IN THE HIGH COURT OF RAJASTHAN BENCH AT JAIPUR
Pankaj Bhandari, J.
Meri-Odin Life Sciences and Ors. - Appellants
Vs.
State of Rajasthan and Ors. - Respondent
S.B. Criminal Miscellaneous (Petition) No. 2446 of 2019
Decided On : 17-07-2019
DRUGS AND COSMETICS ACT, 1940 - SECTION 21, 22, 25 - CRIMINAL PROCEEDINGS - QUASHING - PARTNERSHIP FIRM - RESPONSIBILITY OF PARTNERS - NOTIFICATION ISSUED BY STATE GOVERNMENT - VALIDITY - INHERENT POWERS OF COURT.
Fact of the Case:
Petitioners, partners of a pharmaceutical firm, sought to quash criminal proceedings initiated against them for manufacturing substandard drugs. They contended that the Drug Control Officer who lifted the samples and filed the complaint was not assigned a specific area, and that petitioner Nos. 2, 3 & 4 were not responsible for the day-to-day working of the firm.
Finding of the Court:
The court held that the notification issued by the State Government authorizing Drug Control Officers to exercise their powers throughout the State of Rajasthan was valid and that there was no infirmity in the proceedings initiated by the Drug Inspector. The court also held that petitioner Nos. 2, 3 & 4 were responsible persons as per Section 34 of the Drugs and Cosmetics Act, 1940, and that there was a specific averment in the complaint regarding their responsibility.
Issues: 1. Whether the notification issued by the State Government authorizing Drug Control Officers to exercise their powers throughout the State of Rajasthan was valid? 2. Whether petitioner Nos. 2, 3 & 4 were responsible persons as per Section 34 of the Drugs and Cosmetics Act, 1940? 3. Whether the criminal proceedings against the petitioners should be quashed?
Ratio Decidendi: 1. Section 21 of the Drugs and Cosmetics Act, 1940, authorizes the Central Government or a State Government to issue a notification in the Official Gazette, appointing Inspectors for such areas as may be assigned to them. 2. The notification issued by the State Government in the present case was not under challenge and there appeared to be no infirmity in the proceedings initiated by the Drug Inspector. 3. Petitioner Nos. 2, 3 & 4 were partners of the pharmaceutical firm and there was a specific averment in the complaint that they were responsible persons as per Section 34 of the Act.
Final Decision: The court dismissed the petition and held that no ground was made out for quashing the criminal proceedings.
ORDER :
Pankaj Bhandari, J.
1. Petitioners have preferred this misc. petition seeking quashing of criminal proceedings arising out of Complaint No. 63/2016 and all subsequent proceedings pending in the Court of learned Chief Judicial Magistrate, Ajmer.
2. It is contended by counsel for the petitioners that samples of some drugs were obtained by Drug Control Officer. The said samples were sent to State Forensic Science Laboratory. State Forensic Science Laboratory reported that the drugs are substandard. It is contended that Drug Control Officer was not assigned any specific area and was thus not competent to lift the sample and file complaint against the petitioners.
3. It is further contended that there is no allegation in the complaint that petitioner Nos. 2, 3 & 4 are responsible for the conduct of the business of firm. It is contended that petitioner Nos. 2, 3 & 4 were partners and they were not responsible for the day to day working of the firm.
4. It is also contended that Sub clause (3) of Section 25 of the Drugs and Cosmetics Act, 1940 (in short 'the Act of, 1940) provides that some proceeding should be pending before some Court. At the time when the State analyst report was received, no proceeding was pending before any Court, thus Petitioners' valuable rights have been effected.
5. It is also contended that the notification issued by State gives powers to the Drug Control Officer to exercise it throughout the State of Rajasthan, whereas powers should be given only for specified area within the local limits of which Drug Control Officer can exercise his powers.
6. Is further contended that the samples were not properly stored, hence the proceedings cannot be continued against the petitioners.
7. Counsel for the petitioners has placed reliance on State of Haryana Versus Brij Lal Mittal, 1998 (2) RCR Criminal 608, SMS Pharmaceuticals Limited Versus Neeta Bhalla, 2007 (2) RCR Criminal 126, K.K. Ahuja Versus V.K. Vora, 2009 (3) RCR Criminal 571, National Small Industries Corp. Ltd. Versus Harmeet Singh Paintal & Anr., 2010 (2) RAJ 22, Sunil Bharti Mittal Versus Central Bureau of Investigation, 2015 (1) RAJ 473, Northern Mineral Limited vs. Union of India And Anr., 2010 (3) RCR (Criminal) 763, C.S. Velu vs. State of Himachal Pradesh, 2017 (1) Drugs Cases (DC) 225, State of Maharashtra vs. R.A. Chandawarkar, 1999 Cri.L.J. 4449, Johnson and Johnson Ltd. Himachal Pradesh And Anr. vs. State of Andhra Pradesh And Anr., 2015 (1) Drugs Cases (DC) 2 and State of Nagaland And Ors. vs. Bendangrenla, 2018 AIR (Gauhati) 59.
8. I have considered the contentions and have perused the complaint.
9. Admittedly, drugs manufactured by petitioner No. 1 were found to be sub-standard by the State Forensic Science Laboratory and by the Central Forensic Science Laboratory. Petitioner Nos. 2, 3 & 4 are partners of petitioner No. 1. In the complaint itself, Drug Control Officer has mentioned that petitioner Nos. 2, 3 & 4 are partners and are within the category of persons responsible as per Section 34 of the Act of 1940.
10. State of Haryana Versus Brij Lal Mittal (supra) was a case where Drug Control Officer had not alleged in the complaint that Directors were in-charge and were responsible to the company for the conduct of its business. The proceedings were, therefore, quashed by the Apex Court.
11. In SMS Pharmaceuticals Limited Versus Neeta Bhalla (supra) Apex Court observed that in the complaint there must be averment that the person was in-charge and was responsible for conduct of the business of the company. The Court was dealing with a case under the Negotiable Instruments Act. The Court observed that only those Directors who were in-charge and responsible to the company are liable.
12. K.K. Ahuja Versus V.K. Vora (supra) was also a case under the Negotiable Instruments Act. Apex court held that averment should be there in the complaint that Director was in-charge and was responsible for the conduct of the business of the company.
13. National Small Indu
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