Karnataka High Court
M/S Zim Laboratories Ltd vs Union Of India on 30 August, 2024
Author: N S Sanjay Gowda
Bench: N S Sanjay Gowda
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CRL.P No. 8341 of 2018
R
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 30TH DAY OF AUGUST, 2024
BEFORE
THE HON'BLE MR JUSTICE N S SANJAY GOWDA
CRIMINAL PETITION NO. 8341 OF 2018
BETWEEN:
1. M/S ZIM LABORATORIES LTD.,
B-21/22, MIDC AREA,
KALMESHWAR-441501
DISTRICT NAGPUR,
MAHARASHTRA.
REPRESENTED BY ITS
MANAGING DIRECTOR,
MR. ANWAR SIRAJ DAUD AND
CHAIRMAN,
ZAKIRABHAI SULEHBHAI VALI
2. MR. ZAKIRBHAI SALEHBHAI VALI,
AGED ABOUT 76 YEARS,
S/O MR.SALEHBHAI ABDULALI VALI,
CHAIRMAN OF
Digitally signed M/S ZIM LABORATIORIES LTD.,
by SUMITRA
SHERIGAR B-21/22, MIDC AREA,
Location: HIGH KALMESHWAR-44 1501.
COURT OF DISTRICT NAGPUR,
KARNATAKA MAHARASHTRA.
3. MR. ANWAR SIRAJ DAUD
AGED ABOUT 55 YEARS,
S/O MR. SIRAJ MEHFUZ DAUD,
MANAGING DIRECTOR OF
M/S ZIM LABORATORIES LTD.,
B-21/22, MIDC AREA,
KALMESHWAR-441 501.
DISTRICT NAGPUR,
MAHARASHTRA.
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CRL.P No. 8341 of 2018
4. MR. RIYAZ AHMED KIKABHAI KAMAL
AGED ABOUT 64 YEARS,
S/O MR. KIKABHAI TAHERALI KAMAL,
EXECUTIVE DIRECTOR OF
M/S ZIM LABORATORIES LTD.,
B-21/22, MIDC AREA,
KALMESHWAR-441 501.
DISTRICT NAGPUR,
MAHARASHTRA.
5. MR. NITIN RAJENDRA PUDKE,
AGED ABOUT 56 YEARS,
MANUFACTURING CHEMIST OF
M/S ZIM LABORATORIES LTD.,
B-21/22, MIDC AREA,
KALMESHWAR-441 501.
DISTRICT NAGPUR,
MAHARASHTRA.
6. MR. AMOL SURESH KAKDE,
AGED ABOUT 52 YEARS,
MANUFACTURING CHEMIST OF
M/S ZIM LABORATIORIES LTD.,
B-21/22, MIDC AREA,
KALMESHWR-441 501.
DISTRICT NAGPUR,
MAHARASHTRA.
7. MRS.MANJUSHA SHIVCHARAN MESHRAM,
AGED ABOUT 48 YEARS,
MANUFACTURING CHEMIST OF
M/S ZIM LABORATORIES LTD.,
B-21/22, MIDC AREA,
KALMESHWAR-441 501.
DISTRICT NAGPUR,
MAHARASHTRA.
...PETITIONERS
(BY SRI. DESU REDDY.G., ADVOCATE)
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CRL.P No. 8341 of 2018
AND:
1. UNION OF INDIA,
MINISTRY OF HEALTH AND FAMILY WELFAR
O/O THE CENTRAL DRUGS STANDARD
CONTROL ORGANISATION,
DIRECTORATE GENERAL OF HEALTH SERVICES
O/O OF ASSISTANT DRUGS CONTROLLER(I)
2ND FLOOR, O/O DRUGS CONTROLLER
FOR THE STATE OF KARNATAKA, PALACE ROAD,
BENGALURU-560 001.
REPRESENTED BY
CENTRAL GOVERNMENT PUBLIC PROSECUTOR,
HIGH COURT BUILDING,
AMBEDKAR VEEDHI,
BENGALURU-560 001.
...RESPONDENT
(BY SRI. MADHUKAR DESHPANDE, SENIOR CGSC)
THIS CRIMINAL PETITION IS FILED UNDER SECTION 482
CR.P.C BY THE ADVOCATE FOR THE PETITIONER PRAYING
THAT THIS HON’BLE COURT MAY BE PLEASED TO QUASH THE
ENTIRE PROCEEDINGS IN C.C.No.273/2016 ON THE FILE OF
THE LEARNED PRESIDING OFFICER, SPECIAL COURT FOR
ECONOMIC OFFENCES AT BANGALORE.
THIS PETITION HAVING BEEN HEARD AND RESERVED
FOR ORDERS ON 26.06.2024, COMING ON FOR
PRONOUNCEMENT THIS DAY, THE COURT MADE THE
FOLLOWING:
CORAM: HON’BLE MR JUSTICE N S SANJAY GOWDA
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CRL.P No. 8341 of 2018CAV ORDER
1. This criminal petition is filed opposing the criminal
proceedings initiated against the petitioners — for the
offence punishable under Section 27D of the Drugs and
Cosmetics Act, 1940 (“the Act”) — in Criminal Case
No.273 of 2016, relatable to the subject samples of a drug
called “Regunac Na+ SR 100 (Slow Diclofenac Tablets B.P.
100 mg)” [referred to as “Regunac” or “the drug
sample” or “the subject drug”] which was termed as
being – “Not of Standard Quality (NSQ)”.
2. For ease of reference, this order has been indexed as
follows:
Page
Sl. No. Particulars
Nos.
Brief facts 05
I.
A. Re: 1st sample [Batch No.F957 G220] 05B. Re: 2nd sample [Batch No.F957 C404] 11
II. Counsels’ submissions 19
III. Overview of the Act and the Rules 22
Application of the law to the facts of this
IV. 43
case
V. Conclusion 68VI. Directions 69
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CRL.P No. 8341 of 2018I. BRIEF FACTS:
3. The facts leading to the filing of this petition, in
respect of the two samples in question, are as under:
A. RE: First Sample [Batch No.F957 G220]:
(a) On 28.02.2013, the Drugs Inspector (India), Central
Drugs Standard Control Organization (CDSCO), Sub-Zone
Office of the Drugs Controller for State of Karnataka,
Bengaluru, (“the Drugs Inspector”) took the samples of
the subject drug-Regunac from the Employees’ State
Insurance (“ESI”) Hospital in Mangalore. This drug was
manufactured under Batch No.F957 G220.
(b) The date of manufacture of the subject drug was
July, 2012 and the date of its expiry was June, 2015.
(c) The Drugs Inspector divided the sample into four
equal parts, out of which he gave one portion to the
Pharmacist of the said ESI Hospital and sent another
portion of the sample to the Director, Central Drugs
Laboratory, Kolkota (“the CDL”), i.e., the Government
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CRL.P No. 8341 of 2018Analyst. This sample was sent to the Government Analyst
on 04.03.2013.
(d) On 11.03.2013, the drug sample was received by the
Government Analyst for test/analysis, as contemplated
under Section 23(4) of the Act. Though the Government
Analyst received the drug sample on 11.03.2013, the test
was conducted only between 10.11.2014 and 12.11.2014,
i.e., nearly 20 months after the drug sample was received.
(e) About six months thereafter, the Government
Analyst furnished the Test Report in triplicate to the Drugs
Inspector by his Memorandum dated 05.05.2015. In this
Certificate of test/analysis, he stated that the sample
given to him did not pass the “Drug Release Test” and he
concluded that the sample was “not of standard
quality”.
(f) The Drugs Inspector, thereafter, by his letter dated
14.05.2015, called upon the Pharmacist of the ESI
Hospital, Mangalore (from whom he had secured the drug
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from whom he had acquired the subject drug along with a
copy of the invoice and the quantity received, while
informing the Pharmacist that the drug sample that he had
collected did not conform to the test for drug release and,
therefore, he declared the drug sample as “not of
standard quality”.
