C. Thiagarajan v. The State of Tamilnadu, Rep. by Secretary to Govt. , Health & Family Welfare Department & Others
2006-04-19
J.A.K.SAMPATHKUMAR, P.SATHASIVAM
body2006
DigiLaw.ai
Judgment :- Prayer: Appeal No.2943 of 2001 filed under Clause 15 of the Letters Patent against the order of the learned single Judge (KGJ), dated 1.11.2001, made in W.P. No.11135 of 2001. Common Judgment: (P. Sathasivam, J.) Since the issue raised in all these matters is one and the same, they are being disposed of by this common Judgment. 2. (a) Writ Appeal No.2943 of 2001 has been filed against the order of the learned single Judge, dated 01.11.2001, made in W.P. No.11135 of 2001, in and by which, the learned Judge, following the earlier order of this Court, dated 21.08.2001, made in W.P. Nos.2036 to 2038 of 2001, dismissed the Writ Petition along with two other connected Writ Petitions. (b) Writ Appeal No.2944 of 2001 has been preferred against a similar order, dated 01.11.2001, made in W.P. No.11136 of 2001. (c) In most of the Writ Petitions, the prayer is for the issuance of a writ of mandamus, forbearing the respondents viz., the Secretary, Prohibition and Excise Department, Government of Tamil Nadu; the Commissioner of Prohibition and Excise, Chennai-5; the District Collector of Kanyakumari; and the Superintendent of Police, Nagercoil, from requiring the petitioners as manufacturers for sale of unrestricted Ayurveda Preparations of Asawas and Aristas to take out L-2 Licence under the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 and its Rules. (d) In some of the Writ Petitions, the petitioners prayed for the issuance of a writ of certiorarified mandamus for quashing the order of the Commissioner of Prohibition and Excise, Chepauk, Chennai-5, wherein, the said Authority rejected the request of the petitioners for renewal of L-2 Licence. 3. The brief facts are as follows:- According to the petitioners, they are engaged in the manufacture of unrestricted Ayurvedha preparations of Asawas and Aristas in Kanyakumari District. The public in Kanyakumari District have been consuming Asawas and Aristas for specific ailments and as a tonic. Many in Kanyakuamri District are hereditary Ayruvedha Vaidiyas. The preparations of Asawas and Aristas are done as per the formulae prescribed in the Ayurvedha Pharmacopea-Shagasra Yogam, the original of which has been in Malayalam. The preparations are made out of medicinal plant parts such as their flowers, leaves, nuts, stems, barks etc. and they are crushed in proportions, medicines added with water and the preparations undergo fermentation for a period of 30 days and periodically medicines are added to them.
The preparations are made out of medicinal plant parts such as their flowers, leaves, nuts, stems, barks etc. and they are crushed in proportions, medicines added with water and the preparations undergo fermentation for a period of 30 days and periodically medicines are added to them. The preparations that do not undergo boiling process are Asawas and those that undergo boiling initially are Aristas and they are not obtained by distillation or by adding alcohol in which case alone the preparations would turn out to be restricted preparations containing high percentage of alcohol. By consumption of Asawas and Aristas, there is no harm to the life or parts of the human body as it causes in the case of illicit preparations, which are made in different parts of the State or in other States. In 1955, the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 and its Rules came to govern the Ayurvedha Medicinal and Toilet Preparations. No upper limit of alcohol is prescribed for the preparations. Rule 2 (xix) read with Rule 60 read with the Schedule to the Rules provides a list of restricted preparations. As per Rule 2(xx) read with Rule 60 all others are unrestricted preparations ie., those that are not capable of being consumed as ordinary alcoholic beverages. As per Rule 64, Asawas and Aristas are the principal type of Ayurvedic medicinal preparations. As per Rule 53, periodical samples are taken by the officials of the Excise Department for analysis. As per Rule 60(2), based on the reports, unrestricted preparations could be reclassified as restricted preparations by the Standing Committee constituted under Rule-68. The licensing provisions are in Chapter VI Rules 82-96. Section 3(9) of the Tamil Nadu Prohibition Act defines the term ' liquor' as all those containing alcohol or consisting of alcohol. Since presence of any percentage of alcohol could make the preparations a liquor bringing under the purview of the Act, Section 16 of the Act exempts Medicinal and Toilet Preparations containing alcohol, used as medicines and for scientific and industrial purposes, from the purview of the Act. The same Section provides for punishment for breach of the conditions of the exemption, as per which, the 1st respondent notified the regulations. According to clause 7, there is no restriction or regulation in respect of unrestricted preparations, the regulations having been imparted only on restricted preparations.
