Himachal Pradesh High Court
Mukesh Saini vs Of on 24 November, 2023
Author: Sushil Kukreja
Bench: Sushil Kukreja
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA .
Cr.MP(M) No. 2035 of 2023
Reserved on: 09.10.2023
Decided on: 24.11.2023
Mukesh Saini
...Petitioner
Versus
of
State of Himachal Pradesh
...Respondent
Coram rt
The Hon'ble Mr. Justice Sushil Kukreja, Judge Whether approved for reporting?1 For the petitioner: Mr. Ajay Kochhar, Senior Advocate, with Mr. Vivek Sharma, Advocate.
For the respondent: Mr.Jitender Kumar Sharma, Additional Advocate General.
____________________________________________________ Sushil Kukreja, Judge The instant bail application has been filed by the petitioner under Section 438 of the Code of Criminal Procedure (Cr.P.C.) for releasing him on bail in the event of arrest in a complaint registered under Sections 18(a)(i) read with Section Sections 17 B (e), 18(a)(vi), 18(c), 22(1) (cca), 18A, 18B & 22(1)(d) of the Drugs and Cosmetics Act, 1940 (for short, 'DAC Act').
1Whether reporters of Local Papers may be allowed to see the judgment?
::: Downloaded on - 24/11/2023 20:33:45 :::CIS 22. Brief facts of the case, which emerge from the .
record, are that the Drugs Inspector, HQ Baddi, District Solan, H.P., on receipt of a secret information about sale of spurious drugs through vehicle bearing registration No.HP93-3196 by M/s Magnatek Enterprises, Baddi Solan, H.P., intercepted and of followed the aforesaid vehicle upto the godown of the firm and thereafter, a team of Drugs Inspectors was constituted, who rt alongwith the witnesses and the police personnel reached the godown of the aforesaid firm, where one Ram Sharan, owner of the transport godown, was unloading the shippers/cartons from the said vehicle. The team of the Drugs Inspectors checked the boxes, which were received by the aforesaid transporter from M/s Magnatek Enterprises and said Ram Sharan disclosed that he had also received some medicines from M/s Magnatek Enterprises on 14.07.2023, which were lying in his godown.
Thereafter, the boxes were checked and a huge stock of spurious drugs was recovered, description whereof is as under:-
Sr. Name of Drug Batch No. Mfd. By as per label claim Quantity No.
1. GLIMESTAR- F05W002 M/s Mankind Pharma 1,51,200 PM1 Tablets Limited, Doring Block, tablets Bermiok Elaka, South Sikkim-737 126.::: Downloaded on - 24/11/2023 20:33:45 :::CIS 3
2. Rejunex-CD 3 K2300485 M/s Intas Pharmaceuticals 96,000 Tablets Ltd., Bghhey Khula, Majhitar, Tablets Sikkim.
.
3. Said Ram Sharan produced GST invoices dated 14.07.2023/15.07.2023 and e-way bills, which were issued by M/s Magnatek Enterprises in favour of M/s Evo Lifesciences, of Rohtak and M/s Sai Medical Agency Bhagirath Palace, Delhi and others. However, the drugs on invoices of M/s Magnatek rt Enterprises did not match with the actual drugs which were transported by the firm. The team of Drugs Inspectors seized the spurious drugs and the documents were taken into possession.
Samples of the spurious drugs were sent for analysis. Shri Ram Sharan telephonically contacted M/s Magnatek Enterprises to visit the spot/godown, but no one came on the spot. Thereafter, the team of Drugs Inspectors alongwith the police personnel visited M/s Magnatek Enterprises, Plot No. 74C(II) HPSIDC, Industrial Area Baddi, H.P. to avoid any tempering of evidence by the accused persons at the aforesaid firm and when the said team reached at M/s Magnatek Enterprises, it was found that one Balraj was taking instructions over phone from the owners of the firm and it was also found that said Balraj had dumped the ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 4 scrap of the spurious drugs in two polythene bags near the firm, .
upon the directions of owner of firm, i.e., Mukesh Saini (petitioner herein). The polythene bags of scrap of spurious drugs were recovered and checked, which were containing a huge stock of defoiled strips, empty strips and scraps of product of Glimestar PM1 tablets B No.F05W002 Mfg. date 01/2023 exp.
01/2024 Mfg. by Mankind Pharma Ltd. and of Rejunex CD3 rt Tablets manufactured by M/s Intas Pharmaceuticals and other material were also recovered. During the period of search, aforesaid Balraj absconded from the premises and he did not sign any document. The team recovered a huge stock of spurious material, detail whereof is as under:-
1. Loose white & pink coloured oval biconvex bylayered tablets quantity 134.44 kg.
2. Glimi save M2 tablets B.No.GGLV23010, MFG-Apr.2023, Exp. Mar.2026, manufactured by M/s Eris Lifesciences limited, Amingaon, North Guawahti, District Kamrup-
781031 (Assam) quantity 15 tablets strip.