(g) He also alerted the Drugs Controller, Karnataka on
the movements of the drug and for initiation of action as
provided under the provisions of the Act.
(h) The notice was re-sent to the Medical Superintendent
/ Pharmacist, ESI Hospital, Mangalore on 18.05.2015 since
the Pharmacist to whom the earlier notice had been
addressed had been transferred.
(i) On 23.05.2015, the Pharmacist informed the Drugs
Inspector that the ESI Hospital, Mangalore had secured
the drug directly from M/s. Zim Laboratories Limited,
Nagpur, Maharashtra i.e., petitioner No.1 under the
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invoice dated 28.09.2012, a copy of which was also
enclosed.
(j) On 09.06.2015, the Drugs Inspector addressed a
letter to petitioner No.1 informing them that the drug
sample was declared to be “not of standard quality”,
since the sample did not conform to the parameters of the
test for drug release. A copy of this test report and a
portion of the sealed sample were also forwarded to
petitioner No.1, who was also called upon to stop the sales
and distribution of the subject and withdraw stock from
the market immediately. A direction was also issued to
submit certified copies of twelve documents mentioned
therein.
(k) Petitioner No.1 responded by a letter dated
16.06.2015 stating that they had been manufacturing the
subject drug for the past 15 years and they had not
received any complaint about it till date. It was also stated
that on a scrutiny of the Government Analyst’s report, it
was observed that the sample of the subject batch was
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received on 11.03.2013 and it was tested between
10.11.2014 and 12.11.2014, which indicated that the drug
sample had been kept for 20 months in the Laboratory. It
was stated that since the subjected product is a ‘sustained
release formulation’, the storage condition could alter the
physio-chemical attributes of the drug. It was also stated
that steps had been taken to recall and stop the
distribution of the available stock of the subjected drug
from the market and also from ESI Hospital, Mangalore,
pending their investigation and further line of action. It
was also stated that the analysis of the portion of the
sample that had been sent to them was under progress,
and that after analysis, the details of the results and the
further line of action would be shared with the
Department. Certain documents, which were sought by
the Drugs Inspector, were also forwarded to the Drugs
Inspector including the declaration that they were the
manufacturers of the subject drug.
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(l) On 23.06.2015, petitioner No.1 addressed a letter to
the Drugs Inspector stating that it had analyzed the
sample that it had received from her, and as per the
analysis of the subject product for the test of drug release
in their Quality Control laboratory, the results obtained
indicated that the subject drugs were well within the
accepted criteria and it was clear that the product batch
complied with the test for drug release. It was therefore
stated by petitioner No.1 that it did not agree with the
report of the Government Analyst, by which the subject
drug had been declared as ‘not of standard quality’ and
they also stated that they would like to challenge the
report of the Government Analyst. A request was also
made to send a portion of sample of their product to the
CDL, Kolkata for analysis of the drug release only as per
the analysis enclosed therewith. Petitioner No.1 also
sought the details of the Court / Magistrate and also the
amount of demand draft and details to whom it should be
made out to. Petitioner No.1 further submitted the
analytical results for drug release of the portion of sample
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of the subject batch product along with the method of
analysis.
(m) The Assistant Drugs Controller, CDSCO, Bangalore by
a letter dated 06.07.2015 requested the Deputy Drugs
Controller (India), CDSCO, West Zone, Mumbai to get the
matter investigated at the Manufacturer’s unit and submit
the investigation report, since the drug sample had failed
the test for drug release and was declared as ‘not of
standard quality’. The Certificate of Test/Analysis (Form
No.13) was also furnished to the Drugs Controller.
B. RE: Second Sample [Batch No.F957 C404]:
(n) On 12.06.2014, the Drugs Inspector, collected
another sample of the same drug bearing Batch No.F957
C404 from the premises of the Regional Drug Store, ESI
Directorate, Rajajinagar, Bangalore. He divided the sample
into four equal portions and handed over one portion of
the drug sample to the Senior Insurance Medical Officer of
the Regional Drug Store, ESI Directorate, Rajajinagar,
while another portion of the drug sample was sent to the
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Director, Central Drugs Laboratory, Government of India,
Kolkata.
(o) The Government Analyst, though received the drug
sample on 17.06.2014, subjected the sample for testing
five months thereafter — between 10.11.2014 and
12.11.2014.
(p) After eight months, i.e., on 15.07.2015, the
Government Analyst concluded that the drug did not pass
the test relating to drug release and declared the sample
as ‘not of standard quality’ by his report dated
15.07.2015.
(q) The Drugs Inspector, immediately thereafter, on
20.07.2015, called upon the Senior Insurance Medical
Officer, Regional Drug Store, ESI Directorate, Rajajinagar,
Bangalore (from where she had collected the samples) to
furnish the name and address of the person from whom it
had acquired the subject drug, along with a copy of the
invoice and the quantity received. She informed the
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Medical Officer about the drug sample being sent for
test/analysis and the report that she had received
regarding the drug being ‘not of standard quality’. The
Drugs Inspector also alerted about the movement of the
subject drug and that necessary action should also be
initiated as per the provisions of the Act.
(r) This notice asking for information was re-sent on
31.07.2015, since the Medical Officer to whom the earlier
notice had been addressed was transferred and that said
notice had been returned.
(s) In response, the Junior Specialist, Regional Drug
Store, ESI Directorate, Rajajinagar, Bangalore, by his
letter dated 03.08.2015, informed the Drugs Inspector
that the subject drug was manufactured by M/s. Zim
Laboratories Limited-petitioner No.1 herein and also
enclosed a copy of the invoice under which the subject
drug was procured. It was further stated that they had
also received 13,860 tablets of the subject drug from the
aforesaid manufacturer and at present, there was no stock
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of the subject drug and that they would send a recall
intimation to all the dispensaries (to whom it had supplied
the subject drug) to stop using the subject drug
immediately.
(t) On receipt of said letter, on the same day, i.e., on
03.08.2015, the Drugs Inspector addressed a letter to
petitioner No.1 stating that the drug sample was declared
to be ‘not of standard quality’ since the drug sample did
not conform to the test for drug release. A copy of the test
report and one portion of the sealed drug sample were
also sent to petitioner No.1 and a direction was issued to it
to stop the sale and distribution of the subject drug and
withdraw the stock from the market immediately. In
addition, thirteen documents were sought.
(u) On the same day, a letter was addressed to the
Deputy Drugs Control (India), CDSCO, West Zone, Mumbai
calling upon them to conduct an investigation regarding
the subject drug, in view of the report received at the 1st
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petitioner’s unit, and submit a report along with the
details, so as to launch a case against petitioner No.1.
(v) In response to the notice dated 03.08.2015,
petitioner No.1 issued a reply dated 10.08.2015, in which
it was stated that no stock of the subject batch of drug
was available with them and that they had initiated action
for the immediate recall of and stopping the distribution of
the available stock of the subject batch from the market.
It was also stated that the received portion of the sample
was under analysis and the details of the results and the
relevant documents along with their further line of action
would be communicated to them.
(w) On 26.08.2015, petitioner No.1 addressed another
letter wherein it was stated that the controlled sample was
analyzed, and the controlled samples as well as a portion
of the sample of the subject batch as per the method of
analysis of the product for the test of drug release in their
Quality Control laboratory and the control sample of the
subject batch complied with the test for drug release
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within the specified criteria and in respect of the received
portion sample, it had passed the test for drug release at
L2 stage, as per British Pharmacopeia for interpretation of
drug release. A copy of the analytical results of the control
sample and the portion sample was also enclosed. It was
also stated that the drug release time points and the
percentage of drug release was not specified in the British
Pharmacopeia.
(x) It was also stated that a joint investigation had been
carried out by the Drugs Inspector, CDSCO, West Zone,
Mumbai on 13.08.2015 wherein a thorough investigation
had been done by the Drugs Inspector, FDA, Nagpur
Division, during which petitioner No.1 had furnished nine
documents. Petitioner No.1 also furnished six other
documents to the Drugs Inspector for taking appropriate
action.
