circular No. A.P.(DIR Series) Circular No.4 Dated 19.07.2003 : Attention of authorised dealers has been invited to the provisions of A.P.(DIR Series) circular No.25 dated September 27, 2002 regarding simplification of procedure for financing imports into India by way of Suppliers' or Buyers' Credit. It has been clarified that short term credit either by way of suppliers' credit or buyers' credit, as envisaged in the aforementioned circular is not available for merchanting trade or intermediary trade transactions

  • Asset Liability Management System – Submission of Reports to the RBI 

Notification No. DBS.FID No.C-4/ 01.02.00 / 2003- 04 Dated 29.07.2003 : It has been decided to obtain the data regarding the liquidity and interest rate gaps of the FIs as a part of the extant off-site surveillance system. Accordingly, a hard copy, along with a soft copy (as a MS-Excel file) in a floppy diskette, of the Liquidity Statement and the Interest Rate Sensitivity Statement, prepared in terms of the RBI guidelines, is required to be submitted at quarterly intervals, with effect from the quarter ended June 30, 2003.

  • Slippage of Non-performing assets – Preventive measures 

Notification No. DBS.FID No.C-3/ 01.02.00 / 2003- 04 Dated 17.07.2003 : Based on the recommendations of In-House Group to identify and recommend the measures that could be instituted by the banks to prevent the slippage of the accounts in the ‘sub-standard category to the ‘doubtful’ category the RBI has issued the guidelines to the banks vide Circular No. DBS.CO.OSMOS. BC.4/33.04.06/2002-2003 dated September 12, 2002. RBI has now recommended that the Guidelines should be placed before the Board of Directors of concerned institutions at their ensuing meeting and appropriate action initiated for implementing the recommended measures, to the extent considered necessary, in keeping with the spirit of the guidelines.

  • Guidelines on netting off of old and small value entries - Clearing Differences

Notification No. DBOD No. BP.BC. 4 /21.04.018/2003-04 Dated 19.07.2003 : Banks have been advised to adopt the prescribed procedure for netting off the entries representing clearing differences receivable against entries representing clearing differences payable. Banks have also been advised to route their inter-branch clearing instruments through an in-house clearing mechanism and not route it along with inter-bank clearing instruments.

  • Nomination rules under Section 45QB of RBI Act for NBFC deposits 

Notification No. DNBS(PD)C.C.No. 27 /02.05/2003-04 Dated 28.07.2003 : NBFCs may accept nominations made by the depositors in the form similar to that specified under Banking Companies (Nomination) Rules, 1985 . Forms DA1, DA2, and DA3 are specified in the rules for the purposes of nomination, cancellation of nomination and variation of nomination.

DGFT
  • Amendment In The Handbook Of Procedure Vol.-I Regarding Application Fee 

Public Notice No. 18(RE-03)/2002-2007 Dated 24.07.2003 : The Director General of Foreign Trade has made the amendments in the Handbook of Procedures (Vol.1)

  • Filing IEC Returns

Trade Notice No. 03 / 2002-2007 Dated 16.07.2003 : It has been brought to the notice of the trade that they should file the trade returns only by accessing the website and should not send manual applications to either personally or by post.

Department of Commerce

  • Initiation of Anti-Dumping Investigations Concerning Imports of Chloroquine Phosphate from China PR 

Notification No. 14/3/2003-DGAD Dated 16.07.2003 : Anti-Dumping Investigations have been initiated Concerning Imports of Chloroquine Phosphate from China PR.

Department of Industrial Policy

  • Exemption from Rule 31(2) of Explosives Rules, 1983 

Notification No. SO818(E) to No. SO820(E) Dated 17.07.2003 : ONGC and HLS Asia Limited have been Exempted from Rule 31(2) of Explosives Rules, 1983 for import of specified explosives.

