The main legal point established in the judgment is that for making a director of a company liable for offences committed by the company under the Drugs & Cosmetics Act, 1940, there must be specific averments showing the director's responsibility for the conduct of the business of the company, as established in relevant legal precedents.

ORDER :

Since similar issue is involved in both these criminal petitions filed under Section 482 Cr.P.C., they were heard together and are being disposed of by this common order.

2. Crl.P.No.2894 of 2014 has been filed to quash the proceedings in P.R.C.No.21 of 2013 on the file of the learned II Additional Judicial First Class Magistrate, Machilipatnam, Krishna District, insofar as the petitioners/accused Nos.2 to 4 therein. Crl.P.No.14687 of 2014 has been filed to quash the proceedings in P.R.C.No.18 of 2014 on the file of the learned Additional Munsiff Magistrate, Chirala, insofar as the petitioners/accused Nos.2 to 4 therein.

3. Facts of the cases, briefly stated, are as under :

(i) The subject P.R.Cs. have been registered on the complaints filed by the State under Section 32 of the Drugs & Cosmetics Act, 1940 (for short, ‘the Act of 1940’).

(ii) In the complaint, which led to registration of P.R.C.No.21 of 2013 on the file of the learned II Additional Judicial First Class Magistrate, Machilipatnam, it was alleged that on 20.08.2007, Drugs Inspector, Machilipatnam, picked up 4x6x10 Serra-D tablets, Batch No: ZSRT 702 Exp Dt:2/2010, manufactured by M/s. Laborate Pharmaceuticals India Limited (accused No.1-Firm), from the main stores of DMHO, Machilipatnam, duly following the procedure prescribed under the Act of 1940. Out of the said tablets, 1x6x10 tablets were sent for analysis to the Government Analyst, Drugs Control Administration, vide Form 18 dated 20.08.2007. Upon analysis, the subject drug was declared as not of standard quality, vide report No.0108/DCL/2008 dated 17.01.2008, as it does not meet the labelled claim in respect of Serratiopeptidase and only 5.5 mg. of Serratiopeptidase was found as against the label claim of 10 mg. After securing purchase details and distribution particulars, the Drugs Inspector sent notice dated 22.05.2009 to accused No.1-Firm, to which Authorized Signatory of accused No.1-Firm sent reply dated 24.06.2009, wherein the Firm had challenged the Government Analyst Report dated 17.01.2008 and stated that they were ready to pay the cost of re-analysis. Thereupon, the Drugs Inspector sent Notice dated 20.08.2009 to accused No.1-Firm, duly providing clarifications as raised in the reply of the Firm and it was also communicated that the second portion of the sealed sample would be deposited before the concerned court. Accordingly, the second portion of the sealed sample was deposited before the learned II Additional Judicial First Class Magistrate, Machilipatnam, on 20.08.2009. Thereafter, on 01.12.2009, Analytical Report in Form 2 was received from the Director, Central Drug Laboratory, Kolkata, by the Drug Inspector as well as the Court, as per which the reason for declaring the sample as not of standard quality was because the sample does not conform to claim with respect to the tests for Uniformity of Weight and Assay (i.e., content of Serratiopeptidase) and only 3.42 mg. i.e. 34.2% of the labelled claim of Serratiopeptidase as against 10 mg. was found, which infers that it has been substituted in part by another substance. The matter was investigated into and after completion of investigation, the Drugs Inspector, Machilipatnam, filed a complaint before the learned II Additional Judicial First Class Magistrate, Machilipatnam, under Section 32 of the Act of 1940, against accused No.1-Firm and accused Nos.2 to 4, who are Directors of the Firm, for violation of Section 18(a)(i) r/w Section 17B(d) punishable under Section 27(c), and also violation of Section 18(a)(i) r/w Section 16 punishable under Section 27(d) of the Act of 1940, for manufacture and sale of spurious and not of standard quality drug. The learned Magistrate took cognizance of the offences and the case was numbered as P.R.C.No.21 of 2013. Seeking to quash the proceedings against them in the said P.R.C., accused Nos.2 to 4- Directors of the Firm approached this Court by filing Crl.P.No.2894 of 2014.

(iii) So far as P.R.C.No.18 of 2014