State Petitioner v. Parmanand Malhotra And Anr. S

S.K Agarwal, J.:— This appeal under Section 378 of Cr.P.C has been filed by the State through the Drugs Inspector. Delhi against the judgment and order dated 5.2.1981 passed by the Metropolitan Magistrate, Delhi acquitting Parmanand Malhotra, partner of M/s. Deep Medical Stores for the offences under section 27(a) & (b) read with section 18 (a)(1)(ii) of the Drugs and Cosmetics Act. 1940 (for short, ‘the Drugs Act”). Questions which arise for consideration in this case are: whether a person found in possession of spurious drug, which is seized from an open bottle, can be permitted to raise the defence that it was purchased by him from a licensed dealer, it was properly stored and it remained in the same state as when it was purchased, therefore, he is not liable? And whether in such cases, the Drug Inspector is not obliged to take action against the dealer(s) and manufacturer(s) of such spurious drug? This case is a classic example as to the casual manner in which the cases under the said Act are investigated and prosecuted.

2. Prosecution case, in brief, is as follows: On 23.6.1978, at about 4.00p.m complainant inspected shop of the accused; he was found stocking, and exhibiting for sale 340 tablets of Chloroquine Phosphate I.P 250 mg. Batch No. T-80064 dated April 1978 bearing the label of M/s. Nectarine Pharmacy, Faridabad (hereinafter referred to as ‘the drug’). The entire drug was taken as sample, for the purpose of test and analysis in accordance with section 23 of the Act. On 24.6.1978, sample was sent to Government Analyst, Central India Pharmacopocial Lab., Ghaziabad for analysis along with forwarding memo and seal impression. On 30.6.1978, it was reported that the drug did not contain any chloroquine. It was also found to be misbranded under section 17(f) of the Act, because label of the container bore the false statement. On these facts, complaint was filed alleging that accused contravened the provisions of section 18(a)(1) punishable under section 27(b) and 18(a)(ii) punishable under section 27(a) of the Drugs Act; charge was framed, the accused pleaded not guilty and claimed trial. The parties hereinafter are referred to as the complainant and accused for the sake of convenience.

3. The complainant examined herself as PW-1 and stated that on 23.6.1978 at about 4.00 p.m, she visited the premises of the accused; he was found stocking and exhibiting for sale 340 tablets of Chloroquine Phosphate which were kept in an open plastic container. These tablets were purchased by her for Rs. 61.20 and were divided into four equal parts, as required by section 23 of the Act. The sample was sealed with her own seal, bearing the impression of HMS, in presence of the accused, who was given an opportunity to sign, but he declined. One part of the sample was given to the accused on the prescribed form and accused signed the same at point ‘ × ’. On 24.6.1978, one portion of the sample was sent to Government Analyst for analysis vide memo EX.PW-1.M. The accused was asked to disclose name of manufacturer etc. under section 18-A, vide memo Ex.PWI/N. He sent a reply enclosing a photostat copy of bill Ex. PW-1.DA, showing that drug was purchased by him from M/s. Ghai Enterprises, Ashok Vihar, Delhi (Ex. PW 1/0) {hereafter, ‘the supplier’}. The drug was reported as not of standard quality by the Government Analyst, as it did not contain any chloroquine vide report Ex. PW-1.P dated 30.6.1978 On 7.7.1978 copy of the report was sent to the accused through letter Ex. PW-1.Q. After the accused had disclosed name of the supplier from where the drug was purchased by him, on 22.7.1978, triplicate sealed sample of the drug along with the report was sent to them through the letter Ex. PW-1.R, which was acknowledged vide letter Ex. PW 1.S. The supplier informed Investigating Officers that they had in turn purchased the drug from M/s. Anand Medicines Co., Bhagirath Palace (hereafter, ‘the wholesaler’) vide cash memo No. 8365 dated 14.4.1978, however, no enquiries were made from them. Enquiry was also made from M/s. Nectarine Pharmacy and their chief analyst sent reply, which was treated as the statement, Ex. PW 1.U. The witness in her cross examination admitted that she did not make any investigation either from the wholesaler or the manufacturer, except writing the letter. The reason given was that the sample was taken from an open bottle; and in such cases defence under section 19 of the Drugs Act, was not available to the accused. Prosecution also examined PW-2, Narendra Kumar Ghai, who stated that he was doing business of drugs under a proper license; that he had supplied one bottle of 500 tablets of chloroquine of Batch No. 80064 (Nectrine) to the firm of the accused vide bill dated 19.5.1978, EX.PW-1.DA and that the drug in turn was purchased by him from the said wholesaler, at Bhagirath Place, Delhi.

