The classification of a product under controlled substances requires factual investigation, and the issuance of a show cause notice is valid unless a clear lack of jurisdiction is shown.

JUDGMENT :

PC:-

1. On mentioning, this matter was taken up for consideration in the afternoon session on the production board.

2. Heard learned counsel for the parties.

3. This Petition was initially instituted to seek a declaration that the Petitioner is not required to obtain NOC from the Narcotics Commissioner (Respondent No.2) for exporting its product, namely ADCOTE 545S containing Methyl Ethyl Ketone (MEK) as according to the Petitioner, the same was not covered in Schedule-B of the Narcotics Drugs and Psychotropic Substances (Regulation of Controlled Substances) Order, 2013 (“2013 Order”). The consequential relief to quash the seizure memo was also applied for.

4. During the pendency of this Petition, the first Respondent issued the Petitioner a show cause notice dated 5 August 2024 requiring the Petitioner to show cause as to why its products should not be confiscated and the penalty be imposed. Accordingly, the Petitioner amended this Petition to challenge the show cause notice dated 5 August 2024.

5. Mr Amit Singh learned counsel for the Petitioner, submitted that in terms of Clause 10 of the 2013 Order, there is a bar on exporting any controlled substance in Schedule-B except in accordance with the conditions of the No Objection Certificate issued by the Narcotics Commissioner. He referred us to Schedule-B and submitted that though there is a reference to MEK at Entry 10, the Petitioner’s product ADCOTE 545S cannot be styled as MEK, though MEK may be one of the components of ADCOTE 545S. He referred us to Entries 4, 5, 6 and 16 to submit that where any product and its salts and preparations or only salts were intended to be included, Schedule-B says so in specific terms. He submitted that it was only when MEK was sought to be exported and not some product containing MEK that the NOC from the Narcotics Commissioner would be necessary.

6. Mr Singh submitted that the issuance of show cause notice in the above circumstances is an exercise without jurisdiction. Therefore, a rule must be issued in this Petition, and the Respondents must be restrained from proceeding with the show cause notice pending its final disposal.

7. Mr Singh submitted that the Narcotics Commissioner or the Assistant Narcotics Commissioner has already opined that ADCOTE 545S requires a NOC before it is exported. He also referred to the order made by a Co-ordinate Bench of this Court on 13 October 2017 in Writ Petition No.10730 of 2017 in the context of the seizure of specific goods that may have contained the items specified under Schedule-B. He submitted that the present Petition should be entertained for all these reasons rather than requiring the Petitioner to face the show cause notice.

8. Mr Subir Kumar learned counsel for Respondent No.1 submitted that the issue in this case was whether Schedule-B covered the Petitioner’s product. He submitted that such an issue would contemplate investigation into factual aspects like the product's components and involve interpretation of the various entries in Schedule-B. He submitted that this was not a case of any inherent lack of jurisdiction to issue the show cause notice and, consequently, the rule of exhaustion of statutorily provided remedies should not be deviated from.

9. Mr Kumar also referred to the provisions of Section 9-A of the Narcotics Drugs and Psychotropic Substances Act, 1985 (“NDPS Act”) to submit that the Central Government has the power to control and regulate the controlled substances. He pointed out that if the Central Government was of the opinion that, having regard to the use of any controlled substance in the production or manufacture of any narcotic drug or psychotropic substance, it was necessary or expedient so to do in the public interest, it may, by order, provide for regulating or prohibiting the production, manufacture, supply and distribution thereof and trade and commerce therein. He submitted that the 2013 Order was made under the powers conferred by Section 9-A of the NDPS Act.

1