S. M. Dutta and others v. State of Uttar Pradesh and and others
2012-05-07
S.S.CHAUHAN
body2012
DigiLaw.ai
S.S. Chauhan, J.— Heard Sri Gopal S. Chaturvedi, Senior Advocate assisted by S/Sri Nandit Srivastava and Samit Gopal for the petitioners and Sri Rajendra Kumar Dwivedi, learned Additional Government Advocate as well as learned Additional Chief Standing Counsel. 2. The summoning order dated 28.4.1994 has been made the subject-matter of challenge in this petition under section 482 Cr.P.C 3. The facts in briet are that the petitioners, Hindustan Lever Limited applied for licence for manufacturing toilet soaps in the name and style as "Breeze and Lux" under the Drugs and Cosmetics Act (for short 'the Act'). The application was made to the competent authority for grant of licence for manufacturing the aforesaid toilet soaps and after completing the necessary formalities, the licence was granted to the petitioner's company for manufacturing of the aforesaid toilet soaps vide licence dated 28.2.1990. The licence was granted with the condition that the petitioner's company will subscribe to the ISI specifications for toilet soaps and while granting sanction, the percentage of Sodium Soap Anhydrous in respect of Lux Toilet Soap was prescribed between 55 to 75, whereas in respect of Breeze Toilet Soap it was prescribed between 50-75, but in both the specifications a rider was imposed that the manufacturing should conform to the ISI specifications for toilet soaps. After the grant of licence, manufacturing was started by the petitioners' company and on 12.4.1990 inspection was conducted by the Drug Inspector and after conducting the inspection, a notice was issued to the petitioners' company on 31.5.1993, to which petitioners' company replied by means of letter dated 28.6.1993. Thereafter, the petitioners' company gave another reply on 1.7.1993.
Thereafter, the petitioners' company gave another reply on 1.7.1993. The sample of the petitioners' company was forwarded to the public analyst, who after testing the sample, submitted his report dated 11.10.1993 in which it was found that Lux and Breeze toilet soaps were not conforming to the ISI specifications as Total Fatty Matter ( for short "TFM') in respect of Breeze toilet soap was found to be 33.77 as against 60% and matter insoluble in alcohol and chlorides were found to be 33.91% w/w and 2.54% w/w, which is more than ISl specifications and in the same manner in Lux toilet soap 'TFM was found 50.82% as ,against 60% and matter insoluble in alcohol and chlorides were found to be 28.58% w/w and 2.33% w/w, which is more than ISI specifications. After receiving the report of the public analyst, the Drug Inspector proceeded to lodge a complaint under sections 17-C and 18 (a) (ii) read with section 27 of the Act in the Court of Chief Judicial Magistrate, Unnao, upon which cognizance was taken by the Chief Judicial Magistrate by summoning the petitioners' company. 4. One set of the petitioners have challenged the proceedings before this Court by means of present petition and an interim order was granted on 25.4.1996. Since then the matter has been ingering and could not be taken up, but ultimately anyhow the matter was heard by this Court with great effort and the arguments were advanced. The trial is held up since 1996 on account of the interim order of this Court. 5. Counter-affidavit has been filed by the State denying the grounds set up in the petition and it has been stated that the firm had applied for grant of cosmetic (soap) manufacturing licence to the licensing authority stating therein that the toilet soap, which is to be manufactured shall be of ISI specification with a minimum TFM of 60%. Copy of the application for licence submitted by the petitioners' company vide its letter dated 3.1.1990 addressed to the Drug Controller, U.P., Swasthya Bhawan, Lucknow has also been annexed with the counter affidavit. The licence was granted by the licensing authority on the ISI specifications, which were specifically endorsed in the licence and it was supposed that the petitioners' company will manufacture the toilet soaps on the given standard and specification.