(y) It may be pertinent to state here that a joint
investigation conducted on 13.08.2015 was in respect of
the first sample (Batch No.F957 G220) and the investigation
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report had been forwarded to the Deputy Drugs Controller
(India), Drugs Controller for the State of Karnataka,
Bangalore along with a covering letter dated 21.10.2015,
and this joint investigation report had concluded that the
firm had analysed the finished product (before batch
release for sales /distribution) and it had found that the
drug release test complied with the manufacturer’s
specifications and that the same had also been verified. It
was also remarked that the drug release test of the
investigational product had been performed as per the
manufacturer’s specifications and the results in the
finished product analysis report were compliant with the
standards prescribed. It was further remarked that
petitioner No.1 had stated that the product complied with
their shelf-life specification, which was effective from
22.01.2015, but the product found to be ‘not of standard
quality’ with respect to the test for ‘drug release’ had
been manufactured before the said date.
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(z) About two months thereafter, on 06.11.2015, the
Drugs Inspector sought additional documents for both
these batches of two samples relating to the Managing
Directors, Directors and Partners at the time of offence
i.e., July of 2012 and March of 2014, and the person(s) in
charge of and responsible for the Company’s business at
the time of offence, along with their name, identification
and address proof of the manufacturing chemist and
analytical chemist responsible for manufacturing the
subject drug during July, 2012 and March, 2014, and also
sought information on the process validation and cleaning
validation documents of the subject drug.
(aa) On the same day, a letter was addressed to the
Drugs Controller General (India), CDSCO, New Delhi
seeking permission to launch prosecution against
petitioner No.1–Company.
(bb) Petitioner No.1 complied with the demand for
production of additional documents by their letter dated
23.11.2015.
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(cc) On 04.12.2015, the Drugs Controller General (India)
granted approval for launching of prosecution against
petitioner No.1 firm/person(s) for the violation of the
provisions of the Act.
(dd) Thereafter, the Drugs Inspector sought additional
documents not only from petitioner No.1, but also from
the Registrar of Companies.
(ee) Ultimately, on 22.09.2016, the Drugs Inspector
proceeded to present the complaint (dated 24.08.2016)
under Section 200 of the Criminal Procedure Code, 1973
(“the CrPC”) for offence punishable under Section 27(d)
of the Act for the manufacture of two batches of drugs,
which were ‘not of standard quality’.
As stated above, this criminal petition is filed
challenging the initiation of these proceedings.
II. COUNSELS’ SUBMISSIONS:
4. Mr. Desu Reddy G.–learned counsel for the
petitioners as well as Mr. Madhukar Deshpande–learned
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Central Government Standing Counsel (CGSC) for the
respondent made elaborate submissions in support of their
contentions.
5. The learned counsel for the petitioners contended
that the proceedings were liable to be quashed for the
following reasons:
(i) No proceedings could have been initiated against
petitioner No.1–Company, its Chairman, its
Managing Director and its Executive Director when
the complaint itself did not contain any specific
averments against them regarding their involvement
in the manufacture of the subject drug.
(ii) The entire proceedings were vitiated since the
procedure prescribed under the Act and the Drugs
and Cosmetics Rules, 1945 (“the Rules”) had been
flouted and the tests were conducted after the shelf-
life of the sample drugs had expired and, hence,
their results would not indicate that the subject
drugs were ‘not of standard quality’.
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(iii) A portion of the samples were furnished to them
along with the test report after their shelf-life had
expired and, hence, petitioner No.1–Company had
lost its statutory right to challenge the test reports.
6. The learned CGSC appearing for the Union–Mr.
Madhukar Deshpande supported the case of the
prosecution and put forth these contentions:
(i) The prosecution had been launched on the
petitioners after duly verifying their culpability in the
crimes which were ascertained during the course of
investigation conducted in accordance with the
provisions of the Act and the Rules and, hence, they
were justified.
(ii) It would not be necessary to specifically aver the
involvement of the persons in charge of the conduct
of business of the Company and the persons involved
in the manufacturing of the subject drug, since it had
been stated that all of the accused were responsible,
and also because the entire papers relating to the
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investigation were placed before the
Court/Magistrate and these papers, by themselves,
indicated their involvement which the Magistrate
would peruse.
(iii) The test reports obtained clearly indicated that the
drugs were ‘not of standard quality’ and all the
petitioners were thus required to be prosecuted.
III. OVERVIEW OF THE ACT AND THE RULES:
7. In order to appreciate these contentions, a brief
overview of the provisions of the Act and the Rules which
were enacted to regulate the import, manufacture,
distribution and sale of drugs and cosmetics would be
necessary.
8. The Act has been divided into five chapters. For the
purpose of this case, the provisions of Chapter IV and
some provisions of Chapter V would be relevant.
9. Chapter IV relates to the manufacture, sale and
distribution of drugs and cosmetics. Section 16 deals with
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“standard of quality” and states that said expression in
relation to a drug would mean that said drug complies with
the standard set out in the second schedule. This chapter
also seeks to define ‘misbranded drugs’ (Section 17);
‘adulterated drugs’ (Section 17A); ‘spurious drugs’
(Section 17B) which would, however, not be relevant for
this case.
10. Section 18 of the Act prohibits the manufacture and
sale of certain drugs and cosmetics. It declares that no
person should, either by himself or through any other
person, manufacture for sale or for distribution, or sell, or
stock or exhibit or offer to sell, or distribute any drug
which is not of standard quality, or is misbranded,
adulterated or spurious [Section 18(a)(i)].
11. Section 18A of the Act casts a legal obligation on
every person to disclose to the Inspector — the name,
address and other particulars of the person from whom he
acquired the drug or cosmetics.
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12. Section 20 of the Act provides for the State
Government (and also the Central Government) by
notification in the Gazette to appoint such persons as it
thinks fit and who possess the prescribed qualifications to
be Government Analysts in respect of such drugs or
classes of drugs.
13. Section 21 of the Act similarly provides for the
Central Government or the State Government to appoint
Inspectors who possess the prescribed qualifications.
14. Section 22 of the Act deals with the powers of the
Inspectors so appointed and this Section declares that the
Drugs Inspectors shall have the power to investigate, take
samples of any drugs, and also search any person, enter
and search any place, as well as stop and search any
vehicle — if he has reason to believe that an offence in
this chapter had been/was being committed. This Section
also empowers him to examine any record, register,
document or any other material object found and also
require any person to produce any record or register, etc.
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15. Section 23 of the Act prescribes the procedure to be
followed by the Inspectors. It states that if an Inspector
decides to take any sample of a drug, he should tender a
fair price for it and may also ask for a written
acknowledgement [Section 23(1)] in that regard.
16. Section 23(3) of the Act, which is relevant for the
case at hand, states that whenever an Inspector takes a
sample of a drug for the purpose of test or analysis, he
should intimate such purpose, in writing, and in the
prescribed form, to the person from whom he takes the
sample and, he should thereafter, in the presence of such
person, divide the sample into four portions and effectively
seal and suitably mark the same. He is also required to
permit the person, from whom the sample was taken, to
add his own seal and mark. If, however, the sample of
drug is taken from the premises of a manufacturer, he is
required to divide it into only three portions.
17. The Drugs Inspector under Section 23(4) of the Act
is required to give out one of the four portions of the
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sample drug i.e., the 1st portion of the drug sample to the
person from whom he has taken it, and he is thereafter
required to send one portion i.e., the second portion,
forthwith to the Government Analyst for test or analysis.
18. He is also required to produce the 3rd portion in the
Court before which proceedings have been initiated in
respect of the drug or cosmetic.
19. The Inspector is also required send the 4th portion to
the person whose name, address and particulars have
been disclosed to him under Section 18A i.e., the person
from whom the drug had been acquired.
20. Thus, the first thing that an Inspector is required to
do, on taking a sample of a drug for test or analysis, is
that he should make 4 portions of it and furnish it to the
person from whom it has been secured and, at the same
time, to the Government Analyst for test or analysis. This
is obviously because there is a need to first ascertain the
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quality of the drug, and this ascertainment is to be done —
not by him but by a notified Government Analyst.
