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AMICUS AI
Citation Codes
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Case Number
Attorney(S)
  • Bidyut Kr. Roy
  • Ajay Kumar Gupta and Amal Kumar Mitra
Judges
  • S.B Sinha
  • A.C.J
  • M.H.S Ansari, J.
Acts
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Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
  • Bidyut Kr. Roy
  • Ajay Kumar Gupta and Amal Kumar Mitra
Judges
  • S.B Sinha
  • A.C.J
  • M.H.S Ansari, J.
Acts
See more information ...
Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

This appeal challenges a judgment and order dated 14-02-1997 (reported at AIR 1997 Cal 186) of a learned Single Judge in C.O. No. 5043(W) of 1996 which quashed Notification No. G.S.R-793(E), published in the Gazette on 13 December 1995. The impugned notification, issued under Section 26A of the Drugs and Cosmetics Act, 1940, imposed a prohibition on the manufacture, sale and distribution of fixed dose combinations of the Hydroxyquinoline group of drugs with any other drug, except for preparations meant for external use.

The Single Judge quashed the notification on the ground that it did not specify the basis on which the Central Government was satisfied as required by Section 26A and that there was nothing on record to show constitution of an expert committee or consultation with manufacturers. The Single Judge directed that the order would remain in abeyance for two months to enable the Central Government to reconsider the matter in accordance with the principles of natural justice, including taking assistance of a committee of experts and giving reasonable opportunity of hearing to manufacturers' representatives.

An interim stay of the Single Judge's order was later granted on 03-02-1999 pending hearing of this appeal.

Legal Issues Presented

  1. Whether the impugned notification issued by the Central Government under Section 26A of the Drugs and Cosmetics Act was invalid for failing to specify the grounds on which the Government was satisfied that prohibition was required in public interest.
  2. Whether the principles of natural justice (including giving reasons and affording hearing/consultation with manufacturers) apply when the Central Government issues a notification under Section 26A exercising legislative/policy power to prohibit manufacture, sale or distribution of a drug.
  3. Whether the quashing of the notification by the Single Judge was appropriate in the light of documentary material (including recommendations of the Technical Sub-Committee of the Drugs Technical Advisory Board and directions or orders of the Supreme Court) relied upon by the appellant.
  4. Whether the issuance of a notification prohibiting a drug under Section 26A is violative of Article 14 or Article 19(1)(g) of the Constitution of India.

Arguments of the Parties

Appellant's Arguments (Drug Controller General of India)

  • The Technical Sub-Committee of the Drugs Technical Advisory Board examined various fixed dose combinations of Hydroxyquinoline group drugs and recommended that such combinations be restricted to external use; the matter was referred to that Sub-Committee before issuing the notification.
  • The Technical Sub-Committee is a statutory body which advises the Central/State Governments, and its recommendations were accepted by the Central Government before issuance of the impugned notification under Section 26A.
  • The impugned notification was issued as a measure carrying out directions of the Supreme Court made on 17-11-1994 in W.P. (C) No. 698/93; an earlier Supreme Court order dated 12-02-1997 accepted recommendations in Dr. Bajaj's report for constitution of a core group.
  • The Technical Sub-Committee's meeting on 23-05-1995 discussed amendment of an existing item (Item No.13 of GSR 578(E) dated 23-07-1983) to restrict clioquinol (halogenated hydroxyquinolines) to specific indications and for external use only, and the impugned notification was based on such recommendations.

Respondents' Arguments (Writ Petitioners)

  • The impugned notification merely reproduced the language of Section 26A and did not specify the grounds on which the Central Government arrived at satisfaction that prohibition was necessary in public interest.
  • Prior to issuance of the notification, principles of natural justice were not complied with (no consultation or hearing to affected manufacturers); the Single Judge found in favour of this contention.
  • Despite the Single Judge having granted an opportunity to the authorities to issue an appropriate notification, no action was taken thereafter (as contended before the trial judge).

