Case Note & Summary
The petitioner, Kedarnath Saraf, was a licensed chemist and druggist under the Drugs and Cosmetics Act, 1940 and the Drugs and Cosmetics Rules, 1945. Twenty-six samples were drawn from his shop; six were declared substandard by the competent laboratory. The petitioner had, at the time of sampling, furnished details of the manufacturers and invoices for all samples. Respondent No.2 issued a show cause notice dated 12-09-1995 alleging violation of Section 18(a)(i) and failure to take due diligence under Section 34 of the Act, proposing suspension of licence. The petitioner replied that upon receiving the laboratory report, he had immediately discontinued sale of the substandard drugs. The Licensing Authority, without considering this reply, passed an order suspending the licence. The petitioner challenged the order by way of writ petition. The court held that the petitioner had complied with the requirements by providing manufacturer details and discontinuing sale; there was no finding of lack of diligence. The show cause notice and suspension order were quashed, and the respondents were directed to restore the licence.
Headnote
A) Drugs and Cosmetics Act - Suspension of Licence - Section 18(a)(i) read with Section 34 - Liability of Chemist - A licensed chemist who furnishes details of the manufacturer and invoices, and discontinues sale of substandard drugs upon receipt of laboratory report, cannot be held liable for suspension of licence in the absence of any finding of lack of due diligence or precaution under Section 34 of the Act. The show cause notice and order of suspension were quashed. (Paras 1-8)
Issue of Consideration
Whether a licensed chemist can be held liable for suspension of licence under Section 18(a)(i) read with Section 34 of the Drugs and Cosmetics Act, 1940, when he had furnished details of the manufacturer and discontinued sale of substandard drugs upon receiving laboratory report.
Final Decision
The show cause notice dated 12-09-1995 and the order of suspension of licence are quashed and set aside. The respondents are directed to restore the licence of the petitioner forthwith.
Law Points
- Strict liability under Section 18(a)(i) of Drugs and Cosmetics Act
- 1940 is not absolute
- a licensee who furnishes manufacturer details and discontinues sale upon learning of substandard quality is not liable for suspension if no lack of diligence is shown under Section 34 of the Act.
Case Details
2006 LawText (BOM) (01) 44
Writ Petition No.827 of 1996
Mr. B.G. Kulkarni for Petitioner; Smt. N.S. Jog, Assistant Govt. Pleader for Respondents
Kedarnath s/o Badrinarayan Saraf
1. The Hon'ble Minister for Health, Medical Education and Department, Mantralaya, Mumbai 32; 2. Assistant Commissioner and Licensing Authority (Amravati Division), Food & Drugs Administration, Maharashtra State
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Nature of Litigation
Writ petition challenging suspension of licence under Drugs and Cosmetics Act.
Remedy Sought
Quashing of show cause notice and order suspending petitioner's licence.
Filing Reason
Petitioner's licence was suspended on ground of possession of substandard drugs despite furnishing manufacturer details and discontinuing sale.
Previous Decisions
Licensing Authority suspended petitioner's licence after show cause notice.
Issues
Whether the petitioner can be held liable for suspension of licence under Section 18(a)(i) read with Section 34 of the Drugs and Cosmetics Act, 1940, when he had furnished details of the manufacturer and discontinued sale of substandard drugs.
Submissions/Arguments
Petitioner argued that he had furnished manufacturer details and invoices, and upon learning of substandard quality, he discontinued sale; therefore, no lack of diligence.
Respondents argued that petitioner was liable for action under Section 18(a)(i) and failed to take due diligence under Section 34.
Ratio Decidendi
A licensed chemist who furnishes details of the manufacturer and invoices, and discontinues sale of substandard drugs upon receipt of laboratory report, cannot be held liable for suspension of licence under Section 18(a)(i) read with Section 34 of the Drugs and Cosmetics Act, 1940, in the absence of any finding of lack of due diligence or precaution.
Judgment Excerpts
Petitioner herein is a licensed Chemist and Druggist under the provisions of the Drugs and Cosmetics Act, 1940 and Drugs and Cosmetics Rules,1945.
Twenty Six Samples were drawn from the shop of the petitioner. Six samples were declared by the Competent Laboratory to be of substandard quality while there was no objection as to the rest.
Petitioner replied the show cause notice stating that no sooner report of Laboratory holding that the samples taken were of sub standard quality, the petitioner had discontinued the sale thereof and that he should not be considered to be responsible for any action whatsoever.
Procedural History
Show cause notice dated 12-09-1995 issued by Respondent No.2; petitioner replied; Licensing Authority passed order suspending licence; petitioner filed Writ Petition No.827 of 1996 before Bombay High Court, Nagpur Bench; judgment delivered on 20-01-2006.
Acts & Sections
- Drugs and Cosmetics Act, 1940: Section 18(a)(i), Section 34
- Drugs and Cosmetics Rules, 1945:
