Himachal Pradesh High Court
Reserved On: 13.03.2025 vs Union Of India on 21 March, 2025
2025:HHC:6953 IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Cr. MMO No. 321 of 2023 Reserved on: 13.03.2025 Date of Decision: 21.03.2025.
M/s Unital Formulation and another ...Petitioners
Versus
Union of India ...Respondent
Coram
Hon'ble Mr Justice Rakesh Kainthla, Judge. Whether approved for reporting?1 Yes.
For the Petitioners : Mr. Nitin Bhasin, Advocate, through video-conferencing and Mr Suraj Kumar, Advocate, vice Mr. Tarun Sharma, Advocate, present in the Court.
For the Respondent : Mr. Rajinder Thakur, Central Government Standing Counsel.
Rakesh Kainthla, Judge The petitioners have filed the present petition for quashing the criminal complaint and the consequent proceedings pending before learned Additional Sessions Judge, Nalagarh, District Solan, H.P. for the commission of offences punishable under Sections 18(a)(i), 18(a)(vi), 18(b), 18(c) read 1 Whether reporters of Local Papers may be allowed to see the judgment? Yes.
22025:HHC:6953 with Rules 76 and 78 of the Drugs and Cosmetics Act, 1940.
(Parties shall hereinafter referred to in the same manner as they were arrayed before learned Trial Court for convenience).
2. Briefly stated, the facts giving rise to the present petition are that the complainant, Drugs Inspector, filed a complaint against the petitioners/accused before the learned Trial Court asserting that accused no.1 is a manufacturer of Tblets, Capsules, Liquid Orals, Ointments, Liquid Injections (General Section) and Dry Powder Injection (Betalactum).
Accused No.2 is the proprietor of accused No.1. A Sample of Uni-
Dexa Injection (Dexamethasone Injection IP) was drawn for analysis on 24.2.2020 from Sanjeev Puri, Pharmacist, Main Store (Basement), Civil Hospital, Manimajra. The sample was sent to a Government Analyst, who issued a report stating that the sample was not of standard quality and did not conform to the claim as per IP-2018 regarding sterility and free Dexamethasone. The report was sent to the person from whom the drug was acquired. He disclosed that accused No.1 was the manufacturer of the drug. The test report and one portion of the sealed sample were served upon accused No.1. Accused No.1 replied that the sample was sent to a laboratory, and the result 3 2025:HHC:6953 was awaited. Hence, the Drugs Inspector prayed to the learned Additional Chief Judicial Magistrate, Nalagarh, on 22.6.2020 to get the second portion of the sample tested. The accused also submitted a report from the private laboratory mentioning that the drug was as per the standard laid down under the Act. The second portion of the sample was sent to the Central Drugs Testing Laboratory, which issued a report stating that the sample did not conform to the standards laid down under the Act. Hence, the complaint was filed against the accused for taking action as per the law in the Court of learned Additional Sessions Judge, Nalagarh, District Solan, H.P.
3. Being aggrieved from filing the complaint, the petitioners/accused have approached this Court asserting that the Union of India had no jurisdiction to appoint the Drugs Inspector. There is no averment that accused No.2 is in charge and responsible to accused No.1 for its affairs. The accused have nominated Mr Alok as a competent person for manufacturing activity. The sample is to be analyzed within 60 days. The compliance of Section 202 of Cr.P.C. was mandatory. The shelf life of the drug was to expire in June 2020. The Central Drugs Testing Laboratory tested the drug after its expiry and such a 4 2025:HHC:6953 report cannot be used against the petitioner. Learned Sessions Judge had no jurisdiction to take cognizance without the case having been committed to it. Therefore, it was prayed that the present petition be allowed and the complaint and consequent proceedings pending before the learned Additional Sessions Judge be set aside.
4. The petition is opposed by filing a reply and making a preliminary submission regarding the lack of maintainability.
The contents of the petition were admitted to the extent that the sample was sent for retesting. It was asserted that the sample was found to be not of requisite standards after retesting. The complainant was validly appointed under Section 21 of the Drugs and Cosmetics Act. Accused No.1 is a proprietorship concern, and provisions of Section 34 of the Drugs and Cosmetics Act do not apply to it. Accused No.2 is the proprietor of accused No.1, and he is liable by virtue of his position. Section 32 of the Drugs and Cosmetics Act provides that no Court inferior to the Court of Sessions shall take cognizance of the commission of an offence punishable under the Drugs Act, and the learned Additional Sessions Judge had rightly taken cognizance of the complaint.
Hence, it was prayed that the present petition be dismissed.
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5. I have heard M/s Nitin Bhasin and Suraj Kumar, learned counsel for the petitioners and Mr Rajinder Thakur, learned Central Government Standing Counsel for the respondent-UOI.
6. Mr Nitin Bhasin, learned counsel for the petitioner, submitted that the report of Central Drugs Laboratory shows that the shelf life of the sample had expired. The report of the Central Drugs Laboratory will supersede the report of the Government analyst. Therefore, there is no evidence on record to show that the drug did not conform to the standards laid down in the Drugs and Cosmetics Act. The complaint was filed directly before the learned Additional Sessions Judge, who is not competent to take cognizance in view of Section 193 of Cr.P.C.