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Systopic Laboratories (Pvt.) Ltd. v. Dr. Prem Gupta, 1994 Suppl. (1) SCC 160 : AIR 1994 SC 205 To support the proposition that a notification completely prohibiting manufacture and sale of a drug is not violative of Article 14 or Article 19(1)(g) of the Constitution. The Court relied on this authority to hold that prohibition by notification under Section 26A is not per se unconstitutional under Article 14 or Article 19(1)(g).
Vincent Panikurlangara v. Union of India, AIR 1987 SC 990 To show that the question of banning a drug is a matter of national importance. The Court referred to this decision to underscore that banning a drug involves national importance, supporting the view that such policy decisions fall within governmental competence.
Unichem Laboratories Ltd., Bombay v. Union of India, AIR 1988 Bombay 134 Discusses assignment of reasons as part of natural justice and observes that the decision in that case did not address whether notification under Section 26A is legislative in nature; it does not lay down an absolute rule. The Court noted that Unichem does not lay down any law in absolute terms; it observed that assignment of reasons is part of natural justice but, unless statute requires it or the order has civil consequences, reasons need not be provided; policy decisions necessary in public interest may be excluded from natural justice requirements.
Re. P.P. Raja Reddy, (1997) 1 Cal LJ 41 : AIR 1997 Cal 192 On the discretionary nature of extraordinary writs such as certiorari or mandamus. The Court cited this decision for the principle that issuance of writs like certiorari or mandamus is discretionary, supporting the view that the writ court may refuse to exercise jurisdiction in the larger public interest.

Court's Reasoning and Analysis

The Court's analysis proceeded in several connected steps based exclusively on material in the opinion:

  1. The Drugs and Cosmetics Act is a complete code governing the subject matter, and an order under Section 26A is an exercise of the Central Government's legislative power. When legislative power is exercised in this manner, the Court held that the requirements of natural justice do not ordinarily apply.
  2. The Court emphasized that the Central Government's satisfaction about a drug being injurious to public health is essentially a policy decision. Because it is a policy decision made in the public interest, the Court reasoned that compliance with principles of natural justice (such as prior hearing or assignment of reasons) is excluded in such contexts.
  3. On constitutional challenge, the Court applied Systopic Laboratories to conclude that a notification totally prohibiting manufacture and sale of a drug is not necessarily violative of Article 14 or Article 19(1)(g).
  4. The Court relied on Vincent Panikurlangara to stress that banning a drug is a matter of national importance, reinforcing the conclusion that policy decisions in this area attract deference.
  5. The Court examined the Unichem decision and observed that it did not create an absolute rule requiring reasons in every case; rather, assignment of reasons is part of natural justice but is not required unless a statute clearly provides for it or the order imposes civil consequences on particular persons.
  6. The Court noted that the writ remedies (certiorari, mandamus) are discretionary (citing Re. P.P. Raja Reddy) and that, in some cases, the writ court may refuse to exercise jurisdiction in the larger public interest.
  7. The Court accepted the appellant's contention that the Technical Sub-Committee of the Drugs Technical Advisory Board had considered the matter and made recommendations restricting the clioquinol/halogenated hydroxyquinoline group to certain indications and external use only; the appellant relied on these recommendations and on Supreme Court directions/orders to support issuance of the impugned notification.
  8. Because the appeal is a continuation of the writ proceedings, the Court noted it could consider additional documents not produced before the Single Judge and could grant appropriate relief in continuation of the writ proceeding (citing Section 107 read with Order 7, Rule 7 of the Code of Civil Procedure).
  9. Balancing these considerations, the Court concluded that the Single Judge ought not to have allowed the writ petition and quashed the notification; consequently the impugned judgment and order of the Single Judge could not be upheld.

Holding and Implications

Holding:

The impugned judgment and order quashing Notification No. G.S.R-793(E) dated 13-12-1995 are set aside; the appeal is allowed.

Direct implications for the parties:

  • The Single Judge's order quashing the Central Government's notification has been reversed by this Court; the judgment under appeal cannot be upheld and has been set aside.
  • There is no order as to costs in this appeal.

Broader implications: The opinion emphasizes that notifications issued under Section 26A as policy or legislative measures fall within the Central Government's competence and, in such circumstances, the court will not readily import procedural requirements of natural justice unless statute or the nature of the order demands it. The opinion does not purport to announce a new foundational precedent beyond its application of existing authorities cited in the judgment.

Appeal allowed.
Show full summary ...

