Indian Kanoon - Search engine for Indian Law

    POINT NO.1       :   In the Negative
    POINT NO.2       :   In the Negative
    POINT NO.3       :   As per the final
                         Order for the following;

               :REASONS:

11. POINT NOS.1 AND 2 : The prosecution in order to substantiate these points has relied on the same set of facts. As such and also as the analysis of the facts of the case on these points are interconnected, to avoid repetition, these points are coined together for common discussion.

12. The case of the prosecution is that the CBI received a source information that the accused the pharmacist and Dr. Arun Udayaraj the in charge of stores manager both working at the ESIC hospital, Peenya hatched a conspiracy colluding with the other unknown officials of the ESIC hospital and unknown private drug vendors and in pursuance of conspiracy the accused and Dr. Aurn Udayaraj by violating the purchase procedure guidelines ordered for the purchase of drugs and facilitated the private drug vendors to supply drugs which would otherwise expire and as the drugs were purchased on the abnormal forecast a large quantity of expire drugs were piled up and then in order to show inflated consumption they fabricated/altered medicine prescriptions and accordingly made additional entries in the daily entry sheets and stock registers. Further, it was the source information that in order to dispose off the excess drugs and to suppress the irregularities the drugs have been tried to take out of the hospital in the garbage bags and then they were caught red hand by the security guards. On the source information the case came to be registered and in the investigation the involvement of other except the accused could not find out and as such, now the accused is facing the trial. The specific case of the prosecution against the accused for his trial is that the accused and Dr. Arun Udayaraj the stores manager both working at the ESIC hospital, Peenya being responsible for procurement of medicines during the period from February 2012 to October 2014 procured medicines in excess of the actual requirement due to failure in their management of stock position both in the main stores and sub stores and as a result, the medicines worth of Rs.27,69,293/- came to be expired. The accused in order to show inflated consumption of medicines and to show reduced stock position fraudulently altered and made overwritings in the prescriptions of medicines and accordingly made false additional entries in the entry sheets and in the stock registers of the hospital and thereafter, segregated the expire and nearing expiry medicines worth of Rs.6,88,773/- and on 19.10.2014 committed theft of the said segregated medicines and while he was taking medicines on that day in 22 bags he was stopped by the security guards.

15. P.W.1 - Sri Dr.R.Ramesh the chief medical officer of the ESIC hospital, Peenya has deposed during the course of investigation he has furnished the records viz., various correspondence proceedings, RC expiry communications, expiry circulars, invoices of different companies, purchase procedure guidelines, DG-ESIC Central rate contracts and others relating to procurement of medicines Exs.P.1 to 26. He has deposed that prior to he reporting to Peenya hospital in the month of October 2014 there were some irregularities in the medical stores and due to irregularities nearly Rs.27 lakhs worth of medicines got expired and the said amount has been caused loss to the ESIC. P.W.2 - Sri Dr. Hira Lal the medical superintendent, ESIC hospital, Peenya working from August 2010 to February 2014 has deposed that when he joined the ESIC hospital, Peenya, it was under construction and on 13.02.2012 it was started functioning. He has deposed that initially they started OPD, casualty and later on, they started inpatient section and in the hospital they used to give medicines directly even to the OPD patients, casualty patients and indoor patients and initially there were few patients used to come to the hospital but thereafter, the number of patients increased even to 900 per day. He has deposed that since he was the medical superintendent he formed the medical scrutiny committee for estimation, procurement and for placement of medicines and then the heads of the major departments were the committee members and the heads of the minor departments were co - opt members assisting the other core members. He has deposed that since their hospital was initially started there was no specific data available for exact estimation of the required medicines and then based on the average requirement first the estimation was done for requirement of 3 months and later 2 - 3 times the committee conducted the meetings and guided for purchase of medicines and later on, as the required data was available with store department, the store department started placement of orders for purchasing required medicines after taking concurrence from the finance department and taking approval from the medical superintendent. He has deposed that generally the scrutiny committee holds the meeting once in a year but as their hospital was newly started there were some meetings for purchase of medicines and subsequently the purchase of medicines was given to store department based on the requirement and Dr. Arun Udayaraj was working as medical specialist and he was given the charge of medical stores and the pharmacist working under stores manager was responsible for all the work related to the stores department and the accused now before the court was working as pharmacist and he was one among the others. P.W.3 - Sri Dr. Ashok Kumar the medical superintendent, ESIC hospital, Peenya working from 06-03-2014 to 29-06-2016 has deposed that when he reported Dr. Arun Udayaraj was stores manager and the stores manager monitors such as procurement, consumption, maintaining the stock records and such others and he supervises all the works of the stores and the pharmacists working in the stores have to look after the distribution to patients, to OPD and to other departments and also making indents of medicines and procurement of medicines and they have also to look after the maintenance of the records pertaining to stores and the accused now before the court was working as Pharmacist and then there were nearly 6 pharmacists working in the hospital. He has deposed that the pharmacists have to distribute the medicines based on first come first go i.e., they have to distribute the medicines procured at the earliest point of time to see the consumption of medicines within their shelf life and the pharmacists have to sort out the medicines and they have to intimate the stores manager as to what medicines are going about to expiry and then they have to issue the list of such about to expiry medicines to the stores manager and in turn the same be informed to the concerned department asking them to consume the said medicines within their shelf life. He has deposed that in certain circumstances if it is not possible to consume all the medicines within their shelf life then the other ESIC hospitals and dispensaries are informed and such drugs on their requirement they supplied to them and even then also if the medicines remained unconsumed it may be returned to the concerned companies asking them to replace with fresh medicines and some companies replace the fresh medicines by taking back the expired once but it is not obligatory on their part to replace fresh medicines in place of expired medicines. He has deposed that even then if the medicines expired then the expired medicines have to be segregated from the rest of the medicines and their list with their respective values has to be prepared and they must be sealed and kept separately and thereafter, the same is to be intimated to the head quarters for condonation and after their condonation and after obtaining permission from them to destroy the expired medicines shall be destroyed as per biomedical waste.