3. Empty blister, B. No. C35W010 and 7 defoiled strips/blisters of product Glimestar PM I, labeled as manufactured by M/s Mankind Pharma Ltd, Doring Block, Bermiok Elaka, South Sikkim.
4. One strip of Glimestar PMI B.No. F05W002 labelled as manufactured by M/s Mankind Pharma Ltd. and 1 GST invoice No. MEDA000440 dated 21.03.2023.
5. DVR of CCTV cameras from the manufacturing premises of M/s Magnatek Enterprises, Plot No. 74C(II), HPSIDC Industrial area Baddi, District Solan, H.P. ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 5
4. On 16.07.2023, a notice was given to the petitioner, .
through his employee, namely Rajender Kumar, which was displayed on the gate of M/s Magnatek Enterprises, whereby the petitioner was directed to join the investigation on 17.07.2023.
Statement of Shri Ram Sharan was recorded under Section 164 of Cr.P.C., wherein he stated that he had received the medicines from M/s Magnatek Enterprises for transportation to Delhi. On rt 19.07.2023 a team of Drugs Inspectors visited the office of Drugs Control Department Government of NCT, Delhi for verification of the sale invoices recovered from the aforesaid firm, however, the premises of M/s Sai Medical Agency, situated at Shop No.8, Second Floor, 1541/A-45 ICC Market Bhagirath Place Delhi, was found closed. It was found that said firm was in partnership with Deepak Kumar and Shyam Kumar and the mobile numbers of the said persons were found switched off.
5. A team of Drugs Inspectors visited firm M/s Evo Life Sciences Pvt. Ltd. Rohtak and one Dheeraj was found there, who disclosed that he never received any physical stock from the M/s Magnatek Enterprises and instead the material was directly sent to Delhi and feigned his ignorance that the drugs were ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 6 spurious. He also disclosed that the sale and purchase of drugs .
from M/s Magnatek Enterprises were maintained by another director of M/s EVO Lifesciences, Shri Tarun Sharma, who after receiving the drugs at Delhi, used to make bills in favour of Geet Enterprises, situated at UGF-13 AC, Medicine market building of No.110/51, Aminabad, Lucknow and other firms. Thereafter, the team of Drugs Control Administration, Lucknow, on being rt informed, visited the firm M/s Geet Enterprises on 19.07.2023, where Tarun Sharma, Prop. M/s Geet Enterprises, disclosed that he only received GST invoice from the firm M/s Evo Lifesciences and no physical stock was supplied.
6. On 20.07.2023 authorized signatory of M/s Mankind Pharma Ltd. joined the investigation and after comparative analysis of control samples of M/s Mankind Pharma Ltd., drugs recovered at M/s Magnatek Enterprises were not found to be the true products of M/s Mankind Pharma Ltd. Sikkim. M/s Anand Pharma, UGF-5, Surya Medicine Market Meerjan, Lucknow, U.P., was telephonically inquired about the supply of spurious drugs from M/s Sai Medical Agency Bhagirath Palace, Delhi and it was informed that the drugs were returned through M/s Mehta ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 7 Interstate Transport Corporation, Delhi. Thus, on 05.08.2023 a .
team of Drugs Inspectors, Baddi, alongwith team of Drugs Control Department, Government of NCT, Delhi and CDSCO, Delhi, visited the premises of M/s Mehta Interstate Transport Corporation, Tees Hazari Metro Station Road, Delhi and of recovered a consignment of spurious drugs, details whereof are as under:
No. rt Sr. Name of Drug Batch No. Mfd. By as per label claim Quantity
1. Glimestar M2 C31AV076 M/s Mankind Pharma 192x06x10 Tabs Limited, Doring Block, tabs Bermiok Elaka, South (11520) Sikkim-737 126. tablets
2. Candid Mouth 46220049 Glenmark Pharmaceuticals 450x2 5 ml paint Ltd., at Plot No. 38, 39, Sector-11, I.I.E., SIDCUL, Haridwar, Uttarakhand-
249403
3. Glimisave M2 GGLV22022 Eris Lifesciences Ltd., 44x10x15 Tabs Amingaon, North tablets Guwahati, District Kamrup- (6600 781 031. tablets)
7. A representative of M/s Mankind Pharma Ltd. joined the investigation at Delhi and on comparative analysis of drugs, he disclosed that the recovered drugs did not match with their original products, thus were counterfeit. On 07.08.2023 a team of Drugs Inspectors, Baddi, alongwith the Drugs Inspectors, Lucknow, visited the premises of M/s Anand Pharma, Lucknow ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 8 and procured sale/purchase invoices of spurious drugs supplied .
