30.05.2011 CM No. 20784 of 2010 (for amendment) The amendments prayed for are with respect to addition of two grounds which raise questions of law. For the reasons stated therein, the application is allowed. The writ petition is permitted to be amended. The amended writ petition is taken on record. The application is disposed of. W.P. (C) 639 of 2009 Background Facts

1. Best Laboratories Pvt. Ltd. („BLPL?) challenges an order dated 7th February 2006 issued by the National Pharmaceutical Pricing Authority („NPPA?) Respondent No. 2 herein under Paragraph 9(1) of the Drugs (Prices Control) Order, 1995 („DPCO 1995?) fixing ceiling prices for certain multi-vitamin formulations and the consequential demand dated 27th November 2008 issued by the NPPA requiring the Petitioner to deposit Rs. 1,41,57,104/- towards overcharging amount and interest up to October 2008.

2. BLPL is registered as a small-scale industrial unit. BLPL claims that it is entitled to exemption by an order dated 2nd March 1995 issued by the Ministry of Chemicals and Fertilisers under Para 25 of the DPCO 1995. BLPL states that in terms of the above exemption order every Drug Manufacturing Unit was entitled to exemption from the operation of Para 8 of the DPCO 1995 relating to the fixation of retail price of Scheduled Formulation, if it was not covered under a notification issued by NPPA under Para 9 of the DPCO 1995. BLPL was, inter alia, manufacturing and marketing Riconia tablet under its own brand name under a valid drug licence. By an order dated 25th August 1999 issued under Paras 9(1) and (2) of the DPCO 1995, the NPPA fixed the ceiling prices of certain Scheduled Formulations, which were at Serial Nos. 1 and 2 of the said order. The ceiling price would not apply to those formulations having compositions different from those at Serial Nos. 1 and 2 of the said order and the Note thereunder. According to BLPL, in view of the exemption available to it as a small-scale industrial unit the tablet Riconia was entitled for exemption in terms of exemption application No.23985. Orders dated 24th December 2002, 7th February 2006 and 11th July 2006 were issued under Paras 9(1) and 9(2) of the DPCO 1995 fixing the ceiling prices of formulations at Serial Nos. 1 and 2 of the Order. Note IV was also inserted. By orders dated 7th February 2006 and 11th July 2006, the NPPA fixed the ceiling prices of formulations to cover more bulk drugs. Note IV was inserted to the order dated 7th February 2006. Note IV envisaged that for different/compositions and packing material used or any specific feature claimed, the drug manufacturing companies had to approach the NPPA for approval of the fixation of specific prices. BLPL contends that the order dated 7th February 2006 and the subsequent order dated 11th July 2006 were not applicable to BLPL in view of the exemption to small scale industrial units. Further, tablet Riconia contained Vitamin K which was not an ingredient mentioned in the Order dated 7th February 2006 including the Note thereunder.

3. BLPL states that it was surprised to receive a notice dated 6th November 2006 from the NPPA stating that Riconia was covered under the Notification dated 7th February 2006 read with Note I to IV thereunder, and that therefore there was a price ceiling applicable to it. BLPL replied on 24th November 2006 clarifying that it was not producing any formulation with the composition specified in the Notification dated 7th February 2006 and was therefore not covered by the said Notification. By a letter dated 3rd January 2007 the NPPA directed BLPL to furnish all the requisite information and documents. BLPL replied on 15th January 2007 and requested for a personal hearing. A personal hearing was thereafter given to BLPL and written submissions were also filed by it. By an order dated 16th April 2008 the NPPA raised a demand in the sum of Rs. 1,07,03,216/- on the alleged ground of overcharging by BLPL in terms of the DPCO 1995. BLPL