Supreme Court Upholds Prosecution of SBS Biotech for Violations under Drugs and Cosmetics Act, Complaint within Limitation Period; Special Court Jurisdiction Affirmed by Apex Court
In a significant ruling, the Supreme Court of India has dismissed the appeal filed by M/s SBS Biotech and others against the decision of the High Court of Himachal Pradesh, which upheld their prosecution under various sections of the Drugs and Cosmetics Act, 1940. The apex court, comprising Justices Prashant Kumar Mishra and Vipul M. Pancholi, confirmed that the proceedings initiated against the appellants were neither barred by limitation nor jurisdictionally misplaced.
The case stems from an inspection conducted on July 22, 2014, by the Drug Inspector at the manufacturing premises of SBS Biotech, located in Sirmaur, Himachal Pradesh. The inspection revealed significant lapses in record-keeping as required under Schedule M and U of the Drugs and Cosmetics Rules, 1945. Following the inspection, a series of legal actions were taken against the company for failing to maintain adequate documentation and for alleged tampering with records.
The appellants argued that the complaint, filed after two and a half years, was time-barred under Section 468 of the Code of Criminal Procedure. However, the Supreme Court clarified that the applicable limitation period was three years, given that the punishment under Section 27(d) of the Act could extend up to two years. The court emphasized that the complaint was filed within this three-year window, making the proceedings timely.
Additionally, the Supreme Court addressed the issue of jurisdiction, affirming that offences under Chapter IV of the Drugs and Cosmetics Act are to be tried by a Court of Session. This decision came after the appellants challenged the committal of their case to the Special Judge, arguing that the offence should have been tried summarily by a Magistrate. The court highlighted that Section 32(2) of the Act restricts the trial of such offences to courts not inferior to a Court of Session, thereby validating the lower court's decision.
The judgment also rejected the appellants' claim that the alleged non-compliance pertained only to record-keeping, which is punishable under Section 28-A, with a lesser limitation period. Instead, the court found that the nature of the allegations, including discrepancies and possible tampering, warranted the invocation of Section 27(d).
The Supreme Court's decision underscores the stringent requirements for compliance under the Drugs and Cosmetics Act and the importance of maintaining comprehensive and accurate records in pharmaceutical operations. The ruling serves as a reminder to pharmaceutical companies to adhere strictly to statutory obligations to avoid severe legal consequences.
Bottom Line:
Drugs and Cosmetics Act, 1940 - Non-maintenance and non-furnishing of records as per Schedule M & U constitutes an offence under Section 18(a)(vi) read with Rule 74 punishable under Section 27(d) of the Act.
Statutory provision(s):
Drugs and Cosmetics Act, 1940 Sections 18(a)(vi), 18B, 27(d), 28A, 32(2), 36A, 36AB; Rules framed thereunder; Code of Criminal Procedure, 1973 Section 468, 482
M/s SBS Biotech v. State of Himachal Pradesh, (SC) : Law Finder Doc id # 2856594
