“Harassment Felt by Patients Is Not an Untold Story”: Delhi HC Dismisses Plea Against Max Hospital, Calls for Systemic Reform in Insurance Discharge Process
Safiya Malik
The High Court of Delhi, Single Bench, of Justice Neena Bansal Krishna, dismissed a criminal miscellaneous petition filed under Section 482 of the Code of Criminal Procedure, 1973. The petition sought to set aside the discharge of hospital officials in a billing dispute case involving Max Super Speciality Hospital. The Court concluded that no prima facie case under Sections 342, 420, 406, 34, or 120B of the Indian Penal Code was established against the respondents.
In addressing broader issues associated with discharge procedures under cashless insurance policies, the Court noted, "Such situation may be a ground for seeking compensation for mental harassment, but does not tantamount to any criminal offence."
The petitioner, Shashank Garg, an advocate by profession, filed the petition against the judgment and order dated 19 May 2018 which had allowed criminal revision petitions bearing CR Nos. 8450/2016, 42/2017, and 79/2017 filed separately by the respondents. These revisions challenged the summoning order issued in Complaint Case No. 462884/2016, where the respondents had been summoned under Sections 342, 406, 420, and 120B IPC.
The petitioner was diagnosed with Cysticercosis and was advised to undergo surgical removal of the affected area in his right hand. He opted for surgery at Max Super Speciality Hospital, Saket, a listed network hospital under his Max Bupa Health Insurance policy, which was valid from 28 August 2013 to 28 August 2014 and provided cashless settlement for treatments at network hospitals.
The estimated surgery costs provided by Max Hospital were Rs.1,79,368 for a shared room and Rs.2,20,316 for a single room. The petitioner applied for pre-authorisation from Max Bupa, which approved Rs.75,000 initially on 5 October 2013 with a promise of further authorisation. The petitioner was admitted to Max Hospital on 7 October 2013. Despite approval for a partial amount, the hospital demanded an advance of Rs.1,45,000 before conducting the surgery scheduled for 8 October 2013. The petitioner deposited Rs.50,000 on 7 October and Rs.95,000 on 8 October.
Upon discharge on 9 October 2013 at around 9:15 PM, the petitioner was issued a final bill of Rs.1,61,412, after accounting for a discount of Rs.12,495. Although the insurance company approved Rs.1,73,907, the hospital claimed to have received Rs.1,04,080. An amount of Rs.87,668 was refunded to the petitioner. He alleged that a sum of Rs.57,332 was wrongly deducted from his deposited amount, despite full coverage by the insurance company.
In the complaint, the petitioner contended that the hospital had misappropriated funds, committed cheating, wrongfully restrained him within the hospital, and conspired to cause him financial and emotional distress. He invoked offences under Sections 406 (criminal breach of trust), 420 (cheating), 342 (wrongful confinement), 120B (criminal conspiracy), and 34 IPC (acts done in furtherance of common intention).
The Metropolitan Magistrate recorded the pre-summoning evidence and issued summons against certain hospital officials including Mr. Saqib (Duty Manager), Ms. Nancy Mandal (Patient Care Coordinator), and Mr. Yogesh Sareen under the aforementioned IPC sections. This summoning order dated 3 October 2016 was challenged in separate criminal revision petitions before the Additional Sessions Judge (ASJ), who set aside the summoning orders, stating that they suffered from illegality and did not establish a prima facie case. This led to the present petition under Section 482 CrPC.
The hospital respondents, in their reply, contended that the charges were clearly communicated to the petitioner. The approval from the insurance company came only hours before discharge and was limited to standard room charges, whereas the petitioner had availed a higher-category room. Accordingly, as per IRDA regulations, the differential amount had to be borne by the patient. The hospital submitted that there was no criminal intent and that any delay in the discharge process was procedural and administrative.
The Court, after examining the facts and documents on record, as well as hearing submissions from both sides, noted:
"It may seem to be an onerous condition, but definitely cannot be stated to be extraction of money nor can any dishonesty or fraudulent intention be attached to the Max Hospital."
On the allegation of cheating, the Court observed:
"There is no misappropriation of funds by the Max Hospital and no offence under Section 406 IPC, is made out."
Regarding wrongful restraint, the Court recorded:
"Though there was a palpable delay of few hours in drawing the Discharge papers, but it was on account of completion of formalities... The circumstances do not establish that there was any intentional wrongful restraint."
Further, the Court stated that the petitioner had full knowledge of the insurance coverage limits at the time of admission, and the balance amount was justifiably collected in accordance with hospital policies and insurance norms. The contention that the petitioner was misled into paying the advance was not supported by any material evidence indicating fraudulent inducement.
The petitioner had also alleged that a criminal conspiracy was hatched by the hospital officials to extort money. On this point, the Court held:
"There is no material to suggest that there was any meeting of minds or coordinated action between the respondents amounting to a conspiracy under Section 120B IPC."
With regard to procedural lapses and delay in finalising discharge documents, the Court acknowledged the systemic issues inherent in cashless policy settlements and observed:
"Such incidents of alleged harassment felt by the patients in settling their Final Bills, is not an untold story but is frequently suffered by the patients. Their harassment gets compounded by the fact that they come out of a trauma of an ailment under treatment but even for discharge, there are long drawn procedures for settling the bills with the Insurance Company."
It further remarked:
"Much angst has been expressed on this system of getting the approvals from the Insurance Company at many forums and by the Courts, but such situation may be a ground for seeking compensation for mental harassment, but does not tantamount to any criminal offence."
The Court acknowledged prior recommendations from various forums and the NHRC towards instituting a regulatory policy or a Charter of Patient Rights but stated:
"Unfortunately, no final redressal to this aspect has been worked out till date. It is a matter which must be taken up at the level of State Government/Central Government in consultation with IRDA and the Medical Council of Delhi and India, to work out some mechanism to smoothen the discharge process and settling of the medical Bills."
The Court held:
"It is held that there is no merit in the Petition and the learned ASJ in his well detailed Order, has rightly observed that no criminal offence under Section 342/420/406/34/120B IPC, is made out."
Accordingly, the petition along with all pending applications was dismissed.
Advocates Representing the Parties:
For the Petitioner: Mr. Nitin Mehta and Mr. Bhanu Sanoriya
For the Respondents: Mr. Shoaib Haider, APP, Mr. Anil Bhasin
Case Title: Shashank Garg vs. State & Others
Neutral Citation: 2025: DHC:2699
Case Number: CRL.M.C. 3583/2018
Bench: Justice Neena Bansal Krishna
[Read/Download order]
