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Agarwal Medical and General Stores Vs. the State of Madhya Pradesh and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Petn. No. 129 of 1973
Judge
Reported inAIR1973MP255; 1973MPLJ697
ActsDrugs and Cosmetics Act, 1940 - Sections 18A and 23(4); Drugs and Cosmetics Rules, 1945 - Rule 66
AppellantAgarwal Medical and General Stores
RespondentThe State of Madhya Pradesh and ors.
Appellant AdvocateR.S. Dabir, ;K.N. Agarwal, ;Ku. Kunti Rao and ;O.P. Namdeo, Advs.
Respondent AdvocateM.V. Tamaskar, Govt. Adv.
Cases ReferredDwarka Nath v. I. T. Officer.
Excerpt:
- - --i am, therefore, clearly of the view that the batch number quoted in the cash memo is the actual batch number of the vial sold. he was asked by the inspector to produce for inspection the stock register and other papers relating to this batch but he failed to do so. xxx xxx xxx the licensee has failed to produce thepurchase invoice before the inspector howhe came into possession of batch no. it is proved not only from the admission of the appellant but from the evidence as well that the appellant failed jo produce the purchase voucher of decadron batch no. ' the appellate authority further held that the licensing authority had given proper opportunity under rule 66 of the rules to show cause before coming to the conclusion that the licences of the appellant should be cancelled,.....shiv dayal, j. 1. this is a petition under article 226 of the constitution for an order to quash cancellation of the petitioner's four licences under the drugs and cosmetics act, 1940, and for restoration of the petitioner's stock seized by the collector.2. the petitioner held four licences in forms 21, 21-b, 20 and 20-b (that is, to sell, stock or exhibit for sale, or distribute by retail drugs specified in schedules c and c (1), and also drugs other than those specified in schedules c and c (1) respectively) under rules 61 (1) and 61 (2) of the drugs and cosmetics rules, 1945, (hereinafter called the rules) framed under the drugs and cosmetics act, 1940, (hereinafter called the act). these licences were subject to the conditions enumerated in them.3. section 18 of the act prohibits.....
Judgment:

Shiv Dayal, J.

1. This is a petition under Article 226 of the Constitution for an order to quash cancellation of the petitioner's four licences under the Drugs and Cosmetics Act, 1940, and for restoration of the petitioner's stock seized by the Collector.

2. The petitioner held four licences in Forms 21, 21-B, 20 and 20-B (that is, to sell, stock or exhibit for sale, or distribute by retail drugs specified in Schedules C and C (1), and also drugs other than those specified in Schedules C and C (1) respectively) under Rules 61 (1) and 61 (2) of the Drugs and Cosmetics Rules, 1945, (hereinafter called the Rules) framed under the Drugs and Cosmetics Act, 1940, (hereinafter called the Act). These licences were subject to the conditions enumerated in them.

3. Section 18 of the Act prohibits sale, etc., of any drug or cosmetic, except under and in accordance with the conditions of a licence issued for such purpose by the licensing authority. Under Rule 59 of the said Rules, the Collector is the licensing authority.

4. The licensing authority is empowered under Rule 66 (1) of the Rules to cancel a licence, after giving the licensee an opportunity to show cause why such an order be not passed. The licensing authority has power to cancel a licence, either wholly or in respect of some of the substances to which it relates, if the licensee does not comply with any of the conditions of the licence or the provisions of the Act or the Rules. Under Rule 66 (2), a licensee, whose licence has been cancelled, may appeal to the State Government.

5. It came to the notice of the Drugs Inspector that the petitioner had sold the drug, known as 'decadron' to M/s. Jabalpur Chemists, Jabalpur, and also to M/s. Das Chemists, Jabalpur, the vials bearing batch No, IX-9306. These Chemists produced cash memos No. 3172 dated April 9, 1972, and No. 004663 dated April 11, 1972, respectively in respect of these sales of the drug. The Drugs Inspector directed the petitioner to produce immediately the purchase invoice of the drug bearing batch No. IX-9306. The batch number was mentioned in the cash memos issued by the petitioner as required by Rule 65 (5) (1) (c) of the Rules.