by M/s Magnatek Enterprises, through M/s Sai Medical agency Delhi. Team of Drugs Inspectors also visited M/s Shree Banke Bihari Pharma Shop No.LGF-33, 110/25, Meerjan Lane, NayaGaon, East Aminabad, Lucknow and M/s Sai Nirmal of Enterprises, Shop No. 4, UGF 92/267, Azad Complex, GB Marg, NayaGaon, East Aminabad, Lucknow, U.P. and took into rt possession GST invoices and stock details of drugs supplied by M/s Geet Enterprises.
8. On 12.08.2023 and 13.08.2023, the petitioner joined the investigation with his counsel, but he could not produce any document/record/invoice etc. qua the raw material, foils, packing materials, manufacturing and sale of spurious drugs. On 18.08.2023 a team of Drugs Inspectors visited the premises of M/s Magnatek Enterprises and in presence of the petitioner the premises was searched and the following recoveries were effected, including the recovery of spurious drugs:-
"1. 611 scrap blisters of spurious drug 'Montair LC', labelled as B.No. AFB22P18, Mfg. By M/s Pure & Cure Healthcare Pvt. Ltd. and Marketed By M/s Cipla Ltd.
2. One blister containing 15 tablets of spurious drug Triglimisave 2, B.No. GTMU23001 labelled as manufactured by Eris Lifesciences Ltd.::: Downloaded on - 24/11/2023 20:33:45 :::CIS 9
3. Six blisters containing 15 tablets in each of ZEBIFLAM C, purported to be manufactured by M/s Silhos Pharma Ltd.
.
4. Four Brown coloured tape pre-printed with inscription 'Unichem Laboratories Ltd.'
5. Various invoices and e-way bills suspected of spurious drugs.
6. Printed cartons of products, 'OSTEOBEN, MECAL softgel capsules, ODOCAL-D3 Softgel capsules, CALBOR Softgel Capsules, labelled as manufactured of by 'Sigma softgels & formulations Baddi, District Solan, H.P."
9. The representative of M/s Pure and Cure Healthcare rt Pvt. Ltd., Baddi, District Solan, H.P., also joined investigation, who after physical analysis, reported that the above products were not manufactured by M/s Pure & Cure Healthcare Pvt.
Limited and was spurious in nature. The statement of the petitioner was recorded, wherein he neither disclosed anything nor produced any records qua the aforesaid spurious drugs recovered from his firm. During further investigation, it was found that spurious product Montair LC B.No. AFB22P18, 611 scrapped defoiled blisters whereof were recovered from the premises of M/s Magnatek Enterprises on 18.08.2023, was supplied by M/s Geet Enterprises to M/s Banke Bihari Pharma.
Spurious product Triglimisave 2, B.NO GTMU23001, manufactured by Eris Lifesciences Ltd., which was recovered ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 10 from the premises of the firm M/s Magnatek Enterprises on .
18.08.2023 was supplied by M/s Geet Enterprises to M/s Sai Nirmal Enterprises. On 18.08.2023 the premises of M/s Magnatek Enterprises was sealed and the petitioner was asked to join the further investigation on 19.08.2023, but he did not join of the investigation on the said date and on 21.08.2023 machines used for manufacturing spurious drugs were seized and samples rt for analysis were lifted. On the same day representatives from M/s Pure & Cure Healthcare Pvt. Ltd. and M/s Cipla Ltd. joined the investigation and submitted the control sample of same drugs which were recovered from M/s Magnatek Enterprises and further disclosed that the products recovered from M/s Magnatek Enterprises were spurious.
10. The instant bail application has been filed by the petitioner on the ground that he is innocent and has been falsely implicated in the present case. Learned counsel for the petitioner contended that the petitioner had not supplied or transported any spurious drugs and had only transported the medicines as found mentioned in the invoices. He further contended that the complaint has been registered in order to settle the scores by the ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 11 Drugs Inspector, against whom the petitioner had made .
complaint to the authorities including the police for demanding hefty amount during the subsistence of business, hence, the present complaint is an outcome of the previous enmity of the Drugs Inspector with the petitioner.
of
11. Per contra, the learned Additional Advocate General opposed the bail application on the ground that keeping in view rt the gravity of the offence alleged to have been committed by the petitioner, he is not entitled to be enlarged on bail. He further contended that the investigation in the case is in progress and more evidences are yet to be collected, therefore the custodial interrogation of the petitioner is required as he is not disclosing the sale of spurious drugs and its distribution channels, stock of spurious drugs sold, source of purchase of all raw materials used in manufacturing of spurious drugs, source of purchase of printed foils of spurious drugs, source of packing materials, involvement of other accused persons in the present case.
