Case Note & Summary
The Supreme Court dealt with a criminal appeal against concurrent conviction under the Drugs and Cosmetics Act, 1940. The appellants were wholesale dealers and distributors of drugs holding licences for their Bombay shop and a separate licence for a motor van used for distribution throughout Maharashtra. During distribution operations, they booked certain drugs by lorry to Yeotmal, intending to transfer the consignment to the touring motor van. Owing to the van's delay, one partner released the drugs from the transport operator and temporarily stored them in the godown of a local drug dealer at Yeotmal, premises for which no licence was held. The prosecution alleged that this temporary storage amounted to stocking for sale under Section 18(c) and violated Rule 62, attracting punishment under Section 27(b). The trial court convicted the appellants, and the Bombay High Court (Nagpur Bench) dismissed their appeal, holding that temporary deposit in an unlicensed godown constituted stocking for sale. The appellants then appealed to the Supreme Court, contending that the storage was merely incidental to transit, not for sale at that place, and that the motor van licence should cover the brief interval. They also argued that the prescribed forms did not provide for itinerant wholesale distributors, making compliance impossible. Rejecting these contentions, the Court held that a licence for a vehicle cannot substitute for a licence for a fixed place, and that the law mandates a licence for every place where drugs are stocked for sale, regardless of the duration or absence of intent to sell at that exact location. The Court emphasised that the Drugs and Cosmetics Act is a life-saving statute and must be interpreted to prevent unlicensed storage points from becoming sources of spurious or expired drugs. It noted that while the rules visualise wholesale distribution licences, they do not contain forms for mobile vans or distribution depots, but this deficiency does not excuse non-compliance; an authority to grant suitable licences could be implied under the proviso to Rule 62. The Central Government was urged to clarify the rules and provide appropriate forms. Accordingly, the appeal was dismissed and the conviction upheld.
Headnote
A) Drugs and Cosmetics Act - Licensing Requirement for Stocking for Sale - Every place where drugs are stocked for sale must be licensed - Drugs and Cosmetics Act, 1940, Section 18(c), Rule 62 - The appellant temporarily stored drugs in an unlicensed godown for ultimate distribution, claiming it was not for sale at that place; the court held that stopgap storage as part of sales business amounts to stocking for sale; arguments ab inconvenienti are no defence, and licensing is necessary to prevent spurious and expired drugs (Paras 290-293). Held conviction. B) Drugs and Cosmetics Act - Licence for Vehicle versus Fixed Premises - A licence for a motor van cannot cover storage in a fixed place - Drugs and Cosmetics Act, 1940, Section 18(c), Rule 62 - The appellant's licence Ex.39 authorised stocking and selling in the specified vehicle, but the court ruled that if the law requires a licence for a place, drugs kept there even briefly without licence is an offence; the vehicle licence did not fill the gap (Paras 290-291). Held licence cannot substitute. C) Drugs and Cosmetics Act - Rule-Making and Prescribed Forms - Rules visualise wholesale distribution licences but lack forms for mobile vans and depots; authority to grant suitable licences can be implied - Drugs and Cosmetics Rules, 1945, Rules 61, 62, 62A - The court noted the licence for the vehicle was an improvised innovation without express provision, but such authority could be implied under the proviso to Rule 62; the appellant should have applied for a separate licence for temporary storage; the Central Government should clarify rules and provide appropriate forms (Paras 291-293). Held deficiency of forms does not excuse compliance. D) Statutory Interpretation - Purposive Construction of Life-Saving Statute - Heydon's case principle applied to suppress evil and advance remedy - Drugs and Cosmetics Act, 1940 - The court construed the Act strictly to ensure vigilant medical watch over proper protection of drugs, verification of expiry, and rejection of spurious products; unlicensed godowns can become foci of harmful drugs, so every storage place must be licensed (Paras 289-292). Held strict interpretation.
Issue of Consideration
Whether temporary storage of drugs in an unlicensed godown for ultimate distribution amounts to 'stocking for sale' under Section 18(c) of Drugs and Cosmetics Act, 1940; whether a licence for a motor van covers brief storage in a fixed premises; whether prescribed licensing forms are inflexible or suitable licences can be issued
Final Decision
Appeal dismissed; conviction upheld. Temporary storage of drugs in an unlicensed godown for ultimate distribution amounts to stocking for sale under Section 18(c) and Rule 62; licence for motor van does not cover fixed premises; Central Government directed to clarify rules and provide appropriate forms for mobile vans and distribution depots.
Law Points
- Licence for vehicle cannot cover fixed place storage
- every place where drugs stocked for sale must be licensed
- temporary storage for ultimate sale is stocking for sale under Section 18(c)
- rules under Drugs and Cosmetics Act should provide forms for mobile vans and distribution depots
- authority to grant suitable licences can be implied under Rules 61 and 62 proviso
