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PETITIONER: DR. (MISS) ALETTA GRACE BELL

       Vs.

RESPONDENT: DR. (MISS) S. TIRKEY AND ANR.

DATE OF JUDGMENT08/11/1995

BENCH: PUNCHHI, M.M. BENCH: PUNCHHI, M.M. MANOHAR SUJATA V. (J)

CITATION:  1996 AIR  538            1996 SCC  (1) 285  JT 1995 (8)   203        1995 SCALE  (6)445

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R      This is  an appeal  against the judgment and order of a Division Bench  of the Patna High Court passed in Civil Writ Jurisdiction Case No.3326 of 1979, on 17-7-1980.      The appellant  -  Dr.  (Miss)  Alette  Grace  Bell,  as Medical  Superintendent-cum-Administrative  Officer  of  the Duncan Hospital  at Raxaul in the State of Bihar, was served with a  letter from  the Drug Controller Bihar to the affect that the  hospital being in the manufacture and distribution of a  drug referred to a I.V. Solution, was required to take a licence  under the  provisions of  The Drugs and Cosmetics Act, 1940,  for the  default  of  which  it  has  to  suffer prosecution. Challenging  the same  before  the  Patna  High Court, the  appellant contended that since its product was a preparation  by   compounding  of  glucose  or  sodium  with distilled  water   and  administered   to  patients  in  the hospital, this  solution was  manufactured not  for sale but for  distribution,   and  the   act   of   manufacture   for distribution  required   no  licence.   The  High  Court  on examining the  various provisions  of the  Act, came to hold that the appellant’s hospital was required to obtain licence under clause  (c) of  Section 18  of The Drugs and Cosmetics Act, 1940.  This view  of the  High Court  had led  to  this appeal.      When leave  was granted,  interim  order  of  stay  was vacated. We  are therefore not aware whether any prosecution of the appellant followed or not. Be that as it may, we must state the  legal position. The offence was committed on 2-5- 1979 when the Drugs Inspector on his usual visit, discovered the appellant  engaged in  the manufacture  of I.V. Solution for  administration   to  patients   in  the  hospital.  The provision requiring  licence, being Section 18(c) of the Act then read as follows:      "From such  date as  may be fixed by the      State Government  by notification in the

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    official  gazette  in  this  behalf,  no      person shall  himself or  by  any  other      person on  his  behalf  manufacture  for      sale, or  sell, or  stock or exhibit for      sale,  or   distribute   any   drug   or      cosmetic,   except    under,   and    in      accordance with  the  conditions  of,  a      licence issued  for such  purpose  under      this Chapter." With effect from 1-2-1983, the provision reads:      "..........manufacture for  sale or  for      distribution,  or   sell,  or  stock  or      exhibit or offer for sale, or distribute      any drug  or cosmetic, except under, and      in accordance  with the conditions of, a      licence issued  for such  purpose  under      this chapter."      As is  evident, prior to the amendment, manufacture for sale of  any drug  or  cosmetic,  as  a  composite  activity required a  separate licence.  Likewise, distribution of nay drug  or   cosmetic  required   a  separate   licence.   The significant  change   effected  by  the  amendment  is  that "manufacture for  sale  or  for  distribution"  is  now  one composite  activity   and  would   require  a   licence.  If distribution of  any drug or cosmetic is a separate activity unconnected with manufacture, then as of before, it requires a separate  licence.  In  all  situations  licence  must  be obtained to carry out activity on the conditions given under Chapter IV  of the  said Act  of which Section 33 is a part, empowering the  Central Government to make rules. Section 33 is laid  in the  usual format.  Clause (e)  of Section 33(2) says that Rules to be framed by the Government may prescribe the forms  of licences  for the  manufacture for sale or for distribution (the  relevant words added after the amendment) and inter  alia for  the distribution  of drugs etc. as also the form  of objection  which such lliecneesmayabd authority empowered to issue the same etc. etc. Significantly, no form of licence  for manufacture  for distribution  of  drugs  or cosmetics has  been provided.  No conditions  has been  laid subject to  which such licence may be issued. Only two forms stood prescribed  prior to  the amendment.  Those  were  for obtaining licence  (i) for the manufacture for sale and (ii) for sale of drugs and cosmetics. Now after the amendment the form is  for the manufacture for sale or for distribution of drugs or  cosmetics. In the absence of the requisite form of licence being  part of  the rules  as  per  requirements  of Section 18(c),  it is  difficult to  conceive as  to how the appellant was obligated to apply for obtaining the requisite licence, and  before which  authority and  in which form and subject to  which conditions.  It thus  appears clear  to us that the  requirement in  that regard  leaves a vacuum which for reasons best known to the Executive has remain unfilled. The obligation  of the  appellant and her sequel prosecution being founded  on the  supposed requirement of Section 18(c) of the  Act, not  only the  provision, but  the rules  which carry out its purpose have to be viewed strictly. When there is a  vacuum, as  spelled out before, its benefit must go to the appellant.  She thus has been able to successfully plead and prove that in the absence of the requisites laid down in Sections 18(c) and 33 of the Act, she and hence the hospital could not  be required  to obtain  a licence for manufacture and distribution  of the  drug on  the date when the offence was allegedly committed.      Thus, for  the aforesaid  reasons, we  differ from  the view taken  by the  High Court,  and upset  its judgment and

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order granting  the writ  to the appellant, as prayed. There shall be no orders as to costs.