Madras High Court
M/S.Medplus Pharmacy vs The State Of Tamil Nadu Rep. By on 28 February, 2019
Author: G.K.Ilanthiraiyan
Bench: G.K.Ilanthiraiyan
1
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 28.02.2019
CORAM:
THE HONOURABLE MR. JUSTICE G.K.ILANTHIRAIYAN
Crl.O.P.No.16863 of 2014
and M.P.No.1 of 2014
1.M/s.Medplus Pharmacy,
Unit of Optival Health Solutions Pvt. Ltd.,
Ground Floor, Shop No.4, Old No.32,
New No.73, Bazaar Road, Saidapet,
Chennai – 15 rep. By its Director,
Thiru. K.Satya Murali Krishna.
2.K.Satya Murali krishna
3.G.Madhukar Reddy ... Petitioners
Vs.
The State of Tamil Nadu rep. By
P.Nithin Kumar, Drugs Inspector,
Saidapet Range i/c.
O/o.The Assistant Director
of Drugs Control, Zone-II,
DMS Campus,
No.259/261, Anna Salai, Teynampet,
Chennai 600 006 ...Respondent
PRAYER: Criminal Original Petition filed under Section 482 Cr.P.C.
praying to call for the records in C.C.No.2410 of 2014 on the file of IV
Metropolitan Magistrate, Saidapet, Chennai and quash the same insofar as
the petitioners/Accused 1 to 3 are concerned.
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For Petitioners : Mr.B.Jayaraman
For Respondent : Mr.M.Mohamed Riyaz,
Additional Public Prosecutor
ORDER
This petition has been filed to quash the proceedings in C.C.No.2410 of 2014 on the file of the learned IV Metropolitan Magistrate, Saidapet, Chennai.
2. Mr.B.Jayaraman, the learned counsel for the petitioners would submit that the first petitioner is a unit of Optival Health Solutions Pvt. Ltd. Company registered under the Companies Act and passed a resolution and executed power of attorney in favour of the fourth accused to obtain drug licences from the authorities concerned as required under the Drugs and Cosmetics Act, 1940. Accordingly, he obtained licence to sell, stock to exhibit for sale or distribute by retail drugs. The licence was issued and it was valid upto 20.03.2017. Further he submitted that the respondent conducted inspection on 13.09.2012 at M/s.Medplus Pharmacy situated at Bazaar Road, Saidapet, Chennai - 15. On inspection, the respondent issued show cause notice dated 28.03.2011, for which, one http://www.judis.nic.in 3 K.Selvamkumar, A4 submitted detailed reply to the Drug Inspector concerned. Without application of mind and without considering the explanation submitted by K.Selvakumar, the respondent mechanically lodged complaint as against the petitioners under Section 18 (c ) of Drugs and Cosmetics Act, 1940 read with Rules 65(2), 65(3)(1), 65(4)(4) and 65(9)(a) of Drugs and Cosmetics Rules, 1945 punishable under Section 27
(d) of Drugs and Cosmetics Act. He further submitted that under Section 34(1) of Drugs and Cosmetics Act, the persons in charge of at the time of offence was committed, are responsible and the company shall be deemed to be guilty of the offence. But the petitioners are Directors of the company, they have no knowledge about the day to day affairs of the company which is having various branches in South India. Insofar as the petitioners are concerned, the first petitioner is the company and other two are Directors of the company. They never dealt with policy of the fifth accused and its Operation Manager arrayed as fourth accused. Therefore, they are not responsible for the conduct of the day of day affairs of the fourth and fifth accused. In this regard, the learned counsel has relied upon the judgment of the Hon'ble Supreme Court in the case of Pepsi Co Oncia Holding Pvt. Ltd. Vs. Food Inspector reported in 2011 (1) SCC 176.
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3. Per contra, Mr.M.Mohamed Riyaz, learned Additional Public Prosecutor appearing for the respondent would submit that during the course of inspection, one Arulraj was not present who is the endorsed registered pharmacist having registration No.45899/A2. Without his personal supervision, sales were done from bill no.3012455 dated 10.08.2012 to bill no.3015989 dated 13.09.2012, which is in contravention of Section 18(c) of Drugs and Cosmetics Act, 1940 read with Rule 65(2) of Drugs and Cosmetics Rules, 1945. Further he submitted that on verification of the prescription register, it was found that the sales of the drugs effected from bill No.3012455 dated 10.08.2012 to bill no.3015989 dated 13.09.2012 were not maintained properly in the prescription register, which is in contravention of Section 18(c) of the said Act and the same is given as follows:
S.No. Bill No. Date Name of the Drug Qty.
1 3012494 11/08/12 T.Cardivas 30125mg 10 tabs
T.Dilzen 30mg 20 tabs
T. Gride 1mg 10 tabs
2 3012684 13/08/12 T.Gluformin XL 20 tabs
T.Amitryn 10mg 10 tabs
T.Hyptin 2mg 10 tabs
T.Xtor 10mg 20 tabs
3 3018850 15/08/12 T.Dibizide M 30 tabs
T.Dibizide M 30 tabs
R.Atorva 5mg 30 tabs
T.Tozaar 25mg 10 tabs
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S.No. Bill No. Date Name of the Drug Qty.