6. The said notice issued by the Drugs Inspector, dated April 12, 1972, further required the petitioner to surrender the entire stock of decadron injections, batch No. IX-9306 immediately. This was followed by another memo dated April 17, 1972, issued by the Drugs Inspector repeating the demand and further demanding the production of the cash memo books. The petitioner did not produce either the cash memo under which he had purchased the drug of that batch number, nor did he produce the cash memo books. When both these notices were not complied with, the Collector issued a show cause notice on April 24, 1972, In that notice, he stated that the Drugs Inspector had issued to the petitioner memoranda dated April 12, 1972, and April 17, 1972, whereby the petitioner was asked to produce the entire stock of decadron, along with cash memos, invoices and cash books, but the same had not been produced, which amounted to non-compliance with Rule 65 (6) of the Rules, By this notice, the petitioner was asked to show cause within three days of the receipt of the notice, why its licence be not cancelled under Rule 66.

7. On April 28, 1972, the petitioner wrote to the Collector that earlier on the same day 'necessary documents required by the Drugs Inspector, Jabalpur' had been produced. In the letter addressed to the Drugs Inspector, the petitioner said as follows:--

'1. As regards the stock of Decadron Inj. of Batch No. IX-9306 we hold no stock of that Batch No. and therefore the question of surrender does not arise.

XXX XXX XXX

3. As regards the purchase invoice of the above Batch No. it is submitted that there is no invoice mentioning separately this Batch No. but there is every possibility that the Inj. of this Batch No, might have been packed by mistake by the Company with the Injections of other Batch Nos. as we are having bulk supplies from the company of several batch numbers.'

8. It is now an admitted fact that the petitioner merely submitted two cash memo books to the Drugs Inspector. On May 10, 1972, the licensee appeared before the Collector in response to the show cause notice and gave in writing that he did not have any 'remaining stock' of batch No. IX-9306; and that the purchase invoices of the drug in question were not available because 'they had been purchased from the local market; they were purchased from Bharat Medical, Tularam Chowk, Jabalpur, which had not given a cash memo till then.' ('Sambandhit Dawaika purchase Invoice Uplabdh Nahin Hai Kyonki Local Market Kharid Kiya Tha. Yeh Mal Bharat Medical Tularam Chowk Se Kharid Kiya Tha. Unbone Cash Memo Ab Tak Nahin Diya').

9. In the meantime, the authorities collected information from the manufacturer, the Voltas Ltd. They sent a copy of the original invoice which showed that decadron of batch No. IX-9305 (not 9306) was supplied to the petitioner. The manufacturer further stated that batch No. 9306 was not supplied to the petitioner at all and gave further details:--'Decadron Phos Inj. Batch No. IX-9306.

Date of manufacture -- September, 1970. Total quantity manufactured-27682

These were distributed to the following branches of Voltas Ltd.-

Branch

Quantity

Despatch date

Bombay

19618 Vials

9-11-70

Kanpur

7200 Vials

9-11 70

Madras

864 Vials

15-11-70'

10. It appears that in the meanwhile, a part of the sample of the vial was sent to the Government Analyst for examination. The reply received was that the vials in question were of a spurious variety.

11. By his order dated June 30, 1972, the Collector held as follows:--

'I am, therefore, clearly of the view that the batch number quoted in the cash memo is the actual batch number of the vial sold. It is thus clear that the licensee had sold vials of batch No, 9306 only to Jabalpur Chemist and Dass Chemist.

'Since the licensee had sold a vial of batch No, 9306, it is on him to show how he came to possess this batch. He does not have any_purchase invoice for this particular batch. He was asked by the Inspector to produce for inspection the Stock Register and other papers relating to this batch but he failed to do so. Thus, it is clear that he has not complied with the conditions of the licence.

xxx xxx xxx

'The licensee has failed to produce thepurchase invoice before the Inspector howhe came into possession of batch No. 9306of Decadron vials, and thereby contravenedthe Rules and the conditions of the licence.

