The directions were passed in the wake of a petition filed by the Union of India, UT Administration, Special Secretary, Finance and Project Director, UT Administration.

The petitioner has sought directions for setting aside invitations to expressions of interests for the proposed medicity project, as the project in the present form is against public interest, the petitioner has alleged.

On July 30, 1999, the Medical Council of India had issued guidelines prescribing requirement of more than 25 acres of land for setting up of a medical college. On September 6, 2007 a press release was issued by the UT Administration inviting expressions of interest for the proposed medicity in Chandigarh to be set up on 45 acres of land at village Raipur Kalan.

The proposed city would have a super-speciality hospital-cum-recuperatory centre and a dental college, and will provide healthcare facilities at affordable rates to all sections of population, the UT administration said while inviting proposals from the private sector.

It will also have a nursing college, which would provide free education to 300 nurses per year. The medicity would also provide treatment facilities in different streams of medicines like ayurveda, homeopathy, siddha and unani along with a holistic health centre.

The petitioner has submitted that the concept of public private partnership in health care sector was not practical. It has been further highlighted that Fortis in New Delhi is reflecting a net loss of about Rs 100 crore in its seventh year of existence.