21. It is to be noticed here that Section 23 (4)(i)1 uses
the expression “forthwith for test or analysis” and it is
therefore imperative that the sample of the drug should be
dispatched to the Government Analyst immediately
without any delay. The logic behind this imperative is clear
that the law intends that the quality of the drug sample
should be tested or analyzed immediately, as the
circulation or use of the drug whose quality is suspect
would lead to grave and dangerous consequences to the
public at large.
22. At the stage of taking the sample, obviously, the
Inspector would not be aware of the person from whom
the drug was acquired, and he would therefore have to
take steps to ascertain the person from whom the drug
1
(4) The Inspector shall restore one portion of a sample so divided or one
container, as the case may be, to the person from whom he takes it, and
shall retain the remainder and dispose of the same as follows:–
(i) one portion or container he shall forthwith send to the Government
Analyst for test or analysis;
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had been acquired, as provided under Section 18A. It is
only after he ascertains this fact is he required to send the
fourth portion to the person from whom the drug was
acquired.
23. Since the legislature has made it imperative for the
Inspector to secure a test/analysis of the drug sample
forthwith, it would also be the requirement of the law that
the Inspector takes simultaneous action to ascertain from
whom the drug was acquired. This would also be because,
the moment he is informed of the results of the test or
analysis by the Government Analyst, he can proceed
against the person from whom the drug had been
acquired.
24. The requirement of producing the third portion to the
Court would not be an immediate requirement, unless, of
course, there are already proceedings pending before a
Court regarding said drug. This is also because the
Inspector cannot proceed to prosecute the manufacturer
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or any other person responsible for the drug unless it has
been tested and analysed by the Government Analyst.
25. Section 24 of the Act also casts an obligation on
every person, who is in charge of the any premises where
the drug is manufactured or kept for sale or for
distribution, to disclose to the Inspector the place where
the drug is manufactured.
26. Section 25 of the Act2 deals with the reports of the
Government Analysts. Section 25(1) of the Act mandates
2
25. Reports of Government Analysts.–(1) The Government Analyst to
whom a sample of any drug or cosmetic has been submitted for test or
analysis under sub-section (4) of section 23, shall deliver to the Inspector
submitting it a signed report in triplicate in the prescribed form.
(2) The Inspector on receipt thereof shall deliver one copy of the report
to the person from whom the sample was taken and another copy to the
person, if any, whose name, address and other particulars have been
disclosed under section 18A, and shall retain the third copy for use in any
prosecution in respect of the sample.
(3) Any document purporting to be a report signed by a Government
Analyst under this Chapter shall be evidence of the facts stated therein, and
such evidence shall be conclusive unless the person from whom the sample
was taken or the person whose name, address and other particulars have
been disclosed under section 18A has, within twenty-eight days of the
receipt of a copy of the report, notified in writing the Inspector or the Court
before which any proceedings in respect of the sample are pending that he
intends to adduce evidence in controversion of the report.
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that the Government Analyst, to whom a sample of any
drug is sent for test or analysis, should deliver to the
Inspector a signed report in triplicate in the prescribed
form.
27. At this stage, a reference to the ‘duties of
Government Analysts’ as prescribed under the Rules as it
originally stood before its amendment and after its
amendment in 2017 would also have to be made.
28. Rule 45 of the said Rules, as it stood before the
amendment, stated as follows:
“45. Duties of Government Analysts.− (1) The
Government Analyst shall cause to be analysed or tested
such samples or drugs and cosmetics as may be sent to(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 own 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 thereof, and such report
shall be conclusive evidence of the facts stated therein.
(5) The cost of a test or analysis made by the Central Drugs Laboratory
under sub-section (4) shall be paid by the complainant or accused as the
Court shall direct.
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him by Inspectors or other persons under the provisions
of Chapter IV of the Act and shall furnish reports of the
results of test or analysis in accordance with these Rules.
(2) A Government Analyst shall from time to time forward
to the Government reports giving the result of analytical
work and research with a view to their publication at the
discretion of Government.”
29. Prior to the amendment of 2017, Rule 45 stipulated
that a Government Analyst should cause to be analyzed or
tested such samples sent to him by the Inspector and
should also furnish the report of the results of the analysis
in accordance with the Rules. Rule 46 stipulated that
immediately after the test or analysis was made, he was
required to supply the report forthwith to the Inspector.
Thus, the Rules, by the use of the word “forthwith” also
made it clear that the Government Analyst was required to
act with promptitude in the matter of conducting the test
and also in furnishing the report to the Inspector.
30. Following the 2017 Amendment, Rule 45 reads as
follows:
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CRL.P No. 8341 of 2018“45. Duties of Government Analysts.–
(1) The Government Analyst shall cause to
be analyzed or tested such samples of drugs
and cosmetics as may be sent to him by
Inspectors or other persons under the
provisions of Chapter IV of the Act and shall
furnish reports of the results of test or
analysis in accordance with these rules
within a period of sixty days of the
receipt of the sample:
Provided that where it is not possible to
test or analyse the sample within the
specified period, the Government Analyst
shall seek extension of time from the
Government giving specific reasons for delay
in such testing or analysis.
(2) A Government Analyst shall from time to
time forward to the Government reports
giving the result of analytical work and
research with a view to their publication at
the discretion of Government.”
(emphasis supplied)
31. Rule 45, after the amendment, has gone one step
further and has made it mandatory for the Government
Analyst to conduct the test / analysis and also send the
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report to the Inspector “within a period of sixty days” from
the receipt of the sample. In the event the Government
Analyst is unable to conduct the test or analyse the
sample and send the report within sixty days, he is bound
to seek extension of time from the Government, giving
specific reasons.
32. The intent of this Rule both before and after the
amendment is rather simple and clear. It is the mandate
of the law that a Government Analyst is required to
conduct the test of a sample and also send a signed report
in triplicate at the earliest. In fact, after the amendment, a
period of two months from the receipt of the sample is
prescribed for conducting the test and for sending the
report. This time period stipulated is obviously to ensure
that further action regarding the manufacture/sale of drug
is taken immediately by the Inspector.
33. The use of the expression “shall forthwith send to the
Government Analyst” used in Section 23 of the Act and the
stipulation of conducting the test and sending the signed
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reports forthwith under the old Rule and within a period of
sixty days under the amended Rule leaves no shadow of
doubt that the entire process of taking the sample and
analyzing the same is to be done as expeditiously as
possible.
34. The Inspector is thereafter required to deliver one
copy of the report to the person from whom the drug
sample was taken and another copy to the person whose
name and address was disclosed to him under Section 18A
of the Act.
35. The Drugs Inspector is then required to retain the
third copy to be used in prosecution in respect of such
drug sample.
36. A drug whose quality is doubted is first required to
be tested by the Government Analyst and the report of his
test or analysis is to be supplied to the Inspector, and the
Inspector is, in turn, required to inform the persons who
will be directly affected by the test/analysis i.e., the
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person from whom it is taken and/or the person from
whom it was acquired (as disclosed under Section 18A),
while retaining the third copy for being used in the
prosecution that he may launch. This is the glaringly
apparent purpose behind Section 25(1) and (2) of the Act
and also Rule 45 and 46 of the Rules.
37. Obviously, the person who receives this report, if he
accepts the results of the test, is expected to take
immediate steps to ensure that said drug is not used.
38. Section 25(3) of the Act declares that the report of
the Government Analyst would be evidence of the facts
stated therein and it is also declared to be conclusive.
However, it also gives a right to the person who has been
furnished with the report, an opportunity to challenge it.
39. The law sets a time frame of 28 days to question the
report, and it is required that the person challenging the
report notifies this intention of adducing evidence in
contravention of the report, in writing, to the Inspector. In
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case of pending proceedings, the person can also state
that he intends to adduce evidence before the Court in
contravention of the report.