4. The accused in his statement under section 313 admitted that he is running the chemist shop and was holding a drug licence. He admitted that on 23.6.1978, the Drug Inspector visited his shop and took sample of chloroquine tablets of the said batch bearing label of M/s. Nectarine Pharmacy. Faridabad from an open bottle for tests and analysis. He stated that sample was the product of M/s. Nectarine Pharmacy which was purchased by him from the supplier on 19.5.1978 through the bill Ex. PW-1.DA in the presence of Dr. D.P Mittal. The bottle was opened in the presence of the doctor who took out four tablets. He further stated that the drug was properly stored and it remained in the same state from the time he received delivery: and denied that these tablets were seized in compliance with the mandatory provisions of the Act and the rules. It was pleaded that the prosecution based on the document PW-1.U (statement of M/s. Nectarine Pharmacy Chemical Analyst) is not sustainable. In support of his defence, accused examined Dr. D.P Mittal DW-1 who produced one bottle (Ex.P1) containing chloroquine phosphate tablets purported to have been manufactured by M/s. Nectarine Pharmacy and demonstrated that tablets could be taken out from the bottle without interfering with the seal.

5. On the above facts, learned trial court vide judgment and order dated 5.2.1991 acquitted the accused. This order is under challenge. Ms. Richa Kapur, Addl. Public Prosecutor argued that enquiries were not made either from manufacturers or agents, or supplier, as the drug was seized from an open container from the accused. It was argued that under section 19(3)(c) of the Act, it is for the accused to prove that the drug remained in the same state, as was acquired. Learned counsel argued that as the drug was seized from a bottle which was already open, the plea that it was purchased from the licenced dealer was not - available to the accused. The acquittal of the accused is mainly on this ground, which is not sustainable.

6. Shri D.C Mathur, learned senior counsel for the respondent, argued to the contrary submitting that accused is not liable for the contravention of section 18 of the Act, as he did not know that the said drug was in any way spurious; the drug was properly stored and remained in the same state, as was acquired. Learned counsel argued that defence plea under section 19 would be available to the accused, even if the container had been opened, as contents of the container were not changed. Learned counsel further argued that sub-section (2) of section 19 of the Prevention of Food Adulteration Act. 1954 (for short, “PFA Act”) is pari materia to section 19(3) of the Drugs Act. It was argued that under the PFA Act the vendor who opens the container of a branded article of food and sells the same in retail, does not lose protection of section 19(2) merely because he had opened the container, provided that he sells the article in the same condition in which it was purchased. Learned counsel argued that this principle is fully applicable to the cases under the Drugs Act. In support of his submission reliance was placed on the Supreme Court in Andhra Pradesh Grain and Seed Merchants Association & Ors. v. Union of India & Anr., AIR 1971 SC 2346.

7. In order to appreciate the rival contentions, it is necessary to refer to the relevant provisions of both these Acts. Section 19 (3) of the Drugs Act, reads as under:

“19. Pleas-(1) & (2) xxx

(3) A person, not being the manufacturer of a drug or cosmetic or his agent for the distribution thereof shall not be liable for a contravention of Section 18 if he proves -

(a) that he acquired the drug or cosmetic from a duly licensed manufacturer, distributor of dealer thereof:

(b) that he did not know and could not, with reasonable diligence have ascertained that the drug or cosmetic in any way contravened the provisions of that section; and

(c) that the drug or cosmetic, while in his possession, was properly stored and remained in the same state as when he acquired it.”

8. Perusal of sub-section (3) of section 19 of the Drugs Act reveals that it does not provide protection to the manufacturer of the drug or his agent for the distribution. It only protects the persons, other than the manufacturer or his distributing agents. The essential ingredients required to be established for availing the benefit of this section are: - (i) that he acquired the drug from the duly authorized person; (ii) he did not know and could not with reasonable diligence have ascertained that the drug in any way contravened any provision of the Act; and (iii) that the drug while in his custody was properly stored and remained in the same state, as it was when he acquired it.

9. Section 19 of the PFA Act, provides the defences which may or may not be allowed in the prosecution under this Act. It reads as under:

“19. Defences which may or may not be allowed in prosecutions under this Act.

(1) It shall be no defence in a prosecution for an offence pertaining to the sale of any adulterated or misbranded article of food to allege merely that the vendor was ignorant of the nature, substance or quality of the food sold by him or that the purchaser having purchased any article for analysis was not prejudiced by the sale.