16. P.W.4 - Sri Dr. Atmaram D.C. specialist grade -II, HOD surgery department, P.W.5 - Sri Dr.Babu Prasad specialist, P.W.6 - Sri. Dr. Chandrashekar Murthy Y.M. specialist grade - II, HOD OBG department, P.W.7 - Sri Vijaykumar Deputy Director administration, P.W.12 - Dr. A. Suprada specialist grade - II, pediatric department, P.W.14 - Smt. T. Shantamma deputy director finance and P.W.23

- Sri Dr. Arun Udayraj specialist grade - II medicine department all are of the ESIC hospital, Peenya have deposed that in the month February 2012, the ESIC hospital, Peenya commenced its operation and then as there were no medicines, initially first set of medicines were borrowed from the ESIC hospital, Rajajinagar and thereafter, in the month of February 2012 itself the medical superintendent P.W.2 constituted the medical scrutiny committee headed by the stores manager Dr. Arun Udhay Raj and the other 4 HODs of various departments, deputy director finance Smt. Shanthamma and the HODs of other departments being co opted members. They have deposed that the accused Udhayakantha the Pharmacist was assisting the stores manager Dr. Arun Udayaraj since from formation of the medical scrutiny committee in order to help in the process of medical scrutiny committee work and also in the process of procurement of medicines. They have deposed that after formation of MSC on 25.02.2012 a first meeting was held and thereafter, till May 2012 there were meetings, but thereafter till November 2013 there were no MSC meetings for procuring medicines. They have deposed that on 22.11.2013 Dr. Arun Udayaraj convened a meeting of MSC regarding recommendation for dispensing slow moving medicines as slow moving medicine were accumulated and thereafter, on 17.01.2014 a meeting was convened to discuss to avoid the local purchase of medicines and make a hospital formulary i.e., list of stock checks and previous consumption of medicines on periodical basis and again on 26.06.2014 MSC meeting was convened and in that P.W.4 raised the issue of not obtaining end user approval for local purchase of medicines and surgical and in that meeting the stores manager Dr. Arun Udayaraj expressed his inability to run the stores as there was lack of staff and lack of his experience in running the stores and after the meeting of 26.06.2014 there were regular MSC meetings convened. P.W.14 the deputy director of finance has deposed that she was one of the members of the medical scrutiny committee as she was the Dy. Director (finance) and she was present in the committee to ensure the proposals were to be within the budgetary allocation and the stores manager Dr. Arun Udayaraj has prepared the final indents with the help of his assistants and after taking approval from the medical superintendent and after purchasing of medicines put up the file before the finance section then she went through the file and as there were approvals from the medical superintendent, she passed the bills for the purchase of drugs and dresses. P.W.23 - Dr. Arun Udayaraj has deposed that he was a Specialist Grade - II of the department of medicines and in addition to his regular duty he was also given the charge of stores manager and he was the stores manager from 21.02.2012 to November 2014. He has deposed that there were main stores and sub stores and again in the main stores there were two sections one for procuring medicines and another for procuring surgical instruments and Udhayakanth the accused was in charge of the main stores for procuring medicines. He has deposed that the accused Udhaykanth had to collect indents from the user departments, tabulate them and prepare the list of required medicines and first that medicines required list was to put up before the stores manager and later the same was to forward to the medical superintendent for his final approval and the medical scrutiny committee was formed and it was assessing the future requirement of the medicines of the hospital and based on their assessment the medicines were to be procured. He has deposed that he was one of the members as stores manage and in the initial period the list of required medicines was prepared based on the assessment done by the medical scrutiny committee and subsequently the list of required medicines prepared based on the indents received from the user departments. He has deposed that the user departments prepare the indents based on consumption rates in their department and the pharmacist working in the main stores has to receive the indents and