40. It is to be noticed here that it is only at this stage
that the Inspector has definite material regarding the
quality of the drug and the persons responsible for the
drug (i.e., the person from whom it had been taken / acquired)
and they are required to be put on notice about the drug
with the adverse report of the Analyst. The fact that a
specific time frame of 28 days is provided to react to the
report indicates that the law mandates an immediate
action by the concerned person regarding the drug. The
further consequence of an inaction is also stated that if
there is no challenge to the report within the time frame,
the report becomes conclusive. This process indicates the
urgency with which the matter is to be dealt with by all
concerned i.e., the Inspector, the Analyst and the persons
responsible for the drug.
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41. If the use of the expression ‘forthwith send to the
Government Analyst’ in Section 23 (4)(i), the requirement
of the Government Analyst to complete the
testing/analysis of the sample drug and furnish the report
to the Inspector forthwith in Rule 46 (and the period of
sixty days prescribed under the amended Rule 45) coupled
with the requirement of a time frame of 28 days to react
to the report, when read in conjunction, makes it
absolutely clear that the intention of the law is that the
issue relating to the quality of the drug is to be resolved
with utmost promptitude or at any rate within the
prescribed period.
42. If, however, the Government Analyst were to take an
inordinately long time to conduct the test/analysis of the
drug, the very intent of the law would stand defeated.
More importantly, the delay would enable the suspected
drug to be in circulation, thereby exposing the public to
serious consequences. This would also put the
manufacturer in a piquant situation regarding the drug
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that he has manufactured and which he has distributed for
sale since he would not know what the fate of the drug is.
43. The fact that Rule 45 itself was amended on
02.02.2017, wherein the deadline of sixty days to
conclude the test/analysis of a sample drug by a
Government Analyst was inserted, clearly establishes that
the requirement of conducting the test with promptitude is
a must and there can be no delay in conducting the
test/analysis.
44. It is therefore obvious that it is the clear legislative
intent that the process of taking a sample of the drug,
getting it tested by a notified Analyst and sending a copy
of the report to the persons responsible for the Drug are to
be undertaken with a sense of urgency so that the cloud of
suspicion hanging on the drug is resolved promptly.
45. If the intention of the Legislature was to allow the
Government Analysts to take their own sweet time to
conduct the test/analysis and also enable the person
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affected by the test to react to the report of the test
leisurely, the fixation of time-frames under Sections 23
and 25 of the Act as well as Rule 45 of the Rules would be
rendered redundant.
46. It is quite possible that the persons responsible for
the drug can adduce evidence to the Inspector on the
veracity of the report, and the Inspector may accept it and
choose not to launch prosecution.
47. However, if he does decide to launch prosecution or
if he has already launched prosecution, the manner of
challenge to the report is indicated under Section 25(4) of
the Act.
48. Section 25(4) of the Act deals with the situation
following the reaction to the test report by the persons
responsible for the drug and question it as provided in
Section 25(3). It states that the Court may, in its
discretion or at the request of either the complainant or
the accused, cause the sample to be tested by the CDL
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which has been established under Section 6 of the Act.
However, this option is unavailable to the Court if the drug
sample has already been tested by the CDL.
49. This sub-section (4) makes it obligatory for the CDL
to conduct a test/analysis and send a report in writing
(under the authority of the Director of the Laboratory, the
highest post in the Laboratory) to the Court, and it further
goes on to declare that the report of the test/analysis
made by the CDL shall be conclusive evidence of the facts
stated therein.
50. This would therefore indicate that the Court, before
which proceedings have been launched, has the option of
permitting the accused to adduce evidence, if he has
reacted to the report within 28 days of receipt of the
report or it has the discretion to send the sample to the
CDL established under Section 6 of the Act and seek for a
test to be conducted by CDL. On such a test being
conducted and upon a report in this regard being sent to
the Court, the report is declared to be conclusive and,
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therefore, all the persons concerned, including the Court,
becomes bound by the report.
51. It is for this reason that Section 23 (4)(ii) requires
that the 2rd portion of the sample of the drug be produced
by the Inspector before the Court, enabling the Court to
send it directly to the CDL. This further mechanism of
subjecting the sample of the drug to a second and final
test/analysis by the statutory laboratory provided under
the Act and making the report of this test conclusive is to
basically ensure that there can be no doubt about the
quality of the drug.
52. This mechanism is also to ensure that the Court is
not burdened with the task of analyzing the evidence that
the accused may adduce in contravention of the report of
the Government Analyst. In the task of analyzing the
evidence relating to a drug, which is obviously based on
scientific parameters, the Court may not be equipped with
the expertise to analyze the evidence, and the law
therefore gives the Court the option to send it to the
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premier laboratory established under the Act. This
mechanism would also enable the accused to seek a
second drug test in light of an adverse report of an earlier
test conducted by the Government Analyst.
53. The ultimate effect of this provision is that the
sample of the drug is tested for the second time when the
1st test is under challenge, and the results of the 2nd test,
if in consonance and in conformity with the 1st test report,
brings the curtains down on the quality of the drug and
concludes the question regarding its quality.
54. It is to be noticed here that the accused has been
conferred with the statutory right to request the Court to
seek a reference to the CDL, despite availing the option of
adducing evidence controverting the report of the
Government Analyst. This report is a valuable right
provided under the Statute and cannot, therefore, be
ignored or diluted because the report of the CDL would be
conclusive. If the CDL tests the sample and differs with the
report of the Government Analyst, the entire proceedings
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will have to come to an end as the report is declared to be
conclusive evidence. Obviously, the Court cannot convict
the accused in light of the report of the CDL and would
have to necessarily acquit him.
55. The converse of this is also true that once a report
is submitted by the CDL confirming the test report of the
Government Analyst, the accused would not be able to
question the report and would be bound by it, and he can
establish his innocence on other grounds which may be
available to him.
IV. APPLICATION OF THE LAW TO THE FACTS OF THIS
CASE:
56. In the instant case, as far as the first sample is
concerned, the Government Analyst received the sample
on 04.03.2013 and he was required to conduct the test or
analysis of the sample and submit the report to the
Inspector which would have to be furnished to the
petitioners and they had the right to challenge the report
of the Government Analyst. This right to challenge the
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report was effectively nullified by the delay in the conduct
of the test of the sample by more than 20 months by
which time the shelf life of the drug had also expired.
57. As already stated above, the date of expiry of the
first sample was June, 2015 but the Government Analyst
submitted a report nearly twenty-two months after he had
received the report in May, 2015 and this was just before
the expiry of the shelf-life of the subject drug.
58. The Drugs Inspector, in turn, secured the details of
the manufacturer only after she received the report on
08.06.2015 and she then sent a copy of the report with
the sample.
59. Since the report and sample were sent after the
shelf-life of the drug sample had expired, the valuable
right that the manufacturer had to dispute the veracity of
the test report of the Government Analyst was taken
away. The manufacturer also lost the right to adduce
evidence in contravention of the report which was
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furnished to him only in June, 2016, simply because he
could not have the sample sent to him tested as its shelf
life had expired in June, 2016 itself.
60. The manufacturer also had the right to request the
Court to send the sample to the CDL for the 2nd and
conclusive test and this right was also lost since, by the
time the proceedings were initiated in September of 2016,
the shelf life of the drug had expired and the Court could
also not refer it to the CDL.
61. In my view, if this statutory right of the
manufacturer to oppose the test report by either adducing
evidence in contravention of the report or by requesting
the Court to send the same for the 2nd and conclusive test
to the CDL was taken away, the entire prosecution would
be vitiated as the right of the accused to defend itself, as
provided under the Act itself, had been taken away. It is
thus obvious that the prosecution would only be a futile
exercise.
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62. In fact, in this case, it is to be noticed that the
petitioner responded on 16.06.2015 and 23.06.2015,
highlighting the fact that the test had been conducted 20
months after the drug samples had been secured from the
ESI Hospital, and on their analysis, it was noticed that the
test for drug release was within the accepted criteria.
