A) ABSTRACT / HEADNOTE

In Siddharth Dalmia & Anr. v. Union of India & Ors., [2025] 4 S.C.R. 197 : 2025 INSC 351, the petitioners moved the Court under Article 32 claiming that private hospitals compel patients to purchase medicines, devices and consumables exclusively from hospital-affiliated pharmacies at inflated prices, thereby violating the right to life under Article 21 and the Directive Principles embodied in Articles 38, 39 and 47. The petition highlighted non-disclosure of prices and the regulatory lacuna insofar as many consumables fall outside the Drugs and Cosmetics Act, 1940 definition.

The Union and several States responded that price control and access to affordable medicines are addressed by mechanisms such as the Drug Price Control Order, 2013, the National Pharmaceutical Pricing Authority (NPPA), Jan Aushadhi/Amrit Drug Stores and various State schemes; additionally, the matter of public health falls under the State List (List II, Seventh Schedule). After hearing, the Court recognized that access to medical facilities is integral to Article 21 but concluded that comprehensive regulation of private hospital economic activity is essentially a policy matter for the States.

The Court therefore declined to issue coercive directives against private hospitals, and instead directed all State Governments to consider the problem and take appropriate policy decisions in light of local conditions. The Court did not adjudicate merits and disposed the writ petition. Keywords: Public Interest, Private hospitals, Unreasonable charges, State List, Right to life.

Keywords

Public Interest; Private hospitals; Right to life (Art. 21); State List (List II); Drug Price Control Order, 2013; National Pharmaceutical Pricing Authority.

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The petition arose from a lived experience: the medical treatment of Smt. Neelam Dalmia for breast cancer (surgery, multiple chemotherapies, radiotherapy) during which the petitioners allege systemic exploitation by private hospitals that insist patients purchase medicines and consumables exclusively from hospital-linked pharmacies at inflated prices. The petitioners contended that many consumables fall outside the Drugs and Cosmetics Act definition and thus avoid price regulation, causing deprivation of the right to a healthy life under Article 21. They urged judicial intervention to curb compulsion and to mandate disclosure or price controls.

Respondent States and the Union answered by pointing to existing institutional responses: the National Pharmaceutical Pricing Authority, the Drug Price Control Order, 2013, Jan Aushadhi and Amrit Drug Stores and various State cashless schemes. The Union also noted standards from the National Council for Clinical Establishments requiring availability of pharmaceutical services. States questioned locus and emphasized that health and sanitation are in List II (State List) thereby attracting primary constitutional competence of States for policy and regulation. The Court was asked to determine the legal reach of administrative or legislative intervention against private hospital practices, the permissible extent of regulation, and the enforcement mechanism.

D) FACTS OF THE CASE

The petitioners are private individuals who filed a public interest writ under Article 32 after observing alleged malpractices in a private hospital during the cancer treatment of petitioner No.1’s mother, Smt. Neelam Dalmia. It is alleged that private hospitals, nursing homes and medical institutions either operate in-house pharmacies or have commercial arrangements with external pharmacies and compel patients and attendants to buy medicines, implants and consumables only from those pharmacies. The claim includes non-disclosure of prices and sale at rates higher than notified market prices or MRPs. Petitioners assert that many items sold are not regulated as “drugs” under the Drugs & Cosmetics Act, 1940, leaving them outside NPPA price control.

The petition alleges systemic exploitation nationwide and prays for a judicial direction preventing such compulsion, plus mandating policy formulation by the Union/States to ensure affordable access and protect Article 21 rights. States filed extensive affidavits describing existing schemes: Jan Aushadhi Kendras, Amrit Drug Stores, State cashless treatment programs, reference to Drug Price Control Order, 2013 and NPPA mandates. The Union cited minimum standards from the National Council for Clinical Establishments and denied that hospitals forcibly compel purchases from their pharmacies. Several States raised locus and emphasized that public health regulation is primarily a State function.

E) LEGAL ISSUES RAISED

i. Whether private hospitals’ practice of compelling patients to buy medicines and consumables exclusively from hospital-affiliated pharmacies, at allegedly inflated prices, violates Article 21?
ii. Whether the fixation of prices of drugs, devices and consumables sold by hospital pharmacies can be regulated by administrative or legislative measures?
iii. If regulation is permissible, what is the appropriate extent and content of such measures?
iv. Which authority (Union, State, or regulatory agencies like NPPA) is competent to frame and enforce such regulation, given the constitutional allocation of subjects?
v. Whether the Court should issue mandatory directions or leave policy formulation to the States?

F) PETITIONER / APPELLANT’S ARGUMENTS

i. The petitioners submitted that patients are being exploited by a deliberate system that forces purchases from hospital-linked pharmacies at inflated prices; this practice deprives patients of affordable medical care, infringing Article 21.
ii. They argued that lack of price disclosure and the regulatory lacuna for items not defined as “drugs” compounds the problem, necessitating corrective legislation or judicial directions.
iii. The petitioners invoked Directive Principles Articles 38, 39 and 47 to press for State intervention and asked the Court to direct formulation of a uniform policy to prevent the economic exploitation of patients.

G) RESPONDENT’S ARGUMENTS

i. Counsels for the Union and the States contended that price regulation and access mechanisms already exist: Drug Price Control Order, 2013; NPPA’s mandate; Jan Aushadhi/Amrit Drug Stores; State health schemes.
ii. Several States disputed petitioner locus and asserted that public health is essentially a State subject under List II of the Seventh Schedule, requiring local policy responses.
iii. The Union relied upon minimum standards issued by the National Council for Clinical Establishments, and maintained there is no systemic compulsion to purchase from hospital pharmacies.

