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2022 Supreme(Online)(Kar) 236

HIGH COURT OF KARNATAKA
M.NAGAPRASANNA, J
SRI KUNAL BAHL – Appellant
Versus
STATE OF KARNATAKA – Respondent
CRIMINAL PETITION NO.100653 OF 2021 | CRIMINAL PETITION NO.100652 OF 2021



Advocates:
For the Appellants/Petitioners: SRI C.V.NAGESH, SR.COUNSEL FOR SRI MRUTYUNJAYA S.HALLIKERI
For the Respondents: SRI RAMESH CHIGARI, HCGP

Intermediaries are not liable for third-party sales under the Drugs Act, especially when there's a significant delay in filing complaints.

Headnote:(A) Drugs and Cosmetics Act, 1940 - Sections 18(c), 27(b)(ii), 18A and 28 - Criminal prosecution of intermediaries set aside - Delay of 5 years in filing complaint highlighted - Court upheld prior judgment establishing that intermediaries cannot be liable for vendor's actions when due diligence is followed. (Paras 12.11, 12.14, 16.9)

(B) Criminal Procedure Code, 1973 - Section 482 - High Court’s power to quash proceedings - Delay in lodging FIR reflected poorly on prosecution's credibility, striking down a complaint due to unjustified delay. (Para 14.10)

Facts of the case:
Petitioners, directors of Snapdeal Private Limited, were accused of displaying a drug for sale without a valid license, with a significant delay in filing the complaint against them.

Findings of Court:
The Court confirmed that as intermediaries, the petitioners cannot be held liable unless there is direct involvement in sales, which was not established in this case.

Issues: Whether intermediaries can be held liable under the Drugs and Cosmetics Act for third-party sales and the implications of delayed complaints on prosecution.

Ratio Decidendi: The court confirmed that intermediaries are not liable under the Act for the actions of sellers unless they directly contravene provisions, and highlighted adverse effects of delayed complaints on trial integrity.

Result: Petitions allowed; proceedings quashed.

Table of Content
1. fact summary of the case against the petitioners. (Para 3 , 4)
2. arguments from both sides regarding liability. (Para 5 , 6)
3. court observations on intermediary status and fir delays. (Para 8)

ORDER

The petitioners are before this Court calling in question proceedings in C.C.No.2 of 2019 pending before the JMFC-II Court, Belagavi registered for offences punishable under Sections 18(c) and 27(b)(ii), 18A and 28 of the Drugs and Cosmetics Act, 1940 (‘the Act’ for short).

2. Heard the learned senior counsel Sri C.V.Nagesh representing the petitioners and the learned High Court Government Pleader representing the respondent-State.

3. Brief facts leading to the filing of the present petition, as borne out from the pleadings are as follows:-

The petitioners are Directors of Jasper Infotech Private Limited now known as Snapdeal Private Limited. The petitioners are on the Board of Snapdeal since incorporation of the company. On 02-12-2014 claiming to be on credible information the drug Suhagra-100 mg. was exhibited on the company’s website, the respondent claims to have placed an order for the said tablet on the petitioners company’s website through his e- mail ID. On 10-12-2014 in furtherance of the order, the tablets were delivered to the respondent and on receipt, in the presence of two witnesses, panchanama was drawn on the spot. The allegation is that petitioners company’s website exhibited Suhagra 100 mg. tablet for sale and provided a platform to the seller and purchaser without possessing valid retail drug licence. It was further alleged that displaying and exhibiting the said drug for sale without licence was in contravention of the provisions of the Act.

4. Based upon the said incident which happened on 10.12.2014, a complaint came to be registered on 03-01-2019, five years thereafter, alleging that the petitioners were involved in the commission of offences punishable under Sections 18(c), 27(b)(ii), 18A and 28 of the Act. On 07-01-2019, the learned Magistrate takes cognizance for offences punishable under Sections 18(c), 27(b)(ii), 18A and 28 of the Act and directs registration of a case against the petitioners. On issuance of summons pursuant to taking of such cognizance, the petitioners are before this Court in the subject petitions.

5. The learned senior counsel Sri.C.V.Nagesh representing the petitioners would vehemently argue and contend that the petitioners are only intermediaries and would not become liable for prosecution particularly under the Act. The Company of the petitioners is only a platform through which sale happens on its website. He would further submit that for an incident or a panchanama that was drawn in the year 2014, complaint is registered after five years. The learned Magistrate ought not to have taken cognizance is his emphatic submission.

6. On the other hand, the learned High Court Government Pleader would however, contend that the petitioners are guilty of providing such platform for sale of medicine without there being a valid drug licence or a retail drug licence for such sale.

7. I have given my anxious consideration to the submissions made by the learned senior counsel and the learned High Court Government Pleader and perused the material on record.

8. The petitioners are Directors of Snapdeal Private Limited. It is not in dispute that the petitioners are intermediaries or a platform that would enable sale or purchase of any goods. Whether an intermediary like the Snapdeal Private Limited can be hauled into these proceedings need not detain this Court for long or delve deep into the matter, as this Court in Criminal Petition No.4676 of 2020 and connected matter decided on 7th January 2021 between the same parties and on identical allegations has held that the petitioners being intermediaries cannot be seen to be hauled up in criminal proceedings. Points No.(vi) and (vii) in the aforesaid judgment is what covers the present case on all its fours and are therefore relied on for t

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