The petition had been filed by a city resident, R Veeramani.
A Division Bench, comprising Justices D Murugesan and K K Sasidharan, reserved orders after hearing arguments by senior counsel for the petitioner, P Wilson and Rakesh Trivedi for the State Government.
The AIADMK government on June 3, 2011 had announced that alleged irregularities in construction of the complex, a pet project of DMK president M Karunanidhi, would be probed and construction stopped forthwith for this purpose.
In August 2011, the government decided to convert the complex into a multi super speciality hospital and a new medical college on the lines of AIIMS.
On June 20 this year, the government reiterated its stand to convert the complex into a multi super speciality hospital, saying the place of meeting of the legislature is a constitutional prerogative and absolute discretion of the Governor.