63. Furthermore, they stated their intention to challenge
the report and asked for the drug sample to be sent to the
CDL. Obviously, since the shelf-life of the drug sample had
expired by 23.06.2015, the chance of the petitioners to
establish that the subject drug conformed to the test for
drug release and could not thus be termed as ‘not of
standard quality’ was completely defeated.
64. This inordinate delay of the Government Analyst in
testing the sample and submitting a report has resulted in
serious prejudice to the petitioners. Since the right of the
petitioners to challenge the report has been snatched
away, the entire proceedings could be vitiated.
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65. It is also to be noticed here that if the test report had
been obtained within a short span of time from the subject
drug being sent to the Government Analyst and petitioner
No.1 (being the manufacturer of the subject drug), on
being given the copy of the report, had challenged the
report, then, in the event the Drugs Inspector prosecuted
the petitioners immediately, the manufacturer had the
right to seek a reference and request the Magistrate to
refer the matter to the CDL or adduce evidence before the
Magistrate, refuting the report.
66. The Magistrate could have either accepted the
evidence or resorted to referring the drug sample to the
CDL, whose report was conclusive. Since this valuable
right has been taken away, the proceedings challenged in
the present petition would stand vitiated.
67. As far as the second sample is concerned (Batch
No.F957 C404), this sample was taken on 12.06.2014
and it was sent immediately to the Government Analyst,
who conducted the test nearly five months thereafter,
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between 10.11.2014 and 12.11.2014. Eight months after
conducting the test, the Government Analyst submitted a
report on 15.07.2015 to the effect that the subject drug
did not pass the drug release test.
68. It may be pertinent to notice here that even in this
case, the Government Analyst has taken thirteen months
(from 12.06.2014 to 15.07.2015) to send his report and
the Drugs Inspector has thereafter initiated action i.e.,
sending the report and the sample to petitioner No.1-
Company to obtain their response.
69. Another important factor to be noticed here that in
respect of the first batch of the sample drugs (Batch
No.F957 G220), on the receipt of the report, a joint
investigation was conducted by the Drugs Inspector,
CDSCO, West Zone, Mumbai and the Drugs Inspector,
FDA, Nagpur on 13.08.2015. Pursuant to this joint
investigation, a report dated 28.08.2015 was sent with an
opinion that the controlled sample available with petitioner
No.1 complied with the test for drug release and the
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received portion of the sample also passed the test at L2
stage.
70. This investigation report was shared with the Drugs
Inspector, Bangalore. This would also indicate that the
test/analysis conducted by the Government Analyst was
not reliable. In the background of this particular fact, it is
obvious that the prosecution in respect of the 2nd sample
was also vitiated. Furthermore, the right of the accused-
manufacturer to request the Court to refer the drug
sample to the CDL has also been rendered impossible by
efflux of time, considering the obvious fact that the shelf
life of the drug has expired.
71. Though the prosecution is liable to be quashed on
the above-mentioned reasons, there is one other issue
which was argued at length and is therefore required to be
dealt with.
72. The learned counsel for the petitioners also put forth
the argument that the launch of prosecution against the
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Company, its Chairman, Managing Director and Executive
Director was illegal, inasmuch as the complaint did not
indicate the manner in which the Chairman, Managing
Director and Executive Director were responsible for the
conduct of business. He submitted that it is settled law
that the complaint should specifically aver that the persons
accused and named in the complaint were directly
responsible and also indicate the manner in which they
were responsible. In this regard, he places reliance on the
decision rendered by the Hon’ble Supreme Court in the
case of Lalankumar Singh3.
73. The counsel for the petitioner has also relied on the
following judgments to contend as below:
i. Alembic Pharmaceuticals Ltd. & Ors. v. State of
Karnataka & Anr., Crl.P. 100700/2018 –
28.09.2018 – HCK (Dharwad): non-application of
mind by the Magistrate while taking cognizance
would vitiate the subject proceedings;
3
Lalankumar Singh & Ors. v. State of Maharashtra, 2022 SCC OnLine SC
1383.
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CRL.P No. 8341 of 2018
ii. M/s. Cosmas Pharmacals Ltd. & Ors. v. State of
Karnataka, Crl.P. 100661/2023 – 19.12.2023 –
HCK (Dharwad); M/s. Stadmed Pvt. Ltd. & Ors.
v. Union of India, Crl.P. 891/2017 – 11.12.2022
– HCK (Bangalore); M/s. Perennial Medicare &
Anr. v. State at the Instance of Drugs
Inspector, Crl.P. 2830/2017 – 24.05.2022 –
HCK (Bangalore); Sri. Himanshu Baid & Ors. v.
State of Kerala, Crl.M.C. No.329/2010 –
17.03.2010 – Kerala HC; and Serdia
Pharmaceuticals (India) Pvt. Ltd. v. Union of
India, Crl.P. 919/2020 – 24.03.2021 – HCK
(Bangalore): that by virtue of the subject drug
having expired, the petitioner–Company lost its right
to further test and challenge the Government
Analyst’s report;
iii. Ritesh & Ors. v. the State of Karnataka & Ors.,
Crl.P. 15263/2011 and connected matters –
19.11.2011 – HCK (Gulbarga); and Sri. Sushil
Goel & Ors. v. State at the Instance of Drugs
Inspector, Crl.P. 6875/2020 – 10.05.2022 –
HCK (Bangalore): the specific role of the
petitioners herein — that by virtue of their positions
as the Director/members of the higher management
of the Company, they were directly involved in the
day-to-day affairs of the Company which resulted in
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the subject drug to be “not of standard quantity” —
has not been mentioned in the complaint, and the
same would thus have to be quashed;
iv. Ramprakash Gulati & Ors. v. State of
Maharashtra, Crl. Application No.3684/2009 –
01.09.2017 – Bombay HC (Nagpur); and Siby
Thomas v. M/s. Somany Ceramics Ltd., SLP
(Crl.) No. 12/2020 – 10.10.2023 – the Hon’ble
Supreme Court: direct averments, which are to be
mandatorily specified against the petitioners herein,
are absent — this case, however, deals with a complaint
filed under Section 138 r/w Section 141 of the Negotiable
Instruments Act, 1881.
74. Mr. Deshpande, per contra, contended that this
argument was without any substance. He submitted that
the Drugs Inspector had conducted the investigation
strictly in accordance with the statutory Rules and during
the course of the statutory investigation, he had secured
information of the persons responsible for the conduct of
business of the Company and the correspondences were
also produced along with the complaint, and, therefore,
even if specific averments were not made in the
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complaint, as the entire investigation papers were
submitted to the Magistrate, the requirement of the law
had been complied with.
75. He also relied on the following citations in support of
his contentions:
i. Union of India v. Ashok Kumar & Ors., (2021)
12 SCC 674; and Jeewan Kumar Raut & Anr. v.
Central Bureau of Investigation, (2009) 7 SCC
526: the Officer was duly notified as an “Inspector”
under the Act, empowering him to collect the subject
drug and cause the same to be tested by a
Government Analyst. Further, such Inspector was
also duty-bound and authorised to file a complaint
before the Sessions Court to take cognizance of the
same. Hence, no defects could be raised on
jurisdiction;
ii. State of Gujarat v. Afroz Mohammed
Hasanfatta, (2019) 20 SCC 539: when taking
cognizance for an offence under the Act, the
Magistrate need not specify reasons for issuing
summons based on prima facie evidence. The only
requirement is that he/she is satisfied that there are
sufficient grounds to issue the same;
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iii. Serdia Pharmaceuticals (India) Pvt. Ltd. v.
Union of India (supra) – HCK (Bangalore)
affirmed by the Hon’ble Supreme Court in Serdia
Pharmaceuticals (India) Pvt. Ltd. v. Union of
India, SLP (Crl.) No. 5053/2021 – 13.02.2024;
iv. Dinesh B. Patel & Ors. v. State of Gujarat &
Anr., (2010) 11 SCC 125; and Vikas Rambal &
Ors. v. the State represented by the Drugs
Inspector, Crl.O.P. No.11184 of 2019 & Crl.M.P.