The licence was granted by the licensing authority on the ISI specifications, which were specifically endorsed in the licence and it was supposed that the petitioners' company will manufacture the toilet soaps on the given standard and specification. However, the sample collected from the petitioners' company failed the test by the public analyst. Section 16 of the Act lays down the standard of quality under clause (b) of section 16 and mentions that the cosmetic must comply with such standard as may be prescribed. The word "prescribed" has been defined under section 3(i) of the Act. It is further stated that section 3 (aaa) defines the word 'cosmetics' and the word 'soap' is not included prior to 1.2.1983, but by Act No. 68 of 1982 the word stands included from 1.2.1983. It is, therefore, clear that the soap was included in the word 'cosmetics' w.e.f. 1.2.1983. The formula which was submitted by the petitioners' company at the time of grant of licence under which they were supposed to manufacture the soaps, was accepted by them and they agreed that they would comply with the ISI specifications and a specific endorsement was made in the licence to that effect. The percentage was also indicated for toilet soaps in Table-I of the Indian Standard Specification for Toilet Soap and the lowest grade-3 requirement of TFM is 60%. The samples tested were found to be much below the TFM prescription. It is also stated that the petitioners' company had also specifically displayed on their label of soaps that it contains TFM 50% and it is only incorrect to say that no standard was fixed and the standard, which was fixed in respect of toilet soaps came into effect from 27.10.1993 and by GSR dated 27.10.1993 toilet soap was included in Schedule-S, but it does not mean that the petitioners were free to manufacture soap of any quality they like, but they were required to manufacture the soaps according to the standard fixed in the licence. If the TFM content in the soap is found less and the soap is rubbed or applied on the human body, it will create various skin problems as well as required amount of protection to the human body will not be available. 6.
If the TFM content in the soap is found less and the soap is rubbed or applied on the human body, it will create various skin problems as well as required amount of protection to the human body will not be available. 6. Submission of learned Counsel for the petitioners is that the ISI prescription has been made applicable in respect of the manufacture of toilet soaps from 27.10.1993 and as such no such prescription could have been endorsed on the licence, which was granted to the petitioners' company. It is also submitted that the licence was obtained for manufacturing certain more items and it was not a fresh licence, which was obtained for manufacturing of soaps. Six items were already existing in the licence, which was earlier granted. He has relied upon section 17-C of the Act, which deals with the requirement of misbranded cosmetics. Reliance has also been placed on Rule 138(3) of the Drugs and Cosmetics Rules (for short 'the Rules') to emphasize that application by a licensee to manufacture additional items of cosmetics is to be accompanied by a fee of Rs.100 for each item subject to a maximum of Rs.3000/- for each application. It has also been contended that ISI prescription endorsed on the licence could not have been done by the licensing authority and such specification is not applicable in the case of the petitioners as the said ISI specification has been made applicable w.e.f. 27.10.1993 when notification was issued by the Central Government. It is further submitted that the power to prescribe standard for running cosmetics is exclusively within the domain of the Parliament and no authority has any power in this regard. Thus, the act of the Drug Controller amounts to legislation, which is not within his purview. The standard for cosmetics is prescribed under Rule 150-A of the Rules, which lays down the prescription as may be prescribed in Schedule-S and Schedule-S lays down the prescriptions in regard to manufacture of toilet soaps. In support of his contention, he has placed reliance upon the following cases:- East India Commercial Co. Ltd., Calcutta and another v. The Collector of Customs, Calcutta, AIR 1962 SC 1893 . Becker Gray & Co.(1930) Ltd. and others v. Union of India and another, AIR 1971 SC 116 .
In support of his contention, he has placed reliance upon the following cases:- East India Commercial Co. Ltd., Calcutta and another v. The Collector of Customs, Calcutta, AIR 1962 SC 1893 . Becker Gray & Co.(1930) Ltd. and others v. Union of India and another, AIR 1971 SC 116 . Gopilal Aganval v. State of Orissa and another, AIR 1973 Orissa 15. S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla and another 2007 (58) ACC 41 (SC). State of NCT of Delhi through Prosecuting Officer, Insecticides, Government of NCT, Delhi v. Rajiv Khurana, 2010 (70) ACC 891 (SC) = 2010 (93) A1C 2H (SC). and Pepsico India Holdings Pvt. Ltd. v. Food Inspector and another. 2011 (72) ACC 431 (SC) = 2011 (98) AIC 156 (SC). 7. Learned AGA, on the other hand, has submitted that Rule 142 prescribes the conditions of licence in which a proviso has been added wherein it has been said that clauses (b-1) and (c) shall not apply to the manufacture of soap and the procedure for testing of raw materials and the records to be maintained by a manufacturer of soap shall be such as are approved by the licensing authority. On the aforesaid reasoning, it has been submitted that the ISI specifications, which were prescribed at the time of grant of licence were binding upon the petitioners. The ISI prescriptions are existing since 1978 and a specific endorsement has been made in clause 6.1 of the Indian Standard Specification for Toilet Soap that method of test in IS: 286-1978 has been prescribed. The said testing was prevalent since 1978 and the specifications prescribed therein are applicable, so the petitioners cannot say that a wrong endorsement was made on the licence. The percentage in the said specification has been given in respect of toilet soaps as 76% for Grade-1, 70% for Grade-2 and 60% for Grade-3 and the sample tested did not conform to any of the grades, therefore, the petitioners have committed offence under the provisions of the Act and they are rightly being prosecuted. The application for testing can be moved under section 25(4) of the Act and they could have claimed for retesting before the Central Drugs Laboratory, but that was not done by the petitioners.
