Kerala High Court
Prabhu & Company Acompany Incorporated vs P.K.Shree Kumar on 13 December, 1999
IN THE HIGH COURT OF KERALAAT ERNAKULAM
PRESENT:
THE HONOURABLE MR. JUSTICE A.HARIPRASAD
FRIDAY, THE 8TH DAY OF AUGUST 2014/17TH SRAVANA, 1936
Crl.MC.No. 3957 of 2008 ( )
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CC 998/2008 of OF JUDICIAL FIRST CLASS MAGISTRATE COURT-I, ALAPPUZHA
PETITIONER(S)/ACCUSED 3 AND 4:
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1. PRABHU & COMPANY ACOMPANY INCORPORATED
UNDER THE COMPANIES ACT, 1956 AND HAVING ITS
REGISTERED ADDRESS AT17/2248, THOPPIL HOUSE
MULLACKAL P.O.,ALAPPUZHA - 11.
2. SAROJINI V.PRABHU, HAVING HER ADDRESS
AT17/2248, THOPPIL HOUSE, MULLACKAL P.O.
ALAPPUZHA - 11.
BY ADVS.SRI.P.VIJAYA BHANU (SENIOR ADVOCATE)
SRI.SHAJI P.CHALY
RESPONDENT(S)/COMPLAINANT & STATE:
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1. P.K.SHREE KUMAR, DRUGS INSPECTOR
SPECIAL INTELLIGENCE BRANCH, OFFICE OF THE
DRUG CONTROLLER, TRIVANDRUM - 37.
2. THE STATEOF KERALA, REPRESENTED BY
THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA
ERNAKULAM.
BY DIRECTOR GENERAL OF PROSECUTION SHRI T.ASAF ALI
THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 18.07.2014,
ALONG WITH CRMC. 3958/2008 AND CONNECTED CASES, THE COURT ON 08.08.2014
PASSED THE FOLLOWING:
CRL.MC NO.3957/2008
APPENDIX
PETITIONERS' EXHIBITS:
ANNEXURE A1 TRUE COPY OF THE LICENSE ISSUED BY THE STATE OF GUJARATH
DATED 13.12.1999 AND ITS TRANSLATION
ANNEXURE A2 TRUE COPY OF THE FOOD SAFETYAND STANDARDS ACT
ANNEXURE A3 TRUE COPY OF THE RELEVANT EXTRACT OF THE AMENDMENT BILL
ANNEXURE A4 TRUE COPY OF THE NEWS PUBLISHED IN MATHRUBHUMI DAILY DATED
6.10.2001
ANNEXURE A5 TRUE COPY OF THE LETTER SUBMITTED BY THE 1ST PETITIONER
DATED 3.11.2001
ANNEXURE A6 TRUE COPY OF THE ORIGINAL DRUG LICENSE DATED 25.1.2000
ANNEXURE A7 TRUE COPY OF THE LETTER ISSUED TO THE 1ST RESPONDENT DATED
8.12.2001
ANNEXURE A8 TRUE COPY OF THE LETTER ISSUED TO THE 1ST RESPONDENT DATED
11.12.2001
ANNEXURE A9 TRUE COPY OF THE COMPLAINT FILED BY THE 1ST RESPONDENT DATED
7.8.2002
ANNEXURE A10 TRUE COPY OF THE LETTER DATED13.10.2008
ANNEXURE A11 TRUE COPY OF THE CIRCULAR DATED 17.10.2002 AND ITS
TRANSLATION
ANNEXURE A12 TRUE COPY OF THE CASH BILL DATED 10.10.2008
ANNEXURE A13 TRUE COPY OF THE INTERIM ORDER PASSED BY THIS COURT IN
WP.31630/2007 DATED 25.10.2007
ANNEXURE A14 TRUE COPY OF THE INTERIM ORDER PASSED BY THE BOMBAY HIGH
COURT IN WP(L) NO.1546/2006 DATED 12.07.2006
ANNEXURE A15 TRUE COPY OF THE INTERIM ORDER PASSED BY THE BOMBAY JIGH
COURT IN WP(L) NO.1566/2006 DATED 12.07.2006
ANNEXURE A16 TRUE COPY OF THE INTERIM ORDER PASSED BY THIS COURT IN WP(C)
NO.4128/2004 DATED5.2.2004
ANNEXURE A17 TRUE COPY OF THE INTERIM ORDER PASSED BY THIS COURT IN WP(C)
NO.9354/2007 DATED12.04.2007
RESPONDENTS'S EXHIBITS:NIL
//TRUE COPY//
A.HARIPRASAD, J.
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Crl.M.C. Nos.3957, 3958, 3959,
3960, 3966 & 3967 of 2008
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Dated this the 8th day of August, 2014.
COMMON ORDER
Petitions filed under Section 482 of the Code of Criminal Procedure (in short, "Cr.P.C.").