12. I have heard the learned Senior Counsel for the petitioner as well as the learned Additional Advocate General for ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 12 the respondent-State and also gone through the records .
carefully.
13. It is a settled law that the anticipatory bail can be granted only in exceptional circumstances. Being an extraordinary remedy, it should be resorted to only in a special of case. Though, it would be inappropriate to discuss the evidence in depth at this stage, because it may influence the trial Court, rt but the evidence collected during the investigation, prima facie, indicates the involvement of the petitioner in a serious offence under Section 18(a)(i) read with Sections 17B(e), 18(a)(vi), 18(c), 22(1)(cca), 18A, 18B, 22 (1)(d) and 36 AC of DAC Act, which are punishable under Section 27(c) of DAC Act.
14. For the disposal of the instant application for grant of bail, Section 36-AC of DAC Act is relevant, which may be quoted as below:-
"36 AC. Offences to be cognizable and non-bailable in certain cases.
(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974),-
(a) every offence, relating to adulterated or spurious drug and punishable under clauses (a) and (c) of sub-section (1) of section 13, clause (a) of sub-
section (2) of section 13, sub-section (3) of section 22, clauses (a) and (c) of section 27, section 28, section 28A, section 28B and sub- sections (1) and (2) of section 30 and other ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 13 offences relating to adulterated drugs or spurious drugs, shall be cognizable.
.
(b) no person accused, of an offence punishable under clauses (a) and (c) of sub-section (1) of section 13, clause (a) of sub-section (2) of section 13, sub-section (3) of section 22, clauses
(a) and (c) of section 27, section 28, section 28A, section 28B and sub-sections (1) and (2) of section 30 and other offences relating to adulterated drugs or spurious drugs, shall be released on bail or on his own bond unless of
(i) the Public Prosecutor has been given an opportunity to oppose the application for such release; and
(ii) where the Public Prosecutor opposes the rt application, the Court is satisfied that there are reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail:
Provided that a person, who, is under the age of sixteen years, or is a woman or is sick or infirm, may be released on bail, if the Special Court so directs.
(2) The limitation on granting of bail specified in clause (b) of sub-section (1) is in addition to the limitations under the Code of Criminal Procedure, 1973 (2 of 1974) or any other law for the time being in force on granting of bail.
Nothing contained in this section shall be deemed to affect the special powers of the High Court regarding bail under section 439 of the Code of Criminal Procedure, 1973 (2 of 1974) and the High Court may exercise such powers including the power under clause (b) of sub- section (1) of that section as if the reference to "Magistrate" in that section includes also a reference to a "Special Court" designated under section 36AB."
15. This Section provides that notwithstanding anything contained in the Code of Criminal Procedure, every offence as mentioned in the provision shall be cognizable and no person ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 14 accused of such offence shall be released on bail unless the .
Public Prosecutor has been given opportunity to oppose the application for such release and where Public Prosecutor opposes the application, the Court is satisfied that there are reasonable grounds for believing that the accused is not guilty of of such offence and he is not likely to commit any offence while on bail.
16. rt Section 27 of the DAC Act provides that the persons found guilty for the manufacture, sale etc. of the adulterated and spurious drugs shall be liable to be punished with imprisonment for a term which shall not be less than ten years and which may extend to a term of life with fine which shall not be less than rupees ten lakh or three times value of the drugs confiscated, whichever is more. It reads as under:-
"27. Penalty for manufacture, sale, etc., of drugs in contravention of this Chapter.- Whoever, himself or by any other person on his behalf, manufacturers for sale or for distribution, or sells, or stocks or exhibits or offers for sale or distributes.
(a) any drug deemed to be adulterated under Section 17A or spurious under Section 17B or which when used by any person for or in the diagnosis, treatment, mitigation, or prevention of any disease or disorder is likely to cause his death or is likely to cause such harm on his body as would amount to grievous hurt within the meaning of S. 320 of the Indian Penal Code, ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 15 solely on account of such drug being adulterated or spurious or not of standard quality, as the case may be, shall be punishable with .
imprisonment for a term which shall not be less than five years but which may extend to imprisonment for life and shall also be liable to fine which shall not be less than ten lakh rupees or three times value of the drugs confiscated, whichever is more."
(b) xxx xxx
(c) xxx xxx of
(d) xxx xxx."