Therefore under Rule 66 (i) of the Drugs and Cosmetics Rules, 1945, I hereby order that the licences in form 20,21,20-B and 21-B held in the name of M/s. Agarwal Medical and General Stores be cancelled with immediate effect. The licensee is allowed a period of fifteen days to dispose of his stocks to other licensees and shall maintain proper accounts of the same.'

12. While inflicting the penalty, the Collector was influenced by the facts that the vials in question, according to the Government Analyst, were of spurious variety which made the position 'very serious' and that 'decadron is a life saving wonder drug and by selling spurious drugs in the name of Decadron, the licensee was playing with the life and safety of the individual.

13. The petitioner preferred an appeal under Rule 66 (2) of the Rules, to the State Government. Before the appellate authority, it was contended that the appellant did not sell decadron of batch No. 9306 to the Jabalpur Chemists or the Dass Chemists, but in fact the drug of batch No. 9305, which was purchased by the appellant from the manufacturers, was sold to these chemists and that it was by mistake that in the cash memos, batch No. 9306 was quoted. On that plea, it was contended that the non-production of the purchase invoice of batch No. 9306 did not amount to any breach of the rules and the conditions of the licence. The appeal was dismissed, holding:--

'Thus there is every ground to believe that the appellant procured the drug in question from some source about which he could not give satisfactory account and sold it to Jabalpur chemists and Dass Chemists.

'It appears that the story that by mistake the appellant quoted the wrong batch number in the cash memos with respect to the drugs which he had purchased from Voltas Ltd. is not only an afterthought but a concoction pure and simple.

'In all the licences there is a condition that no drug shall be sold unless such drug is purchased under cash or credit memo from a duly licensed dealer or a duly licenssed manufacturer. It is proved not only from the admission of the appellant but from the evidence as well that the appellant failed jo produce the purchase voucher of decadron batch No. 9306 which he had sold to the two chemists of Jabalpur.

'From the admission of the appellant it is further proved that he purchased the drug in question from the local market without obtaining any cash or credit memo.

'It is, therefore, established beyond any doubt that the appellant contravened the Drugs Rules and conditions of the licences.'

The appellate authority further held that the licensing authority had given proper opportunity under Rule 66 of the Rules to show cause before coming to the conclusion that the licences of the appellant should be cancelled, so that the provisions of the law as well as the principles of natural justice had been fully complied with.

14. It must be mentioned that the appellate authority also took into consideration the report of the Government Analyst and observed:--

'At the stage of enquiry, the appellant had not challenged the factum of sample purchase made by the Drugs Inspector.'

The appellate authority observed that the licensing authority was justified in taking a very serious view of the matter, as it was found to be a spurious drug on chemical examination.

15. As regards the direction about the petitioner's stock, the appellate authority accepted the appellant's contention that there was no provision in the law for fixing time during which a licensee should dispose of his stock, and accordingly modified the licensing authority's order to that extent be withdrawing the condition as regards the disposal of the stock within a period of 15 days.

16. The appellate authority had passed a stay order which stood dissolved on December 4, 1972, when the appeal was disposed of. Thereafter, on December 16, 1972, the petitioner's shop was sealed by the Drugs Inspector in pursuance of the Collector's order dated December 15, 1972, for necessary action and report. The stock was to be checked on the 17th December at 10 A. M. but, on the petitioner's application dated December 17, 1972, seeking one month's time to dispose of all the drugs, the Collector directed the Drugs Inspector not to effect seizure nor to break the seal which had been put on the 16th December.

17. The petitioner then filed this petition. The contentions before us are three. The first is that there was no contravention of Rule 65 (6) of the Rules; the second, in being influenced by the report of the Government Analyst, the Collector acted in violation of the principles of natural justice, as no notice had been given to the petitioner; and, third, the Collector had no authority to seize the goods and to keep them in his custody indefinitely.

