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2008 Supreme(P&H) 711

PUNJAB & HARYANA HIGH COURT
M.M.Kumar and Sabina JJ.
Goyal And Company
Versus
State Of Punjab
Decided On : MARCH 17, 2008

Serious violations of the Drugs and Cosmetics Act, 1940 can lead to the cancellation of a drug license.

Headnote:

Drug Licence - Violation of Drugs and Cosmetics Act, 1940 - Rule 65(5)(3), Section 26(A), Section 18(A), Section 7-B - The court discussed the violations of various provisions of the Drugs and Cosmetics Act, 1940 and Rules, including Rule 65(5)(3), Section 26(A), Section 18(A), and Section 7-B. The violations included selling prohibited drugs, contravening standard quality requirements, and selling spurious drugs, leading to the cancellation of the petitioner's drug license.

Fact of the Case:

The petitioner sought to quash an order upholding the cancellation of their drug license due to violations of the Drugs and Cosmetics Act, 1940 and Rules.

Finding of the Court:

The court upheld the cancellation of the petitioner's drug license, citing serious violations including selling prohibited drugs and spurious drugs, and upheld the order of the appellate authority.

Issues: Violation of Drugs and Cosmetics Act, 1940 and Rules, cancellation of drug license, and permission for disposal of medicines/drugs in stock.

Ratio Decidendi: The petitioner was found guilty of serious violations under the Drugs and Cosmetics Act, 1940, leading to the cancellation of the drug license.

Final Decision: The court upheld the cancellation of the petitioner's drug license and granted liberty to move an appropriate application for seeking permission for disposal of medicines/drugs in stock.

Judgment

M.M.Kumar, J.

1. This petition filed under Article 226 of the Constitution prays for quashing order dated 2.1.2007 (Annexure P.8) passed by the Secretary, Health and Family Welfare, Punjab, Chandigarh, respondent upholding the order dated 13.7.2007 (Annexure P.6) passed by the State Drugs Licensing Authority cum Director Health Services. Punjab, respondent No. 1. A further prayer for restoration of drug Licence of the petitioner has also been made.

2. In his order dated 13.7.2001, respondent No. 3, has noticed that the Inspectors of Ludhiana and Amritsar namely S/Shri Sanjeev Kullar and Rajesh Suri inspected the premises of the petitioner on 8.5.2007 in the presence of Incharge of the petitioner firm namely Shri Deep Kumar and one independent witness namely Shri Mandeep Dhawan under the Drugs and Cosmetics Act, 1940 (for brevity the Act); and Drugs and Cosmetic Rules, 1945 (for brevity the Rules). Accordingly a show cause notice dated 13.6.2007 was issued to the petitioner for explaining the reasons for contravening various provisions or the Act. The reply was round to be unsatisfactory and an after thought. It was concluded that the petitioner-firm has indulged in sale of prohibited drugs. The prohibition has been imposed by the Government of India on the sale or these drugs vide notifications dated 23.7.1983 and 24.8.2001. The samples were tested vide drug sample No. ASR 59 of 2007. A perusal of the order shows that the provisions of Rule 65(5)(3) of the 1945 Rules and Section 26(A) of the Act have been violated. A number of other violations are stated to have been committed resulting in violation of provisions or Section 18(A) of the Act.

3. The petitioner has also found to be selling spurious drugs as per Section 7-B of the Act. It has been found that tablet Cavisova was tested and it was not found to be of standard quality by the Government Analyst, Punjab, Chandigarh vide his test report No. 1082 dated 8.6.2007 for the following reasons:

i) the identification test for Diazepam found is negative

ii) the contents of Diphenhydramine Hcl found 9.77 mgm/u.c. tab against the label claim of 50 mg per u.c. tablet and Diazepam zero mg.u.c. Tab. against the label claim of 5 mg/u.c. Tab., iii) the sample referred to above is misbranded under the provisions of Drugs & Cosmetics Act 1940 and rules thereunder due to the fact that Expiry date is not given on the label. It is also covered under the definition of spurious drugs as defined under Section 17B of the Drugs & Cosmetics Act, 1940 and further Its manufacturing, sale a distribution is prohibited under Section 26(A) of the Drugs & Cosmetics Act, 1940, vide Govt. of India, gazette notification No. GSR 169(E:) dated 12.3.2001, hence you have contravened Section 18(a)(i) and 26a of the Drugs & Cosmetics Act, 1940.

4. There are other numerous violations indicated in the order which only go to show that the petitioner has been contravening the provision of the Act and Rules. The order passed by the State Drugs Licensing Authority (P-6) further points out that the drugs seized from the petitioner by the Police Department were definitely meant to sell for addiction as they were habit forming drugs. Those drugs were misused by the youngsters and public at large. The concluding para of the order reads thus:

In view of the above you have found committing serious contraventions under Section 18(a)(i) read with Sections 17B, 26A and Rules 65(5)(1), 65(5)(3) and 65(6) of Drugs & Cosmetics Act 1940 and Rules 1945 and you have become habitual for contravening the various provisions of the Drugs & Cosmetics Act 1940 and Rules made thereunder and found to be deeply indulged in the unethical sale and purchase of habit forming/addiction causing drugs due to their misuse.

It is pertinent to mention over here that the shop premises were locked/sealed by the Punjab Police Department and was jointly inspected on 20.3.2003 by the Punjab Police and officer of the State Drugs Control Department Po

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