12. Section 3 (f) of the DAC Act defines the terms 'manufacture', which reads as under:-
"(f) rt"manufacture" in relation to any drug [or cosmetic] includes any process or part of a process for making, altering, ornamenting, finishing, packing, labelling, breaking up or otherwise treating or adopting any drug [or cosmetic] with a view to its [sale or distribution] but does not include the compounding or dispensing [of any drug, or the packing of any drug or cosmetic,] in the ordinary course of retail business; and "to manufacture" shall be construed accordingly."
17. It is not disputed that petitioner Mukesh Saini is the partner in the firm namely M/s Magnatek Enterprises, which is engaged in manufacturing and supply of Pharma drugs. During investigation, prima facie, it has been revealed that M/s Magnatek Enterprises is involved in the manufacturing and sale of huge quantity of spurious drugs. As per the investigation, on the information received about sale of spurious drugs through vehicle bearing registration No.HP93-3196 by M/s Magnatek ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 16 Enterprises Baddi, Solan, H.P., the team of Drugs Inspectors in .
the presence of witnesses recovered huge stock of spurious drugs, which are described as under:-
Sr. Name of Drug Batch No. Mfd. By as per label claim Quantity No.
1. GLIMESTAR- F05W002 M/s Mankind Pharma 1,51,200 PM1 Tablets Limited, Doring Block, tablets Bermiok Elaka, South of Sikkim-737 126.
2. Rejunex-CD 3 K2300485 M/s Intas Pharmaceuticals 96,000 Tablets Ltd., Bghhey Khula, Majhitar, Tablets Sikkim.
18. rt The investigation, prima facie, reveals that above mentioned drugs on invoices of M/s Magnatek Enterprises did not match with the actual drugs which were transported by the firm. Thereafter, when the team reached the premises of M/s Magnatek Enterprises, a person was found inside the firm, who disclosed his name as Balraj and also disclosed that he dumped the scrap of the spurious drugs in two polythene bags near the firm on the directions of owner of firm Mukesh Saini (petitioner herein) and the team had recovered two polythene bags containing scrap of spurious drugs and when the said bags were opened, huge stock of defoiled strips, empty strips and scraps of product Glimestar PM1 tablets B No.F05W002 Mfg. date 01/2023 exp. 01/2024 Mfg. by Mankind Pharma Ltd. and of ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 17 Rejunex CD3 Tablets manufactured by M/s Intas .
Pharmaceuticals and other material were recovered. The team also recovered huge stock of spurious material, detail whereof is as under:-
1. Loose white & pink coloured oval biconvex bylayered tablets quantity 134.44 kg.
of
2. Glimi save M2 tablets B.No.GGLV23010, MFG-Apr.2023, Exp. Mar.2026, manufactured by M/s Eris Lifesciences limited, Amingaon, North Guawahti, District Kamrup-
781031 (Assam) quantity 15 tablets strip.
rt
3. Empty blister, B. No. C35W010 and 7 defoiled strips/blisters of product Glimestar PM I, labeled as manufactured by M/s Mankind Pharma Ltd, Doring Block, Bermiok Elaka, South Sikkim.
4. One strip of Glimestar PMI B.No. F05W002 labelled as manufactured by M/s Mankind Pharma Ltd. and 1 GST invoice No. MEDA000440 dated 21.03.2023.
5. DVR of CCTV cameras from the manufacturing premises of M/s Magnatek Enterprises, Plot No. 74C(II), HPSIDC Industrial area Baddi, District Solan, H.P.
19. The investigating agency had also got recorded the statement of one Ram Sharan under Section 164 Cr.P.C.
(Annexure R-5), who disclosed that he had received the medicines from M/s Magnatek Enterprises for transportation to Delhi, which did not match with the invoices issued by the firm and the same were recovered by the team of Drugs Inspector from his godown. The team of Drugs Inspectors also visited the firm M/s Evo Life Sciences Pvt. Ltd. Rohtak and another team of ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 18 Drugs Inspectors visited the firm M/s Geet Enterprises, UGF-13, .
Upper Ground Floor, AC Market, Medicine Market Building No.110/51, Naya Gaon, East, Aminabad, Lucknow, UP on 19.07.2023. During investigation, the authorized signatory of M/s Mankind Pharma Ltd. was also associated on 20.07.2023 at the of office of State Drugs Controller Baddi and after comparative analysis of control samples of M/s Mankind Pharma Ltd. with rt drugs recovered at M/s Magnatek Enterprises, he submitted that the drugs which were transported and recovered from M/s Magnatek Enterprises were not truly the product of M/s Mankind Pharma Ltd. Sikkim and were counterfeit. Thus, on 05.08.2023, a team of Drugs Inspectors, Baddi, alongwith team of Drugs Control Department, Government of NCT, Delhi and CDSCO, Delhi, visited the premises of M/s Mehta Interstate Transport Corporation, Tees Hazari Metro Station Road, Delhi and recovered a consignment of spurious drugs, details whereof are as under:
Sr. Name of Drug Batch No. Mfd. By as per label claim Quantity No.