No.5726 of 2019 – 12.10.2022 – Madras HC:
Directors could be held liable for the affairs of the
Company if the drug manufactured by their Company
for human consumption was found to be defective;
v. Glaxosmithkline Pharmaceuticals Ltd. & Anr. v.
State of Madhya Pradesh, (2011) 13 SCC 72:
option given under the Act to challenge the
Government Analyst’s report within 28 days and such
report becomes conclusive if the expiry date of the
drug has passed in the meantime.
76. The Hon’ble Supreme Court in the case of
Lalankumar Singh (supra) has reiterated the case of Brij
Lal Mittal4 wherein it is categorically held as follows:
4
State of Haryana v. Brij Lal Mittal, (1998) 5 SCC 343.
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CRL.P No. 8341 of 2018“8. Nonetheless, we find that the impugned judgment of
the High Court has got to be upheld for an altogether
different reason. Admittedly, the three respondents were
being prosecuted as directors of the manufacturers with
the aid of Section 34(1) of the Act which reads as under:
“34. Offences by companies.– **** commission
of such offence.”
It is thus seen that the vicarious liability of a person for
being prosecuted for an offence committed under the Act
by a company arises if at the material time he was in
charge of and was also responsible to the company for
the conduct of its business. Simply because a person is a
director of the company it does not necessarily mean
that he fulfils both the above requirements so as to
make him liable. Conversely, without being a director a
person can be in charge of and responsible to the
company for the conduct of its business. From the
complaint in question we, however, find that except a
bald statement that the respondents were directors of
the manufacturers, there is no other allegation to
indicate, even prima facie, that they were in charge of
the company and also responsible to the company for
the conduct of its business.”
77. In view of this clear declaration of law, it is obvious
that the complaint should categorically state the manner in
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which the persons accused in the complaint were
responsible for the conduct of the business and in the
manufacturing of the subject drug. However, in the instant
case, as already extracted above, the complaint merely
alleged that all the accused were responsible for the
manufacture of the subject drug. Since the dictum of the
Hon’ble Supreme Court has not been complied with, the
complaint cannot be sustained.
78. An argument was also sought to be advanced by Mr.
Deshpande that the Drugs Inspector was conducting a
statutory investigation and the entire papers relating to
the investigation were placed before the Magistrate, and,
therefore, a hyper-technical view that the complaint
should also state the manner in which the accused were
responsible was not necessary.
79. He submitted that an investigation conducted in
accordance with the statutory provisions cannot be
equated with a complaint presented by any other person
under Section 200 of the CrPC, and certain credence must
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be given to such statutory investigation conducted by the
Drugs Inspector, who also trace their power to a statute.
80. In my view, this argument of Mr. Deshpande cannot
be accepted. Chapter XV of the CrPC relates to complaints
that can be given to the Magistrate.
81. “Complaint” has been defined under Section 2(d) of
the CrPC to mean “any allegation made orally or in writing
to a Magistrate with a view to his taking action under the
Criminal Procedure Code, that some person, whether
known or unknown, has committed an offence, but does
not include a police report”. This definition clearly excludes
a police report, but the explanation appended to this
definition states that a report made by a police officer
after investigation, which indicates the commission of a
non-cognizable offence, is deemed to be a complaint, and,
in such an event, the police officer who makes the report
is deemed to be the complainant.
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82. Thus, if a person makes an allegation in oral or in
writing to a Magistrate, it becomes a complaint, and it
doesn’t matter whether that person is a private citizen or a
public servant. This Section makes it clear that it is only if
a police officer has conducted the investigation regarding
the commission of a non-cognizable offence and has
submitted a report, it is deemed that his report is a
‘complaint’.
83. In light of the fact that the explanation clearly refers
only to a police officer who investigates the commission of
a non-cognizable offence and the report made by that
police officer can only be deemed to be a complaint, the
argument that the complaint presented by the Drugs
Inspector should be treated on par with the report of a
police officer cannot be accepted.
84. Since the explanation to Section 200 has not
included an investigation made by a public servant under
any enactment to be a deemed complaint, it cannot
obviously confer the status of a police officer on a public
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servant conducting investigation for an offence under any
other enactment.
85. Section 200 of the CrPC enables a complaint to be
given to a Magistrate, and the Magistrate is thereafter
empowered to take cognizance of the offence, and this in
law, is the initiation of criminal proceedings.
86. Section 200 thereafter casts an obligation on the
Magistrate who has taken cognizance to examine upon
oath the complainant and the witnesses present. It
requires that the substance of such an examination should
be reduced in writing and signed by the complainant, the
witnesses and also by the Magistrate.
87. However, when a complaint is made in writing, the
proviso to Section 200 of the CrPC makes an exception
and dispenses with the obligation of the Magistrate to
examine the complainant and the witnesses, if a public
servant acting or purporting to act in the discharge of his
official duties has made the complaint.
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88. Thus, as against normal procedure of examining the
complainant on oath, when a complaint is presented to a
Magistrate by a public servant, the Magistrate is not
required to examine him on oath and is also not required
to reduce the substance of such a complaint in writing.
This is obviously because a public servant is presumed to
act responsibly when he makes a complaint, and there
would be no need to have any kind of safeguard to make a
public servant liable if the statements are found to be
incorrect since this action can be taken without any
difficulty, as compared to taking action against a private
citizen.
89. As stated above, the explanation under Section 2(3)
of the CrPC is confined only to a police officer and not to a
public servant. A public servant, therefore, would have to
necessarily present a set of allegations orally or in writing
to the Magistrate, and it is this set of allegations which is
to be looked into by the Magistrate for taking cognizance
and the proceedings would thereafter stand initiated.
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90. It is therefore clear that a complaint presented by a
public servant such as the Inspector, if against a
Company, its Chairman, Managing Director and Director, is
required to conform to the law of making specific
allegations against each of the accused as declared by the
Apex Court in the case of Brij Lal Mittal Mittal and
reaffirmed in Lalankumar Singh referred to above.
91. Even considering the judgment of the Apex Court
relied upon by Mr. Deshpande for the respondents
rendered in the case of Dinesh B. Patel (supra), which
has considered and distinguished Brij Lal Mittal (supra),
there were specific averments in said case that the
Directors therein were privy to the manufacturing of the
subject drug therein and it was thus necessary that they
be made liable. In the instant case, however, no
averments to that effect have been made. While Dinesh
B. Patel makes Directors liable for the manufacturing of a
drug, it also meted out the indispensable requirement that
specific averments were necessary in the complaint to
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demonstrate that the Director/higher management officials
of such company were privy to OR were directly involved
in the manufacturing of the subject drug.
92. Even if the Inspector has been notified and has
jurisdiction to present a complaint before the Sessions
Court as per Ashok Kumar and Jeewan Kumar Raut
(both cited supra), the fact remains that the drug had
expired before it was even tested by the Government
Analyst, thus not rendering the petitioners herein a fair
opportunity to challenge the Government Analyst’s report.
Reliance placed on Afroz Mohammed Hasanfatta and
Glaxosmithkline (both cited supra) to urge that the
Magistrate need not specify reasons for issuing summons
based on prima facie evidence and that 28 days were
provided to the petitioners herein to challenge the report
which became conclusive upon the expiry of the drug in
the meantime, is a misconceived argument, and these
judgments do not aid the grounds raised by Mr.
Deshpande for two reasons: 1. that the Magistrate, by
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taking cognizance of a report based on the testing of an
expired drug, has displayed clear non-application of mind;
and 2. since the drug itself expired before the test was
conducted by the Government Analyst, there is no
question of subjecting it to further testing in order to
challenge the Analyst’s report.
93. Now coming to the facts of the present case, as
narrated above, the allegations as far as the officers /
accused are concerned was as follows:
“47. The complainant submits the
accused 2 is the Chairman, 3 is the
managing director & 4 is the executive
director of the company that is accused
no.1 and A5 to A8 who are the
manufacturing and analytical chemist
are responsible for manufacturing &
analyzing / testing the substandard drug
with a mala fide intention in order to
have unlawful gain and they are liable
for criminal prosecution, hence the
above complaint.”