2. Petitioners in Crl.M.C.Nos.3957 of 2008 and Crl.M.C.3958 of 2008 are the accused 3, 4, 1 and 2 respectively in C.C.No.998 of 2008 on the file of Judicial First Class Magistrate Court-I, Alappuzha. Petitioners in Crl.M.C.Nos.3959 of 2008 and 3966 of 2008 are the accused 1, 2 and 3 to 8 respectively in C.C.No.1232 of 2008 on the file of Judicial First Class Magistrate Court-I, Thiruvalla. Petitioners in Crl.M.C.Nos.3960 of 2008 and 3967 of 2008 are the accused 1, 2 and 3 to 7 respectively in C.C.No.1474 of 2004 on the file of Judicial First Class Magistrate Court-III, Kottayam. For the sake of convenience, I am considering Crl.M.C.No.3958 of 2008 as the leading case. Parties are hereinafter referred to as the complainant and the accused for clarity.
3. Annexure-A9 in all the cases are the complaints filed by the respective Drug Inspectors under Section 32 of the Drugs and Cosmetics Act, 1940 (in short, "the Act") alleging offences punishable under Section 18(c) read with Section 27 of the said Act.
Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 2
4. Facts relevant for our purpose, stated briefly, are as follows:
Troikaa Pharmaceuticals Ltd., 1st petitioner in Crl.M.C.No.3958 of 2008/1st accused in C.C.No.998 of 2008 is a limited company, having its registered office at Ahammadabad. The company is engaged in the manufacture and sale of drugs. 2nd petitioner in Crl.M.C.No.3958 of 2008/2nd accused in C.C.No.998 of 2008 is the Managing Director of the company. As per the Memorandum of Association and Articles of Association, he is responsible for the day today affairs of the company under Section 34 of the Act. 3rd accused in C.C.No.998 of 2008 is a partnership firm doing wholesale business of drugs as per a drug licence issued to them. 4th accused in C.C.No.998 of 2008 is the Managing Partner. They are dealing the drugs manufactured and distributed by the 1st accused company.
5. The complainants inspected the sales premises of the distributors of drugs manufactured by the 1st accused company on various dates. During the inspection, it was found that the 1st accused company manufactured and sold the drugs, viz., Cartilamine (Glucosamine Sulphate Tablets) and Cartilamine Forte Tablets (Glucosamine Sulphate 250 mg +Chondroistin Sulphate 200 mg Tablets) without a drug manufacturing licence. Details of sales invoices are mentioned in the respective complaints. As per the authentic pharmacopoeia, Glucosamine has been Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 3 indicated as a drug used in the treatment of rheumatic disorders including osteoarthritis. It is averred in the complaints that the Indian Drugs Research is an authorised reference book for medical practitioners and pharmacists explaining the method of action, adverse effects, indications, contra-indications, special precautions, onset of action, duration of action and dosage of drugs. The drugs and other details listed in the book are contributed by the manufacturers for the reference of the medical professionals. In the book, Glucosamine is categorised under other anti arthritic agents. Cartilamine and Cartilamine Forte which are preparations of Glucosamine Sulphate manufactured and sold by the 1st accused were originally categorised as anti arthritic agents under musculo skeletal disorders. There is another section in the said book relating to the preparation of food products. Glucosamine does not come under this category.
6. 1st accused company has a website in the internet "http/w.w.w.trcikea.com/nutritional supplements". The drug Cartilamine Forte and Cartilamine SR are indicated for osteoarthritis. It is a disease of the joints manifested by swelling, stiffness and pain. As per another website of the company, it is advised to take Cartilamine 500 mg three times daily for three months and Cartilamine Forte one or two tablets three Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 4 times a day as the adult doses for arthritis. It is contended that no dose is prescribed for nutritional products (dietary supplements). It is evident that Glucosamine Sulphate is used for treatment of osteoarthritis, a disease, and hence it is a drug. The said drug was manufactured by the accused 1 and 2 and sold the same without a drug licence to the accused 3 and 4. Thus, by manufacturing and distributing the drugs, viz., Cartilamine, Cartilamine Forte and Cartilamine SR without drug manufacturing licence, the accused 1 and 2 and by distributing these drugs to retailers, the accused 3 and 4 have committed the offence under Sections 18(c) of the Act punishable under Section 27(b)(ii) of the Act. With almost similar allegations in the other complaints, the respective complainants have sought for prosecution of the accused persons.
7. Heard Shri P.Vijaya Bhanu, learned Senior Counsel appearing for the petitioners and Shri T.Asaf Ali, learned Director General of Prosecution.
8. Learned Senior Counsel contended that the prosecution allegation that Cartilamine and Cartilamine Forte are drugs is incorrect. According to him, these are dietary supplements.