(2) A vendor shall not be deemed to have committed an offence pertaining to the sale of any adulterated or misbranded article of food if he proves -

(a) that he purchased the article of food

(i) in a case where a licence is prescribed for the sale thereof, from a duly licenced manufacturer, distributor or dealer;

(ii) in any other case, from any manufacturer, distributor or dealer, with a written warranty in the prescribed form;and

(b) that the article of food while in his possession was properly stored and that he sold it in the same state as he purchased it.

(3)xxxxxx”

10. The comparative analysis of section 19 (2) of the PVA Act would show that this provision is similar to section 19 (3) of the Drugs Act. Although two are differently worded but the basic ingredients are the same. The Supreme Court in Andhra Pradesh Grain and Seed Merchants Association's case (supra), while considering the scope and ambit of section 19(2) of the PFA Act laid down that vendor does not lose limited protection merely because he had opened the container. It was held:

“The argument of counsel for the petitioners that the provision that a retail seller who opens a container of a branded article of food loses even the limited protection under Sec. 19(2) is without substance. Clause (b) of sub-s. (2) of S. 19 does not provide, nor does it imply, that if the container of a branded article is opened, the article of food ceases to be in the same state in which the vendor purchased it. If the article of food is sold in the same condition in which it was purchased from a licensed manufacturer or dealer, or was purchased with a warranty, the vendor will not lose the protection of sub-section (2) of S. 19 merely because he opened the container.”

11. The ratio of the above decision is fully applicable to the facts at hand. In this view of the matter, contention of the petitioner that as the drug was seized from the bottle which was open, the onus to prove that he did not contravene the provisions of the drugs act was on him or that it was not necessary for the Investigating Officer to make investigation from the supplier or manufacturer, is totally misplaced and has to be rejected. The appeal has no merit and (the same is dismissed.

12. Before parting with the case, I am constrained to observe that the record of this case demonstrates the casual manner in which the investigation and prosecution of the cases under the Drugs and Cosmetics Act, 1940 are dealt with by the department. Firstly, despite the fact that no Chloroquine ws found in the bottle seized from the chemist shop, Investigating Officer did not make any effort to interrogate or search premises of the supplier - M/s. Ghai Enterprises, Ashok Vihar, Delhi; wholesaler- M/s Anand Medicines Company, Bhagirath Place, Delhi; and manufacturer - M/s Nectarine Pharmacy, Faridabad, to find out whether similar spurious drugs were available there or not. Dr. D.P Mittal appeared as a defence witness during the trial and produced another bottle of Chloroquine tablets of the same manufacturer and from that bottle tablets could be taken out without tampering with the seal. Even, at this stage, department did not feel it necessary to take remedial steps. Secondly, complaint was filed by the Drug Inspector himself. She was not represented by any lawyer either at the time of filing of the complaint or at any stage during the trial. The Court was informed that this is the usual practice being followed in all investigations and trials. Thus, it was felt necessary that deciding of the appeal would not be enough and further directions are called for, so that other pending investigations or trials can be properly pursued. Accordingly, on 24.8.2005 the Drug Controller, Delhi was directed to file an affidavit stating that how many cases are pending trial under the Drugs and Cosmetics Act, and in how many cases the manufacturer or wholesaler is being prosecuted and whether complainants are represented by any lawyer for conducting trial Shri Baldev Malik, Advocate was appointed as the Amicus Curiae, to assist in the matter.

13. Shri G.C Lal, Deputy Drugs Controller and Licencing Authority, Drugs Control Department, Government of NCT of Delhi, filed affidavits inter alia stating that: ‘more often than not, a person apprehended with spurious drug(s) does not disclose source or at times produces fake purchase bill(s). Whenever, the apprehended person discloses source, investigations are made by the officers of Drugs Control Department and/or Delhi Police and accused are prosecuted.’ It is further stated: ‘there have been some instances in which spurious drugs were manufactured outside Delhi but were being delivered in Delhi suggesting that spurious drugs are manufactured outside Delhi. The Drugs Inspector of Delhi Government has no jurisdiction to investigate the matter pertaining to the manufacturers and suppliers located outside Delhi. In such cases, the matter is generally referred to State Drugs Controller and FIR is filed against the person from whom the sample of spurious drug was collected/seized. It is further stated that the total number of cases under the Drugs and Cosmetics Act, 1940 pertaining to spurious drugs are 67 and only in 15 matters manufacturer of the drug has been arrayed as an accused and in other cases they have been made witnesses. Thus, in about 80 per cent cases, manufacturing of spurious drugs have not been challenged and the manufacturing tools were not seized.