The application for testing can be moved under section 25(4) of the Act and they could have claimed for retesting before the Central Drugs Laboratory, but that was not done by the petitioners. The action of the petitioners is hazardous to the public safety and health and they cannot be allowed to play with the life of the people. They are standard company and they have a mass service and sale of items, so they are bound to manufacture the items on the same lines and same specifications for which they have been given the licence. Section 18 of the Act prohibits the manufacture and sale of certain drugs and cosmetics, which are misbranded. The case of the petitioners is covered under misbranded cosmetics as contemplated under section 17-C of the Act as they have displayed the percentage of fatty contents on the wrapper of the soap, but the said percentage has not been found to match with the Government analyst report. On the question of discharge also he has placed reliance on the decision of this Court in the case of Manoj Dalmia v. State of U.P. and others decided on 27.9.2011. Therefore, the contention of the petitioners' Counsel that no offence is made out, cannot be accepted as is evident from the Government analyst report and as such the petition is liable to be dismissed. In support of his contention he has placed reliance upon the following decisions:-- U.P. Pollution Control Board v. Messers Modi Distillery and others, 1988 (25) ACC 34 (SC). U.P. Pollution Control Board v. Mohan Meakins Ltd. and others, (2000) 3 SCC 745 . U.P. Pollution Control Board v. Dr. Bhupendra Kumar Modi and another, 2009 (64) ACC 1006 (SC) = 2009 (74) AIC 141 (SC). State of Kerala v. Orison J. Francis and another, 2009 (65) ACC 684 (SQ. Dinesh B. Patel and others v. State of Gujarat and another, 2010 (71) ACC 546 (SC). and Smt. Nagawiva v. Veeranna Shivlin-gappa Konjalgi and others. 1976 (13) ACC 225 (SC). 8. I have heard learned Counsel for the parties and perused the record. 9.
State of Kerala v. Orison J. Francis and another, 2009 (65) ACC 684 (SQ. Dinesh B. Patel and others v. State of Gujarat and another, 2010 (71) ACC 546 (SC). and Smt. Nagawiva v. Veeranna Shivlin-gappa Konjalgi and others. 1976 (13) ACC 225 (SC). 8. I have heard learned Counsel for the parties and perused the record. 9. The main argument of Counsel for the petitioners is that the ISI prescriptions, which have been endorsed on the licence, were not within the domain of the Drug Controller and as such the endorsement is without authority of law and the petitioners cannot be prosecuted on account of the said ISI prescription as the said prescription was made applicable w.e.f. 27.10.1993 when the Central Government issued notification in this regard. 10. The aforesaid argument of the Counsel for the petitioners cannot be accepted on account of the fact that the ISI prescription has been made applicable for testing by the Indian Standard Specification for Toilet Soap (Second Revision) and in clause 6.1. of the said specification a method of testing for toilet soap has been prescribed in IS: 286-1978. The said testing method is prevalent since 1978 and, therefore, if any endorsement was made in respect of ISI prescription, then it cannot be said that there was no power vested with the Drug Controller to make such endorsement or making of such amendment amounts to legislation on the part of the Drug Controller. The Drug Controller while granting licence only intended that the ISI specification No. I.S. 286-1978 is to be made applicable in respect of Breeze toilet soap and ISI specification No. 2536-1978 is to be applicable in respect of Lux toilet soap. This is evident from pages 63 and 64 of the paper book, which are copies of the test report, which go to indicate that the said prescription has been applied and on that basis the test has been done. Therefore, the contention of the Counsel for the petitioners cannot be accepted that the endorsement made on the licence by the Drug Controller to the effect that minimum ISI prescription for toilet soaps was to be adhered to, was without authority of law.
