HC rejects Kanchi Trust move to sell hospital

Dismissing a suit filed by the Trust seeking permission to sell the hospital, Justice (Ms) R Bhanumathi observed that the institutions were established ‘‘with a view to providing medical education at an affordable cost to deserving students in the middle and lower income groups’’. The Tamilnad Hospital as it was known earlier, located at Perambakulam near Sholinganallur about 45 km from Chennai, was a public limited company run by a group of NRI doctors. The hospital caters to 47 villages in the area, with a substantial low-income group of people. The Mutt acquired it, establishing the Sri Kanchi Kamakoti Sankara Hospital.

The Trust’s ambitions to start the Sri Jayendra Saraswati Institute of Medical Sciences faced roadblocks with the Jayalalithaa regime declining to issue ‘No-Objection Certificate’ necessary to run the institute. ‘‘We invested nearly Rs 40 crore to satisfy all the conditions imposed by the two inspection committees sent by the state government,’’ T V Rajagopalan, senior advocate and another Kanchi Kamakoti Peetam trustee told The Indian Express. But, in April 2005, the state government rejected the Trust’s application for NOC. ‘‘Without that clearance for the College, running the Hospital was not a viable project,’’ he pointed out.

Last week, the Trust sought Court permission to sell the charitable institutions. In its suit, it said revenue loss incurred by the hospital had eroded its capital and, as on date, its net worth was negative. While the hospital’s average monthly income was Rs 30 lakh, expenses were Rs 1.03 crore. Its repayment liability for 2006-07 was Rs 11.52 crore. Therefore, it desired to sell the hospital and college and use the funds to discharge existing liabilities and spend on other charitable purposes.

The trust also disclosed to the court that it had received offers for purchase of the college and hospital from Chettinad Hospitals Private Ltd., owned by well-known industrialist, M A M Ramasamy, for Rs 105 crore, Mahatma Gandhi Medical College, Pondicherry for Rs 100.01 crore, the Chennai-based Jaya Educational Trust for Rs 100 crore, and ISPAT Industries, Delhi for Rs 70.08 crore. However, the judge declined permission saying the sale would defeat the objectives of the Trust, meant to be charitable in nature.