Hence, he prayed that the present petition be allowed and the proceedings pending before learned Additional Sessions Judge, Nalagarh, District Solan, H.P. be set-aside. He relied upon the following judgments in support of his submissions:-
(i) Union of India Vs. Ashok Kumar Sharma, (2021) 12 SCC 674;
(ii) Dharam Pal Vs. State of Haryana (SC) Constitution Bench 2013 (3) RCR (Criminal) 787;6
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(iii) Dilip Pal Vs. State of Tripura, 2015 SCC OnLine Tri 1070;
(iv) Banu Enterprises Vs. State of J&K (J&K) 2017(2) RCR (Criminal) 540;
(v) Sanjay Gupta Vs. State of Haryana, Punjab & Haryana 2019 (2) Drugs Cases (DC) 134;
(vi) M/s Ortin Laboratories Limited Vs. State of Telangana, 2023 (2) ALT (Crl.) 503;
(vii) Medicamen Biotech Ltd. Vs. Drug Inspector (2008) 7 SCC 196;
(viii) M/s Srinivas Medical and General Stores and two others Vs. State of Andhra Pradesh, Cr. Petition Nos. 11345 of 2011 and 146 of 2013;
(ix) Mahendra Prakash Garg Vs. State of U.P. (2021) 1 DC 245;
(x) Glaxo India Ltd. Vs. State of M.P. 2020 SCC OnLine MP 3819;
(xi) Ashok Sureshchand Bal Vs. State of Maharashtra (Bombay) 2002 (1) All MR (Cri) 682; and
(xii) M/s Quixotic Healthcare Vs. State of Maharashtra 2020 All MR (Cri.) 1880.
7. Mr Rajinder Thakur, learned Central Government Standing Counsel for the respondent-UOI, submitted that reliance can be placed upon the report of the Government Analyst if it was found by Central Drugs Laboratory that the 7 2025:HHC:6953 shelf life of the sample had expired. The complaint was rightly filed before the learned Sessions Judge in view of Section 32 of the Drugs and Cosmetics Act. No sanction was required in the present case. Hence, he prayed that the present petition be dismissed.
8. I have given considerable thought to the submissions made at the bar and have gone through the records carefully.
9. It was submitted that the Central Government had no authority to appoint the Drugs Inspector. This submission is not acceptable. It was laid down by this Court in Marc Laboratories Limited v. Union of India, 2019 SCC OnLine HP 2825 that the Central Government has the power to appoint a Drugs Inspector.
It was observed:
"15. As per Section 21 of the Drugs Act, the appointment of a person as an Inspector is to be notified in the official Gazette for such areas as may be assigned to him by the Central Government or State Government, as the case may be. This Section provides appointment of persons to be Inspectors for such areas as may be assigned to them. It does not prohibit the Government from appointing more than one person for an area rather empowers to do so and further it does not restrict the area assigned to an Inspector to a particular segment of the Country or State, rather it empowers the Government for appointment of Inspectors for such areas as may be assigned to them. It does not restrict the Government to appoint an Inspector 8 2025:HHC:6953 to a particular area, rather it provides appointment of Inspectors for 'areas' as may be assigned to them and when the appointment is to be made by the Central Government, it has power to appoint a person, having prescribed qualification, to be an Inspector for entire India, which includes all such areas where he may be posted by the Central Government during his appointment as Inspector. Therefore, when Central Government or State Government appoints a person or persons as Inspector(s) for whole of India or the entire State, as the case may be, there is substantial compliance of provisions of Section 21 of the Drugs Act with respect to notification of appointment of Inspector for the area which may be assigned to such Inspector. In case contention of the petitioners is accepted, then Government has to notify each and every posting of the Inspector every time in the official Gazette as provided under Section 21 of the Drugs Act, whereas on initial appointment for the entire Country or entire State, concerned Government has not to notify the same in compliance of Section 21(1) of the Drugs Act on every posting/transfer of such Inspector from one place to another place having local limits of the said area to exercise powers of Inspector under the Drugs Act." (Emphasis supplied)
10. It is undisputed that the complaint was filed before the learned Additional Sessions Judge, Nalagarh, District Solan, H.P. It was submitted that the learned Sessions Judge has the power under Section 32 of the Drugs and Cosmetics Act to try the offence. It was laid down by the Hon'ble Supreme Court in Union of India vs. Ashok Kumar Sharma 2021 (12) SCC 674 that the Court of Sessions can try the offences punishable under Chapter IV of 9 2025:HHC:6953 the Drugs and Cosmetics Act after the case is committed to it. It was observed:-
"Being a special enactment, the manner of dealing with the offences under the Act would be governed by the provisions of the Act. It is to be noted that Section 32 declares that no court inferior to the Court of Session shall try an offence punishable under Chapter IV. We have noticed that under Section 193CrPC, no Court of Session can take cognizance of any offence as a court of original jurisdiction unless the case has been committed to it by a Magistrate under CrPC. This is, undoubtedly, subject to the law providing expressly that that Court of Session may take cognizance of any offence as the court of original jurisdiction. There is no provision in the Act that expressly authorises the Special Court which is the Court of Session to take cognizance of the offence under Chapter IV. This means that the provisions of Chapters XV and XVI CrPC must be followed in regard to even offences falling under Chapter IV of the Act. Starting with Section 200 of the Act dealing with taking of cognizance by a Magistrate on a complaint, including examination of the witnesses produced by the complainant, the dismissal of an unworthy complaint under Section 203 and following the procedure under Section 202 in the case of postponement of issue of process are all steps to be followed. It is true that when the complaint under Section 32 is filed either by the Inspector or by the authorised Gazetted Officer being public servants under Section 200, the Magistrate is exempted from examining the complainant and witnesses." (Emphasis supplied)
11. Therefore, in view of the binding precedent of the Hon'ble Supreme Court, the case is to be tried by the learned Sessions Judge but after it is committed to it for trial.