18. As regards the first contention, the Collector and the appellate authority have concurrently found that the vials in question, bearing batch No. 9306, were actually sold by the petitioner to the Jabalpur Chemists and Dass Chemists; that the drug of this batch number was never supplied by the manufacturer to the petitioner; and that the petitioner could not produce the purchase invoice, which it was required to produce for the purpose of ascertaining whether the provisions of the Act and the Rules had been observed. The petitioner took three different stands on three different occasions. At first, it was contended that the goods of batch No. 9306 might have been sent to the petitioner by the manufacturer, along with other goods. Later on, the petitioner gave in writing to the Collector that the vials in question had been purchased by the petitioner from Bharat Medical Stores, Tularam Chowk, Jabalpur. The third stand taken before the appellate authority was that the vials bearing batch No. 9306 were not at all sold by the petitioner; the vials which the petitioner had sold were vials bearing batch No. 9305. The appellate authority held that the petitioner had purchased the drugs in question from local market, but it did not produce cash or credit memo, (see condition No. 4 in licences Nos. 20, 21 and 21-B, or condition No. 3 in licence No. 20-B).

19. Section 33 of the Act bestows rule making power. Rule 65 reads as follows:--

'65. Condition of licences.-- Licencesin Forms 20, 20-A, 20-B, 21, 21-B shall besubject to the conditions stated therein andto the following general conditions.-

xxx xxx xxx (4) Records of purchase of a drug intended for sale or sold by retail shall be maintained by the licensee and such records shall include the following particulars.

(a) the date of purchase.

(b) the name, address of the person from whom purchased and the number of the relevant licence held by him,

(c) the name of the drug, the quantity and the batch number,

(d) the name of the manufacturer of the drug.

xxx xxx xxx (6) The licensee shall produce for inspection by an Inspector appointed under the Act on demand all registers and records maintained under these Rules, and shall supply to the Inspector such information as he may require for the purpose of ascertaining whether the provisions of the Act and Rules thereunder have been observed,'

Rule 66 laid down as follows:--

'66. Cancellation and suspension of licences.-- (1) The licensing authority may, after giving the licensee an opportunity to show cause why such an order should not be passed by an order in writing stating the reasons therefor, cancel a licence issued under this part or suspend it for such period as he thinks fit, either wholly or in respect of some of the substances to which it relates, if in his opinion, the licensee has failed to comply with any of the conditions of the licence or with any provisions of the Act or Rules thereunder. ....'

The relevant condition in the licences is:--

'No drug shall be sold unless such drug is purchased under cash or credit memo from a duly licensed dealer or a duly licensed manufacturer.'

20. The petitioner was given due notice by the Drugs Inspector to produce the relevant record of the purchase of Decadron batch No .9306, which the petitioner had sold. The petitioner did not produce the record, Moreover, it admitted that it purchased the drug from a local dealer, but had no credit or cash memo of a licensed manufacturer or a licensed dealer.

21. Thus, the position boils down to this that the petitioner did not produce record of the purchase of the vials in question as required to be maintained by Rule 65 (4) and also as required by condition No. 4 of the licence. Even if the Bharat Medical Stores, from whom the petitioner alleges to have purchased these vials did not give it a cash memo, the petitioner was bound to maintain the record as required by Rule 65 (4), which it did not produce for inspection. Moreover, under Rule 66 (1), a licence can be cancelled also for non-compliance with any of the conditions of the licence. In this case, condition No. 4 of the licence was not, complied with.

22. As regards the second contention, Section 23(3) lays down the procedure for obtaining a sample for the purpose of test or analysis, A part of the sample has to be supplied to the person whose name, address and other particulars are disclosed under Section 18A. As required by subsection (4) (iii) of this section, read with Section 18A, it was the duty of the Drugs Inspector to supply to the petitioner the third portion of the sample. Learned Government Advocate has filed an affidavit to the effect that one part was retained by the Drugs Inspector and two parts were given to the Chemist, 'with the instructions to send one part to the warranty, that is, Agarwal Medical and General Stores,' vide memo dated April 11, 1972, and that the said sample was sent thrice through a messenger by Dass Chemist, as per his directions, but the sample sent was refused to the petitioner. Thereafter, the same was sent by registered parcel on July 6, 1972, but the packet was refused. It is argued that the only reasonable opportunity contemplated by the Act is that the licensee may challenge the report of the Analyst under Section 25(4) of the Act, and for that purpose a portion of the sample is supplied to the licensee. It is urged that there was substantial compliance with the requirements of Section 23 read with Section 18A. In our opinion, this argument cannot be accepted because the statute enjoins the Inspector to send the third portion of the sample to the petitioner. There is nothing to show that the petitioner could have knowledge that the sample was sent to it by the inspector. On the registered parcel packet also, the sender's name is 'Dass Chemist', not the Drugs Inspector. In the peculiar situation that had developed by the date when the registered parcel was sent by Dass Chemist, it was neither unreasonable nor unnatural for the petitioner to refuse to accept any parcel from Dass Chemist. The rule has been succinctly stated in Jagadish Swamp's Legislation and Interpretation (1968) at page 275, para 12.6, as follows:--

