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2017 DIGILAW 675 (KER)

Aditya Medisales Ltd. v. State of Kerala

2017-04-05

NAVANITI PRASAD SINGH

body2017
ORDER : Navaniti Prasad Singh, J. By this two applications, the four petitioners seek quashing of their criminal prosecution for alleged violation of the Drug Price Control Order, 1995 issued under Section 3 of the Essential Commodities Act, which is punishable under Section 7 of the said Act. 2. I have heard the learned counsel for the petitioner and the learned Public Prosecutor for the State. 3. Petitioners 2 and 3 are the Directors of the first petitioner Public Limited Company and they reside at Bombay. The fourth petitioner is their Manager at Kochi where the Company aforesaid has C & F Agency inter alia in respect of a drug manufacturer, M/s. Sun Pharmaceutical Industries Limited. In the complaint, as lodged by the Drug Inspector, Special Intelligence Branch, Thiruvananthapuram, it is alleged that he had received a complaint from one T.C. Antony, Managing Partner of Drug House, Thrissur alleging that he was one of the dealers who was dealing in medicines manufactured by M/s. Sun Pharmaceuticals. Accordingly, he used to place indent for different types of drugs to the first petitioner at Kochi, but from invoices produced, it appeared that the accused persons did not supply the drugs. Accordingly, it is alleged that even though drugs were available in the stock, there was refusal to sell the drugs. Hence it is in contravention of Clause 18 of the Control Order aforesaid. 4. On behalf of the petitioners, it is submitted that so far as petitioners 2 and 3 are concerned, they are Directors of first petitioner and are stationed at Bombay. It is merely because of that in view of Section 10 of the Essential Commodities Act, they are being prosecuted. But before they can be proceeded against, it has to be avered with certainty that they were in charge of and responsible to the company for the conduct of the business of the company at the time when the offence was committed and in the absence of the said, merely because they were Directors, they cannot be prosecuted. But before they can be proceeded against, it has to be avered with certainty that they were in charge of and responsible to the company for the conduct of the business of the company at the time when the offence was committed and in the absence of the said, merely because they were Directors, they cannot be prosecuted. Reliance has been placed on the judgment of the Apex Court in the case of State of Karnataka v. Pratap Chand ad Others [ AIR 1981 SC 872 ], which dealt with partners of a Partnership firm and the Apex Court clearly held that unless it is specifically avered that they were in charge of and responsible to the affairs of the firm at the time when the offence was committed, and merely because they were partners, they cannot be prosecuted. Even if I accept this ground, the prosecution would still continue against the first and fourth petitioners. In that respect learned counsel for the petitioners submit that for an offence of refusal to sell, the refusal has to be implicit from the communication of the complainant firm. It is apparent that they were placing orders from time to time in regular course of business and certain drugs were being supplied whereas certain drugs were not invoiced for sale. Subsequent communication of the complainant party clearly shows that it was due to certain procedural defect in the automated system that this misunderstanding took place. On perusing those correspondences, are part of the complaint as made by the Drug Controller, it is apparent that there is no positive refusal to sell. The complaint is that in spite of intending the invoices showed no delivery. Even the allegation is not that there was a refusal to sell. It must be borne in mind that we are dealing with a penal provision having severe consequences. It is settled that mens rea is an essential ingredient under Section 7 of the Essential Commodities Act. In the facts as borne out from the records, even if technically it may be alleged that there was a refusal, it is not accompanied by any mens rea. The subsequent communications explained that it was due to some technical problem in the automated system, the misunderstanding took place. 5. In the facts as borne out from the records, even if technically it may be alleged that there was a refusal, it is not accompanied by any mens rea. The subsequent communications explained that it was due to some technical problem in the automated system, the misunderstanding took place. 5. Having considered the matter, in my view, it would be futile to permit the prosecution to carry on for such a hyper technical breach involving no mens rea. In that view of the matter, it would be deemed that the prosecution of all the petitioners would be an abuse of process of law and as such the complaint as lodged by the Drugs Controller is quashed and the Court is restrained from proceeding in the matter any further. 6. These applications are thus allowed.