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12. It was submitted that the complainant has not complied with the requirements of Section 34 of the Drugs and Cosmetics Act. This submission will not help the petitioners. It is undisputed that petitioner No. 1 is a proprietorship concern. It was laid down by the Hon'ble Supreme Court in Shankar Finance and Investment Vs. State of A.P. 2008 (8) SCC 536, that there is no distinction in law between a proprietor concern and individual trading under a trading name. It was observed:-
"8. As contrasted from a company incorporated under the Companies Act, 1956 which is a legal entity distinct from its shareholders, a proprietary concern is not a legal entity distinct from its proprietor. A proprietary concern is nothing but individual trading under a trade name. In civil law where an individual carries on business in a name or style other than his own name, he cannot sue in the trading name but must sue in his own name, though others can sue him in the trading name. Therefore, if the appellant, in this case, had to file a civil suit, the proper description of the plaintiff should be "Atmakuri Sankara Rao carrying on business under the name and style of M/s. Shankar Finance and Investments, a sole proprietary concern". But we are not dealing with a civil suit. We are dealing with a criminal complaint to which the special requirements of Section 142 of the Act apply. Section 142 requires that the complainant should be a payee. The payee is M/s. Shankar Finance and Investments. Therefore in a criminal complaint relating to an offence under Section 138 of the Act, it is permissible to lodge the complaint in the name of the proprietary concern itself."11
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13. Therefore, as per the judgment of the Hon'ble Supreme Court, a proprietorship firm is not a juristic person and cannot be impleaded as a party in its capacity. It was laid down in Parvesh Kaur v. State of Punjab, 2022 SCC OnLine P&H 4065, that proprietorship concern has no legal identity and cannot be impleaded as a party. It was observed:-
"8. Furthermore, in fact, the law as enunciated by the Hon'ble Supreme Court of India in the case of Raghu Lakshminarayanan v. Fine Tubes (2007) 5 SCC 103, draws a clear distinction emerging therefrom that only the proprietor can be held liable under Section 138 of the Act, as the proprietorship concern has no separate legal identity, it means and includes sole proprietor and vice versa. Thus, a sole proprietorship firm would not fall within the ambit and scope of Section 141 of the Act, the proprietor and the firm being one and the same. The para as relevant reads thus:--
"It is settled position in law that the concept of vicarious liability introduced in Negotiable Instruments Act is attracted only against the Directors, partners or other persons in charge and control of the business of the company, or otherwise responsible for its affairs. Section 141 of the NI Act not covers within its ambit, the proprietary concern. The proprietary concern is not a juristic person so as to attract the concept of vicarious liability. The concept of vicarious liability is attracted only in the case of juristic person, such as the company registered under the provisions of the Companies Act, 1956 the partnership firm registered under the provisions of the Partnership Act, 1932 or the association of persons which ordinarily would mean a body of persons which is 12 2025:HHC:6953 not incorporated under any statute. The proprietary concern stands absolutely on a different footing. A person may carry on a business in the name of the business concern being the proprietor of such proprietary concern. In such a case, the proprietor of proprietary concern alone can be held responsible for the conduct of business carried in the name of such proprietary concern. Therefore, Section 141 of the Negotiable Instruments Act has no applicability in a case involving the offence committed by a proprietary concern."
9. Still further, in M. M. Lal v. State NCT of Delhi, 2012 (4) JCC 284, the High Court of Delhi, while following the dictum of the Hon'ble Supreme Court of India, held that "it is well settled that a sole proprietorship firm has no separate legal identity and in fact is a business name of the sole proprietor. Thus, any reference to sole proprietorship firm means and includes sole proprietor thereof and vice versa.
Sole proprietorship firm would not fall within the ambit and scope of Section 141 of the Act, which envisages that if the person committing an offence under Section 138 is 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. The company includes a partnership firm and any other association of individuals. The sole proprietorship firm would not fall within the meaning of a partnership firm or association of individuals. Thus, in the case of a proprietorship concern, only the proprietor can be held liable under Section 138 NI Act as the proprietorship concern and the proprietor are one and the same."
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10. In view of the law as enunciated above, there was no legal requirement of the proprietorship firm to have been arrayed as an accused.
14. A similar view was taken by Allahabad High Court in Dhirendra Singh v. State of U.P., 2020 SCC OnLine All 1130, and it was held that a proprietorship concern is not a juristic person which can be impleaded under Section 141 of the Negotiable Instruments Act. It was observed:-
"10. A plain reading of the provision makes it clear, that if the person committing the offence is a "company", in that event every natural person responsible for such commission as also the artificial person namely the company shall be deemed to be guilty of the offence and be liable to be proceeded against and punished accordingly. Also, certain other natural persons may be held guilty, if so proved.
11. Perusal of the registration of the firm, Annexure no. 1, it transpires that the petitioner is the proprietor of the firm namely M/S. Rashmi Arosole& Chemical Avas Vikas Colony, Sector 10, Sikandara Agra. Perusal of the registration certificate of the firm, petitioner Dhirendra Singh, is the proprietor of the firm and it is clear that this is the sole proprietorship firm. Thus, the main question arises whether in sole proprietorship firm indictment of firm arraign as parties is necessary or not.
12. Thus, the phrase "association of individuals"
necessarily requires such entity to be constituted by two or more individuals i.e. natural persons. On the contrary, a sole-proprietorship concern, by very description does not allow for ownership to be shared or be joint and it defines, restricts and dictates the ownership to remain with one person only. Thus, "associations of individuals" are 14 2025:HHC:6953 absolutely opposed to sole-proprietorship concerns, in that sense and aspect.
13. A 'partnership' on the other hand is a relationship formed between persons who willfully form such a relationship with each other. Individually, in the context of that relationship, they are called 'partners' and collectively, they are called the 'firm', while the name in which they set up and conduct their business/activity (under such relationship), is called their 'firm name'.
14. While a partnership results in the collective identity of a firm coming into existence, a proprietorship is nothing more than a cloak or a trading name acquired by an individual or a person for the purpose of conducting a particular activity. With or without such a trade name, it (sole proprietary concern) remains identified to the individual who owns it. It does not bring to life any new or other legal identity or entity. No rights or liabilities arise or are incurred, by any person (whether natural or artificial), except that otherwise attach to the natural person who owns it. Thus it is only a 'concern' of the individual who owns it. The trade name remains the shadow of the natural person or a mere projection or an identity that springs from and vanishes with the individual. It has no independent existence or continuity.