'Where powers, rights or immunities are granted with direction that certain regulations, formalities or conditions shall be complied with, it is neither unjust nor inconvenient to exact a rigorous observance of them as essential to the acquisition of the right or authority conferred. If a statute directs a thing to be done in a certain way, that thing shall not, even if there be no negative words, be done in any other way. The statute shall be deemed to have prohibited the doing of that thing in any other way. Thus where an Act requires a particular officer to issue a notice, the person to whom the notice is issued is not bound to give any attention to the notice if it is issued by any other person.'

Dharandra Krishna v. Nihar Ganguly, AIR 1943 Cal 266 at p. 278; Stephens Ex parte, (1876) 3 Ch D 659; Patna Improvement Trust v. Laxmi Devi, (1963) Supp 2 SCR 812 at p. 823 = AIR 1963 SC 1077 at p. 1081; Chotabhai Jethabhai Patel v. State of M. P., AIR 1966 Madh Pra 34 at p. 41; Chunilal Mansa Ram v. Ratti Ram Shiv Narain, AIR 1005 Punj 340 at p. 341; Pun-fab National Bank v. Bunder Insptr. K. Port Trust, AIR 1921 Sind 142 at Pp. 143, 144. Thus, there was no compliance with the requirements of Section 23(4)(iii), read with Section 18A of the Act. Further, in any event, the fact remains that no opportunity was given to the petitioner to show cause why its licence should not be cancelled on the ground that the drug was found to be spurious. In not giving a show cause notice, the petitioner was denied an opportunity to defend itself. There was violation of the principles of natural justice. The show cause notice merely required it to produce the documents of purchase of the drug in question.

23. In D. F. O. South Kheri v. Ram Sanehi, AIR 1973 SG 205 their Lordships have held:--

'Granting that the order was administrative and not quasi-judicial, the Order had still to be made in a manner consonant with the rules of natural justice when it affected the respondent's right to property.'

In State of Orissa v. Dr. (Miss) Rinapani Dei, AIR 1967 SC 1269, it was held, while dealing with an administrative order, that

'the rule that a party to whose prejudice the order is intended to be passed is entitled to a hearing applied alike to judicial tribunals and bodies of persons invested with authority to adjudicate upon matters involving Civil consequences. It is one of the fundamental rules of our constitutional set-up that every citizen is protected against exercise of arbitrary authority by the State or its officers.'

24. The petitioners' second contention, with which we are dealing, is pertinent for the question of penalty. Under Rule 66, the Collector has a discretion, which is indicative of an extensive power confided to him. Discretion, therefore, has to be exercised according to the rules of reason and justice, not according to private opinion. It has not to be arbitrary, vague and fanciful. It has to be legal and regular. It has to be according to law, and not humour. Discretion must be exercised within the limit to which an honest man, competent to the discharge of his office, ought to confine himself. As early as in Rooke's case, (1598) 5 Co Rep 99b it was said :--

'Discretion is a science or understanding to discern between falsity and truth, between wrong and right, between shadows and substance, between equity and colourable glosses and pretences, and not to do according to their wills and private affections; for as one saith, talis discretio discretionem confundit.'

Also in Wilson v. Rastall, (1792) 4 TR 753 at p. 757, Lord Kenyon, said:--

'Discretion.... is not a wild but sound discretion, and to be confined within those limits within which an honest man, competent to discharge the duties of his office, Ought to confine himself.'

