Justice Jyotsna Rewal Dua, Himachal Pradesh High Court
State Cannot Withhold Approved AB-PMJAY Bills Of Empanelled Hospitals On Grounds Of Pending Vigilance Inquiry: Himachal Pradesh High Court
|The Court directed Himachal Pradesh to release approved pending claims of private empanelled hospitals under AB-PMJAY and HIMCARE within three weeks, holding that admitted dues could not be withheld on the pretext of funding issues or a pending vigilance inquiry.
The Himachal Pradesh High Court has held that the State cannot withhold duly approved AB-PMJAY bills of empanelled hospitals merely by citing a pending vigilance inquiry, once its financial liability under the scheme stands admitted.
The Court was hearing a batch of writ petitions filed by private hospitals empanelled to provide cashless treatment under AB-PMJAY and the Mukhya Mantri Himachal Health Care Scheme, complaining that payments for services already rendered to beneficiaries had not been released despite approval of their claims.
A Bench of Justice Jyotsna Rewal Dua, while observing that “state cannot keep on evading its financial obligations under the pretext of it having contemplated or initiated a vigilance inquiry into bills submitted by the private empanelled hospitals”, further held that “once liability is admitted, it cannot be postponed on pretext of an ongoing vigilance inquiry that even otherwise appears to be proceeding on merrily & indefinitely.”
Advocate Ajay Chandel appeared for several petitioner hospitals, while Anup Rattan, Advocate General, appeared for the State and Reeta Thakur, Senior Panel Counsel, appeared for the Union of India.
Background
The hospitals submitted that they had been treating eligible beneficiaries under AB-PMJAY and HIMCARE but were not being reimbursed for approved claims. The State did not dispute that payments were due, but raised issues regarding the share of liability under AB-PMJAY and also referred to an ongoing vigilance inquiry into past claims.
Under AB-PMJAY, the Union submitted that its liability was limited to the ceiling fixed under the scheme and the memorandum of understanding, while the State was required to bear additional claims beyond that ceiling. The State argued that this interpretation imposed an excessive financial burden on it, particularly after the number of beneficiaries and claims rose sharply.
The Court recorded that, according to data placed before it, approved bills amounting to ₹11.03 crore under HIMCARE and ₹25.22 crore under AB-PMJAY were pending as on July 6, 2026.
Court’s Observations
The Court noted that the State had executed the MoU for implementing AB-PMJAY and was aware that additional liability beyond the Central ceiling had to be borne by it. Since the State had not opted out of the arrangement, it could not avoid payment of approved claims.
The Court observed: “It is admitted case of the respondent-State that MoU was executed by it with the Central Government for implementing the Scheme and in that memorandum also it has also been clearly provided that any additional liability over and above the maximum ceiling limit of grant-in-aid to be released by the Central Government per family, per annum, has to be borne by the State Government.”
It further held: “It is not in dispute that duly approved monetary claims of petitioners for providing treatment to the beneficiary patients under AB-PMJAY have not been cleared by the State.”
The Court concluded that since the Central Government had already cleared its financial liability under the scheme, the remaining part of duly approved bills had to be released by the State.
On HIMCARE, the Court recorded that the State did not dispute that the scheme was State-funded and that release of claims to empanelled hospitals was its sole responsibility. The Court rejected temporary non-availability of funds as a justification for non-payment.
The Court also noted that HIMCARE had been framed on the analogy of AB-PMJAY, with AB-PMJAY package rates adopted and AB-PMJAY empanelled hospitals standing automatically empanelled under HIMCARE.
The Court was critical of the State’s attempt to delay payment of approved bills by citing a vigilance inquiry. It clarified that the State could continue with the inquiry and recover any amount found recoverable later, but could not indefinitely block dues already verified and approved.
The Bench remarked: “These hospitals also have to run, to conduct their day to day business. They are still liable to provide cashless treatment to the patients under AB-PMJAY & HIMCARE Scheme (dialysis only w.e.f. 31st August, 2024). In case the heavy financial liabilities towards the petitioners that have staggered over the years are not cleared, they will suffer immensely and their working will also be affected. Apparently no sound justiciable reason has come forth from the State to deny the payment to the petitioners for their duly approved bills. Non release of duly approved bills of the petitioners is a flagrant breach of both the Schemes as also the operational guidelines and MoU/notifications.”
The Court observed that the petitioners were providing treatment under schemes designed to address healthcare needs and that delay in payment would harm both the hospitals and the scheme objectives.
It said: “Delay in making due payments to them will cause them financial hardships – in time affecting their working and consequently the goals intended to be achieved under the Schemes.”
Conclusion
The Court directed the State to release all duly approved pending AB-PMJAY bills within three weeks, with interest at 1% of the claim amount per week after 15 days of delay. It issued the same direction for approved HIMCARE bills.
For future claims under both schemes, the State was directed to process and verify bills within prescribed timelines and clear approved claims strictly within the scheme period, with delayed payments attracting the same interest. The Central Government was also directed to ensure the prompt release of its AB-PMJAY contribution as per the agreed covenants.
The Court clarified that if the ongoing vigilance inquiry reveals any recoverable amount from the hospitals, the authorities may proceed for recovery in accordance with the law.
Cause Title: M/S Maatri Medicity & Orthocare Hospital v. State of Himachal Pradesh & Ors. and Connected Matters (Neutral Citation: 2026:HHC:29794)
Appearances
Petitioners: Advocates Ajay Chandel, Parav Sharma, Rupesh Kumar, Amit Singh Chandel, Jagan Nath and R.L. Verma; Senior Advocate Neeraj Sharma with Advocate Vidhush Chauhan
Respondents: Advocate General Anup Rattan with L.N. Sharma, Additional Advocate General, Sikander Bhushan, Deputy Advocate General, and Rajat Choudhry, Assistant Advocate General; Senior Panel Counsel Reeta Thakur and Bharat Bhushan with Central Government Standing Counsel Shashi Shirshoo, Virbahadur Verma, Janak Raj and Anshul Attri; Advocate Mansi Sharma