15. In the context of an offence under section 138 of the Act, by virtue of Explanation (b) to section 141 of the Act, only a partner of a 'firm' has been artificially equated to a 'director' of a 'company'. Its a legal fiction created in a penal statute. It must be confined to the limited to the purpose for which it has been created. Thus a partner of a 'firm' entails the same vicarious liability towards his 'firm' as 'director' does towards his 'company', though a partnership is not an artificial person. So also, upon being thus equated, the partnership 'firm' and its partner/s has/have to be impleaded as an accused person in any criminal complaint, that may be filed alleging offence committed by the firm. However, there is no indication in 15 2025:HHC:6953 the statute to stretch that legal fiction to a sole proprietary concern.
16. Besides, in the case of a sole proprietary concern, there are no two persons in existence. Therefore, no vicarious liability may ever arise on any other person. The identity of the sole proprietor and that of his 'concern' remain one, even though the sole proprietor may adopt a trade name different from his own, for such 'concern'. Thus, even otherwise, conceptually, the principle contained in section 141 of the Act is not applicable to a sole- proprietary concern.
17. Accordingly, there is no defect in the complaint lodged against the applicant, in his capacity as the sole proprietor of the concern M/s. Rashmi Arosole& Chemicals. There was no requirement to implead his sole proprietary concern as an accused person nor there was any need to additionally implead the applicant by his trade name.
15. It is an admitted case that petitioner No.1 is a proprietorship concern. Therefore, it does not have any independent identity, and there was no need to comply with the requirements of Section 34 of the Drugs and Cosmetics Act.
16. It was submitted that the complaint is bad for want of sanction. This submission is not acceptable. Section 32 of the Act deals with the cognisance of the offence punishable under Chapter IV and reads as follows: -
"32. Cognizance of offences.-- (1) No prosecution under this chapter shall be instituted except by--
(a) an inspector; or 16 2025:HHC:6953
(b) any gazetted officer of the Central Government or a State Government authorised in writing on this behalf by the Central Government or a State Government by a general or special order made in this behalf by that Government; or
(c) the person aggrieved; or
(d) a recognised consumer association whether such a person is a member of that association or not.
(2) Save as otherwise provided in this Act, no court inferior to that of a Court of Session shall try an offence punishable under this chapter. (3) Nothing contained in this chapter shall be deemed to prevent any person from being prosecuted under any other law for any act or omission which constitutes an offence against this chapter."
17. It is apparent from the bare perusal of Section that it does not provide for obtaining sanction before launching the prosecution. It was laid by the Delhi High Court in Sanofi India Ltd. v. Union of India, (2021) 3 HCC (Del) 691, that there is no requirement to obtain sanction for the prosecution of the offence under Chapter IV. It was observed:
"25. A perusal of Section 32 of the Drugs and Cosmetics Act, 1940 shows that prosecution can be instituted by an inspector or by any gazetted officer of the Central Government or a State Government authorised in writing in this behalf by the Central Government or a State Government by a general or special order made in this behalf by that Government or the person aggrieved or a recognised consumer association whether such person is 17 2025:HHC:6953 a member of that association or not. This section stipulates that sanction has to be obtained under Chapter IV of the Drugs and Cosmetics Act, 1940. Admittedly, the petitioner is accused of an offence covered under Chapter IV of the Drugs and Cosmetics Act, 1940. Section 32 of the Drugs and Cosmetics Act, 1940 only stipulates as to who is authorised to file a complaint. The complaint in this case is filed by an inspector whose authorisation is not required. Section 32 of the Drugs and Cosmetics Act, 1940 does not require sanction to be obtained from the competent authority for filing the complaint."
18. A similar view was taken by the Karnataka High Court in Emcure Pharmaceuticals Ltd. and Ors. vs State of Karnataka (22.09.2022 - KARHC): MANU/KA/4700/202 wherein it was observed:
"14. The ground on which condonation of delay was sought was that the Drugs Inspector who was to register the complaint was awaiting sanction/permission from the hands of the Drugs Controller for registration of the crime and it is in the process of seeking sanction/permission 5 years and 7 months had passed by and, therefore, the delay was condonable. While submitting justification for condonation of delay, the learned High Court Government Pleader seeks to take support of Section 33M of the Act. It therefore becomes germane to notice Section 33M of the Act. Section 33M of the Act forms a part of Chapter IV-A of the Act. The applicability under Chapter IV-A of the Act and Section 33M of the Act read as follows:
"[CHAPTER IV-A PROVISIONS RELATING TO 254[AYURVEDIC, SIDDHA AND UNANI DRUGS] 18 2025:HHC:6953 33-B. Application of Chapter IV-A.-This Chapter shall apply only to 255[Ayurvedic, Siddha and Unani drugs].
"33-M. Cognizance of offences.-(1) No prosecution under this Chapter shall be instituted except by an Inspector with the previous sanction of the authority specified under sub-section (4) of Section 33-G. (2) No Court inferior to that of a Metropolitan Magistrate or of a Judicial Magistrate of the first class shall try an offence punishable under this Chapter."(Emphasis supplied) Section 33B of the Act makes Chapter IV-A applicable to certain drugs which are Ayurvedic, Siddha or Unani.
Section 33M of the Act deals with taking cognizance of offences which mandates that no prosecution under this Chapter shall be instituted except by an Inspector with the previous sanction of the authority specified under sub-section (4) of Section 33G of the Act. Section 33M of the Act comes under Chapter IVA. Chapter IVA exclusively deals with the provisions relating to Ayurvedic, Siddha and Unani drugs. Section 33M of the Act forms part of Chapter IVA which deals with the aforesaid drugs. Therefore, Section 33M of the Act cannot but be read to be for the purpose of those drugs enumerated in the said Chapter. Sanction under Section 33G of the Act for registration of the crime or cognizance by the concerned court under Section 33M of the Act would only be for enumerated drugs in Chapter IVA. Section 33B of the Act makes the entire Chapter IVA to become applicable only to Ayurvedic, Siddha and Unani drugs. An unmistakable inference that would flow from a perusal of the provisions extracted hereinabove would be that for a prosecution to be initiated under Section 27(d) of the Act, the sanction would be required only if the drugs would be either Ayurvedic, Siddha or Unani. Section 33M of the Act mandates so only if the drugs are those which come within the Chapter.