9. In this context, the definition of 'drugs' in Section 3(b) of the Act assumes importance. It reads as follows:
Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 5 ""drug" includes-
(i) all medicines for internal or external use of human beings or animals and all substances intended to be used for or in the diagnosis, treatment, mitigation or prevention of any disease or disorder in human beings or animals, including preparations applied on human body for the purpose of repelling insects like mosquitoes;
(ii) such substances (other than food) intended to affect the structure or any function of the human body or intended to be used for the destruction of vermin or insects which cause disease in human beings or animals, as may be specified from time to time by the Central Government by notification in the Official Gazette;
(iii) all substances intended for use as components of a drug including empty gelatin capsules; and
(iv) such devices intended for internal or external use in the diagnosis, treatment, mitigation or prevention of disease or disorder in human beings or animals, as may be specified from time to time by the Central Government by notification in the Official Gazette, after consultation with the Board;"
In the complaint, it has been specifically averred that the preparations by Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 6 name Cartilamine and Cartilamine Forte were intended for therapeutic use for osteoarthritis. The main ingredient of Cartilamine, Cartilamine Forte and Cartilamine SR is Glucosamine Sulphate. It is widely used as an anti arthritic agent. Therefore, the products by name, Cartilamine, Cartilamine Forte and Cartilamine SR will fall within the definition of 'drug', contended the learned Director General of Prosecution.
10. Learned Senior Counsel contended that Annexure-A1 in all the cases is the licence obtained by the 1st accused company under the Prevention of Food Adulteration Act, 1954 (in short, "the PFA Act"). True translation of the original licence in Gujarati is also provided for perusal. Annexure-A1 is dated 13.12.1999. As per the licence issued in Form B under the PFA Act, it could be seen that the 1st accused was authorised to manufacture combinations of Glucosamine Sulphate as dietary supplement. When there was an objection regarding non-taking of the drug licence under the Act, they obtained a drug licence, which is exhibited as Annexure-A6 in all the cases. Section 18 of the Act prohibits manufacture and sale of certain drugs and cosmetics. The prohibition alleged in this case falls under Section 18(c) of the Act, which reads as follows:
"18. Prohibition of manufacture and sale Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 7 of certain drugs and cosmetics.- From such date as may be fixed by the state Government by notification in the Official Gazette in this behalf, no person shall himself or by any other person on his behalf, no person shall himself or by any other person on his behalf-
(a) and (b) xxxxxxxxxx
(c) manufacture for sale or for distribution, or sell, or stock or exhibit or offer for sale, or distribute any drug or cosmetic, except under, and in accordance with the conditions of, a licence issued for such purpose under this Chapter:
Provided that nothing in this section shall apply to the manufacture, subject to prescribed conditions, of small quantities of any drug for the purpose of examination, test or analysis:
Provided further that the Central Government may, after consultation with the Board, by notification in the Official Gazette, permit, subject to any conditions specified in the notification, the manufacture for sale or for distribution, sale, stocking or exhibiting or offering for sale or distribution of any drug or class of drugs Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 8 not being of standard quality"
11. Learned Senior Counsel contended that Annexure-A6 was issued to the company on 25.01.2000 in Form 25 of the Act, which relates to the manufacture for sale or for distribution of drugs other than those specified in Schedule C, C(1) and X. It shows that from 13.11.2001 onwards, the 1st accused company was permitted to manufacture and market Cartilamine and Cartilamine Forte tablets. The dispute is in respect of drugs manufactured and sold between 13.12.1999 to 13.11.2001, during which there was no licence for the 1st accused company to manufacture and sell the products. Learned Director General of Prosecution contended that even as per Annexure-A6 drug licence, the company had not obtained any permission to manufacture and sell Cartilamine SR. In answer to this contention, learned Senior Counsel contended that the appellation 'SR' to Cartilamine is only to indicate that it means sustained relief. It is not clear as to whether there is any difference in the chemical combination or strength of the chemicals used in Cartilamine, Cartilamine Forte and Cartilamine SR. Whatever that be, the fact remains that they did not specifically obtain a licence for the manufacture and sale of Cartilamine SR.
12. Learned Senior Counsel for the petitioners contended that the Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 9 company is having drug licences for various products manufactured and sold by it. It was not difficult for the company to apply and obtain drug licence for Cartilamine preparations. As the company could obtain licence under the PFA Act in respect of those preparations and the company was under a bona fide belief that it could be manufactured and marketed as a dietary supplement, the company did not apply for drug licence in respect of those drugs. Learned Senior Counsel further contended that in the State of Gujarat, licences under the PFA Act and the Act are issued by the same authority. Since the authority did not insist on taking drug licence for the said products, the company did not obtain it. It was not a willful act or omission on the part of the company, contended the learned Senior Counsel. In reply to this argument, learned Director General of Prosecution contended that the company cannot get itself extricated from the liability since the Cartilamine preparations squarely fell within the definition of 'drugs' under the Act. Further, Cartilamine SR was manufactured by the company without any licence is evident from Annexure-A6.
