Point of Law : Contents of policy document cannot be read and interpreted as statutory provisions and further holds that breach of a policy decision by itself is not a ground to invalidate the delegated legislation. [Para 17]

ORDER :

The petitioner, a Healthcare Global Enterprises Limited (hereinafter referred to as ‘the Company’ for short) is before this Court calling in question order dated 27-02-2019 by which the Ministry of Chemicals and Fertilizers in the Department of Pharmaceuticals imposes a cap on trade margin of 30% and directs manufacturers to fix their retail price based on price at first point of sale of the product of non-scheduled formulations containing in all those 42 drugs listed in the said order.

2. Shorn of unnecessary details, facts in brief that are germane for consideration, as borne out from the pleadings, are as follows :

The petitioner claims to be the largest provider of cancer care and is in the forefront of the battle against cancer and claims to have 20 comprehensive cancer care centers across the nation. The petitioner further claims that it has been successfully able to provide innovate and cost-effective methods of treatment and management of cancer. It operates a hub and spoke model and has been acclaimed of both commitment and quality of health care. The petitioner fits into the definition of retailer in any of the enactments that are necessary to be considered in the case at hand. The issue that drives the petitioner to this Court in the subject petition is the order of the Ministry of Chemicals and Fertilizers in the Department of Pharmaceuticals at the National Pharmaceuticals Pricing Authority imposing a cap of 30% upon manufacturers for select anti cancer drugs identified by the Ministry of Health and Family Welfare as being essential for the treatment of cancer invoking its power under the Drugs (Prices Control) Order, the policy to keep the margin to a maximum extent of 30% to the manufacturers is what is promulgated under the Notification. The petitioner, a retailer who runs cancer care centers and deals with these medicines which are used to combat cancer rushes to this Court once the Notification comes about on 27-02-2019 contending that the petitioner being a stockist, the cap laid on the manufacturer would result in his business getting affected inter alia. This Court declined to grant an interim order of stay of any kind of the order impugned but by a detailed order noticed that in the event the petitioner succeeds, his interest would be protected.

3. Heard Sri Deepak Bhaskar, learned counsel appearing for the petitioner and Sri M.B.Nargund, learned Additional Solicitor General of India appearing for the respondents.

4. The learned counsel appearing for the petitioner would contend that the National Pharmaceuticals Pricing Authority who has now issued the Notification is not empowered under the Price Control Order to fix ceiling price or retail price of non-scheduled formulations. The non-scheduled formulations are to be determined only by the market force and cannot be subject to any regulation. There is no extraordinary circumstance for fixing of ceiling price or retail price of any drug invoking its power under the Price Control Order and, therefore, the cap that is laid at 30% is arbitrary and imposes an unreasonable restriction on the petitioner’s right under Article 19(1)(g) of the Constitution of India which depicts right to trade. He would further contend that the Price Control Order is arbitrary, unreasonable and bears no application of mind for capping the trade margin of 42 drugs at 30% and seeks quashment of the order of such capping.

5. On the other hand, the learned Additional Solicitor General of India would vehemently refute the submissions to contend that under the Prices Control Order, the Government is empowered to put a cap on the price of either the manufacturer or the retailer. It is the manufacturer whose price is now capped and not the retailer and the petitioner cannot claim to be an aggrieved person by issuance of the impugned order as it is not the manufacturer. He would contend that for the public good essential drugs can be placed under the price control order as the market for