The Supreme Court’s interim order requiring private laboratories to test for COVID-19 free of cost, without any order on its reimbursement claims from the government, while laudable in intent, seems to be an overreach of its powers.

Yesterday, while hearing a PIL (Shashank Deo Sudhi v. Union of India & Ors.), a Bench of Justices Ashok Bhushan and Ravindra Bhat of the Supreme Court passed an interim order requiring that all private laboratories conducting COVID-19 tests do so free of cost, similar to the government laboratories.

Additionally, all laboratories have to be accredited by the National Accreditation Board for Testing and Calibration (NABL) or agencies approved by the World Health Organization (WHO) or the Indian Council of Medical Research (ICMR).

Two additional things are notable from the Court’s judgment. First, the Court stated that “whether the private Laboratories carrying free of cost COVID-19 tests are entitled for any reimbursement of expenses incurred shall be considered later on.”

Second, the justification that the Court gave for its order was articulated in the following words:

“The private Hospitals including Laboratories have an important role to play in containing the scale of pandemic by extending philanthropic services in the hour of national crisis. We thus are satisfied that the petitioner has made out a case for issuing a direction to the respondents to issue necessary direction to accredited private Labs to conduct free of cost COVID-19 test.”

While the intention of the Supreme Court is laudable, without a question, it also gives rise to several important legal questions. There is hardly room for debate that the current circumstances call for an ‘all hands on the deck’ approach. However, precisely because of the ‘black swan’ nature of the calamity we face, every decision can have widespread ramifications, extending beyond what appears obvious.

For example, the first question that arises is - What did the Supreme Court base its judgment on?

The Court did not cite any legal provisions/Act/Regulation in its interim order justifying the same. Since the Central government has invoked the provisions of the Disaster Management Act, 2005 (the DMA Act) and the Epidemic Diseases Act, 1897, it is noteworthy to peruse these Acts to see whether any such power emanates from them.

While the latter does not make any reference to the Court’s power, the former limits the jurisdictions of all courts except the High Court and the Supreme Court to review government action.

To elaborate, Section 71 of the DMA Act states:

While the above section gives power to the Supreme Court and the High Courts, it is limited to "anything done, action taken, orders made, direction, instruction or guidelines issued by the Central Government". Thus far, the government is yet to take any action to lay down the rules for tests by private laboratories.

The ICMR's Department of Health Research, through an advisory dated March 17, had fixed the fees for screening and confirming COVID-19 by private laboratories at Rs. 4,500. This was successfully challenged by the petitioner in the above mentioned PIL.

The Supreme Court in its order does not mention if any particular rationale for fixing the fees to the tune of Rs. 4,500 had been asked or given. The Court’s concern, in its own words, was limited to the fact that

“...at this time of national calamity permitting private Labs to charge Rs.4,500 for screening and confirmation test of COVID-19 may not be within means of a large part of population of this country and no person be deprived to undergo the COVID-19 test due to non-payment of capped amount of Rs.4,500. It is submitted before us that insofar as Government Laboratories are concerned the COVID-19 test is conducted free of cost.”

So, when the ICMR fixed the fees at Rs. 4,500 per test what was the criteria it followed and why couldn’t it be lower? We do not know the answer to this question.

Also, while the government labs are providing it for free, what is the cost, if any, that they are accruing per test? These could have been considered by the Court to arrive at a fee that balances affordability with sustainability.

Again, while one can understand the Court’s perspective, this gives rise to a second legal question – Can the Court pass an order against private players?

For example, can any person’s property be used by the government for the 'collective good' during the current situation? While it is difficult to answer this question with a clear yes or no, it will depend on the action per se.

Here again, the provisions of the DMA Act are useful. While the Act does not have any one clear clause that enables action against private players, it is justified in some cases. Section 35 lays down the powers of the Central government to take measures. Specifically, Section 65 (1) lays down that as under:

This clarifies that for ‘rescue operations’, the National Executive Committee, State Executive Committee or District Authority, may authorise using resources of private persons too. But without any such order in this behalf, it is hard to assume that there is a general power for either the Courts or the government to order against private players.

One would imagine that in extraordinary times, the State should have the power to require what it needs from private persons. However there has to be a balancing act that has to be done.

It is here that the Supreme Court’s interim order has a gap, since it left the question of reimbursement by these private laboratories from the government to a later date. In the Court’s words,

While it is an interim order, leaving the question of reimbursement to a later date hangs the rights of private laboratories in limbo. While many of these laboratories may themselves be happy with the order, there is a reason why law cares more for the process more than the form. At the risk of being misinterpreted or being seen as taking a hyper-technical view of the law, this argument is important to avoid foreseeable slips from the cracks.

Consider this. The Courts are yet to pass any judgment on whether the legal concept of ‘force majeure’ will be applicable for those who wish to avoid their contractual obligations to another private player, by let’s say, defaulting in the payment of rent. Since several private parties find themselves in extremely difficult financial conditions, can the Court pass a blanket order waiving off the requirement for all tenants across India, to pay rent for the time that the crisis continues?

While such a move will be lauded by the tenants, it will have the effect of imposing unforeseen hardship on the landlords. Perhaps, it is for this reason that the Courts are likely to adopt a case-to-case approach and/or adopt a ‘balancing approach’.

While the Supreme Court leads with a vision to provide leadership to the country in these tough times, it is essential that it adopts an overall balanced approach and bases its action firmly rooted in the law. This will ensure that no private person feels threatened of what may be asked of her.

Times like these are the truest test of democracy, and hopefully, most of India’s citizens will step up by themselves to go all out in the fight against Coronavirus. But, law, as always, can neither afford too strict or too philanthropic a view. It calls for striking a ‘balance’ in these tough times.

Also, it needs to be ensured that the laudable intent of the Supreme Court is not mistaken by some as a clear overreach of the constitutional scheme of separation of powers.

The author is a lawyer at the Supreme Court of India, founder of Hamara Kanoon (YouTube), and author 'Life At Law School' (EBC). Write to her at advocateavanibansal@gmail.com

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect those of Bar & Bench.