Case Note & Summary
The High Court of Bombay, Nagpur Bench, dealt with a criminal application under Section 482 of the Code of Criminal Procedure, 1973 seeking quashing of a criminal complaint under the Drugs and Cosmetics Act, 1940. The applicant was arraigned as accused No.2 in Complaint Case No.2450/2020 pending before the Additional Chief Judicial Magistrate, Nagpur. The complaint alleged that a drug sample of Enteric Coated Rabeprazole and Domperidone sustained release capsules (Rabetroy-DSR) drawn on 23.9.2016 was found not of standard quality by the Government Analyst in a report dated 17.7.2017. The drug was manufactured by M/s IBN Herbals, a unit of Curetech Formulations Private Limited. The applicant was a director of Curetech Formulations Private Limited but not of IBN Herbals. The complaint was filed on 8.10.2020 after obtaining sanction on 25.9.2018. The applicant contended that the proceedings were initiated after the expiry of the drug's shelf life in April 2018, thereby depriving him of the right under Section 25(3) and (4) of the Act to challenge the analyst report. He further argued that the analyst report was prepared nearly ten months after receipt of the sample, violating Rule 45 of the Drugs and Cosmetics Rules, 1945 which mandates analysis within 60 days. He also raised limitation, asserting that the complaint should have been filed within three years from the date of the analyst report. On vicarious liability, the applicant submitted that he was not in charge of day-to-day business of IBN Herbals; the joint investigation report showed Mr. Sumit Singla as proprietor of IBN Herbals, and Curetech Formulations Private Limited was not made an accused. The non-applicant (Drugs Inspector) maintained that the chain of disclosure under Section 18A was followed, a notice under Section 25(3) was sent to the manufacturer, no response was received, and the sample was tested well before expiry. The court, after considering the submissions, noted that there was no averment in the complaint that the applicant as director was responsible or in charge of the conduct of the business of the company. The joint investigation report indicated that Mr. Sumit Singla was the proprietor of M/s IBN Herbals, and the applicant was a director of Curetech Formulations Private Limited, which was not made a party. The court reproduced Section 34 of the Drugs and Cosmetics Act, which deals with offences by companies, and observed that in the absence of impleading the company and specific averments regarding the applicant's role, vicarious liability could not be fastened. The court also considered the delay in filing the complaint and the deprivation of the right to challenge the analyst report. Ultimately, the court appeared inclined to allow the application and quash the proceedings, though the final operative portion was not included in the extracted text. The decision emphasizes that mere directorship does not ipso facto establish liability under Section 34, and non-compliance with statutory safeguards under the Drugs and Cosmetics Act can warrant quashing under Section 482 CrPC.
Headnote
A) Drugs and Cosmetics Law - Right to Challenge Analyst Report - Delay in Filing Complaint After Expiry of Drug Shelf Life Deprives Accused of Statutory Right - Drugs and Cosmetics Act, 1940, Sections 25(3) and 25(4) - Applicant contended that complaint was filed after expiry of drug shelf life, preventing him from challenging government analyst report under Section 25(3)/(4); court recognized this as a valuable right and non-compliance may vitiate proceedings (Paras 8, 11). B) Drugs and Cosmetics Law - Time Limit for Analysis - Government Analyst Must Test Sample Within 60 Days - Drugs and Cosmetics Rules, 1945, Rule 45 - Applicant argued that analyst received sample on 29.9.2016 but prepared report on 17.7.2017 after nearly ten months, violating Rule 45; non-compliance with mandatory time limit alleged to render prosecution invalid (Paras 8, 11). C) Criminal Procedure - Limitation for Taking Cognizance - Complaint Filed Beyond Three Years From Analyst Report Barred - Not specified - Applicant argued complaint ought to be filed within three years from date of analysis report; court considered this ground along with delay in filing and expiry of drug shelf life (Paras 8, 11). D) Criminal Liability - Vicarious Liability of Directors - Director Not Liable Without Company Impleaded and Specific Averments - Drugs and Cosmetics Act, 1940, Section 34 - Court observed no averment in complaint that applicant as director was responsible or in charge of conduct of business; joint investigation report showed proprietorship of Sumit Singla, not applicant; company Curetech Formulations Private Limited not made accused; hence prosecution against applicant untenable (Paras 13-14). E) Criminal Procedure - Quashing of Proceedings - Inherent Powers Under Section 482 CrPC - Code of Criminal Procedure, 1973, Section 482 - Applicant invoked inherent jurisdiction to quash complaint and process; non-compliance with statutory safeguards and absence of vicarious liability constituted abuse of process, warranting quashing (Paras 1, 3, 8, 13-14).
Issue of Consideration
Whether criminal complaint and order issuing process against applicant director should be quashed under Section 482 CrPC due to non-compliance with Sections 23, 25 and Rule 45 of the Drugs and Cosmetics Act, 1940; whether complaint was barred by limitation; whether vicarious liability under Section 34 could be fastened on applicant when company not impleaded and no averments of being in charge of day-to-day business.
Final Decision
The High Court, after considering the submissions, found merit in the applicant's contentions regarding lack of vicarious liability and non-impleadment of company, and thus the proceedings were liable to be quashed. However, the exact final operative order is not present in the extracted text.
Law Points
- Right to challenge analyst report under Section 25(3) and 25(4) Drugs and Cosmetics Act 1940 is valuable and delay in filing complaint after expiry of drug shelf life deprives accused of that right
- Government analyst must analyze sample within 60 days as per Rule 45 Drugs and Cosmetics Rules 1945
- Complaint barred by limitation if filed beyond three years from date of analysis report
- Vicarious liability of director under Section 34 Drugs and Cosmetics Act 1940 requires company to be impleaded as accused and specific averment that director was in charge of day-to-day business
- mere directorship does not ipso facto establish liability
- Non-impleadment of company and absence of essential averments vitiate process
- Inherent jurisdiction under Section 482 CrPC can be exercised to quash proceedings where statutory safeguards not complied with and abuse of process established.
