JUDGMENT

B. P. JEEVANREDDY, J. —Leave granted.

2. Hindustan Antibiotics Limited (H.A.L.) is engaged in the manufacture of several antibiotic drugs including Pencillin-G. It has a plant at Pimpri in the State of Maharashtra. Though the installed capacity of the plant is 1600MMM, it has been able to produce only 850 MMU. H.A.L. is a Government company fully owned by the Government of India. There is another Government company, I.D.P.L.producing the same drug. We are told that at present there is only one unit in private sector, Alembic, which is producing the said drug. The total production of Penn-G within the country is sufficient to meet only 45 of the countrys total requirement. The remaining 55 is being imported. The price of the imported Penn-G is half the price at which the locally produced drug is sold.

3. Penn-G is produced through complex fermentation under controlled conditions of strains of the fungus Penicillium Notatum and Penicillium Chrysogenum. It is stated that the companies all over the world have been trying to develop the strains to improve the quality and yield. H.A.L., which has been producing the drug in this country for over two decades, has also been trying