Mere Designation As Managing Director Not Enough To Attract Criminal Liability Under Drugs & Cosmetics Act: Himachal Pradesh High Court
The Himachal Pradesh High Court held that criminal liability of company officials cannot be presumed merely on the basis of their designation, such as Managing Director or Director.The Court reiterated that, for invoking vicarious liability under Section 34 of the Drugs and Cosmetics Act, the complaint must contain specific averments demonstrating that the accused was in charge of and...
The Himachal Pradesh High Court held that criminal liability of company officials cannot be presumed merely on the basis of their designation, such as Managing Director or Director.
The Court reiterated that, for invoking vicarious liability under Section 34 of the Drugs and Cosmetics Act, the complaint must contain specific averments demonstrating that the accused was in charge of and responsible for the conduct of the company's business at the relevant time.
The Court further noted that that the complaint lacked any specific allegations regarding the petitioner's role in the day-to-day functioning of the company. It noted that the complaint did not explain how the petitioner, despite being Managing Director, was responsible for the alleged offence.
Justice Sandeep Sharma remarked that:“Simply because a person is a director of the company, it does not necessarily mean that he fulfils both the above requirements so as to make him liable. Conversely, without being a director, a person can be in charge of and responsible to the company for the conduct of its business.”
Background:
The case arose from a complaint filed by the Drugs Inspector against M/s Crest Lifesciences Pvt. Ltd. (manufacturer) and M/s Cipla Ltd. (marketer) concerning a drug “Oflox OZ Suspension.” Samples of the drug failed quality tests conducted by both the Regional Drugs Testing Laboratory and the Central Drugs Laboratory, showing significant deviation from prescribed standards.
Following investigation and sanction from the Drugs Controller General of India, prosecution was initiated under Sections 18 and 27 of the Act. The petitioner, Umang Vohra, Managing Director of Cipla, was arrayed as an accused and challenged the complaint and summoning order before the High Court.
The petitioner contended that Cipla was only a marketer, not the manufacturer of the drug. Manufacturing responsibility lay entirely with Crest Lifesciences under a contractual arrangement. An authorized representative had been appointed to handle day-to-day affairs of the Company. The complaint contained no specific averments showing his role in daily business or involvement in the alleged offence.
Case Name: Umang Vohra V/s Union of India
Case No.: CrMMO No.733 of 2025
Date of Decision: 25.03.2026
For the petitioner: Mr.Gagan Anand, Mr. Ramanjit Singh and Mr.Pranjal Munjal, Advocates
For the respondent: Mr.Balram Sharma, Deputy Solicitor General of India