14. It is also stated that the Drugs Control Department, Government of NCT does not have services of full time lawyers for conducting trials and that Drug Inspectors of the Department, who are graduates in Law, assist the complainant/Investigating Officer for conducting the trial and in case of any difficulty, learned Additional Public Prosecutor of the concerned Court is requested to assist the department. “It is difficult to undterstand why this is being permitted. The Drug Inspectors cannot be expected to know technicalities of law, which are essential for conducting any trial. This practice would only help the accused, who are generally represented by competent and experienced lawyers.

15. There cannot be any dispute that the offences under the Drugs and Cosmetics Act are grave. It is shocking even to imagine a person being administered spurious drugs, who is fighting between life and death. The spurious drug destroys even the last chance of a dying man; even when the spurious drugs do not endanger life, they can leave the patient seriously ill for the rest of his life. The inadequate potency also does a bigger harm to the society because of the resistant the patient may develop to the drug. Thus the spurious drug risks the entire society and, therefore, manufacturers and the distributors of the spurious drugs ought to be traced in each case. Merely catching a person with the spurious drug can never be considered enough. In other words, source in all cases has to be detected and machines and manufacturing tools are to be seized. As noted above, in 80 percent cases, despite recovery of the spurious drugs, manufacturers have only been made witnesses and the persons in alleged possession of the spurious drugs are being prosecuted. Where are the persons who manufacture spurious drugs? Where are the machines and other articles used for manufacturing such drugs? The answers are writ large. The reasons may be many. The drug inspectors, who investigate these offences are hardly trained in the manner of interrogation and investigations of the cases. Whenever the spurious drug is seized, they feel content by prosecuting the person from whose possession the recovery has been effected. They do not possess the power for custodial interrogation like that of the police. They further do not have any power to investigate beyond the territorial jurisdiction of the district, where they are posted. For all this the Drugs Act would require legislative changes and the Bill for amendment of the Drugs Act is already pending before the Parliament.

16. Whatever may be the constraints, the investigation and prosecution of the offences under the Drugs Act cannot be permitted to be handled, in the manner in which it is being presently done. Learned Amicns Curiae has given several useful suggestions to make the existing procedure more meaningful and effective. Till such time the remedial steps are taken by the Legislature, in my considered view, it is permissible to adopt a practical approach to give effect to the purpose and the spirit of the Drugs and Cosmetics Act. For the foregoing reasons, the Drugs Controller and Licencing Authority, Government of NCT, Delhi is directed to ensure the following:

(1) Whenever there is a recovery of spurious or adulterated drugs, First Information Report should be invariably lodged at the concerned police station, as early as possible so that, if necessary, the offender can be subjected to custodial interrogation and manufacturer(s) and distributor(s) of such drugs can be traced and prosecuted in accordance with law.

(2) Whenever FIRs under the Drugs and Cosmetics Act are lodged, the matter should be got investigated by some senior officer preferably above the rank of an inspector. After completion of investigations, the report under section 173 Cr.P.C, should be filed in the Court along with complaint under section 32 of the Drugs Act, with a specific prayer to the Court, that the cognizance be taken on the complaint. The Drug Inspector should be called in the Court, when the challan is filed and he should be associated during investigations so that procedural and technical aspects of the seizure and analysis are properly followed as was laid down in Ram Chandar v. P.K Gupta & Anr.; 99 (2002) Delhi Law Times 706.

(3) Even in the complaints which are filed by the inspectors, where the FIR is not lodged, the trial should be conducted on behalf of the department through the experienced lawyers because drug inspectors are not expected to be conversant with technicalities of procedure etc. This practice is being followed in the other Government departments, dealing with the cases under PFA Act, Essential Commodities Act and Customs Act, and also by corporate bodies like MCD, DDA, NDMC, BSES.

(4) In all cases pending trial pertaining to spurious or adulterated drugs, the Department is directed to engage services of competent lawyers, within eight weeks, so that the pending cases do not suffer because of lack of legal assistance.

(5) The department should be strengthened and complaint(s) should be filed by some senior officer and not by the drug inspector, whose main job should be to gather intelligence and to effect seizures. If necessary, the department may consider designating officers from amongst the officials competent to file the complaints and pursue them in the Court of law. The concerned staff should be provided sufficient training in the detection, investigation and prosecution of the cases, at suitable centres like Delhi Judicial Academy and other training centres.

17. Before concluding, I would like to record appreciation for the assistance rendered by learned counsel for the parties and Mr. Baldev Malik, learned Amicus Curiae.

18. With the above directions, appeal is disposed of. List the matter before the Division Bench dealing with Public Interest Litigation, for further directions, on 10th March, 2006.

19. Copy of the Judgment be sent to the Chief Secretary, Government of NCT of Delhi and Commissioner of Police for appropriate follow up action.