Drugs & Cosmetics Act | 'Rule-Making Power Lies Only With Centre': HP High Court Quashes SOPs By State Drug Controller

The Himachal Pradesh High Court has held that the State Drug Controller does not have the authority to issue an Office Order or Standard Operating Procedure, as rule-making power under the Drugs & Cosmetics Act lies exclusively with the Central Government.Justice Ajay Mohan Goel: “In this view of the matter, when the Rule making power is exclusively conferred upon the Central Government and the Central Government has in exercise of the powers so conferred, framed Rules which govern all the activities of manufacturers like the petitioners including the sale of drug manufactured, the Office Order in question which has been issued by the State Drug Controller, bereft of any Authority in law vested in the State Drug Controller to issue the same, is not sustainable in the eyes of law.”Background Facts:The petitioners in this writ petition are pharmaceutical companies in Himachal Pradesh licensed to manufacture medicines, including drugs containing psychotropic substances such as tramadol and alprazolam. The dispute arose when the State Drug Controller conducted inspections of the petitioners' manufacturing units. Thereafter, through an Office Order dated June 4, 2021, the Drug Controller directed manufacturers to submit details of sales of psychotropic substances to the police and district authorities. The petitioners were also served with seizure orders, inspection reports, and recovery memos. Aggrieved by the seizure orders, the petitioners filed a writ petition before the High Court, stating that they were being treated as accused in relation to the commission of offences under the provisions of the Narcotic Drugs and Psychotropic Substances Act, 1985, because the Drug Controller alleged that they had violated the Standard Operating Procedure. Contentions:The petitioners contended that the Standard Operating Procedure was not legally valid as the State Drug Controller did not have any authority under the Drugs and Cosmetics Act, 1940 to issue it. Further, the Standard Operating Procedure was neither a Statutory Notification, nor a Statutory Regulation, and neither the Drugs & Cosmetics Act nor the Rules framed thereunder confer any such power upon the State Drug Controller to issue any such office order. They further submitted that the Standard Operating Procedure wrongly referred to a Central government notification dated February 11,2020 issued by the Ministry of Health & Family Welfare. As a simple reading of the Notification showed that it did not require or authorise the issuance of any such Standard Operating Procedure. The Notification only dealt with amendments to certain Rules related to marketers and labelling responsibilities; it did not direct State Drug Controllers to impose new reporting requirements.In response, the State contended that the Standard Operating Procedure was issued in the larger public interest to control drug abuse and to ensure that drugs manufactured by Companies like the petitioners did not land in the wrong hands. It further submitted that the issuance of the Standard Operating Procedure was according to the powers given to the drug controller under Sections 18B and 22 of the Act, for monitoring the activities carried out by manufacturers. Findings:The Court noted that the Drugs and Cosmetics Act, 1940, was enacted to regulate the manufacture, distribution and sale of drugs and cosmetics. As per Section 2(b) of the Act, the definition of drug “covers all medicines for internal or external use in humans or animals, substances used for diagnosis, treatment, prevention, or mitigation of disease, components used to make a drug and certain medical devices notified by the Central Government”. Examining the notification referred to, the Court observed that the Central Government had used its powers under Sections 12 and 13 of the 1940 Act, and in consultation with the Drugs Technical Advisory Board, amended the Drugs and Cosmetics Rules, 1945, as represented in the Notification. However, nowhere did the notification mention that for the implementation of this notification, any Office Order was required to be issued.It further stated that under Section 33 of the Act, the power to make rules to carry out the purposes of the Act lies exclusively with the Central government and deals with the manufacture, sale, and distribution of drugs & cosmetics. The Court noted that, according to section 18B read with section 33(2)(ee) of the Act, it is clear that records and documents must be maintained in accordance with the Rules framed by the Central Government. Similarly, Section 22 of the Act only authorises the drug controller to carry out inspections as per the rules prescribed by the Central Government, but it does not authorise it to issue the kind of Office Order challenged in this writ petition.The Court concluded that it was clear from the provisions of the Act and the Rules formed by the Central Government that everything was already covered, including how information about the...

Drugs & Cosmetics Act | 'Rule-Making Power Lies Only With Centre': HP High Court Quashes SOPs By State Drug Controller

Mehak Aggarwal

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