GLAXO SMITHKLINE PHARMACEUTICALS LTD. & ANR versus STATE OF MADHYA PRADESH

Leave granted.

p. 609, margin D

This appeal has been preferred against the judgment and order dated 14.9.2010 passed by the High Court of Madhya Pradesh at Jabalpur in Misc. Criminal Case No. 6315 of 2008 which rejected the application of the appellants for quashing the complaint under the provisions of The Drugs and Cosmetics Act, 1940 (hereinafter called 'the Act 1940').

p. 609, margin E

Facts and circumstances giving rise to this appeal are that: A. The Drug Inspector under the Act 1940 had taken a sample of Betnesol tablets (Batch No. NC 160 Mfg. October 1996, expiry March 1998), manufactured by the appellantcompany from the shop of one Mahesh Agarwal at Chattarpur on 9.12.1996. The statutory authority sent the medicine for chemical analysis to the laboratory i.e. Government Analyst, Madhya Pradesh (Bhopal) on 10.12.1996. B. The said Government Analyst vide certificate dated 27 .8.1997 declared that the sample was not of "standard quality" as defined under the Act 1940. The sample led to "analytical difficulties" for the purpose of determining compliance with the official standards as stated under uniformity of content. C. In view thereof, a show cause notice was issued to the appellant-company by the statutory authority on 29.9.1997 as to why proceedings should not be initiated against the appellants and others. The appellant submitted its reply on 3.11.1997, submitting that sample of the aforesaid medicine ought to have been examined/analysed under Indian Pharmacopoeia (hereinafter called 'l.P.') 1996 and it had wrongly been analysed under l.P. 1985. Subsequent thereto, the department filed a complaint against the appellants on 3.7.2001 impleading the company as well as its Managing Director and Officers under the provisions of the Act 1940. A prayer was made that the appellants and other accused be punished under Section 35 of the Act 1940 and information of the said punishment be published in the newspapers at the cost of the accused. D. The Chief Judicial Magistrate, Chattarpur, took cognizance and issued summons to all accused persons including the appellants. The appellants filed an application under Section 25(3) of the Act 1940 before the Chief Judicial Magistrate, Chattarpur, with a prayer that sample of Betnesol tablets be sent for chemical analysis to the Director, Central Drugs Laboratory for being tested as per l.P.1996 on 1.10.2007. The said application stood rejected vide order dated 5.5.2008. The appellants approached the High Court by filing Misc. Criminal Case No. 6315 of 2008 for quashing the proceedings in Criminal Case No. 982 of 2001 (State of Madhya Pradesh v. M/s Aggarwal Medical Stores and Ors.). The said application stood rejected by the impugned judgment and order dated 14.9.2010. Hence, this appeal.

pp. 609–610, margin F

Shri R. Ramachandran, learned senior counsel appearing for the appellants, submitted that the Drugs Inspector issued show cause notice dated 29.9.1997 which was duly replied by the appellants on 3.11.1997. Therefore, there was no occasion for the respondent- authorities to file a complaint, that is too afterthe expiry of more than 3 years and 9 months of the expiry date of the medicine itself. The appellants could not avail their remedy under Section 25(3) of the Act 1940 which can be exercised within 28 days from the date of service of show cause notice. The chemicalcapalyst's report was not clear at all. The certificate declared that the medicine ''was not of the standard quality". The analyst had analytical difficulties in determining the compliance with the official standards as stated "Under uniformity of Contents". The purpose of exercising his right under Section 25(3) of Act 1940 is to ask the statutory authority to send the medicine to some other laboratory for chemical analysis in case the report was not acceptable to the accused. In the instant case; it was the technical problem as the fault had been found in view of analytical defects, and thus, there was no violation of substantive character. There could be no justification for the State to file the complaint at such a belated stage. Thus, the High Court erred in rejecting the application for quashing the complaint.

p. 611, margin A

On the other hand, Ms. Vibha Datta Makhija, learned counsel appearing for the respondent-State, has vehemently opposed the appeal contending that the applicants are the manufacturer of drugs and under Section 18(a)(i) of the Act 1940, they could not manufacture drugs of sub-standard quality. They could have expressed their option to adduce evidence in contravention of the analytical report within the period of limitation i.e. 28 days which they did not do. Unless the accused has given option that it would adduce evidence in contravention of the analytical report, it cannot ask the court to send the medicine for chemical analysis to the Central Government Laboratory. As no such option had been made by the appellants, they are not entitled to challenge the report. More so, the onus of proof was on the appellants date the company had received the show 29.9.1997. The appellants have not receipt of the show cause notice till date. criminal prosecution at a much belated raised before the High Court in the gravity agitated before this Court. Appeal lacks to be dismissed.

pp. 611–612, margin D

We have heard the learned counsel perused the records.

