1. This is an appeal from an appellate order dated November 4, 1960, passed by the learned Additional Sessions Judge, Gondal, acquitting the respondent Harilal Jethalal of the offences under Section 27, read with Section 18 (a) (i) and (2) of the Drugs Act, The respondent was prosecuted before the learned Judicial Magistrate, First Class, Upleta, for the above offences. The learned Magistrate found that the offences had been established and sentenced the respondent to pay a fine of Rs. 100/- for each of the offences, in default, to suffer simple imprisonment for two months for each offence. The respondent went in appeal to the Sessions Court at Rajkot and the appeal was disposed off by the learned Additional Sessions Judge who reversed the order of conviction and sentence.
2. The facts leading up to this prosecution are not in dispute. The respondent conducts a cutlery-cum-medicine shop at Upleta under the firm name of M/s Hiraial Jethalal and Co. He has obtained a licence, under the Drugs Act, 1940, for retail selling of drugs. On June, 26, 1958, Shri Oza, who was then Drugs Inspector, appointed under Section 21 of the Drugs Act, 1940, (hereafter called the 'Act'), visited the shop of the respondent and obtained from him four bottles of Vicks Vapomb Ointment for test and analysis. On that date, the respondent had, in all, 21 bottles in stock. The balance of 17 bottles was seized by the Inspector under Section 22, Sub-section (i), Clause (c) of the Act and necessary orders were obtained by him from the Magistrate for custody of that balance. Of the four bottles, he handed over one bottle to the respondent and, from out of the remaining three, he sent one bottle for test and analysis to the Government Analyst, Bombay. The ointment in question was alleged to be a proprietary medicine. It was packed in a container which set out the formula or list ot ingredients of the ointment. The Analyst found that the volatile matter of the ointment was only 41.73 per cent of the amount mentioned in the formula. Accordingly, the Analyst expressed the opinion that the sample analysed was not of standard quality as required by the Act. There is no dispute that this was so. The expression 'standard quality' has been defined in Section 16 of the Act. That section and Section 18, with which we are concerned, occur in Chapter IV of the Act. Section 16 states that, 'For the purposes of this Chapter the expression 'standard quality' when applied to a drug means that the drug complies with the standard set out in the Schedule'; and the Schedule states that a patent or a proprietary medicine must comply with the formula or the list of ingredients displayed in the prescribed manner on the label or the container. The analyst sent a signed report in triplicate in the prescribed form to the Drugs Inspector. One of the copies of the certificate was sent to the respondent. The respondent sent a reply on August 25, 1958, acknowledging receipt of the copy of the certificate and stated that he had purchased the bottles in question from four named firms under bills dated 6-2-1957, 8-10-1957, 10-10-1957 and 24-12-1957; and that he could not say definitely from which of these four firms the sample which was examined by the analyst was purchased by him. He further stated that he had purchased these bottles on trust and that he did not know that it was spurious and promised that he would not keep such goods in future. There is no dispute that, under Sub-section (3) of Section 25 of the Act, this certificate of the analyst was conclusive evidence of the facts stated therein. After the receipt of this reply_ the Drugs Inspector made some enquiries from the firms mentioned by the respondent and also from an agent of the Company which manufactured the ointment. The successor of the Inspector, ultimately, filed a complaint before the learned Magistrate, Upleta, which resulted in the conviction of the respondent. Besides Mr. Oza, the prosecution examined a representative of the Vicks Company, one Jayantilal Dalichand. This witness stated that there were vital differences between the caps and the labels on the samples attached from the respondent and the caps and the lables on the genuine bottles sold by the Company. He deposed that the caps on the bottles attached from the respondent differed from those on the genuine bottles in ink, printing and general texture. The ink on the caps of the genuine bottles was deep and could not be blurred by touching; while the ink on those of the attached bottles was faint and got blurred by touch. He also pointed out the differences between the labels on the attached bottles and the labels on the genuine bottles. He stated that the colour of the attached bottels was faint; that the printing was much blurred and was not readable; that the shapes of the two sets of bottles differed, as also their colour; that the monogram on the labels of the attached bottles was not properly printed and that the formula on the same was not readable. He also pointed out that there were no batch numbers mentioned on the labels and that the Company used to put the batch numbers on their bottles. All this evidence was accepted by the learned Magistrate. He came to the conclusion that the respondent had in his possession the bottles in question; that he had stocked and exhibited them for sale, and that, on the basis of the certificate given by the analyst, the drug was not of standard quality and on the basis of the evidence given by witness Jayantilal and the Drugs Inspector, the drug was a misbranded drug. The expression 'misbranded' has been defined in Section 17. The section states that a drug shall be deemed to be misbranded if, inter alia, it is an imitation of, or substitute for, the genuine drug manufactured by the Company. The learned Magistrate held on the testimony of Jayantilal that the drug attached from the possession of the respondent was an imitation of the genuine drug manufactured by the Vicks Company. The defence which was urged by, the respondent in the trial Court was based upon Section 19 Sub-section (3), Clause (a). That defence is available to a person who is not a manufacturer of a drug or who is not the agent for distribution of such a manufacturer. The respondent being only a stockist or seller of the above ointment was, therefore, entitled to the defence under Sub-section (3). That sub-section states that a person shall not be liable for a contravention of Section 18 if he proves
'that he did not know, and could not with reasonable diligence have ascertained, that the drug in any way contravened the provisions of that section, and that the drug while in his possession remained in the same state as when he acquired it'.