    Drug Controller General Of India And Another v. West Bengal Small Scale Manufacturers Association And Others

    1. The instant appeal is directed against a Judgment and order dated 14-2-97 reported in AIR 1997 Cal 186 passed by a learned Single Judge in C.O No. 5043(W) of 1996 whereby and whereunder the Notification No. G.S.R-793(E), issued under Section 26A of the Drugs and Cosmetics Act, 1940 (in short the Act) and published in the Gazette dated 13th December, 1995 was quashed and set aside.

    2. By the impugned Notification dated 13th December, 1995 a prohibition on manufacture, sale and distribution of fixed dose combination of Hydroxyquinoline group of drugs with any other drug, except for preparations meant for external use, was imposed.

    3. The impugned Notification has been issued in exercise of the power vested in the Central Government under Section 26A of the Act which reads as under:—

    “Power of Central Government to prohibit manufacture, etc. of drug and cosmetic in public interest.— Without prejudice to any other provision contained in this Chapter, if the Central Government is satisfied, that the use of any drug or cosmetic is likely to involve any risk to human beings or animals or that any drug does not have the therapeutic value claimed or purported to be claimed for it or contains ingredients and in such quantity for which there is no therapeutic justification and that in the public interest it is necessary or expedient so to do, then, that Government may, by notification in the Official Gazette, prohibit the manufacture, sale or distribution of such drug or cosmetic.”

    4. The contention of the respondents-writ petitioners assailing the impugned notification was that except reproducing the language of Section 26A of the Act, the impugned Notification does not specify the ground on which the Central Government arrived at a satisfaction that the manufacture, sale and distribution of fixed dose combination of Hydroxyquinoline group of drugs with any other drug, except for preparations meant for external use was required to be prohibited in the public interest.

    5. The above contention found favour with the learned single Judge in quashing the impugned notification. The Ld. single Judge observed that there was nothing on record to show that any expert committee was constituted to examine the matter in consultation with the manufacturers of the drugs in question and directed that the order under appeal shall remain in abeyance for a period of two months from the date thereof to enable the Central Government to consider the matter afresh in accordance with the principles of natural justice and administrative fair play. It was further directed that while reconsidering the matter, the Central Government should take the assistance of a committee of experts which should give the representative of the manufacturers of the drug in question, including the petitioners a reasonable opportunity of hearing and placing relevant research papers and documents.

    6. While giving directions for hearing the appeal expeditiously an interim order staying the operation of the Judgment under appeal was passed on 3-2-99.

    7. It is the case of The Drug Controller General of India, appellant before us, that before issuing the final notification the matter was referred to before the Technical Sub-Committee of Drugs Technical Advisory Board whereby the Technical Sub-Committee has recommended the case for external use after examination of various fixed dose combination of Hydroxyquinoline group of drugs with any other drug. It is the submission of the appellant that the Sub-Committee is a statutory body which may advice the Central/State Government for implementation of the Act. The recommendations made by the said Sub-Committee were accepted by the Central Government and thereafter the impugned notification was issued in exercise of the power vested in it under Section 26A of the Act.

    8. It is the further submission of the Ld. Counsel for the appellant that the impugned notification was issued as a measure of carrying out the directions of the Supreme Court of India made on 17-11-1994 in W.P (C) No. 698/93. The Ld. Counsel for the appellant has referred to and relied upon an earlier order of the Supreme Court dated 12-2-97 whereby the Supreme Court accepted the recommendations made in the report of Dr. Bajaj for constitution of a core group.

    9. Reliance has also been placed upon the order of the Supreme Court dated 17-11-1994 wherein the submissions of learned Additional Solicitor General were accepted and the Supreme Court considered it appropriate to permit the Advisory Board to constitute a Technical Sub-Committee for the purpose of expediting its work. It is the submission of the Ld. Counsel for the petitioner that the Technical Sub-Committee so constituted, at its meeting held on 23rd May, 1995 made the following suggestions:—

    “The members had agreed to amend the existing item No. 13, GSR 578 (E) dated the 23rd July, 1983 which reads as follows:—

    ‘Fixed dose combination of halogenated hydroxyguinoline group of drugs except preparations which are used for the treatment of diarrhoea and dysentery and for external use only.’