Therefore, the contention of the Counsel for the petitioners cannot be accepted that the endorsement made on the licence by the Drug Controller to the effect that minimum ISI prescription for toilet soaps was to be adhered to, was without authority of law. The Drug Controller while making such endorsement was clearly of the view that IS: prescription 286-1978 was prevalent in respect of Breeze toilet soap since 1978 and in respect of Lux toilet soap ISI specification No. 2536-1978 was prevailing, therefore, the testing was done in accordance with the prescription laid down by the Indian Standard Specification for Toilet Soaps. The fatty contents were found to be 50.82% as compared to the minimum requirement of 60% in respect of Lux toilet soap, whereas in respect of Breeze toilet soap it was found to be 33.77% in comparison to the minimum limit of 60%. 11. The next point, which has been argued by the Counsel for the petitioners, is that the items manufactured by the petitioners are not covered under the head of misbranded cosmetics. For appreciation of the said argument, one has to go through the language employed in section 17-C of the Act, which provides that for the purposes of this Chapter, a cosmetic shall be deemed to be misbranded, -- (a).............. (b)............. (c) If the labelor container or anything accompanying the cosmetic bears any statement which is false or misleading in any particular, it will be covered under the term 'misbranded cosmetic'. 12. The wrapper on both the soaps did not conform to the fatty contents as required and they have been found to be much less than the display on the wrapper. In respect of Breeze toilet soap 50% has been displayed, whereas it has been found to be 33.77% in the report and in respect of Lux toilet soap the minimum requirement is 55 to 75%, whereas on the wrapper they have displayed 50% and it has been found 50.82% in the report and the Government analyst found that it was lacking the minimum requirement of 60%. Therefore, the contention of the Counsel for the petitioners that it does not come within the purview of misbranded cosmetics, cannot be accepted and is hereby rejected. 13. The conditions are part of the licence as submitted by the learned AGA.
Therefore, the contention of the Counsel for the petitioners that it does not come within the purview of misbranded cosmetics, cannot be accepted and is hereby rejected. 13. The conditions are part of the licence as submitted by the learned AGA. Rule 142 provides that subject to the conditions stated therein in the licence. The licence contains a specific endorsement that according to the ISI prescription for toilet soaps the manufacture has to be made. Once it is found that the prescription is there, the manufacturing ought to have been made in accordance with the said prescriptions. The licence itself indicates the percentage of fatty contents from 55 to 75% in the case of Lux toilet soap and in the case of Breeze toilet soap it is 50-75%. Thus, the argument advanced by the Counsel for the petitioners fails in this respect. 14. The licence was granted to the petitioner's company for manufacturing of the aforesaid toilet soaps vide licence dated 28.2.1990. The licence was granted with the condition that the petitioner's company will subscribe to the ISI specifications for toilet soaps and while granting sanction, the percentage of Sodium Soap Anhydrous in respect of Lux Toilet Soap was prescribed between 55 to 75, whereas in respect of Breeze Toilet Soap it was prescribed between 50-75, but in both the specifications a rider was imposed that the manufacturing should conform to the ISI specifications for toilet soaps. After the grant of licence, manufacturing was started by-the petitioners' company and on 12.4.1990 inspection was conducted by the Drug Inspector and after conducting the inspection, a notice was issued to the petitioners' company on 31.5.1993, to which petitioners' company replied by means of letter dated 28.6.1993. Thereafter, the petitioners' company gave another reply on 1.7.1993.
After the grant of licence, manufacturing was started by-the petitioners' company and on 12.4.1990 inspection was conducted by the Drug Inspector and after conducting the inspection, a notice was issued to the petitioners' company on 31.5.1993, to which petitioners' company replied by means of letter dated 28.6.1993. Thereafter, the petitioners' company gave another reply on 1.7.1993. The sample of the petitioners' company was forwarded to the public analyst, who after testing the sample, submitted his report dated 11.10.1993 in which it was found that Lux and Breeze toilet soaps were not conformed to the ISI specifications as TFM in respect of Breeze toilet soap was found to be 33.77 as against 60% and matter insoluble in alcohol and chlorides were found to be 33.91% w/w and 2.54% w/w, which is more than ISI specifications and in the same manner in Lux toilet soap TFM was found 50.82% as against 60% and matter insoluble in alcohol and chlorides were found to be 28.58% w/w and 2.33% w/w, which is more than ISI specifications. After receiving the report of the public analyst, the Drug Inspector proceeded to lodge a complaint under sections 17-C and 18 (a) (ii) read with section 27 of the Act in the Court of Chief Judicial Magistrate, Unnao, upon which cognizance was taken by the Chief Judicial Magistrate by summoning the petitioners' company. Therefore, it cannot be said that the summoning order suffers from any illegality. 15. Reliance placed by the Counsel for the petitioners on the case laws are not of much assistance on account of the fact that as in the case of Capital Agarwal (supra) it was found that no standard quality was prescribed in respect of Gudakhu and in those circumstances, it was held that there was no provision of the Act and the Rules on the basis of which penalty cannot be imposed for infringement of standard quality. Non-fixation of standard quality of Gudakhu has however nothing to do with the taking of licence. Whereas, in this case the prescription is there and in accordance with that testing has been done. Once the legal requirement is there, the said case law is not applicable to the facts of the present case. 16.