These decisions were approved by the House of Lords in Sharp v. Wakefield, 1891 AC 173 at p. 179.

25. In the present case, the Collector pronounced a speaking order in the matter of penalty (vide paragraph 9 of his order). He ordered cancellation of the licences because he was influenced by the report of the Government Analyst according to which the vial in question was found to contain spurious drug. According to the printed pamphlet (Annexure R-VII), issued by the manufacturer :--

'Decadron Phosphate Injection (dexa-methasone sodium phosphate) is an effective versatile adrenocortical hormone preparation that may be given intravenously or intramuscularly in the treatment of acute disorders responsive to adrenocortical hormone therapy.

'It may also be injected locally in the treatment of intrasynovial (intra-articular or intrabursal) and soft tissue disorders.'

But in doing so, the Collector did not observe the principles of natural justice inasmuch as he did not give an opportunity to the petitioner to challenge the finding of the Government Analyst. If the Collector had not been so influenced by that consideration, whether he would have still inflicted the same penalty or some other penalty, is not for us to say.

26. The above discussion leads us to the following conclusions. The Collector acted within his jurisdiction in taking action against the petitioner for non-compliance with Rule 65 (6) of the Rules and for breach of condition No. 4 of the licences, because:--

(a) The vials in question were sold by the petitioner to M/s. Jabalpur Chemists, Jabalpur, and M/s. Dass Chemists;

(b) the petitioner came in possession of the vials but did not produce the record of purchase required to be maintained under Rule 65 (4) of the Rules.

(c) On its own showing, the petitioner did not have a cash or credit memo of the purchase of the drug in question from a licensed manufacturer or a licensed dealer as required by condition No. 4 of the licence and did not, therefore, produce the document of purchase;

(d) the petitioner did not produce cash memo books within the time specified by the Drugs Inspector or within a reasonable time;

(e) the Collector, therefore, had the discretion to cancel the licences; wholly or partly; and

(f) the Drugs Inspector did not supply to the petitioner a third portion of the sample of the vial in question, which was a mandatory requirement under Section 23(4)(iii), read with Section 18A of the Act, Nor did the Collector give notice to the petitioner to show cause why his licence be not cancelled as the drug supplied by it was found to be spurious. Therefore, the Collector acted in violation of the principles of natural justice, when he inflicted the penalty of cancelling the licences under the influence of the Government Analyst's report.

27. This brings us to the third contention of the petitioner. Section 22(1)(c) of the Act empowers an Inspector to order in writing the person in possession of any drug, in respect of which the offence has been or is being committed, not to dispose of any stock of such drug for a specified period, not exceeding 20 days. Section 23(5)(b) requires that where action has been taken under Clause (c) of Section 22(1) and the stock of the drug has been seized, the Inspector shall, as soon as may be, inform a Magistrate and take his orders as to the custody thereof. Section 31 provides for confiscation of any stock of the drug in respect of which there has been contravention of the provisions of Chapter IV or the rules made thereunder, and for which contravention any person has been convicted under that Chapter. And, Rule 58-A lays down the procedure for disposal of confiscated drugs.

28. In the present case, no action was taken under any of the provisions strictly speaking. What was done was that the Collector, by his order dated June 30, 1972, while cancelling all the four licences, allowed a period of 15 days to the petitioner 'to dispose of his stock to other licensees and to maintain proper account for the same'. The appellate authority upheld the petitioner's contention in respect of the condition as regards the disposal of the stock within a period of 15 days and modified the Collector's order accordingly. When consequent upon the disposal of the appeal, the stay order, which had been granted by the appellate authority, stood dissolved, the authorities, on December 16, 1972, sealed the shop of the petitioner. The Drugs Inspector was to check the stock on the 17th December, but, on an application made by the petitioner that it be granted one month's time to dispose of the stock, the Collector stayed the matter. Today the position is that the petitioner's shop is lying sealed. The petitioner's anxiety is that the stock of drugs should be immediately disposed of as most of the drugs are timebound; they will become useless and will have to be destroyed after the expiry date mentioned on every drug. The petitioner, however, is unable to point out any specific provision of the law under which a prescribed direction can be given. On the other hand, the Collector also does not know what he can do of the stock of drugs, which he has sealed. Therefore, at the hearing of the petition, both parties asked us to give such directions as may, in the circumstances of the case, appear reasonable to us. Learned counsel for the petitioner stated that the petitioner is in great difficulty since the period of licences has already expired. The law is silent as to what will happen to the drugs in stock, if a licence is cancelled, or if a licence is not renewed after its expiry. It is conceded by learned counsel for both sides that the law is silent on this point; there is a lacuna; it is a case of casus omissus. In this situation, the petitioner invoked the extraordinary powers of this Court under Article 226 of the Constitution to issue appropriate directions.