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15. The drugs in the case at hand are not the ones which are either Ayurvedic, Siddha or Unani. They are allopathic drugs and therefore, Section 33M of the Act on the face of it, is inapplicable to the fact situation. The sheet anchor of the learned High Court Government Pleader to lend support to the enormous delay in registering the complaint taking recourse of Section 33M of the Act would thus tumble down. There was absolutely no necessity to await sanction/permission from the Drugs Controller to register the complaint as the legal sample of the drug that was drawn was not of either Ayurvedic, Siddha or Unani. If the Drugs Inspector has by taking recourse to a wrong provision of law sought sanction from the hands of the Drugs Controller to register prosecution, it cannot be said to be condonable as it was a question of jurisdiction. The statutory bar that kicks in terms of Section 468 of the Cr.P.C. could not have been condoned by both Courts as it gets at the root of the matter."
19. A heavy reliance was placed upon the guidelines issued by the Central Drugs Standard Control Organization, which mention that the prosecution by the Inspectors shall be launched based on written permissions of the controlling authority, who shall consider the recommendations of the screening committee while taking a final decision in the matter.
It is difficult to see how the guidelines issued by the Central Drugs Standard Control Organization will supersede the provisions of the Act. It was laid down by Allahabad High Court in Vijay Singh v. State of U.P., 2004 SCC OnLine All 1656: (2004) 103 FLR 1147: (2005) 6 SLR 378: 2004 All LJ 4242: 2005 Lab IC 505 that 20 2025:HHC:6953 executive instructions cannot override the statutory provisions.
It was observed:
"4. It is a settled legal proposition that executive instructions cannot override the statutory provisions. Vide B.N. Nargajan v. State of Mysore [AIR 1966 SC 1942.], Sant Ram Sharma v. State of Rajasthan [AIR 1967 SC 1910.], Union of India v. Majji Jangammyya [(1977) 1 SCC 606: AIR 1977 SC 757.], B.N. Nagarajan v. State of Karnataka [(1979) 4 SCC 507: AIR 1979 SC 1676: 1980 (16) SCLJ 344.], P.D. Agrawal v. State of U.P. [(1987) 3 SCC 622.] Beopar Sahayak (P) Ltd. v. Vishwa Nath [(1987) 3 SCC 693: AIR 1987 SC 2111.], State of Maharashtra v. Jagannath Achyut Karendikar [1989 (58) FLR 635.], Paluru Ramkrishananiah v. Union of India [(1989) 2 SCC 541: AIR 1990 SC 166.] Comptroller and Auditor General of India v. Mohan Lal Mehrotra [1991 (63) FLR 699.] State of Madhya Pradesh v. G.S. Dall and Flour Mills [1992 Supp (1) SCC 150: AIR 1991 SC 772.], Naga People's Movement of Human Rights v. Union of India [(1998) 2 SCC 109: AIR 1998 SC 431.], C. Rangaswamaeah v.
Karnataka Lokayukta [(1998) 2 SCC 502: AIR 1998 SC 96.].
5. Executive instructions cannot amend or supersede the statutory Rules or add something therein, nor the orders be issued in contravention of the statutory rules for the reason that an administrative instruction is not a statutory rule nor does it have any force of law; while statutory rules have full force of law provided the same are not in conflict with the provisions of the Act. Vide State of U.P. v. Babu Ram Upadhyaya [AIR 1961 SC 751.], and State of Tamil Nadu v. Hind Stone etc. [(1981) 2 SCC 205: AIR 1981 SC 711.].
6. In Union of India v. Sri Somasundaram Vishwanath [(1989) 1 SCC 175: AIR 1988 SC 2255.], the Hon'ble Apex Court observed that if there is a conflict between the executive instruction and the rules framed under the proviso to Article 309 of the Constitution, the rules will prevail. Similarly, if there is a conflict between the rules 21 2025:HHC:6953 made under the proviso to Article 309 of the Constitution and the law, the law will prevail.
7. A similar view has been reiterated in Union of India v. Rakesh Kumar [2001 (89) FLR 599.].Swapan Kumar Pal v. Samitabhar Chakraborty [(2001) 5 SCC 581: AIR 2001 SC 2353.], Khet Singh v. Union of India [(2002) 4 SCC 380.], Laxmi Narayan R. Bhattad v. State of Maharashtra [(2003) 5 SCC 413.], and Delhi Development Authority v. Joginder S. Monga [(2004) 2 SCC 297.], observing that statutory rules create enforceable rights which cannot be taken away by issuing executive instructions.
8. In Ram Ganesh Tripathi v. State of U.P. [1997 (75) FLR
554.], the Hon'ble Supreme Court considered a similar controversy and held that any executive instruction/order which runs counter to or is inconsistent with the statutory rules cannot be enforced, rather deserves to be quashed as having no force of law. The Hon'ble Supreme Court observed as under:--
"They (respondents) relied upon the order passed by the State. This order also deserves to be quashed as it is not consistent with the statutory rules. It appears to have been passed by the Government to oblige the respondents and similarly situated ad hoc appointees."
9. Thus, in view of the above, it is evident that executive instructions cannot be issued in contravention of the rules framed under the proviso to Article 309 of the Constitution and statutory rules cannot be set at nought by the executive fiat.
20. It was laid down by the Hon'ble Supreme Court in DDA v. Joginder S. Monga, (2004) 2 SCC 297 that in case of conflict between a statute and an executive instruction, the statute will prevail over the executive instructions: It was observed:
30. It is not a case where a conflict has arisen between a statute or a statutory rule on the one hand and an 22 2025:HHC:6953 executive instruction, on the other. Only in a case where a conflict arises between a statute and an executive instruction, indisputably, the former will prevail over the latter. The lessor under the deed of lease is to fix the market value. It could do it areawise or plotwise. Once it does it areawise which being final and binding, it cannot resile therefrom at a later stage and take a stand that in a particular case, it will fix the market value on the basis of the price disclosed in the agreement of sale.