The same Section provides for punishment for breach of the conditions of the exemption, as per which, the 1st respondent notified the regulations. According to clause 7, there is no restriction or regulation in respect of unrestricted preparations, the regulations having been imparted only on restricted preparations. Then, by virtue of the power under 54(m) of the Tamil Nadu Prohibition Act, the Government is empowered to frame Rules for regulating the exempted items. Tamil Nadu Spirituous Preparations (Control) Rules, 1984, in supercession of the earlier Government order, has been framed. Under Amendment Act 23 of 64, amendment has been brought in, seeking to govern the Ayurveda, Homeopathy and Unani medicines as well, and Chapter IV-A has been introduced. The State Government could enforce this by notification and the Tamil Nadu Government enforced it around 1978. As per the drugs Rules, unrestricted Ayurveda preparations should not exceed 12% of alcohol. Schedule-T of the Rules prescribe the detailed equipment and accessories and technical personnel to be provided in an Ayurvedic manufactory and after verification of the equipment the drug licence is issued. In Kanyakumari district, the manufacturers have provided a manufactory as per the Drug Rules, with technical personnel as required by 2002 amendments. The samples of the preparations are periodically taken by drug officials. While thus there are enough regulations in the trade of manufacture of Asawas and Aristas, in the past 3 years, L2 licenses for manufacture / sale are not granted or renewed and existing license of more than 100 licences in Kanyakumari District have been cancelled and the police are misusing the Tamil Nadu Spirituous Preparation (Control) Rules by arbitrarily interfering with the trade by arresting the persons in the trade, seizing the stock and launching prosecutions. Hence, the Writ Petitioners are before this Court. 4. Heard Mr. M. Kalyanasundaram, learned Senior Counsel for some of the petitioners; Mr.V.Selvaraj, learned counsel for the appellants and some of the writ petitioners; Mr. C.K.M. Appaji for petitioner in W.P. No.2981 of 2004; and Mr.R.Muthukumarasamy, learned Additional Advocate General for respondents/State. 5. Though an argument was advanced by Mr.
Hence, the Writ Petitioners are before this Court. 4. Heard Mr. M. Kalyanasundaram, learned Senior Counsel for some of the petitioners; Mr.V.Selvaraj, learned counsel for the appellants and some of the writ petitioners; Mr. C.K.M. Appaji for petitioner in W.P. No.2981 of 2004; and Mr.R.Muthukumarasamy, learned Additional Advocate General for respondents/State. 5. Though an argument was advanced by Mr. M. Kalyanasaundaram, learned Senior Counsel, that inasmuch as all the petitioners are having licence under the Drugs and Cosmetics Act, 1940, and in view of the contents of the preparations made by them, there is no need to get the L-2 licence; considering the fact that the petitioners and other similarly placed manufacturers are liable for levy of Excise Duty, the said contention is to be rejected. In fact, the learned Senior Counsel himself has informed this Court that the petitioners would be satisfied if necessary direction is issued to the authorities to consider their claim in the light of the relevant Rules in the licensing Chapter, particularly Rule-95 of the Medicinal and Toilet Preparations (Excise) Duties Rules, 1956, when they make applications for grant of L-2 licence. 6. Mr. V. Selvaraj also requested for a similar direction to the authorities concerned for compliance of Rule-95 while processing their Application for L-2 licence. 7. Mr. R. Muthukumarasamy, learned Additional Advocate General, has brought to our notice that the issue raised in these Writ Petitions has already been settled by various orders passed by the learned single Judges of this Court, confirmed by the Division Bench, as well as the decisions of the Apex Court. He drew our attention to the decision of the Apex Court in Kanyakumari Dist. S. & A.V. Sangam vs. Govt. of T.N. ( AIR 1996 SC 1314 ) as well as judgments of this Court reported in 2002 Writ Law Reporter. 498 (A.Jesu Arul, etc. v. The Superintendent of Police, Kanyakumari District at Nagercoil and another)(D.B.) and 2004 Writ Law Reporter 235 (Kumarapillai Vaidyar v. The District Collector, Nagercoil), and contended that all the Writ Petitions are liable to be dismissed. 8. We have considered the rival contentions.