1. Glimestar M2 C31AV076 M/s Mankind Pharma 192x06x10 Tabs Limited, Doring Block, tabs Bermiok Elaka, South (11520) Sikkim-737 126. tablets ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 19
2. Candid Mouth 46220049 Glenmark Pharmaceuticals 450x2 5 ml paint Ltd., at Plot No. 38, 39, Sector-11, I.I.E., SIDCUL, .
Haridwar, Uttarakhand-
249403
3. Glimisave M2 GGLV22022 Eris Lifesciences Ltd., 44x10x15
Tabs Amingaon, North tablets
Guwahati, District Kamrup- (6600
781 031. tablets)
20. A representative of M/s Mankind Pharma Ltd. joined of the investigation at Delhi and on comparative analysis of drugs, he disclosed that the recovered drugs did not match with their rt original product, thus were counterfeit. On 18.08.2023, the team of Drugs Inspectors visited the premises of the petitioner's firm, i.e. M/s Magnatek Enterprises, Baddi and during search, huge stock of the following spurious drugs were recovered from inside the manufacturing premises in presence of the petitioner/ accused:-
A. 611 scrap blisters of spurious drug 'Montair LC', labelled as B.No. AFB22P18, Mfg. By M/s Pure & Cure Healthcare Pvt. Ltd and Marketed By M/S Cipla Ltd.
B. One blister containing 15 tablets of spurious drug Triglimisave 2, B.No. GTMU23001 labelled as manufactured by Eris Lifesciences Ltd. C. Six blisters containing 15 tablets in each of ZEBIFLAM C, purported to be manufactured by M/s Silhos Pharma Ltd.
D. Four Brown coloured tape pre-printed with inscription 'Unichem Laboratories Ltd.' ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 20 E. Various invoices and e-way bills suspected of spurious drugs.
.
F. Printed cartons of products, 'OSTEOBEN, MECAL Softgel capsules, ODOCAL-D3 Softgel capsules, CALBOR Softgel Capsules, labelledas manufactured by 'Sigma softgels & formulations Baddi, Distt. Solan H.P'.
21. The representative of the firm M/s Pure and Cure of Healthcare Pvt. Ltd, Baddi, Distt. Solan H.P. also joined the investigation and they were asked to identify and verify the rt product, Montair LC B.No. AFB22P18 labelled as Mfg. By M/s Pure & Cure Healthcare Pvt. Ltd and Marketed By M/S Cipla Ltd, recovered from the premises of M/s Magnatek Enterprises. The representative of the said firm after detailed physical analysis submitted that the above said product was not manufactured by M/s Pure & Cure Healthcare Pvt. Ltd and was spurious in nature.
The statement of petitioner-accused Mukesh Saini was also taken, but he didn't disclose any information and did not produce any records regarding the above said spurious drugs recovered from his firm. During further verification, it was found that the spurious product Montair LC B.No. AFB22P18, whose 611 scrapped defoiled blisters were recovered from inside the firm M/s Magnatek Enterprises Plot No. 74 C(ii), HPSIDC Baddi, ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 21 Distt. Solan H.P. on dated 18- 08-2023, was supplied by M/s .
Geet Enterprises to M/s Banke Bihari Pharma through GST invoice No. G0000213 dated 08-07-2023. It was also found that the spurious product Triglimisave 2, B.No. GTMU23001 manufactured by Eris Lifesciences Ltd. which was recovered of from the premises of the firm M/s Magnatek Enterprises on 18.08.2023 was supplied by the firm M/s Geet Enterprises to firm rt M/s Sai Nirmal Enterprises vide GST Invoice No. G0000092 dated 10- 05-2023. On 21.08.2023, during search of M/s Magnatek Enterprises, the machines used for manufacturing of spurious drugs were seized and samples were taken for test and analysis and on the same date, the representatives of M/s Pure & Cure Healthcare Pvt. Ltd and M/S Cipla Ltd., during investigation submitted the control sample of same drugs which were recovered from M/s Magnatek Enterprises and disclosed that the product recovered from M/s Magnatek Enterprises were spurious. The investigation further reveals that on 21.08.2023 the representative of the firm M/s Pure and Cure Healthcare Pvt.