21. Hence, there was no requirement of obtaining sanction and the complaint is not bad for want of sanction.
22. The report of Central Drugs Laboratory shows that the sample was received and tested after the date of expiry, i.e., 6/2020. Section 25(4) of the Drugs & Cosmetics provides that the Director of the Central Drugs Laboratory shall cause the sample to be tested, and such report shall be conclusive evidence of the facts stated therein. It reads as follows:
"Section 25(4). Unless the sample has already been tested or analysed in the Central Drugs Laboratory, where a person has under sub-section (3) notified his intention of adducing evidence in controversion of a Government Analyst's report, the Court may, of its motion or in its discretion at the request either of the complainant or the accused: cause the sample of the drug or cosmetic produced before the Magistrate under sub-section (4) of section 23 to be sent for test or analysis to the said Laboratory, which shall make the test or analysis and report in writing signed by or under the authority of, the Director of the Central Drugs Laboratory the result 23 2025:HHC:6953 thereof, and such report shall be conclusive evidence of the facts stated therein."
23. Therefore, it is apparent from the bare perusal of the Section that the report of the Director of Central Drugs Laboratory has been made conclusive of its contents and will supersede the report of the Government Analyst.
24. It was laid down by this Court in Elnova Pharma Village Mginand & ors Vs. State of Himachal Pradesh, 2022 SCC OnLine HP 5091, that the report of Central Drugs Laboratory is conclusive evidence as per Section 25(4) of the Drugs and Cosmetics Act, and the prosecution will fail or succeed based on such a report. It was observed:
"28. It may be noticed that as per Section 25(4) of the Act, the report of Central Drug Laboratory, Kolkata is conclusive proof of the content thereof, meaning thereby, that prosecution with a view to prove such report otherwise not required to examine the author of the report and if the same is accepted, prosecution is either bound to fail or succeed. In case the report is negative, the prosecution would fail and if the report is positive, the prosecution would succeed and the person, against whom, the report is positive, is liable to be dealt with in accordance with the law for his having contravened the provisions as referred herein above."
25. Thus, it is apparent that while the report of the analyst under Section 25(3) is evidence of the facts therein, the report of the Central Drugs Laboratory has been made 24 2025:HHC:6953 conclusive evidence. It was laid down in Amery Pharmaceuticals v. State of Rajasthan (2001) 4 SCC 382 that once the sample is tested by the Central Drugs Laboratory and the report has been received in the Court, the conclusiveness attaches to the same.
It was observed:
"25. In our view the court should lean to an interpretation that would avert the consequences of depriving an accused of any remedy against such evidence. He must have the right to disprove or controvert the facts stated in such a document at least at the first tier. It is possible to interpret the provisions in such a way as to make a remedy available to him. When so interpreted the position is thus: the conclusiveness meant in Section 25(3) of the Act need be read in juxtaposition with the persons referred to in the sub-section. In other words, if any of the persons who receive a copy of the report of the Government Analyst fails to notify his intention to adduce evidence in controversion of the facts stated in the report within a period of 28 days of the receipt of the report, then such report of the Government Analyst could become conclusive evidence regarding the facts stated therein as against such persons. But as for an accused, like the manufacturer in the present case, who is not entitled to be supplied with a copy of the report of the Government Analyst, he must have the liberty to challenge the correctness of the facts stated in the report by resorting to any other mode by which such facts can be disproved. He can also avail himself of the remedy indicated in sub-section (4) of Section 25 of the Act by requesting the court to send the other portion of the sample remaining in the court to be tested at the Central Drugs Laboratory. Of course, no court is under a compulsion to cause the said sample to be so tested if the request is made after a long delay. It is for that purpose 25 2025:HHC:6953 that discretion has been conferred on the court to decide whether such a sample should be sent to the Central Drugs Laboratory on the strength of such request. However, once the sample is tested at the Central Drugs Laboratory and a report as envisaged in Section 25(4) of the Act is produced in the court the conclusiveness mentioned in that sub-section would become incontrovertible. (Emphasis supplied)
26. In the present case, the second sample was tested after the expiry of its shelf life. Therefore, the valuable right of the accused to get the sample reanalysed was lost. It was laid down by the Hon'ble Supreme Court in Medipol Pharmaceutical (India) (P) Ltd. v. Post Graduate Institute of Medical Education & Research, (2021) 11 SCC 339: (2022) 1 SCC (Cri) 782: 2020 SCC OnLine SC 638 that where the shelf life of the sample expired due to the delay, the prosecution cannot continue against the accused. It was observed:-
"7. The decisions of this Court on the aforesaid provision are instructive. In Medicamen Biotech Ltd. v. Drug Inspector [Medicamen Biotech Ltd. v. Drug Inspector, (2008) 7 SCC 196 : (2008) 3 SCC (Cri) 20] , after extracting the section, the Court held : (SCC pp. 199-200, para 13) "13. ... A reading of the aforesaid provisions would reveal that they lay certain obligations as well as provide safeguards for a person from whom a drug has been seized for analysis or testing as Section 25(3) specifies that unless such a person controverts the correctness of the report submitted by the Government Analyst within 28 days in writing that he intends to adduce evidence to controvert the report of 26 2025:HHC:6953 the analyst, it would be deemed to be conclusive evidence of the quality of the drug whereas sub- section (4) of Section 25 obliges the Magistrate on the request of the complainant or the accused or on his own motion to send the fourth sample which has been disputed for fresh testing to the Director of the Central Drugs Laboratory."
