MOREPEN LABOURATORIES LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The challenge in this petition by the Petitioner Morepen Laboratories Limited ('MLL') is to the communications dated 2nd February 2009 issued by the National Pharmaceutical Pricing Authority ('NPPA') Department of Chemicals & Petrochemicals, Ministry of Chemicals & Fertilizers, Government of India requiring the Petitioner to deposit a sum of Rs. 2,36,55,235/- (including an amount of Rs. 78,85,079/- towards interest) on account of manufacturing/marketing of scheduled formulation Norpen TZ Tablets at a price higher than the ceiling price notified by the Government by a notification dated 16th September 2005.

(2.) The challenge in this petition is also to the communications dated 21st April 2008 and 8th April 2009 issued by the NPPA requiring the Petitioner to deposit the amount liable to be paid on the ground of overcharging for the above drug Norpen TZ. It also challenges the recovery certificate dated 9th July 2009 issued by the Assistant Collector, District- New Delhi for recovery of Rs. 2,39,50,925/-.

(3.) The facts leading to the filing of the present petition are that MLL has its registered office in Himachal Pradesh and has its corporate office in Delhi. The petitioner is engaged in the business of manufacturing and marketing of pharmaceutical formulations and other products. On 15th June 2005 MLL entered into a distributorship agreement with M/s. Generica India Limited ('Generica'). Generica is engaged in the business of marketing and distribution of pharmaceutical products. Avis Lifesciences ('Avis') is the marketing arm of Generica. MLL granted Generica all the rights of purchase for resale MLL's healthcare (branded generics) products in the territories mentioned thereunder. Clause 9 dealing with fixation of price for the drugs reads as under (the word 'Company' refers to MLL):