    10. This amendment was considered necessary as in the last meetting which was held on 15th February, 1995, it was decided by majority of the experts that clioquinol group of drugs (halogenated hydroxyquinolines) can only be indicated as rational for the treatment of non-dysentric amoebic colicis and for syst passers and clioquinol or any derivative of clioquinol should alone be administered for the treatment of diarrhoea and dysentery and not any fixed dose combination.

    11. The member had agreed that this Item No. 13 of GSR 578(E) 23-7-1983 require amendment in light of the discussion of the experts and clioquinol group of drugs should alone be marketed for restricted indications as amended above and for external use only. However, for the exact language of this notification, the members will give a thought to it and write back to the secretariat.”

    12. In short, it is the submission of the appellant that the impugned Notification was based upon the recommendations of the said Technical Sub-Committee.

    13. On the other hand, the submission of the respondent which has been found favour with the learned trial Judge was that prior to issuance of the impugned notification, the principles of natural justice had not been complied with. It has further been contended that despite the fact that an opportunity had been granted to the authorities by the Ld. trial Judge to issue an appropriate notification, no action thereupon had been taken.

    14. Drugs and Cosmetics Act, is a complete code in itself. The said Act lays down procedures before a notification under Section 20-A of the Act can be issued. An order issued under Section 26-A of the Act by the Central Government would be in exercise of its legislative power. When such legislative power is exercised, the question of complying with the principles of natural justice would not arise. Furthermore satisfaction of the Central Government to the effect as to whether drug should be prohibited or not on the ground that the same is injurious to public health is essentially a matter dealing with a policy decision, and, thus, compliance of the principles of natural justice must be held to be excluded in such a situation.

    15. A notification completely prohibiting manufacture and sale of drug is not either violative of Article 14 of the Constitution of India or Article 19(1)(g) thereof. See Systopic Laboratories (Pvt.) Ltd. v. Dr. Prem Gupta, reported in, 1994 Suppl. (1) SCC 160 : AIR 1994 SC 205.

    16. In Vincent Panikurlangara v. Union of India, reported in AIR 1987 SC 990, the Apex Court has held that the question of banning a Drug is of National importance.

    17. Unichem Laboratories Ltd., Bombay v. Union of India reported in AIR 1988 Bombay 134 upon which reliance had been placed by the respondent herein does not lay down any law in absolute term. In the said decision the question as to whether issuance of a notification in terms of Section 26-A being legislative in nature or not, was not raised. Assigning of a reason is a part of principles of natural justice. Unless a statute clearly provides for assignment of reason, no reason is required to be assigned unless the order visits the concerned persons with civil consequences. A policy decision adopted by the State may affect a particular person or a group of persons but such a policy decision being necessary in the public interest, requirements to comply with the principles of natural justice must be held to be excluded.

    18. According to the respondents, the requirements laid down under the provisions of Section 26-A of the Act have been complied with. Assuming that the same had not been complied with, the writ Court in a given case may refuse to exercise its jurisdiction keeping in view in larger public interest.

    19. In Re. P.P Raja Reddy reported in, (1997) 1 Cal LJ 41 : (AIR 1997 Cal 192) one of us held that issuance of writ of certiorari or, mandamus is a discretionary remedy.

    20. In any event, it was not a case where a writ application could have been entertained by way of a public interest litigation in view of the aforementioned decision in Vincent Panikurlangara v. Union of India reported in, AIR 1987 SC 990.

    21. For the reasons aforementioned we are of the opinion that it was not a fit case in which the learned trial Judge ought to have allowed the writ application.

    22. Although several documents had now been placed before us as regards compliance of the provisions of the Act we are of the opinion that appeal being a continuation of writ petition, this Court while exercising its jurisdiction for issuance of a writ of or in the nature of mandamus in public interest can take into consideration other and further documents which had not been produced by the appellants before the learned trial Judge. It is also well settled that the appeal being a continuation of a writ proceedings; the Court in terms of the principles laid down in Section 107 read with Order 7, Rule 7 of the Code of Civil Procedure, can grant appropriate relief.

    23. For the reasons aforementioned we are of the opinion that the impugned judgment and order cannot be upheld which is set aside accordingly. The appeal is allowed but in the facts and circumstances of this there will be no order as to costs.

    Appeal allowed.

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