Ltd. also joined the investigation and brought a control sample in original of their genuine produce 'Montair-LC' B.No.QFB22P18 ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 22 and after detailed comparative physical analysis of their control .
sample with the product seized from the premises of M/s Magnatek Enterprises, it was revealed that the said product was not manufactured by M/s Pure & Care Healthcare Pvt. Ltd. and was spurious in nature. The representative of the firm M/s Cipla of Ltd, Baddi also joined the investigation and the representative of the said firm also submitted that Montair-LC is their registered rt brand and was being manufactured by M/s Pure and Care Healthcare Pvt. Ltd., Haridwar on third party manufacturing basis and the representative of the said firm further submitted that the product was not manufactured by M/s Pure and Care Healthcare Pvt. Ltd. and was spurious in nature. The representative of the firm M/s Sigma Softgel Formulations, Baddi had also disclosed that it had also filed a specific complaint against M/s Magnatek Enterprises with Superintendent of Police, Baddi and the petitioner's firm was involved in the spurious drugs in the shape of soft gel formulations in the cartons with the name and style of Sigma Softgel Formulations. Thus, the investigation, prima facie, shows the involvement of the petitioner's firm in the serious offence of manufacturing and sale of spurious drugs.
::: Downloaded on - 24/11/2023 20:33:45 :::CIS 2322. The learned Senior Counsel for the petitioner .
contended that the petitioner is innocent and he has got nothing to do with the alleged offence in question. He further submitted that the petitioner is not responsible to the firm for the conduct of its everyday business and the offence, if any, was committed of without the knowledge of the petitioner. In support of his contention, he placed reliance upon Girdhari Lal Gupta Versus rt D.H. Mehta and another, 1971 (3) Supreme Court Cases, 189, State of Karnataka Versus Pratap Chand and others, (1981) 2 Supreme Court Cases 335, State of Haryana Versus Brij Lal Mittal and others, (1998) 5 Supreme Court Cases 343, Katta Sujatha (SMT) Versus Fertilizers & Chemicals Travancore Ltd. and another, (2002) 7 Supreme Court Cases 655, Cheminova India Limited and another Versus State of Punjab and others, 2021 SCC OnLine SC 573 and Lalankumar Singh and others Versus State of Maharashtra, 2022 SCC OnLine SC 1383.
23. There is no dispute about the proposition of law that a person cannot be made liable unless at the material time he was in-charge and was also responsible to the company for the ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 24 conduct of its business and merely because a person is the .
director of the company, it is not necessary that he/she was aware about the day-to-day functioning of the company and was in-charge of its everyday affairs. However, in the instant case, the investigation prima facie reveals that the petitioner, who is of the partner in the firm, was knowingly involved in the manufacture and supply of the spurious drugs. The Section rt 34(2)(1) of DAC Act provides that where an offence under this Act has been committed by the company and it is proved that the offence has been committed with the consent or connivance of any director, such director shall also be deemed to be guilty of that offence. The explanation provides that the director in relation to a firm means a partner in the firm. The Section 34 (2) of DAC Act alongwith explanation reads as under:-
"(2) Notwithstanding anything contained in sub-
section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable o be proceeded against and punished accordingly.
::: Downloaded on - 24/11/2023 20:33:45 :::CIS 25Explanation.--For the purposes of this section--
(a) "company" means a body corporate, and includes a .
firm or other association of individuals; and
(b) "director" in relation to a firm means a partner in the firm."
24. Learned Senior counsel for the petitioner next contended that as per the analysis reports of the sample of received from the government analyst, Regional Drugs Testing Laboratory (Annexure R-22), the samples were declared to be of rt standard quality and the same were not spurious drugs, therefore, the petitioner deserves to be released on bail.
Pertinently the definition of the 'spurious drugs' provided under the DAC Act is very wide. Section 17B of the DAC Act provides that a drug shall be deemed to be spurious if it is manufactured under the name which belongs to another drug, or if it is an imitation, or is a substitute for another drug, or if the label or the container bears the name of an individual or the company purporting to be the manufacturer of the drug, which individual or the company is fictitious or does not exist; or if it has been substituted wholly or in part by another drug or substance; or if it purports to be the product of a manufacturer of whom it is not truly a product. Section 17B of the DAC Act reads as under:-
::: Downloaded on - 24/11/2023 20:33:45 :::CIS 26"17B. Spurious drugs.- For the purposes of this Chapter, a drug shall be deemed to be spurious.-
(a) if it is manufactured under a name which belongs .
to another drug; or
(b) if it is an imitation of, or is a substitute for, another drug or resembles another drug in a manner likely to deceive or bears upon it or upon its label or container the name of another drug unless it is plainly and conspicuously marked so as to reveal its true character and its lack of identity with such other drug; or of
(c) if the label or container bears the name of an individual or company purporting to be the manufacturer of the drug, which individual or company is fictitious or does not exist; or
(d) if it has been substituted wholly or in part by rtanother drug or substance; or
(e) if it purports to be the product of a manufacturer of whom it is not truly a product."