Department of Health
  • Prevention of Food Adulteration (…………………..Amendment) Rules, 2003 

Notification No. GSR555(E) Dated 18.07.2003 : Draft of certain rules further to amend the Prevention of Food Adulteration Rules, 1955, has been published for the information of all persons likely to be affected thereby, and notice is has been given that the said draft rules will be taken into consideration on or after the expiry of a period of sixty days from the date on which copies of the Gazette of India in which this notification is published are made available to the public.

  • Prevention of Food Adulteration (1st Amendment) Rules, 2003

Notification No. GSR554(E) Dated 18.07.2003 : In the Prevention of Food Adulteration Rules, 1955, in Appendix B, in item A.33 relating to Packaged drinking water (other than Mineral Water), in the table, and entries relating to serial number 40 have been substituted 

  • Drugs and Cosmetics (………..Amendment) Rules, 2003

Notification No. GSR548(E) Dated 16.07.2003 : In the Drugs and Cosmetics Rules, 1945, in Schedule M-III, under the heading "7. Testing facilities", in the proviso, after the words "Sterility, Pyrogens, Toxicity", the words "wherever applicable", has been inserted. 

  • Drugs and Cosmetics (5th Amendment) Rules, 2003 

Notification No. GSR549(E) Dated 16.07.2003 : In the Drags and Cosmetics Rules, 1945, in Schedule K, after Serial Number 32 ,new entry 33 relating to Nicotine gum has been inserted.

Department of Justice
  • Effective Date of Enforcement of Delhi High Court (Amendment) Act, 2003 

Notification No. SO806(E) Dated 16.07.2003 : The Central Government had appointed 16.07.2003 as the date on which Delhi High Court (Amendment) Act, 2003(35 of 2003) came into force.

Ministry of Chemicals
  • Validity of the Notification No. 578 (E) Dated 13th July, 1999 Further extended

Order No. SO793 (E) Dated 11.07.2003 : The National Pharmaceutical Pricing Authority has notified the norms for conversion cost packing charges and process loss vide notification No. S.O. 578(E) dated 13th July, 1999 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (ii). In compliance with the requirement for Paragraph 7 of the Drugs (prices Control) Order, 1995 the validity of the notification No. 578 (E) dated 13th July, 1999 has been further extended with immediate effect.

Press Information Bureau
  • Priority For Cases Of Senior Citizens And Women In Fast Track Courts 

Dated 22.07.2003 : The Department of Justice has adopted the strategy of earmarking separate courts to deal with cases involving senior citizens, who are above 60 years of age, and with those concerning abuse of women. The new measure is to ensure that in the order of disposal, due priority is given to more vulnerable segments of the population

Supreme Court
  • John Vallamattom and Anr. Vs. Union of India (UOI)

This petition is filed against discriminatory treatment meted out to the members of the Christian community under the provisions of Section 118 of the Indian Succession Act, 1925 by which they were practically prevented from bequeathing property for religious and charitable purposes. The said provision, postulates that a person having a nephew or niece or any nearer relative cannot bequeath his property for religious or charitable use unless: (i) the will is executed not less than twelve months before the death of testator; (ii) it is deposited within six months from its execution in some place provided by law for the safe custody thereof; and (iii) it remains in such deposit till the death of the testator.The section plainly means that to the extent to which the bequest is for religious or charitable uses, the application of this section is attracted despite the fact that the bequest may be for only a part of the property or some interest in the property. According to the petitioners the said provision is violative of Articles 14 and 15 of the Constitution of India.