498 (A.Jesu Arul, etc. v. The Superintendent of Police, Kanyakumari District at Nagercoil and another)(D.B.) and 2004 Writ Law Reporter 235 (Kumarapillai Vaidyar v. The District Collector, Nagercoil), and contended that all the Writ Petitions are liable to be dismissed. 8. We have considered the rival contentions. In view of the limited relief sought for and of the fact that the issue in question has been settled by a series of decisions of this Court and the Hon'ble Supreme Court, we are of the view that it is unnecessary to refer all the factual matrix as stated. 9. It is not in dispute that the petitioners are engaged in the manufacture of Asawas and Aristas and all of them are from Kanyakumari District. It is also not in dispute that the petitioners have obtained licence under the Drugs and Cosmetics Act, 1940. As said earlier, though it is the claim of the petitioners that there is no need to obtain L-2 licence under the Medicinal and Toilet Preparations (Excise Duties) Act, 1955, in view of interpretation of provisions, declaring it necessary to take L-2 Licence, it is but proper that all concerned must secure L-2 licence. 10. Before going into the relevant provisions in the licensing Chapter in the Medicinal and Toilet Preparations (Excise Duties) Act, 1955, let us consider the decisions relied on by the learned Additional General. At the foremost, by placing reliance on the decision reported in AIR 1996 SC 1314 (cited supra), he contended that the State Government is well within their power in requiring the Manufacturers of the Medicinal and Toilet preparations containing alcohol to apply for License. Considering the provisions of the Tamil Nadu Spirituous Preparation (Control) Rules, 1984, the Supreme Court concluded that to regulate the sale of medicinal or toilet preparations containing alcohol and/or intoxicating drugs is consistent with the scheme and provisions of the Tamil Nadu Prohibition Act i.e., prohibition of the manufacture, sale and consumption of intoxicating liquors and drugs in the State. It was further concluded that the restriction of obtaining licence under Rule 11 of the Tamil Nadu Spirituous Preparation (Control) Rules (1984) and other restrictions imposed by the said Rules (1984) are consistent with the provisions of the Tamil Nadu Prohibition Act (1937) and the State Government had authority to frame such Rules under Section 54 (2) (m) of the said Act (1937).
In the said case, it was the stand taken by the Kanyakumari District Sidha and Ayruveda Vaidyar Sangam and others before the Supreme Court that they are dealing in many products of indigenous system of medicines and all of them do not contain alcohol. In other words, according to them, majority of the medicinal preparations are neither spirituous preparations nor restricted preparations containing any alcohol. Rejecting their contention, the Hon'ble Supreme Court concluded thus:- “ ..... This according to us, is of no significance or consequence. Once it is found that the appellants have been dealing and selling any medicinal preparation through indigenous system of medicines which can be held to be restricted preparation or spirituous preparation then the provisions of the Rules shall be attracted and the appellant can deal only on basis of licences being granted for the same. The notification through which the rules were notified as already mentioned above clearly indicate the object and the reason for framing such rules. The primary object is to regulate the sale of medicinal or toilet preparations containing alcohol and/or intoxicating drugs, which is consistent with the scheme and provisions of the Act ie., prohibition of the manufacture, sale and consumption of intoxicating liquors and drugs in the State of Tamil Nadu. The impugned order of the High Court requires no interference. The appeal is accordingly dismissed......” 11. In W.P. Nos.16133 of 1991 and 2870 of 1992, order dated 17.04.20 00, a learned single Judge had an occasion to consider a similar prayer from the manufacturers of Asawas and Aristas. The learned Judge, after considering the provisions of the Drugs and Cosmetics Act, 1940 ; the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 and the Rules made thereunder, rejected the relief prayed for by the petitioners. The learned Judge dismissed the Writ Petitions by concluding that if the relief as prayed for is granted, it will lead to unregulated preparation, on which, the State will have no control and it will affect ultimately the public health. 12. It is also brought to our notice that in W.P. Nos.2036 to 2038 of 2001, order dated 21.08.2001, another learned Judge negatived similar relief. 13.
12. It is also brought to our notice that in W.P. Nos.2036 to 2038 of 2001, order dated 21.08.2001, another learned Judge negatived similar relief. 13. Following the Division Bench decision in W.A. No.360 of 1998, dated 19.3.1998, and after referring to the decision in W.P. Nos.16133 of 1991 and 2870 of 1992, dated 17.4.2000, as well as the definition for the term 'liquor' as given in Section 3(9) of the Tamil Nadu Prohibition Act; another Division Bench of this Court, in the decision reported in 2002 Writ L.R. 498 (cited supra), concluded thus:- “The above definition leaves no doubt that all liquid consisting of or containing alcohol would be attracted within the definition. It is not as if this definition excludes medicinal preparations or alike In such case as held by the Supreme Court as well as by the Division Bench of this Court, followed by the learned single Judge, so long as the petitioners are preparing liquid medicine containing alcohol even if it be self generated their trade is to be restricted or regulated by the State Government. Hence, it is necessary that they have to take the licence as contemplated under Rule 11 of the Tamil Nadu Spirituous Preparations (Control) Rules. 28. This is more essential because when the trade in liquor is being controlled or regulated by the State Government the State Government should have necessary Jurisdiction or authority to exercise the same on all those who are trading in liquor. If no licence is taken by the petitioners, then the State Government cannot exercise any control over them or regulate though the petitioners products or preparations or manufacture falls within the expression 'liquor' as defined under the Prohibition Act. 29. As rightly pointed out by the Division Bench of this Court in W.A.360/96 it is the individual cases to be considered as to whether the action taken by the State Officials is correct or not. When that be the case, the contention of the learned counsel for the petitioners that the Tamil Nadu Spirituous Preparations (Control) Rules is beyond the legislative competence cannot be countenanced. 30. Wherever the permissive limit or percentage of the contents of alcohol in such medicines exceed, then it is an intoxicating liquor as defined in the prohibition Act and only the State Government has authority to take action. 31.