Non-fixation of standard quality of Gudakhu has however nothing to do with the taking of licence. Whereas, in this case the prescription is there and in accordance with that testing has been done. Once the legal requirement is there, the said case law is not applicable to the facts of the present case. 16. The case of S.M.S. Pharmaceuticals Ltd. (supra) is in respect of N.I. Act, which does not apply in the facts of the present case. Here in the case in hand, it has been found that the manufacturing was being done at the instance of the petitioners and they were in full knowhow of the fact that they obtained the licence and they have to manufacture the items in accordance with the specification prescribed therein. 17. The case of Rajiv Khurana (supra) is also not applicable in view of the" reasoning given above. The case of PepsiCo India Holdings Pvt. Ltd. (supra) is also a case wherein it was found that insecticide residue was not beyond the permitted limit, whereas in the present case, the prescription is there. Rule 150-A also lays down that the cosmetics in finished form was to conform to the IS specifications laid down from time to time by the Bureau of Indian Standards and under Rule 150 toilet soap is covered, as such the case of the petitioners is fully covered under the said rule as well. 18. Learned AGA has placed reliance upon the case of M/s Modi Distillery (supra) to contend that in spite of lodging of complaint against the company for alleged offence under section 44 of the Water (Prevention and Control of Pollution) Act, 1974 on the ground of contravention of sections 25(1) and 26 by an industrial unit owned by the company, the unit itself as well as Chairman, Managing Director and members of the Board of Directors of the company impleaded by the appellant Pollution Control Board. In the said case, it was found that such legal infirmity attributable to failure of the industrial unit to furnish the requisite information called for by the company was not established. In these circumstances, the order of Chief Judicial Magistrate was restored and the trial was allowed to proceed. Similar is the preposition which laid down in the case of Mohan Meakins Ltd. ( supra).
In these circumstances, the order of Chief Judicial Magistrate was restored and the trial was allowed to proceed. Similar is the preposition which laid down in the case of Mohan Meakins Ltd. ( supra). In the said case also it was found that where an offence under the Act was committed by a company, then any director, manager or the officer of the company, who has consented to or connived in the commission of the said offence, is also liable for the punishment of the offence and this fact is discernible from section 47 of the Act. It was also held that lapse of a long period cannot be a reason to absolve the respondents from the trial and it must reach its logical culmination. The Courts should not deal with the prosecution for offences under the Act in a causal or routine manner. 19. In the case of Dr. Bhupendra Kumar Modi (supra) again section 47 of the Water (Prevention and Control of Pollution) Act, 1974 was considered and placing reliance upon the decision rendered in the case of Nagawwa (supra) it was again reiterated that in a matter of this nature, particularly, when it affects public heath if it is untimely proved, Courts cannot afford to deal lightly with cases involving pollution of air and water. The message must go to all persons concerned whether small or big that the Courts will share the parliamentary concern and legislative intent of the Act to check the escalating pollution level and restore the balance of our environment. It was further held that while exercising inherent powers either on civil or criminal jurisdiction, the Court does not function as a Court of appeal or revision. The inherent jurisdiction though wide has to be exercised sparingly, carefully and with caution. 20. The case of Orison J. Francis and another (supra) again arose under the Drugs and Cosmetics Act and the Apex Court refused to interfere in the matter although an argument has been advanced that they were producing ayurvedic drugs in respect of which subsequent licence was granted. The Apex Court refused to interfere with the matter and set aside the order passed by the High Court quashing the proceedings. 21.
The Apex Court refused to interfere with the matter and set aside the order passed by the High Court quashing the proceedings. 21. The case of Dinesh B. Patel (supra) also relates to the Drugs and Cosmetics Act and it was again held that the Directors were also held responsible for the affairs of the company when a drug manufactured by the company was found to be defective. 22. The petitioners are a leading manufacturing company and they ought to have manufactured the toilet soaps on a certain confidence reposed by the public on account of their high good will in the society. People purchase the items of branded companies blindly because of their goodwill and they rely on the contents displayed on the wrapper of the company. In the present case, the petitioners' company has rather played fraud with the public at large by displaying that they are producing toilet soaps in accordance with the prescribed standards, whereas the fatty contents were altogether very low. It appears that the fatty contents were reduced on account of their interpolation in the manufacturing. Less fatty contents can affect the skin of the public and it can also be susceptible to various skin deceases. Therefore, the petitioners' company, being a high reputed cannot be absolved in such a manner from prosecution. 23. On a consideration of the aforesaid case laws, I do not find any ground to quash the proceedings instituted against the petitioners. 24. Petition is devoid of merit. It is accordingly dismissed. Petition Dismissed. _____________