8. After referring to the case law on the subject, the Court arrived at the following conclusion on the facts of the case : (Medicamen Biotech case [Medicamen Biotech Ltd. v. Drug Inspector, (2008) 7 SCC 196 : (2008) 3 SCC (Cri) 20] , SCC p. 202, para 19) "19. In the affidavit filed to the petition by Dr D. Rao, Deputy Drugs Controller, and in arguments before us, it has been repeatedly stressed that the delay in sending of the sample to the Central Drugs Laboratory had occurred as the appellant had avoided service of summons on it till 9-5-2005. This is begging the question. We find that there is no explanation as to why the complaint itself had been filed about a month before the expiry of the shelf life of the drug and concededly the filing of the complaint had nothing to do with the appearance of the accused in response to the notices which were to be issued by the Court after the complaint had been filed. Likewise, we observe that the requests for retesting of the drug had been made by the appellant in August/September 2001 as would be clear from the facts already given above and there is absolutely no reason as to why the complaint could not have been filed earlier and the fourth sample sent for retesting well within time. We are, therefore, of the opinion that the facts of the case suggest that the appellants have been deprived of a valuable right under Sections 25(3) and 25(4) of the Act which must necessitate the quashing of the proceedings against them."
9. In Laborate Pharmaceuticals (India) Ltd. v. State of T.N. [Laborate Pharmaceuticals (India) Ltd. v. State of T.N., 27 2025:HHC:6953 (2018) 15 SCC 93 : (2019) 1 SCC (Cri) 717] , after referring to Section 25 of the Act, this Court held as follows : (SCC p. 95, paras 7-8) "7. The cognizance of the offence(s) alleged in the present case was taken on 4-3-2015 though it appears that the complaint itself was filed on 28-11-2012. According to the appellant the cough syrup had lost shelf life in the month of November 2012 itself. Even otherwise, it is reasonably certain that on the date when cognizance was taken, the shelf life of the drug in question had expired. The Magistrate, therefore, could not have sent the sample for reanalysis by the Central Laboratory.
8. All the aforesaid facts would go to show that the valuable right of the appellant to have the sample analysed in the Central Laboratory has been denied by a series of defaults committed by the prosecution; firstly, in not sending to the appellant manufacturer part of the sample as required under Section 23(4)(iii) of the Act; and secondly, on the part of the court in taking cognizance of the complaint on 4-3-2015 though the same was filed on 28-11-2012. The delay on both counts is not attributable to the appellants and, therefore, the consequences thereof cannot work adversely to the interest of the appellants. As the valuable right of the accused for reanalysis vested under the Act appears to have been violated and having regard to the possible shelf life of the drug we are of the view that as on date the prosecution, if allowed to continue, would be a lame prosecution."
10. The position is no different under pari materia provisions of other Acts. Thus, in MCD v. Ghisa Ram [MCD v. Ghisa Ram, (1967) 2 SCR 116 : AIR 1967 SC 970 : 1967 Cri LJ 939] , the testing of samples was dealt with by Section 13 of the Prevention of Food Adulteration Act, 1954. This Court held : (SCR pp. 118-20 : AIR pp. 971- 72, paras 4-5 & 7) 28 2025:HHC:6953 "4. ... There can be no doubt that sub-section (2) of Section 13 of the Act confers a right on the accused vendor to have the sample given to him examined by the Director of the Central Food Laboratory and to obtain a certificate from him on the basis of the analysis of that sample. It is when the accused exercises this right that a certificate has to be given by the Director of the Central Food Laboratory and that certificate then supersedes the report given by the Public Analyst. If, in any case, the accused does not choose to exercise this right, the case against him can be decided on the basis of the report of the Public Analyst. ...
5. In the present case, we find that the decomposition of the sample, which the respondent desired should be analysed by the Director of the Central Food Laboratory, took place because of the long delay that had occurred in sending the sample to the Director. ...
***
7. It appears to us that when a valuable right is conferred by Section 13(2) of the Act on the vendor to have the sample given to him analysed by the Director of the Central Food Laboratory, it is to be expected that the prosecution will proceed in such a manner that that right will not be denied to him. The right is a valuable one, because the certificate of the Director supersedes the report of the Public Analyst and is treated as conclusive evidence of its contents. Obviously, the right has been given to the vendor in order that, for his satisfaction and proper defence, he should be able to have the sample kept in his charge analysed by a greater expert whose certificate is to be accepted by Court as conclusive evidence. In a case where there is denial of this right on account of the deliberate conduct of the prosecution, we think that the vendor, in his trial, is so seriously prejudiced that it would not be proper to uphold his conviction on the basis of the report of the Public Analyst, even though 29 2025:HHC:6953 that report continues to be evidence in the case of the facts contained therein."
11. On the facts of the case, the Court arrived at the following conclusion : (Ghisa Ram case [MCD v. Ghisa Ram, (1967) 2 SCR 116 : AIR 1967 SC 970 : 1967 Cri LJ 939] , SCR pp. 120-21 : AIR pp. 972-73, para 9) "9. In the present case, the sample was taken on 20-9- 1961. Ordinarily, it should have been possible for the prosecution to obtain the report of the Public Analyst and institute the prosecution within 17 days of the taking of the sample. It, however, appears that delay took place even in obtaining the report of the Public Analyst, because the Public Analyst actually analysed the sample on 3-10-1961 and sent his report on 23-10- 1961. It may be presumed that some delay in the analysis by the Public Analyst and in his sending his report to the prosecution is bound to occur. Such delay could always be envisaged by the prosecution, and consequently, the elementary precaution of adding a preservative to the sample which was given to the respondent should necessarily have been taken by the Food Inspector. If such a precaution had been taken, the sample with the respondent would have been available for analysis by the Director of the Central Food Laboratory for a period of four months which would have expired about 20-1-1962. The report of the Public Analyst having been sent on 23-10-1961 to the prosecution, the prosecution could have been launched well in time to enable the respondent to exercise his right under Section 13(2) of the Act without being handicapped by the deterioration of his sample. The prosecution, on the other hand, committed inordinate delay in launching the prosecution when they filed the complaint on 23-5- 1962, and no explanation is forthcoming why the complaint in court was filed about seven months after the report of the Public Analyst had been issued by him. This, is, therefore, clearly a case where the respondent was deprived of the opportunity of 30 2025:HHC:6953 exercising his right to have his sample examined by the Director of the Central Food Laboratory by the conduct of the prosecution. In such a case, we think that the respondent is entitled to claim that his conviction is vitiated by this circumstance of denial of this valuable right guaranteed by the Act, as a result of the conduct of the prosecution."