T.Tozaar 25mg 20 tabs
T.Ecosprin 75mg 28 tabs
4 3013070 17/08/12 T.Deplatt A75MG 20 tabs
T.Deplatt A75mg 10 tabs
T.Trika 0.5mg 15 tabs
T.Anxit 0.5mg 30 tabs
T.Anxit 0.5mg 30 tabs
T,Neurocetam 400 30 tabs
T.Liofen 10mg 30 tabs
T.Amiosafe 5mg 30 tabs
T.Arkamin H 30 tabs
T.Glibimet Forte 60 tabs
5 3013463 21/08/12 T.Xtor 10mg 20 tabs
T.Lanoxin 0.25mg 20 tabs
T.Calaptin 40mg 50 tabs
6 3014068 26/08/12 Asthalin Inhaler 1
T.Aten 25mg 28 tabs
T.Cloterite B 15 tabs
T.Elo Salbetol 20 tabs
T.Anxit 0.5 mg 10 tabs
7 3014347 29/08/12 T.Glizid M 15 tabs
T.Lorvas 2.5mg 10 tabs
T.Caleigard 10mg 20 tabs
T.Clopilet Aztor 40 10 tabs
8 3014905 03/09/12 T.Tribet 1mg 10 tabs
T.R2 10mg 10 tabs
T.Stator F 10 tabs
9 3015117 05/09/12 Insugen 30/70 2
T.Dytor 5mg 20 tabs
T.Dytor 5mg 10 tabs
T.Alprax 0.25mg 30 tabs
10 3015581 09/09/12 T.Olmezest 40mg 20 tabs
T.Glimisave M1 20 tabs
T.Crevast 5mg 10 tabs
T.Dutalea 10 tabs
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Similarly, on verification of the purchase invoices, carbon copies of sales bills and physical stocks of certain drugs it was observed that the firm has supplied the following drugs by way of retail, but the firm have not maintained proper records of purchase as required under the Rule 65 (4) (4) of the said Rules. Therefore the petitioners committed offence under the Drugs and Cosmetics Act, 1940 and prayed for dismissal of this quash petition.
4. Heard, Mr.B.Jayaraman, the learned counsel for the petitioners and Mr.M.Mohamed Riyaz, learned Additional Public Prosecutor appearing for the respondent.
5. On perusal of records, the petitioners are arrayed as A1 to A3. According to the complaint, the first accused is the company, and the second and third accused are the Directors. Insofar as the allegations as against the petitioners are that the first petitioner is the company, and the second and third petitioners are being the directors, they have been impleaded as accused. On inspection of the Drug Inspector, it was found irregularities and issued show cause notice dated 20.05.2013. By the reply dated 30.08.2013, the petitioners submitted their explanation and denied the allegations made in the show cause notice. http://www.judis.nic.in 7
6. The points for consideration are that whether the complaint is sustainable as against the petitioners?
7. It is seen from the entire complaint, the fourth accused was authorised to make necessary applications to the authorities concerned to obtain licence under the Drugs and Cosmetics Act, 1940, and the first petitioner authorised and also executed power of attorney in his favour. Therefore, the first petitioner is the company and petitioners 2 and 3 are Directors of the first petitioner. It is relevant to extract Section 34(1) of Drugs and Cosmetics Act, 1940 as follows:
“...34. Offences by Companies – (1) Where an offence under this Act has been committed by a Company, every person who at the time of offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.”
8. It is seen from the complaint, the second and third petitioners being the Directors of the first petitioner, have no direct knowledge in http://www.judis.nic.in 8 respect of the licence and sales by the fourth accused. They also never involved in day to day affairs of the company, since the first petitioner company is having various branches in South India. There is no specific allegations as against the second and third petitioners as that they are in charge of the company and also responsible to the company for the conduct of its day to day business affairs except vague and bald statement against them. Therefore, the entire proceedings is vitiated as against the petitioners herein.
9. In this regard, the Judgment rendered by the Hon'ble Supreme Court relied upon by the learned counsel for the petitioners in the case of Pepsi Co Oncia Holding Pvt. Ltd. Vs. Food Inspector reported in 2011 (1) SCC 176, is extracted hereunder:
“...50...It is now well established that in a complaint against a company and its Directors, the complainant has to indicate in the complaint itself as to whether the Directors concerned were either in charge off or responsible to the company for its day to day management, or whether they were responsible to the company for the conduct of its business. A merely bald statement that a person was a Director of the company against which certain allegations had been made is not http://www.judis.nic.in 9 sufficient to make such a Director liable to in the absence of any specific allegations regarding his role in the management of the company”.
10. In the case on hand, the petitioners 2 and 3, being the Directors of the company, have not involved in the day to day affairs of the company. Further there is no averment in the complaint that the petitioners involved in the business transaction. Therefore, they are not responsible for the company for the conduct of its business. As such, the above judgment of the Hon'ble Supreme Court of India is squarely applicable to this case and the present complaint cannot be sustained as against the petitioners.
11. In view of the above discussions, this Criminal Original Petition is allowed and the proceedings in CC.No.2410 of 2014 on the file of the learned IV Metropolitan Magistrate, Saidapet, Chennai is hereby quashed as against the petitioners alone. Consequently, connected miscellaneous petition is closed.
28.02.2019 Index:Yes/No Internet: Yes/No nl http://www.judis.nic.in 10 G.K.ILANTHIRAIYAN, J.
nl To The Additional Public Prosecutor, High Court of Madras.
Crl.O.P.No.16863 of 2014 and M.P.No.1 of 2014
28.02.2019 http://www.judis.nic.in