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2024 Supreme(SC) 1333
SUPREME COURT OF INDIA
VIKRAM NATH, PRASANNA B. VARALE, JJ.
M/s Bhagwati Medical Hall & Anr. – Appellants
Versus
Central Drugs Standard Control Organization & Ors. - Respondents
Civil Appeal Nos. 14735-14736 of 2024 [Arising From SLP(C) Nos.22833-22834/2022]
Decided on : 19-12-2024
For the Petitioner(s): Ms. Parul Shukla, AOR (mentioned by)
For the Respondent(s): Mr. Gurmeet Singh Makker, AOR Mr. Samar Vijay Singh, AOR
The court ruled that only the Central Government can prohibit the sale of a drug under the D&C Act, 1940, and local authorities cannot unilaterally classify a licensed product as prohibited.
Headnote:(A) Drugs & Cosmetics Act, 1940 - Section 26A - The Appellants challenged the High Court's orders restricting the sale of aromatic tincture of cardamom, asserting it is a licensed medicine. The High Court upheld the restrictions, categorizing it as a prohibited article. The court found no prohibition under the Act, emphasizing that only the Central Government can impose such restrictions. (Paras 7, 9, 14)
(B) Administrative Law - The court ruled that local authorities cannot unilaterally classify a licensed drug as prohibited without a notification from the Central Government, reaffirming the need for a centralized regulatory approach. (Paras 11, 14)
Facts of the case:
The Appellants, licensed sellers of medicinal products, faced repeated inspections and restrictions on selling aromatic tincture of cardamom, which they argued was lawful under the D&C Act, 1940. (Paras 3.1, 3.6)
Findings of Court:
The court determined that the tincture is not prohibited and the Appellants are entitled to resume their business without unwarranted interference. (Paras 14, 17)
Issues: The main issues were whether the tincture could be classified as a prohibited article and the authority of local officials to impose such restrictions. (Paras 4.1, 4.4)
Ratio Decidendi: The court held that the absence of a prohibition notification under Section 26A of the D&C Act, 1940 means the tincture remains lawful, and local authorities cannot impose bans without proper statutory backing. (Paras 9, 14)
Result: Appeals allowed.
ORDER :
1. Leave granted.
2. These appeals, by the Appellants, challenge the correctness of the orders dated 12.07.2022 and 22.09.2022 passed by the High Court of Judicature at Allahabad in Writ C No.13134 of 2022 and Civil Misc. Review Application No.355 of 2022, respectively. By the impugned orders, the High Court dismissed the writ petition as well as the review petition preferred by the Appellants, thereby upholding the actions taken by the Respondent authorities restricting the sale of a medicinal preparation known as “aromatic tincture of cardamom” at the Appellants’ medical shops.
3. The factual background giving rise to the present appeals are as follows:
3.1. The Appellants are proprietors of medical firms/shops engaged for several decades in the wholesale and retail sale of drugs and medicines at Agra, Uttar Pradesh. They hold valid and subsisting licenses under the Drugs & Cosmetics Act, 1940 (hereinafter, “D&C Act, 1940”) and the rules framed thereunder, permitting them to sell, stock, and distribute various drugs, including a herbal medicinal preparation commonly referred to as “aromatic tincture of cardamom.”
3.2. The said tincture, as stated by the Appellants, is a non- prescription, licensed medicine recognized under the D&C Act, 1940. It is used for treating mild ailments such as indigestion, flatulence, stomach pain, nausea, and vomiting. The tincture is manufactured by licensed manufacturers who are approved by the Indian Government, and the Appellants procure their supplies from such recognized sources, including the British Pharmacopoeia-approved suppliers.
3.3. The Appellants submit that, despite the lawful nature of their business, the Respondent authorities—comprising officers from the Drug Control and Excise Departments of the State—subjected their shops to repeated inspections, abrupt closures, and harassment.
3.4. On earlier occasions, the Appellants approached the High Court of Judicature at Allahabad, which, by an order dated 27.09.2021, directed that the State authorities shall not interfere with the running of the Appellants’ business except in accordance with law.
3.5. Further grievances arose when the District Magistrate, Agra, issued orders on 28.02.2022 constituting a joint team to curb the sale of “alcohol mixed tinctures,” and the Drug Inspector thereafter, on 11.04.2022, purportedly directed the Appellants not to sell aromatic tincture of cardamom.
3.6. Aggrieved by these actions, the Appellants filed Writ C No.13134 of 2022 before the High Court, seeking quashing of the impugned orders restricting their trade and an interim direction permitting them to continue their lawful business. The High Court, however, dismissed the writ petition on 12.07.2022, holding inter alia that “alcohol mixed tincture is a prohibited article,” thereby upholding the actions taken by the Respondent authorities. The Appellants filed a Civil Misc. Review Application No.355 of 2022, but the review petition was also dismissed on 22.09.2022.
3.7. The Appellants are before this Court challenging the aforesaid orders of the High Court and seek restoration of their right to carry on their business in accordance with their valid license and the statutory provisions.
4. The learned counsel for the Appellants, Shri Nikhil Goel, advanced the following arguments:
4.1. The learned counsel for the Appellants contends that the High Court erred in categorizing aromatic tincture of cardamom as a “prohibited article.” According to the Appellants, no such prohibition exists under the D&C Act, 1940, or any notification issued thereunder. Section 26A of the D&C Act, 1940 empowers only the Central Government to regulate, restrict, or prohibit the sale and distribution of any drug in the public interest. There being no notification prohibiting this particular tincture, the Respondent authorities have no jurisdiction to treat it as a banned substance.
4.2. The Appellants argue that the impugned orders passed by the Respondent authorities and the Hi