25. In view of the above definition for the drug to be spurious, it is not necessary that it should be first subjected to any Chemical examination. It would be deemed to be a spurious drug if any of the above clauses are satisfied. Therefore, this contention of the learned Senior Counsel for the petitioner is also devoid of any force.
26. As per Section 36 AC of DAC Act, apart from giving an opportunity to the Public Prosecutor to oppose the application for release on bail, the other twin conditions (i) the satisfaction of the Court that there are reasonable grounds for believing that the accused is not guilty of the alleged offence; (ii) that he is not ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 27 likely to commit any offence while on bail, have to be satisfied.
.
The conditions are cumulative and not alternative.
27. The satisfaction contemplated regarding the accused being not guilty has to be based on reasonable grounds. The expression "reasonable grounds" has not been defined in the Act of but means something more than prima facie grounds. In the present case, the petitioner has failed to satisfy the conditions for rt grant of bail, as provided under Section 36 AC of DAC Act. 25.
From the investigation, prima facie, it is evident that the petitioner was knowingly involved in the manufacture and supply of spurious drugs in connivance with other accused to various drugs manufacturing firms knowing pretty well that the drugs were spurious and has thus jeopardized the life of the innocent persons and therefore, the case would fall under the category of "heinous crime" affecting the life of innocent citizens. Once the allegations against the petitioner are of such type, he cannot claim anticipatory bail as a matter of right. It is a settled law that the provisions for grant of anticipatory bail under Section 438 of Cr. P.C., are not to be mechanically applied. Nature and gravity of the offence, the position and status of the accused with ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 28 reference to the victim and witnesses, likelihood of the accused .
fleeing from justice, possibility of the accused tampering with the evidence and larger public interest are some of the considerations which must weigh with the Court while deciding the application for grant of anticipatory bail. Liberty of a citizen is of indeed of a paramount importance, but at the same time, fair and fearless investigation of case of a serious nature is of no less rt importance. The Court shall refrain from exercising its discretion in favour of the accused under Section 438,Cr. P.C., if it adversely affects the investigation and larger public interest. In view of the serious nature of allegations against him, a wall cannot be created between the Investigating Agency and the petitioner. The petitioner was granted interim bail by this Court on 09.08.2023 and he was ordered to join the investigation of the case, but as per the status report, the petitioner is not cooperating with the Investigating Agency as he is not disclosing the sale of spurious drugs and its distribution channels, stock of spurious drugs sold, source of purchase of all raw materials used in manufacturing of spurious drugs, source of purchase of printed foils of spurious drugs, source of packing materials, involvement ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 29 of other accused persons in the present case. Since the .
petitioner is alleged to be involved in the commission of a serious offence, his custodial interrogation is necessary for the proper investigation of the case.
28. The contention of learned Senior counsel for the of petitioner that the complaint has been filed in order to settle the scores with the petitioner by the Drugs Inspector, against whom rt he had made complaint, cannot be decided at the stage of deciding the present bail application in the absence of any satisfactory and concrete material having been placed on record by the petitioner.
29. Therefore, in view of the facts and circumstances of the case as the investigation in this case is still in progress, grant of anticipatory bail to the petitioner is likely to hamper the progress of the investigation as such, this Court does not find any exceptional ground to exercise its discretionary jurisdiction under Section 438, Cr.P.C. to grant him anticipatory bail. It is needless to mention that the offences under the DAC Act are grave and serious in nature. Hence, looking into the nature and gravity of offence and severity of punishment, in my considered ::: Downloaded on - 24/11/2023 20:33:45 :::CIS 30 view, the petitioner does not deserve to be released on bail as .
such, the present anticipatory bail application is liable to be dismissed being devoid of merits.
30. Accordingly, the bail application is dismissed and the interim protection granted to the petitioner, vide order dated of 09.08. 2023, stands withdrawn.
31. Before parting with this order, it is hereby clarified rt that the aforesaid observations made in this order, have been made only for the purpose of considering the present petition for anticipatory bail. Therefore, the same shall not come in the way of the trial court for considering the application that may be filed by the petitioner for regular bail or at the time of the trial and the trial Court concerned shall not be influenced by the observations made hereinabove.
( Sushil Kukreja )
November 24, 2023 Judge
(VH)
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