SHIMAL INVESTMENT AND TRADING CO. Vs. UNION OF INDIA
LAWS(DLH)-2013-10-193
HIGH COURT OF DELHI
Decided on October 21,2013

Shimal Investment And Trading Co. Appellant
VERSUS
UNION OF INDIA Respondents

JUDGEMENT

V.K.JAIN, J. - (1.) VIDE notification dated 3.9.1996, issued in exercise of the powers conferred by the Drugs (Prices Control Order, 1995), the Central Government, inter alia, fixed the price of Nalidixic Acid + Metronidazole Tab having strength of Nalidixic Acid 300 MG and Metronidazole 200 MG, at Rs.12.70 for a pack of six tablets. Vide order dated 27.01.1998, issued under the aforesaid order, the National Pharmaceutical Pricing Authority) notified that the manufacturers of all the Scheduled formulation, in pack sizes different from the notified pack size under sub -paragraphs (1) and (2) of the paragraph 9 of the aforesaid order, shall work out the price for such pack sizes, in respect of tablets and capsules of the same strength or composition, packed in different strips or blisters, on prorata basis of the latest ceiling price fixed for such formulations under sub -paragraphs (1) and (2) of the paragraph 9 of the aforesaid order. Vide Notification dated 9.3.1998, issued in exercise of the above referred powers, the National Pharmaceutical Pricing Authority fixed the price of the coated tablets containing Nalidixic Acid 300 mg and Metronidazole 200 mg at Rs.13.65 in respect of pack of six tablets.
(2.) VIDE letter dated 24.2.2000, the National Pharmaceutical Pricing Authority, referring to the ceiling prices fixed vide Notification dated 1996 as also to the above referred notification dated 27.01.1998, informed M/s Oscar Laboratories Private Limited that the said company had been manufacturing Gramogyl Tablets (Nalidixic Acid Formulations) in the pack of 8 tablets, but it had not complied with the ceiling price and had continued to charge retail price of Rs.24.65/ - per strip of 6 tablets and Rs.31.80/ - per strip of 8 tablets, for the said formulation. It was further stated that the said company had been directed vide letter dated 2.8.1999 to furnish the actual quantity of gramogyl Formulation sold during the period from January, 1998, but had not furnished the requisite information and, therefore, the said office was constrained to work out the amount overcharged by the notice on the basis of ORG data. It was estimated in the notice that the noticee company had obtained an unauthorized benefit of Rs.3,29,71,014/ - by way of overcharging from the consumers in respect of Gramogyl Tablets during the period from February, 1998 to December, 199 The details of overcharged amount were given in Annexure -I to the notice. The noticee was required to deposit the over -charged amount, along with interest @ 15% per annum, under Section 7A of Essential Commodities Act, 1955. The liability towards interest till December, 1999 was worked out at Rs.49,45,652/ - as per the details given in Annexure -I to the notice. The noticee was required to show cause why the aforesaid amount be not recovered from it. The above referred notice was responded by the petitioner ­ 3. Shimal Investment & Trading Company vide reply dated 23.3.2000 with which Oscar Laboratories Private Limited has amalgamated with effect from 29th August, 199 It was stated in the reply that the brand ,,Gramogyl had been assigned by Oscar Laboratories Private Limited to M/s Delta Aromatics (P) Ltd. on 23.8.199 It was further stated that the company had not manufactured or marketed any pack of eight tablets in respect of which ceiling prices were notified. It was also stated in the reply that subsequently the company had stopped manufacturing conventional tablets and had introduced Dispersible Tablets. The basic difference pointed out in the reply, between Gramogyl tablets and Gramogyl dispersible tablets, was (a) difference in the type of packing, (b) Gramogyl tablets being film coated, whereas the dispersible tablets being uncoated (c) the mix of raw material required for dispersible tablets being different from the conventional tablets, as also in respect of packing. Vide letter dated 2.6.2000, the National Pharmaceutical Pricing Authority informed the petitioner company that the ceiling price fixed vide notification dated 3.1996 was applicable to all tablets including dispersible tables, as also tablets manufactured in a pack of eight tablets. It was also clarified vide the said notification that the notice dated 24.2.2000 pertained only to the overcharging in respect of the formulation sold from 1.2.1998 to 31.12.1999 and the overcharging on the formulation sold from 1.10.1996 to 31.12.1997 was the subject matter of a different notice dated 5.1997.
(3.) PURSUANT to the demand raised by the National Pharmaceutical Pricing Authority, the Additional District Magistrate issued notice to the petitioner requiring it to deposit a sum of Rs.4,38,92,663/ -. Being aggrieved, the petitioner is before this Court seeking the following reliefs: a) issue of a writ of or in the nature of certiorari and/or any other appropriate writ, order or direction quashing and/or setting aside the demand of Rs.4,38,92,773/ - as envisaged in the notice dated 8.5.2001 issued by the Additional District Magistrate/ Additional Collector being respondent no.4 herein to the petitioner. b) issue of writ of or in the nature of certiorari or any other appropriate writ, order or direction quashing the demand notice issued by respondent no.2 dated 24.2.2000 demanding sum of Rs.3,29,71,000/ -. c) issue of a writ of or in the nature of prohibition or any other appropriate writ, order or direction restraining the respondents, their officers, servants and agents and in particular respondent no.3 and no.2 from taking any action for recovery of alleged demand of Rs.4,38,92,663/ - or any part thereof or from taking any action pursuant to or in furtherance of the demand notice of respondent no.4 received by the petitioner on 8.5.2001. d) issue a writ of or in the nature of mandamus and/or any other appropriate writ order or direction requiring the respondent no.2 to issue a non -ceiling price order in respect of the Gramogyl dispersible tablets. e) pass ad interim ex -parte orders in terms of prayers hereinabove and confirm the same after notice to the respondents. ;


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