30. Wherever the permissive limit or percentage of the contents of alcohol in such medicines exceed, then it is an intoxicating liquor as defined in the prohibition Act and only the State Government has authority to take action. 31. As pointed out by the Apex Court in Southern Pharmaceuticals & Chemicals case ( AIR 1981 SC 1863 ) the Tamil Nadu Spirituous Preparations (Control) Rules occupied totally a different field and never transgress the occupied field of the Central Government either under the Drugs and Cosmetics Act or the Medicinal and Toilet Preparation Rules.” 14. In 2004 Writ L.R. 235 (cited supra), while dealing with a batch of Writ Petitions, seeking similar reliefs, a learned single Judge, following the decision of the Supreme Court reported in 1996(8) SCC 3 42: AIR 1996 SC 1314 (cited supra) and the Division Bench decision of this Court rendered in W.P. Nos.1211 of 1995 etc. (reported in 20 02 Writ L.R. 498 [cited supra]); disposed of the Writ Petitions by issuing certain directions. The learned Judge permitted the official respondents to take action in accordance with law, particularly under the Drugs and Cosmetics Act and the Rules framed thereunder, Tamil Nadu Prohibition Act, the Tamil Nadu Spirituous Preparations (Control) Rules, 1984 and the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956. 15. In AIR 2005 SC 932 (State of Bihar v. Shree Baidyanath Ayurved Bhawan (P) Ltd.), while considering the provisions under the Bihar Excise Act and the relevant Rules, which are similar to that of the Tamil Nadu Spirituous Preparations (Control) Rules, 1984, the Supreme Court concluded that when the Ayurvedic preparation is diverted to human consumption the State shall have the power to regulate and control such use. Concluding so, the Apex Court upheld similar restriction and the action taken by the Government of Bihar. 16. In view of the various pronouncements, the petitioners cannot be permitted to contend that there is no need to take L-2 licence. Further, in view of the fact that the product is dutiable, undoubtedly, the persons in charge of the manufacture have to obtain such licence. 17. As said earlier, the other grievance of the petitioners is that when they apply for L-2 licence, the licensing Authority is not considering their claim as per the Rules provided in the Licensing Chapter.
Further, in view of the fact that the product is dutiable, undoubtedly, the persons in charge of the manufacture have to obtain such licence. 17. As said earlier, the other grievance of the petitioners is that when they apply for L-2 licence, the licensing Authority is not considering their claim as per the Rules provided in the Licensing Chapter. Chapter VI of the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956, deals with the licensing procedure. Rule-82 refers to the procedure for obtaining licence. Rule-84 relates to grant of licence. Rule-95 prescribes the procedure for disposal of Application for licence to manufacture medicinal and toilet preparations in a bonded/non-bonded manufactory by the licensing authority. Sub Rule-(1) thereto makes it clear that on receipt of an application, it is the bounden duty of the licensing authority to cause enquires into the following:- “(i) the qualifications and previous experience of technical personnel engaged in the manufacturing operation; (ii) the equipment of the bonded and non-bonded manufactory; (iii) soundness of the applicant's financial position; and (iv) suitability of the proposed building for the establishment of manufactory. “ As per Clause-2, if the licensing authority is satisfied in respect of the enquiries made on the above aspects, then, he is bound to grant licence. 18. In view of the above discussion and the statutory provisions as interpreted in various decisions of this Court and the Apex Court, we are satisfied that the relief as prayed for by the petitioners cannot be granted. However, it is made clear that if any application is made for grant of licence, the authority concerned is bound to follow the procedure provided in the licensing chapter, particularly Rule-95 of the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956 and dispose of the application expeditiously. 19. With the above observation, the Writ Appeals as well as the Writ Petitions are dismissed. No costs. Consequently, connected Miscellaneous Petitions are also dismissed.