TRIDOSS LABORATORIES PVT. LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner No.1 is a company engaged in the business of manufacturing and marketing pharmaceutical products and petitioner No.2 is its authorized representative. They have filed this petition being aggrieved by a demand notice dtd. 15/2/2016 issued by respondent No.1 i.e. Union of India through Department of Pharmaceuticals as also impugned notice of demand issued to a defaulter by respondent No.3 Tahsildar under Sec. 267 of the Maharashtra Land Revenue Code, 1966 (for short 'MLR Code'). The principal contention raised on behalf of the petitioners is that the petitioner No.1 is not liable to pay the amount demanded by the respondents for allegedly overcharging consumers in respect of a specific pharmaceutical formulation and that, in any case, the demand is hopelessly time-barred. The huge delay in raising the demand has resulted in depriving the petitioners from formulating their defence as the records pertaining to the relevant period were not available with the petitioners in the year 2016, when the impugned notices of demand were issued by the respondents.

(2.) The chronology of events leading to filing of the present writ petition would be relevant for appreciating the rival contentions. On 6/1/1995, respondent No.1 issued Drugs (Price Control) Order 1995 (DPCO 1995) by exercising power under Sec. 3 of the Essential Commodities Act, 1955. The First Schedule appended to DPCO 1995 specified the bulk drugs and formulations for which the respondent No.1 fixed ceiling price in accordance with paragraph 9 of DPCO 1995. For the present case, inclusion of 'Theophylline' in the First Schedule is relevant. The aforesaid DPCO 1995 consisted of 27 paragraphs, inter alia, providing for definitions of various terms used therein and also specified the powers of the respondent No.1 to fix retail price, ceiling price and to recover overcharged amounts from the entities in the business of manufacture and marketing of such bulk drugs and formulations.

(3.) The petitioner No.1 claims that it was exempted under a Notification dtd. 2/3/1995 issued by the respondent No.1, meant for small scale units. On 6/11/1995, the respondent No.1 issued Notification, fixing ceiling prices for various formulations of Theophylline. The petitioner No.1 was manufacturing Theophylline CR 300 mg tablets. Since the Notification issued by the respondent No.1, fixing ceiling prices for various formulations of Theophylline did not include Theophylline CR 300 mg tablets, the petitioner No.1 proceeded on the basis that there was no ceiling price. It is to be noted that certain variants of tablets were added by way of subsequent specific Notifications issued on 9/8/1996, but the aforesaid formulation of the petitioner No.1 was not included. Therefore, the petitioner No.1 proceeded on the basis that the ceiling price did not apply to the variant of Theophylline CR 300 mg tablet, as it was never notified by the respondent No.1.