H) RELATED LEGAL PROVISIONS 

i. Article 21, Constitution of India (Right to life and personal liberty).
ii. Articles 38, 39, 47, Part IV (Directive Principles on public health and welfare).
iii. Seventh Schedule, List II (Public health and sanitation; hospitals and dispensaries — State list competence).
iv. Drug Price Control Order, 2013 (price fixation for essential formulations).
v. Drugs & Cosmetics Act, 1940 (definition of “drug” and regulatory scheme).
vi. Institutional standards: National Council for Clinical Establishments guidelines.

I) JUDGEMENT

The Court accepted that access to medical facilities is integral to Article 21 and acknowledged the constitutional obligations reflected in Part IV Directive Principles. The Court also recorded the State’s pragmatic reliance on private healthcare providers given infrastructural deficits. Faced with the tension between protecting patients from exploitation and not stifling private investment in health services, the Court examined the contours of competence. The Court observed that questions of economic policy, price fixation and comprehensive regulation of private hospital commercial practices engage matters best suited to the policy-making organs principally State Governments because public health and sanitation, hospitals and dispensaries are in List II (State List). The Court therefore declined to issue mandatory judicial directions that might deter private participation in health infrastructure.

Instead, the Court chose a restrained approach: it sensitized the State Governments to the problem of unreasonable charges and exploitation and directed all State Governments to consider the issue and take appropriate policy decisions as per local conditions. The Court clarified it did not express any opinion on the merits and disposed the petition. Pending interlocutory applications were also disposed. The decision relied on precedents recognizing the separation of powers and deference to policy makers in complex socio-economic regulation, including references in the judgment (e.g., State of Punjab v. Ram Lubhaya Bagga and others cited in the record). The Court balanced constitutional imperatives: upholding Article 21 while respecting the legislative and executive domain over health policy.

a. RATIO DECIDENDI

The decisive legal proposition is that while the right to health forms part of Article 21 and States carry obligations under Part IV, the detailed regulation of private hospital economic practices price fixation, compulsion to buy from affiliated pharmacies — engages policy choices within the State List and therefore calls primarily for legislative and executive action by State Governments. The Court held that judicially imposed, across-the-board mandatory directions regulating every activity of private hospitals would be imprudent and could chill private investment in healthcare. Thus, the proper course is to require State Governments to consider tailored policy measures and, if needed, legislate or frame administrative rules rather than have the Court craft sector-wide economic regulation by writ.

b. OBITER DICTA

The Court observed (obiter) that existing mechanisms NPPA, Drug Price Control Order, 2013, Jan Aushadhi, Amrit Drug Stores and State schemes are relevant institutional safeguards and should be deployed or strengthened. It also noted the National Council for Clinical Establishments’ minimum standards for pharmaceutical services as a standard-setting reference. The observation stressed cooperative governance: Centre and States must coordinate to protect patients while preserving an enabling environment for private healthcare infrastructure.

c. GUIDELINES

i. The Court directed all State Governments to examine the issue of unreasonable charges and exploitation in private hospitals and to take appropriate policy decisions tailored to local conditions.
ii. States should consider measures to increase price transparency (disclosure of MRP/prices for medicines, devices and consumables sold within hospitals).
iii. States may examine strengthening State schemes, promotion of Jan Aushadhi/Amrit Stores or other supply side interventions to enhance access.
iv. Where statutory gaps exist for items not defined as “drugs,” States should evaluate legislative or administrative steps to bring necessary items within suitable regulatory frameworks.
v. Centre-State coordination with agencies like NPPA and clinical standards bodies should be pursued to ensure effective implementation.

J) CONCLUSION & COMMENTS

The Court’s approach is pragmatic and constitutionally cautious. It reaffirms the centrality of Article 21 while respecting the domain of State policy making under the Seventh Schedule. The decision refrains from judicial overreach into complex economic regulation of private healthcare, preferring to stimulate executive and legislative processes. Practically, the judgment places an onus on States to enact transparent, proportionate policies including disclosure norms, statutory coverage for unregulated consumables and bolstering public procurement/retail options (Jan Aushadhi/Amrit stores) to mitigate exploitation. For litigants and consumer advocates, the judgment signals that the Supreme Court will prefer facilitating systemic administrative reform rather than prescriptive judicial micromanagement, especially where subject-matter lies predominantly within State competence. The ruling preserves avenues for targeted legal action in specific cases of proven coercion or fraud while urging systemic policy responses to safeguard patients’ Article 21 rights.

K) REFERENCES

a. Important Cases Referred

i. State of Punjab v. Ram Lubhaya Bagga, (1998) 4 SCC 117.
ii. Paschim Banga Khet Mazdoor Samity v. State of W.B., (1996) 4 SCC 37.
iii. Vincent Panikurlangara v. Union of India, (1987) 2 SCC 165.
iv. In Re : Section 6A of the Citizenship Act 1955, 2024 SCC OnLine SC 2880.
v. Suman Kumar v. Union of India, 2023 SCC OnLine SC 1750.
vi. Transport & Dock Workers Union v. Mumbai Port Trust, (2011) 2 SCC 575.
vii. Govt. of A.P. v. N. Subbarayudu, (2008) 14 SCC 702.
viii. The present case: Siddharth Dalmia & Anr. v. Union of India & Ors., [2025] 4 S.C.R. 197 : 2025 INSC 351.

b. Important Statutes / Instruments Referred

i. Constitution of India — Articles 21, 38, 39, 47; Seventh Schedule (List II).
ii. Drugs and Cosmetics Act, 1940 (definitional/regulatory context).
iii. Drug Price Control Order, 2013 (pricing control for essential formulations).
iv. Institutional references: National Pharmaceutical Pricing Authority (NPPA); National Council for Clinical Establishments guidelines.