12. Likewise, under Section 24 of the Insecticides Act, 1968, this Court in State of Haryana v. Unique Farmaid (P) Ltd. [State of Haryana v. Unique Farmaid (P) Ltd., (1999) 8 SCC 190 : 1999 SCC (Cri) 1404] held : (SCC p. 197, para 12) "12. It cannot be gainsaid, therefore, that the respondents in these appeals have been deprived of their valuable right to have the sample tested from the Central Insecticides Laboratory under sub-section (4) of Section 24 of the Act. Under sub-section (3) of Section 24 report signed by the Insecticide Analyst shall be evidence of the facts stated therein and shall be conclusive evidence against the accused only if the accused do not, within 28 days of the receipt of the report, notify in writing to the Insecticide Inspector or the court before which proceedings are pending that they intend to adduce evidence to controvert the report. In the present cases the Insecticide Inspector was notified that the accused intended to adduce evidence to controvert the report. By the time the matter reached the court, the shelf life of the sample had already expired and no purpose would have been served informing the court of such an intention. The report of the Insecticide Analyst was, therefore, not conclusive. A valuable right had been conferred on the accused to have the sample tested from the Central Insecticides Laboratory and in the circumstances of the case the accused have been deprived of that right, thus, prejudicing them in their defence."
13. Though the aforesaid judgments pertain to criminal prosecutions under the Drugs and Cosmetics Act, the Prevention of Food Adulteration Act and the Insecticides 31 2025:HHC:6953 Act, yet, they lay down that a valuable right is granted to a person who is sought to be penalised under these Acts to have a sample tested by the Government Analyst that is found against such person, to be tested by a superior or appellate authority, namely, the Central Drugs Laboratory. These judgments lay down that if owing to delay which is predominantly attributable to the State or any of its entities, owing to which an article which deteriorates with time is tested as not containing the requisite standard, any prosecution or penalty inflictable by virtue of such sample being tested, cannot then be sustained. We have seen that on the facts of this case, the sample drawn and analysed by the Government Analyst was delayed for a considerable period resulting in the sample being drawn towards the end of its shelf life. Even insofar as the samples sent to the Central Drugs Laboratory, there was a considerable delay which resulted in the sample being sent and tested 8 months beyond the shelf life of the product in this case. It is thus clear that the valuable right granted by Section 25 of the Drugs and Cosmetics Act kicks in on the facts of this case, which would necessarily render any penalty based upon the said analysis of the sample as void.
27. A similar view was taken in M/s Srinivas Medical and General Stores (supra), Glaxo India Ltd. Vs. State of M.P. 2020 SCC Online MP 3819 and Ashok Sureshchand Bal Vs. State of Maharashtra 2002 (1) Mh.LJ 211.
28. Therefore, the proceedings cannot continue against the petitioners due to the expiry of the sample.
29. Mr. Rajinder Thakur learned Central Government Standing Counsel relied upon the judgment of this Court in Marc 32 2025:HHC:6953 Laboratories Limited v. Union of India, 2019 SCC OnLine HP 2825.
However, this judgment does not help the respondent because this Court also recognised that the report of the Govt. Analyst will lose its conclusive nature once the accused notifies his intention to get the sample reanalysed. It was observed as under:-
"30. Section 25(3) of the Drugs Act provides that testing/analysis report signed by a Government Analyst shall be conclusive evidence unless accused, within twenty- eight days of receipt of copy of the said report, intends to adduce evidence in controversion of the report. Section 25(4) of the Drugs Act, provides sending of another sample for testing or analysis to the Central Drugs Laboratory by the Court on its own motion or in its discretion at the request of either the complainant or the accused, unless the sample has already been tested or analyzed in Central Drugs Laboratory and where accused under Section 25(3) has notified his intention to adduce evidence in controversion of a report of Government Analyst.
31. Notifying the intention to adduce evidence under Section 25(3) has two effects : First the report of Government Analyst looses its character of conclusive evidence and second a right to test or analyze another sample in the Central Drugs Laboratory accrues in favour of the accused subject to fulfilling other conditions provided under Section 25(4) of the Drugs Act.
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35. However, report of the test or analysis has lost its nature of conclusive evidence as petitioners have notified their in- tention to adduce evidence in controversion of the report under Section 25(3) of the Drugs Act and thus petitioners are not only at liberty but have right to adduce any such evi- dence as admissible under law to rebut the report, but issue 33 2025:HHC:6953 raised by the petitioners regarding depriving them from a valuable right available to them under Section 25(4) of the Drugs Act, is not sustainable in the given facts and circum- stances of present case, hence contentions raised on their behalf in second plea, are also not sustainable."
30. Thus, this judgment also recognises the principle that the report of the Government Analyst shall lose its significance after the accused has notified his intention to get the sample retested. Hence, the submission that it is permissible to rely upon the report of the Govt. Analyst is not acceptable.
31. Since the second sample had expired by the time it reached the Central Drugs Laboratory, therefore, the continuation of the proceedings before the learned Trial Court would amount to an abuse of the process of the Court.
32. Hence, the present petition is allowed and the proceedings pending before learned Additional Sessions Judge, Nalagarh, District Solan, H.P. in a case titled Union of India Vs. M/s Unital Formulations and another are ordered to be quashed.
33. The present petition stands disposed of, and so is the miscellaneous application, if any.
(Rakesh Kainthla) Judge 21st March, 2025 (Chander)