Delhi High Court Directs State Trading Corporation Of India To Fully Reimburse Medical Expenses Of ₹23.79 Lakhs To Its Retired Employee

Justice Jyoti Singh observed that the government company's circular placing a cap on the amount of reimbursement that can be claimed by its retired employees, could not be an impediment to claim reimbursement of actual expenses.

The petitioner served in the STC for 31 years and retired in 1997. The STC provides for a 'STC (Retired Employees') Medical Benefits Scheme, 1981' ('Medical Scheme') available for employees who have rendered a minimum of 15 years of service. The STC on 12.11.2010 issued a Circular that imposed a ceiling limit on the amount reimbursable towards indoor medical expenses.

The petitioner's wife was hospitalized in Max Super Speciality Hospital on 09.01.2012 for multiple organ failures due to severe sepsis. She was also suffering from chronic kidney disease (Stage-V) requiring haemodialysis thrice a week. She passed away on 31.01.2012 in the hospital. The medical expenses raised by the hospital were Rs. 25,75,275.

The petitioner's claim for reimbursement of medical expenses was rejected by the STC in view of its Circular dated 12.11.2010. It stated that since the treatment of the petitioner's wife took place in 2012, the expense would be governed by slab-wise annual ceiling, which in the case of the petitioner was Rs.2.75 lacs, although the ceiling limit was doubled to Rs.5.50 lacs at the request of the petitioner.

The STC also relied on Clause 4.4 of the Medical Scheme, which provides that in the event of treatment in a private hospital, reimbursement will be subject to a maximum of such rates as are chargeable by All India Institute of Medical Sciences (AIIMS).

The petitioner thus challenged the STC's order rejecting his claim for medical reimbursement.

The Court noted that the averments made by the petitioner about his wife's condition were not denied by the STC.

It noted that the main reason for rejection was that since the hospitalisation and treatment of the petitioner's wife was in 2012, Circular dated 12.11.2010 would apply and thus no reimbursement could be made above the ceiling limit. It also noted that STC rejected the claim because as per Clause 4.4 of Medical Scheme, the petitioner was only entitled to AIIMS rates at the highest.

The Court remarked, “It is evident that in the anxiety to contest the claim of the Petitioner, STC has completely overlooked that Petitioner's wife was admitted in the hospital in a critical condition with severe sepsis and was shifted to ICU, where she passed away. The factum of treatment in emergency is not controverted by STC. Therefore, neither Clause 4.4 of the Medical Scheme, which no doubt Petitioner himself relies on, nor the ceiling limit in the Circular dated 12.11.2010, can be an impediment in the way of the Petitioner getting reimbursement of actual expenses, in light of the settled law.”

It was of the view that Clause 4.4 of the Medical Scheme or ceiling limit in the Circular dated 12.11.2010 would prevent the petitioner from receiving reimbursement.

The Court relied on the Supreme Court's case in Shiva Kant Jha v. Union of India (2018), where the petitioner was denied reimbursement of the medical claim on the ground that he had not approached the empanelled hospital during the medical emergency. Observing that a government employee is entitled to the benefit of medical facilities and that no fetters could be placed on such rights, the Apex Court held that the right to medical claim could not be denied merely because the name of the hospital is not included in the government order.

The Court further referred to Union Of India & Anr. V. Shri. Joginder Singh (2023 LiveLaw (Del) 427), where a division bench of the Delhi High Court too held that a medical claim for treatment undertaken in an emergency could not be denied for reimbursement merely because the hospital was not empanelled. It was observed that the test would be to see whether the claimant had undertaken the treatment in an emergency condition as advised and if the same was supported by the record.

Relying on other decisions, the Court observed, “The Supreme Court and the Division Benches of this Court have emphasized and highlighted that there is a positive obligation on the State to ensure timely medical treatment and no fetters can be placed on this right. How a patient is to be treated is a decision which vests only with the doctor, who is well-versed in the field and very little scope is left to the patient or his relative to decide the manner of treatment. Where an employee is admitted in a hospital in an emergency condition, law does not require that prior permission has to be taken in such a situation where the prime consideration is the treatment and survival of the patient. In fact, the Courts have repeatedly held that in an emergency case, even the fact that the treating hospital is not empanelled, will make no difference.”

The Court thus quashed the STC's order rejecting the petitioner's claim and directed the STC to reimburse the entire medical expenses to the petitioner.

Case title: Jagdish Chandra vs. State Trading Corporation Of India Ltd 

Citation: 2025 LiveLaw (Del) 147