29. It is a celebrated rule, which is firmly established, that where jurisdiction is conferred, by necessary implication, it carries the power of doing of such acts or employing such means as are necessary to its execution. (See Mangilal v. Parasram, 1970 MP LJ 1 = (AIR 1971 Madh Pra 5 (FB)); Maxwell on Interpretation of Statutes, 11th Edition, at page 350; Sutherland Statutory Construction (3rd Edition, Vol. 3, Sections 5401 and 5402)). Recently, in Asst. Collector of Central Excise v. National Tobacco Co. Ltd., (AIR 1972 SC 2563). their Lordships have laid down thus -

'It is a well established rule of construction that a power to do something essential for the proper and effectual performance of the work which the statute has in contemplation may be implied. (See Craies on Statute Law, 5th Edition, p. 105).'

30. It is well settled that High Courts can also issue directions, orders or writs other than prerogative writs. The jurisdiction conferred under Article 226 of the Constitution is wider than the jurisdiction in England in regard to the issuance of prerogative writs. This rule is confirmed in Dwarka Nath v. I. T. Officer. AIR 1966 SC 81 where their Lordships have observed :--

'High Courts can also issue directions, orders or writs other than the prerogative writs. The High Courts are enabled to mould the reliefs to meet the peculiar and complicated requirements of this country. To equate the scope of the power of the High Court under Article 226 with that of the English Courts to issue prerogative writs is to introduce the unnecessary procedural restrictions grown over the years in a comparatively small country like England with a unitary form of Government to a vast country like India functioning under a federal structure. Such a construction would defeat the purpose of the Article itself. But this does not mean that the High Courts can function arbitrarily under this article. There are some limitations implicit in the article and others may be evolved to direct the article through defined channels.'

32. We have already found that the authorities did not take appropriate action under the rules abovementioned. We intended to borrow the spirit of Rule 58-A (which lays down the procedure for disposal of confiscated goods) to the extent that it was reasonable and necessary for the present case. Although that rule does not apply in terms to the present case, we thought of giving suitable directions by borrowing the principles of that Rule. But after the hearing, an application has been made by the petitioner insisting that it has the right to dispose of the stock as it pleases but it would be satisfied if the authorities are directed to deliver the drugs to either of the following two dealers who held the requisite licences: (1) Khunneylal Chingelal, Jawaharganj Jabal-pur; or (2) Chhingelal Premchand, Jawaharganj, Jabalpur. It appears that in making the subsequent application, the petitioner has changed its mind. We would, therefore, make no directions for the disposal of the goods and leave the matter to all concerned to exercise their own rights and powers.

33. The result is :--

(i) As the term of each of the four licences in question was upto December, 1972, we cannot issue any effective writ in respect of the Collector's order cancelling the licences. We have enunciated the legal position as it became necessary.

(ii) In respect of the petitioner's shop which was sealed on December 16, 1972, we direct that the Collector shall get the seal opened and shall restore the shop to the petitioner. This order shall be no impediment to the authorities taking an appropriate action, in respect of the drugs in the shop, which may be within their powers under the Act, the Rules or any other law. Likewise, the Collector will be free to consider the petitioner's request to transfer the stock of drugs to either or both of the above named licensees.

(iii) There shall be no order for costs.

(iv) The outstanding amount of security deposit shall be refunded to the petitioner.


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