p. 612, margin B

The issue involving herein is no The ii;sues have been examined time legal proposition that report of the means that no reasons are needed given in the report, nor it is required contain the mode or particulars of the Singh v. Municipal Board, Saharanpur 318.) However, law permits the drug manufacturer the report expressing his intention controvert the report within the prescribed as provided under Section 25(3) of the case, the report dated 27.8.1997 was authorities who sent the show cause on 29.9.1997 and the appellants replied 3.11.1997. The case of the statutory willingness to adduce evidence to controvert was not filed within the period of prescribed for it. The appellants are the date on which the show cause notice reasons best known to them, they have date. It is a company which must be having department and should have an office date it has received the notice, and the willingness to controvert the report. had only been made on the technique adopted for analysis. It A has been the case that instead of testing the medicine under the l.P. 1985, it could have been done under l.P. 1996 because the 1.P.1996 had come into force prior to the date of taking the sample on 9.12.1996.

pp. 612–613, margin C

In view of the fact that the appellants did not express an intention to adduce evidence to controvert the analyst report within the statutory limitation period of 28 days, further delay in filing the complaint becomes immaterial. Even otherwise, expiry date of the medicine was March 1998 i.e. only after 4 months of submission of the reply by the appellants, and they did not fulfill their burden of expressing intention to adduce evidence in contravention of the report. Therefore, they cannot raise the grievance that the complaint had been lodged at a much belated stage. So far as the application of l.P. 1985 or l.P. 1996 is concerned, such an issue can be agitated at the time of trial.

p. 613

The judgment in Medicamen Biotech Limited & Anr. v. Rubina Bose, Drug Inspector, (2008) 7 SCC 196, was heavily relied on by Shri R. Ramachandran, learned senior counsel appearing for the appellants. Nevertheless, the facts of the said E case are quite distinguishable. In that case, the complaint had been filed about a month short of expiry date, and the accused therein had expressed their option to lead evidence in contravention of the analyst's report within limitation time but were not able to do so as shortly thereafter the medicine expired.

p. 613

We agree with Ms. Makhija that the case is squarely covered by the judgment of this Court in State of Haryana v. Brij Lal Mittal & Ors., (1998) 5 SCC 343 wherein this Court has held as under: " .... Sub-section (4) also makes it abundantly clear that the right to get the sample tested by the Central Government Laboratory (so as to make its report override the report of the Analyst) through the court accrues to a H A + person accused in the case only if he had earlier notified in accordance with sub-section (3) his intention of adducing evidence in controversion of the report of the Government Analyst. To put it differently, unless requirement of subsection (3) is complied with by the person concerned he cannot avail of his right under sub-section (4)." ,. In the said case, like the present case, the manufacturer did not notify the Inspector within the prescribed period that he intended to adduce evidence in contravention of the report. Also, akin to the case at hand, the manufacturer's right under section (3) of Section 25 expired few months before expiry of shelf life. Holding for the directors of the manufacturing company on different grounds, the court opined that the right to get drugs tested by Central Drugs Laboratory does not arise unless requirement of sub-section (3) is complied with.

pp. 613–614

It is pertinent to mention herein that present appellants • had earlier also been informed by the Drug Inspector of various cities on many occasions that the aforesaid medicine was i.e. Betnesol Tablet, was not of standard ..;:.iality and the authorities had been making an attempt to initiate proceedings against them. As is evident from the pleadings taken by the appellants themselves and the letter dated 1. 7 .1996 (Annexure P-9) wherein the appellant-company wrote a letter to The Controller, Food and Drug Administration, Madhya Pradesh. The relevant part thereof reads as under: F ' "During the past one month we have received requests from Drug Inspectors of Dhar, Rewa, Seoni and Ambikapur all under your kind control, to provide Memorandum of Articles of Association, constitution etc. of our company to initiate action for manufacturing Betnesol Tablets B.No. NA 660, Mfd. Dec. 92, Exp. May 94, NB 290, Mfd. Nov. 94, \ Exp. Apr. 96, NB 538, Mfd. May 95, Exp. Dec. 96 and NB 656, Mfd. Sep. 95, Exp. Feb. 97, which were earlier declared as not of standard quality by Government Analyst, H Bhopal for facing analytical difficulties during the determination of uniformity of content by the IP 1985 method." (Emphasis added) In that letter also the appellant company does not make its intention clear to adduce any evidence to controvert the Government Analyst's report rather made the following request: "Under these circumstances, we respectfully reiterate that our product Betnesol Tablets referred above are of standard quality and request you to kindly treat all the matter as closed."

pp. 614–615, margin B

As explained hereinabove, the appellants and other coaccused did not give any option to adduce evidence in contravention of the analyst's report within statutory limitation period. Even if there was inordinate delay in launching the criminal prosecution or filing the complaint, it is thereby of no consequence. We do not find any ground to interfere with the well reasoned judgment of the High Court. The appeal lacks merit and is, accordingly, dismissed. R.P. Appeal dismissed.

p. 615, margin C