The Hon'ble Supreme court held that the impugned provision was enacted to prevent persons from making ill-considered death bequest under religious influence. The object behind the said legislation was, therefore, to protect a section of illiterate or semi-literate persons who used to blindly follow the preachers of the religion. Such a purpose has lost all significance with the passage of time and, therefore, has to be declared ultra vires Article 14 of the Constitution of India.whether in an enactment religious bequests by a Christian is discriminatory and violative of Articles 14 and 15 of the Constitution must be determined as per the rule of procedure laid down by Section 118 of the Act, which comes with the purview of Articles 14 and 15 of the Constitution, and it is, therefore, necessary that all testators who are similarly situated should be subjected to the same rule of procedure. There cannot be any unusual burden on Christian testators alone when all other testators making similar bequests for similar charities and similar religious purposes are not subjected to such procedure. Therefore, Section 118 of the Act is anomalous, discriminatory and violative of Articles 14, 15, 25 and 26 of the Constitution and should be struck down.---Writ Petition allowed

  • The State of Madhya Pradesh and Ors. Vs. Gopal D. Tirthani and Ors.

On 14th January, 2002, the Department of Medical Education, Government of Madhya Pradesh promulgated the Madhya Pradesh Medical and Dental Post Graduation Entrance Examination Rules, 2002 (hereinafter referred to as 'P.G. Entrance Examination Rules, 2002', for brief) published in Madhya Pradesh Government Gazette Extraordinary dated 14.1.2002. The P.G. Entrance Examination Rules, 2002 make provision for the entrance test being conducted by the State Government. 20% seats are allocated for in-service candidates i.e. for medical graduates who are in the employment of the State Government. They are exempted from taking PG Entrance or Pre-PG examination. Such candidates are obviously governed by the service rules of the State.

The PG Admission (In-service) Rules framed by the Public Health and Family Welfare Department, vide Rule 2 under Selection Criteria, provide for a different mechanism including 40% marks to be awarded on the basis of a written examination conducted by Madhya Pradesh Professional Examination Board which is to be held separately for in-service candidates

The qualifying examination for entrance to post-graduate is called Pre-P.G. Entrance Examination and is conducted by M.P. Professional Entrance Test Board ('PET Board', for short), an autonomous body two separate entrance tests were held; one for open category candidates, and the other for in-service candidates. However, much before the holding of the tests, writ petitions were filed in the High Court of Madhya Pradesh laying challenge to the constitutional validity of P.G. Entrance Examination Rules, 2002 and P.G. Admission (in-service) Rules, 2002. The High Court, by interim orders passed in the writ petitions, permitted the entrance examinations being held as scheduled but directed the declaration of results to remain stayed. On 20th February, 2003, the High Court pronounced its decision disposing of a batch of writ petitions. The High Court struck down as ultra vires the P.G. Admission (in-service) Rules, 2002. In substance, the High Court upheld the validity of reservation of 20% seats out of the total in favour of in-service candidates.On 18th February, 2003, the State Government promulgated the Madhya Pradesh Medical and Dental Post Graduation Entrance Examination Rules 2003.The process for conducting entrance examinations so as to select the candidates for post graduation courses commencing in the year 2003-2004 was initiated. A set of fresh writ petitions came to be filed in the High Court of Madhya Pradesh by some of the in-service candidates laying challenge to the weightage given to the period of service spent in rural/tribunal areas by the candidates, relaxed eligibility test for women candidates serving in rural areas.

  • The Hon'ble Supreme court held

In the State of Madhya Pradesh allocation of 20% seats in post graduation in the Universities of Madhya Pradesh for in-service candidates is not a reservation; it is a separate and exclusive channel of entry or source of admission, the validity whereof cannot be determined on the constitutional principles applicable to communal reservations. Such two channels of entry or two sources of admission is a valid provision.There can be only one common entrance test for determining eligibility for post graduation. The requirement of minimum qualifying marks cannot be lowered or relaxed contrary to Medical Council of India Regulations framed in this behalf.. It is permissible to assign a reasonable weightage for service rendered in rural/tribal areas by in-service candidates for the purpose of determining inter se merit within the class of in-service candidates who have qualified in the Pre-PG test.Women candidates constitute a class by themselves and the provision of relaxed or reduced eligibility criteria by reference to continuous service rendered in rural areas for the purpose of sponsorship by the State Government in specified disciplines which have utility for serving women folk in villages does not suffer from the vice of invidious discrimination.