13. Learned Senior Counsel contended that the drug licence (Annexure-A6) authorised the company to manufacture additional products. In other words, these products were added to the existing list of Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 10 drugs manufactured by the company. According to the learned Senior Counsel, Annexure-A6 drug licence was issued with effect from 25.01.2000 to 31.12.2001. As per Annexure-A6(4), permission was given to manufacture and sell Cartilamine and Cartilamine Forte tablets on 13.11.2001. As it was attached to the existing drug licence, it took effect from 25.01.2000. Stated differently, by the addition of Cartilamine and Cartilamine Forte tablets to the drug licence existing in favour of the company on 13.11.2001, the effect is to ratify the manufacture of the same from 25.01.2000 onwards. This is contended on the basis that the conditions of licence shown in Annexure-A6 did not prohibit the manufacture of drugs, which were added subsequently and they would relate back to the original date of licence. I am unable to accept this argument for the main reason that if such a view is adopted, the very purpose of the Act would be defeated. The fundamental principle is that nobody shall manufacture a drug without obtaining due licence and permission from the authorities concerned. The prime object of the Act is to ensure health and safety of the general public. Nobody shall be allowed to make a spurious or an adulterated or an inferior quality drug, which may tend to cause hazards and injury to public health. Therefore, the Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 11 theory propounded by the learned Senior Counsel that a drug manufactured without a licence can be validated by a subsequent licence or by adding to an existing licence subsequently is an antithesis to the avowed object of the statute.
14. Learned Director General of Prosecution contended that Rule 96(1)(vi) of the Drugs and Cosmetics Rules, 1945 is also pertinent to consider, which says that every drug manufactured in India shall bear on its label the number of the licence under which the drug is manufactured. If the arguments raised by the petitioners are accepted, the drugs manufactured by them before 13.11.2001 could not have exhibited such a manufacturing licence and that is not the intention of the Legislature. I agree with the contention raised by the State that no person shall be allowed to manufacture or sell a drug without obtaining a valid licence for obvious reasons. Therefore, the contentions raised by the petitioners that they were innocently manufacturing the drugs and later, on realisation of their mistake, they obtained a licence are not excuses that can be countenanced.
15. Based on Section 34 of the Act, learned Senior Counsel for the petitioners contended that the accused, who are not in charge of and Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 12 was responsible to the company, cannot be prosecuted. It is true that Section 34 of the Act dealing with the offences by companies insists that the persons, who at the time of commission of the offence should be in charge and be responsible to the company for the conduct of the business of the company. From the complaints, I find that there are clear allegations that the accused named therein were responsible for the conduct of the business at the material time. However, that is an issue in the realm of evidence. Therefore, on that score also, the petitioners cannot get any relief.
16. Learned Director General of Prosecution drew my attention to a decision rendered by the Apex Court in Municipal Corporation of Delhi v. Ram Kishan Rohtagi and others (AIR 1983 SC 67). It deals with the distinction between the revisional powers under Section 397 Cr.P.C. and inherent powers under Section 482 Cr.P.C. The relevant dictum reads as follows:
"It may be noticed that Section 482 of the present Code is the ad verbatim copy of Section 561-A of the old Code. This provision confers a separate and independent power on the High Court alone to pass orders ex debito justitiae in cases where grave and substantial injustice has Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 13 been done or where the process of the Court has been seriously abused. It is not merely a revisional power meant to be exercised against the orders passed by subordinate Courts. It was under this section that in the old Code, the High Courts used to quash the proceedings or expunge uncalled for remarks against witnesses or other persons or subordinate Courts. Thus, the scope, ambit and range of Section 561-A (which is now Section 482) is quite different from the powers conferred by the present Code under the provisions of Section 397. It may be that in some cases there may be overlapping but such cases would be few and far between. It is well settled that the inherent powers under Section 482 of the present Code can be exercised only when no other remedy is available to the litigant and not where a specific remedy is provided by the statute. Further, the power being an extraordinary one, it has to be exercised sparingly. If these considerations are kept in mind, there will be no inconsistency between Sections 482 and 397 (2) of the present Code."
17. Considering the entire facts and circumstances of the case arising out of averments in the complaints and the legal position discussed Crl.M.C. Nos.3957, 3958, 3959, 3960, 3966 & 3967 of 2008 14 above, I am of the view that the petitioners are not entitled to get the complaints quashed. The reasons put forward for quashing Annexure-A9 complaint in all the cases are insufficient in law and unsustainable. Therefore, the petitions are liable to be dismissed.
In the result, all the petitions are dismissed.
All pending interlocutory applications will stand dismissed.
A. HARIPRASAD, JUDGE.
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