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94. As could be seen from the above, the complaint
merely states that the Chairman-Accused No.2, the
Managing Director-Accused No.3 and the Executive
Director-Accused No.4 of the Company along with three
others (Accused Nos.5 to 7) i.e., the Manufacturing and
the Analytical Chemists were responsible for
manufacturing, analyzing and testing the sub-standard
drug.
95. The Apex Court as already noticed above in its
judgment rendered in Brij Lal Mittal and reiterated in
Lalankumar Singh (both supra) which was also arising
out of a complaint in writing under the Act, after taking
note of every judgment rendered in relation to offences
under the Act, has held that the complaint is required to
specifically aver wrongdoings on each of the accused and a
general allegation would not suffice.
96. It is thus clear that the complaint against accused
Nos.2 to 4, i.e., the Chairman, Managing Director, and
Executive Director should have categorically stated as to
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how and in what manner they were responsible for the
conduct of the business of the Company. Admittedly, even
according to the complaint, these three persons were not
responsible for the manufacturing of the drug and from
the post that they were holding, and it cannot be
presumed that they were, by themselves, responsible for
the conduct of the business of the Company in terms of
production of the subject drug. It is thus clear that the
complaint lodged against accused Nos.2 to 4 is
unsustainable.
97. As far as the other accused are concerned (Accused
Nos.5 to 7), as already noticed above in relation to the
first sample, the Government Analyst, by not conducting
the test/analysis from 11.03.2013 to till 10.11.2014, has
ensured that the right of the manufacturer to challenge
the test/analysis report has been defeated.
98. The further fact that he has taken six more months
from 10.11.2014 till 05.05.2015 to send the report after
being aware of the fact that the drug sample would expire
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in June, 2015, has ensured that the right of the
manufacturer to challenge the test/analysis report is
completely defeated.
99. The Inspector has contributed to this inordinate delay
by calling upon the ESI Hospital to furnish the name and
address of the manufacturer under Section 18A of the Act
only after she received the report. By the time this
information was received on 08.06.2015, the shelf-life of
the drug had expired and, therefore, the right that the
manufacturer possessed to challenge the veracity of the
test/analysis report was also defeated.
100. It may also be pertinent to notice here that at the
request of the manufacturer, a joint analysis of this
sample was conducted before concluding that the
controlled sample complied with the test for drug release
and that the received portion passed the test at L2 stage.
101. This, by itself, proves that there were contradictory
reports — one report stated that the sample drug did not
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pass the test relating to the release of the drug; while the
other report stated that it had passed the test.
102. It is hence clear that there could be no justification
to continue the prosecution when the joint investigation by
the Drug Inspector, CDSCO, West Zone, Mumbai and the
Drug Inspector, FDA, Nagpur Zone had concluded that the
sample drug did pass the drug release test.
103. As far as the second sample is concerned, the other
Government Analyst received the sample in June, 2014
but again, he took five months to conduct the test and
took a further period of seven months to send his report.
The Government Analyst thus took more than a year to
conduct the test/analysis and submit his report. This
report was also to the effect that the drug did not pass the
test for drug release. Even in this case, the Drugs
Inspector called upon the ESI Hospital to furnish the
details of the manufacturer only after she received the
report from the Government Analyst and, thereafter,
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notified petitioner No1.-Company, who immediately
responded challenging the test report.
104. Even in the case of second sample, the complaint
cannot succeed because of the fact that the averments in
paragraph 47 are vague, insofar as involvement of
accused Nos.2 to 4 is concerned.
105. Having regard to the fact that the very same drug
sample was subjected to a joint investigation in August,
2015 (of the first sample) and it was held that it did pass
the test for drug release, the test conducted on the second
drug sample also cannot be accepted.
V. CONCLUSION:
106. The impugned proceedings as against the petitioners
are therefore, in their entirety, quashed.
107. The criminal petitions are allowed accordingly.
108. In view of the disposal of the petition, all pending
interlocutory applications, if any, stand disposed of.
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VI. DIRECTIONS:
109. Before parting with the case, it is necessary to make
certain observations and issue certain directions regarding
the manner in which the entire process was conducted and
by the Drugs Inspector as well as the Government
Analysts.
110. As already noticed above, the investigation process
prescribed under the Act contemplates taking of the drug
sample. The first step is to secure the drug, divide it into
four portions, handover one portion to the person from
whom the drug sample was obtained, and immediately
send the second portion to the Government Analyst for
test/analysis. The third portion is required to be retained
by the Drugs Inspector if proceedings are to be initiated
on the basis of said drug sample.
111. Since the statutory procedure requires that one
portion needs to be sent for test/analysis, it would be
incumbent upon the Inspector to simultaneously call for
and secure the information regarding the particulars of
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manufacturer of the drug sample, as provided under
Section 18A of the Act. This is necessary because the
moment (s)he receives the test/analysis report from the
Government Analyst under Section 22 of the Act, (s)he is
required to send one copy to the person from whom the
drug sample was obtained and, more importantly, send
the second copy to the person from whom the drug was
procured i.e., the manufacturer whose details were being
furnished under Section 18A of the Act.
112. The fact that the report of the Government Analyst is
required to be sent to the person whose details were
furnished under Section 18A of the Act presupposes that
the Drugs Inspector has to have this information in his/her
possession by the time he receives the report from the
Government Analyst.
113. The procedure adopted in this case of securing the
information of the manufacturer after receipt of the report
from the Government Analyst basically defeats the entire
statutory mandate.
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114. For this reason, henceforth, the Inspectors under the
Act are directed to ensure that they secure information
relating to: (a) the person from whom the drug was
acquired (as provided under Section 18A of the Act); and
(b) the place where the drug was manufactured (as
provided under Section 24 of the Act) — at the same time
that they send the drug sample for test/analysis to the
Government Analyst. Thereafter, on receipt of the report,
(s)he is further directed to immediately forwards the same
to the manufacturer of the drug and whose details are
provided under Section 18A of the Act.
115. In this case, it is also to be noticed here that the
Government Analyst is required to test the drug to ensure
that there are no ill-effects by the use of such drugs to the
general public. By an insertion to Rule 45 of the Rules in
2017, a time limit of 60 days is prescribed for the conduct
of the test and for sending of the report by the Analyst.
116. If a Government Analyst takes several months or, as
in this case, more than a year to conduct the test/analysis
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and submit their report, the possibility of the drug
continuing in circulation, thereby exposing the public to its
ill-effects is clear and present.
117. The Inspector also cannot initiate action against the
manufacturer until he has secured the report from the
Government Analyst and has furnished a copy of such
report to the manufacturer.
118. The Drugs Controller General (India), CDSCO, New
Delhi is therefore directed to issue proper directions to the
Government Analysts to ensure that the test/analysis of
the drug sample sent to them is conducted without any
delay and within the period of sixty days prescribed in Rule
45 from 2017.
119. The Drugs Controller General (India) is also directed
to ensure that an efficient online system is created,
whereby the drug samples which are sent for test/analysis
are expeditiously tested and analyzed by the Government
Analyst within sixty days, and the reports sent by them
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are available online on a real-time basis. This creation of
an effective mechanism to ensure that the entire process
is monitored, and unnecessary delay is not caused in the
conduct of the test/analysis of the drugs sample sent for
test to the Government Analysts would ensure that the ill-
effects of a drug of doubtful quality is prevented.
120. The Drugs Controller (General) shall preferably
ensure that this entire process be web-hosted so that that
all the concerned are aware of the process of testing and
its outcome.
121. A report of compliance of these directions is be
furnished to this Court within a period of eight weeks
from today.
122. The Registry is directed to send a copy of this order
to the Drugs Controller General (India), Central Drugs
Standard Control Organization (CDSCO), FDA Bhavan,
Kotla Road, New Delhi-110 002, forthwith.
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123. Re-list the matter on 28.10.2024 for reporting
compliance.
Sd/-
(N S SANJAY GOWDA)
JUDGE
RK
CT: SN
VC List; Sl No.:11