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Vetindia Pharmaceuticals v. The State of Uttar Pradesh
The appeal has been filed in the Supreme Court by the appellant, who is aggrieved by the indefinite order of blacklisting dated on 8th September 2009. The High Court dismissed the writ petition only on the ground of delay, as the Writ petition was filed after 10 years.
The learned counsel for the appellant submits that the appellant holds a valid license under the Drugs and Cosmetic Acts, 1940 hereinafter referred to as the Act in Form 28, Rule 76 issued by the Drugs Control Administration. Private limited had obtained supplies from Vetindia Pharmaceuticals in the year 2007 and in return supplied tender to the respondent under a tender notice dated 4th October 2006. The label on the injection 'XYO 701' was an unintentional error. The brand name correctly mentioned was 'OXY 125'. The component was correctly mentioned as Oxytetracycline IP Vet 125 mg. Only word Hcl was only missing on the label. Because of that, it was a case of an unintentional printing error which turned into a misbranding. The product was not substandard or fake veterinary medicine.
The appellant was served with an order of blacklisting dated 8th September 2009 by the office of Director, Animal Husbandry Department, declaring the batch supplied by the appellant to be substandard quality, violating clause 8.12 and 8.23 of the tender of 2006-2007. Misbranding was referred to as an unintentional error. The respondents required certain clarification which was given to them on 4th May 2019 but there was no outcome to that. The blacklisting order caused a great loss to the appellant as the tender was rejected by the government of Rajasthan because of the blacklisting reasons. The respondent did not initiate proceedings against the appellant under Sec 23,25,26 and 27 of the Act.
The explanation given for the delay has not been properly considered. The blacklisting order is violative of the principles of natural justice. The learned counsel has relied on the judgement of Gorakha Security Services v. Government NCT of Delhi and ors (2014) to submit that the show cause notice did not meet the requirement of the law. Further, the counsel relied on Daffodils Pharmaceuticals Ltd. v. the State of U.P and ors (2019) that the debarment of four years is sufficient.
The learned counsel for the respondents submitted the Writ petition was dismissed on the ground of inordinate delay of 10 years in challenging the blacklisting order. The medicine was misbranded in terms of Sec 9 of the Act supported by the report of the analyst. Therefore, the impugned orders merit no interference.
Court after listening to both the parties are satisfied that the petition is to be allowed. Since the appellant has a license for manufacturing. The drugs which are in question have been misbranded and not fake. The appellant took the plea of an unintentional printing error on the label. The appellate tried to clear the matter with the respondents. The appellant requested for allowing them to participate in further tenders. The respondent rejected the request on the ground that there was a violation of clause 8.12 and 8.23 of the tender. Because of the blacklisting order, the appellant was not allowed to participate in the tender given by the government of Rajasthan.
According to the facts of the case, it is clear that the injection was not supplied to the respondent by the appellant. The show-cause did not state the action why blacklisting was to be taken or was under contemplation. Invoking clause 8.12 and 8.23 is a fundamental flaw in the absence of any supply. Even after the appellant brought the facts to the attention of the reapondents, they refused to pay attention.
There is no doubt that the High Court in its jurisdiction may decline the Writ petition on the ground of delay in filing the petition. The power vested in the Court under Article 226 of the constitution has to be exercised after considering all the pros and cons of the matter, including nature and the explanation for the delay in filing the petition and to see if any 3rd party rights have been intervened. The Supreme Court in case of Basanti prasad v. Bihar School Examination Board and ors (2009), referring to Maharashtra SRTC v. Balwant Regular Motor Vehicle Service (1969), Moon Mills Ltd. v. Industrial Court (1967), held that if the delay is properly explained to the court and is reasonable and without the interference of any 3rd party rights being effected, the Court may excise the delay.
Further, the Court is of the view that the contention of the respondents that they have acted by the Act followed by the report of the misbranded product has no merit of consideration.
After carefully examining the circumstances and facts of the case the Court has concluded that the Writ petition is not barred by unexplained delay as the appellant has been pursuing the matter with the authorities. Further, the High Court has been mistaken in dismissing the writ petition on the ground of delay. Further, the order dated 8th September 2009 of the respondent to be set aside.
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