he has to compare the same with the stock register with him and thereafter prepare the list of medicines to be procured in the next quarter and even if the indents come from user departments for particular medicines and if such medicines still are in the stock then the pharmacists should not list them in the next quarter purchase. He has deposed that since the Peenya hospital was newly established hospital they were not having any prior consumption pattern and as such, a medical scrutiny committee was formed and on their assessment medicines were procured but later as consumption patterns started available they started procuring based on the available consumption pattern rate. He has deposed that in the year 2012 - 13 nearly 20 purchase orders were put to various manufacturing companies and the list of required medicines were put before him by Udhayakanth and he went through it and recommended to the medical superintendent for his final approval and in order to cross check the list of required medicines before recommendation he ought to have upto date stock register and also update consumption register but then both of them were incomplete and as such, he could not cross check the required list before recommendation and the pharmacist working as in charge of medicines had to update these registers but the accused Udhayakanth did not keep them update. He has deposed that in the month of September 2013 the pharmacists working in the pharmacy were reshuffled and then Sri Khalid pharmacist took the charge of medicines of main stores from Udhayakanth and in the month of November 2013 Sri Khalid informed that there were some medicines in the main stores that could not be consumed within their expiry period and then he informed the same to their medical superintendent Sri Hiralal and on the direction of the medical superintendent Sri Khalid prepared the list of medicines which were in excess which could not be consumed within their expiry period and put the list before the medical scrutiny committee. He has deposed that after tracing out of this incident he issued a memo to the accused Udhayakanth asking his explanation and the accused in writing replied that he was inexperienced to handle new hospital and there was over work load and as such, he could not update the registers and gave the consumption rate based on approximation. P.W.8 - Sri Dr. Mahesh S.N. Insurance medical officer grade - II, P.W.9 - Dr. Rachita Biswas and P.W.12 - Dr. A. Suprada have deposed that they knew Dr. Arun Udayaraj and the accused the pharmacist and then they were also having the Addl. Charge as stores officers and then Dr. Arun Udayaraj was the store manager and Dr. Arun Udayaraj and pharmacists Udhaykanth and Khalid informed them about the presence of excess amount of drugs nearing expiry and thereafter, they informed the other departments to use the nearing expiry medicines as much as possible and corresponded with other ESIC hospitals and dispensaries asking them to procure the nearing expiry medicines from their hospital and asked the companies to replace the nearing expiry medicines.

22. P.W.16 - Smt. R. P. Rohini and P.W.17

- Smt. Nitha J. P. Vimal Pharmacists have deposed that when the ESIC hospital, Peenya, started there was no sub stores and they, the accused Udhaykanth and others were working in the main stores and in the year 2013 they were posted to the sub stores. They have deposed that in the sub stores they and other pharmacists were used to disburse medicines to patients according to the prescriptions of doctors and also used to enter so disbursed medicines in the stock registers and they were also used to forward the indents to the main stores based on the stock position in the sub stores and after disbursing medicines to patients they were entering the disbursed medicines first in the compilation entry sheets Exs.P.46 and 47 on daily basis. P.W.16 has deposed that Ex.P.46 (a) is the entry sheets of dated 04.08.2014 and in the first sheet at second page the accused Udhaykanth has entered new entries against medicines Bita - Histadine, Carbamzepine and Cefpotozime and likewise, in the entry sheets dated 07.08.2014, 12.08.2014 and such others there are new entries made by the accused Udhaykanth and Ex.P.29 is the stock register of tablets and in the stock register entries therein dated 04.08.2014 there is no inflated entry so for Cefpotozime tablets is concerned and the entries therein are as per entry sheets dated 04.08.2014. P.W.16 has deposed that Ex.P.47