In support of this defence, the respondent examined three witnesses, viz., (i) Vrajlal Jethalat Kothari (2) Valimohamed Abubhai and (3) Suresh-chand Devshanker. From this evidence, the respondent wanted to establish that he was a bona fide purchaser for value of the 21 bottles which were attached from him by the Drugs Inspector. His case was that four out of 25 bottles which he had purchased from the four named firms had been sold by him in the interval. The learned Magistrate came to the conclusion that the respondent had failed to establish that the bottles in question had been purchased by him from the aforesaid firms, much less that he was a bona fide purchaser in respect of those bottles. The learned Magistrate does not appear to have mentioned the defence under Sub-section (3) separately, nor does he appear to have raised a specific issue on the subject. But, at the same time, from the judgment of the learned Magistrate, it is quite clear that he has considered the aforesaid defence of the respondent and reached his own conclusion on the subject. On the aforesaid findings, the learned Magistrate convicted and sentenced the respondent as already mentioned. The respondent preferred an appeal from the order of conviction and sentence. In the appellate Court it was not disputed on behalf of the respondent that the prosecution had succeeded in establishing that the respondent had stocked or exhibited for sale drugs which were not of standard quality and that the drugs attached from him were misbranded drugs. But, the main point which was urged in the appellate Court was that the learned Magistrate had failed to consider the defence under Section 19 Sub-section (3) of the Act. The learned appellate Judge accepted this contention and proceeded to examine the defence. The learned appellate Judge came to the conclusion that the respondent was a bona fide purchaser for value. He reached this conclusion apparently on the testimony of the three defence witnesses whom we have mentioned above. The learned appellate Judge stated that, therefore, the question which arose for his consideration was whether the respondent, who was not a manufacturer of the drug in question and who was not an agent for the distribution of the drug, could be held to be liable for stocking or exhibiting for sale when the drug was misbranded and not of standard quality. He held that the respondent had clearly shown that ho did not know as to what was contained in the bottels in question. He also held that the respondent was a bona fide purchaser of the drug in question; that it was also clear that it was not possible for him to ascertain with reasonable diligence that the drug in question, in any way, contravened the provisions of Section 18. On these findings, the learned Judge reversed the order of conviction and sentence and acquitted the respondent.
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3-4. Therefore, the main question which requires to be considered in the appeal is whether the respondent has substantiated the defence under Section 19, Sub-section (3). Now Section 18 prohibits any person from, amongst other things, stocking or exhibiting for sale any drug which is not of standard quality or any misbranded drug. We have already shown that there was sufficient evidence in the case to prove these two facts. Now, before we turn to Sub-section (3), it is necessary to read Sub-section (i), which clearly gives an indication as to the correct approach which is to be made in prosecutions under Section 18. Subsection (1) of Section 19 states in specific terms that it shall be no defence in a prosecution under Chapter IV to prove merely that the accused was ignorant of the nature, substance, or quality of the drug in 'respect of which the offence had been committed. Therefore, mere ignorance on the part of the accused person that he was unaware of the nature or the substance or the quality of the drug is not a defence. In other words all that the prosecution is required to prove in order to establish contravention under Section 18, is the fact that the accused had sold or exhibited a drug which was not of standard quality or which was a misbranded drug. It is not necessary for the prosecution to establish that the accused had done so knowingly, wilfully or with a guilty mind. Therefore, the moment the aforesaid three ingredients of Section 18 are established, the prosecution is entitled to ask for an order of conviction to be recorded. If the accused wants to get rid of the effect of the prosecution evidence, then, it is for him to establish the defences which are available to him under Sub-section (3). There are two defences which are available to the accused under that, sub-section. Clause (b) of that sub-section deals with the defence of the written warranty in the prescribed form and signed by the person from whom the drug was purchased or obtained. The respondent did not plead this defence and, therefore, it is not necessary for us to consider the provisions of Clause (b). The defence on which he relied was the one which is mentioned in Clause (a) and as we have already pointed out that defence requires three ingredients to be established. One is that the accused did not know that the drug, in any way, contravened the provisions of Section 18 of the Act. The second ingredient is that he could not, with reasonable diligence, have ascertained that the drug, in any way, contravened the same provision. The third ingredient is that the drug whilst in his possession, remained in the same state when he acquired it. It is necessary to observe that all the three ingredients are cumulative and all of them must be established to substantiate the defence. If any one of the ingredients is missing, then the defence does not come to be established. Therefore the question for consideration in the appeal is whether the respondent has led sufficient evidence or placed sufficient materials on the record from which it can be said that all the aforesaid three ingredients are satisfied.
5. The first witness Vrajlal only gives general testimony to the effect that, if retail dealers purchase medicines, then, they do not read the labels, specially if they do so from wholesale merchants. The second witness Valimohmed was examined to prove that the respondent had purchased from him three bottles of Vicks on 6th of February, 1957. The witness was serving in the shop of one Parmohamed. The defence showed to him the bill, Ex. 41. The witness admitted that the bill was of his shop, but he denied that the three bottles of Vicks ointment sold thereby had been sold to the respondent. He stated that the goods had been sold to one Hiralal Chhaganlal and Bros. The name of the respondent is Hiralal Jethalal and he trades in tie firm name 'M/s Hiralal Jethalal and Co.'. There is nothing on the record to show that the respondent was trading in the name of 'Hiralal Chhaganlal and Bros'. In any case none of the bottles which were attached from the respondent was shown to this witness and no attempt was made to prove that any of the aforesaid 17 bottles could have been purchased from the firm in which this witness was serving. Therefore, from the evidence of this witness it is difficult to conclude that any of the 21 bottle's had been purchased from this particular shop under the bill, Ex. 41. The next witness Sureshchandra is the proprietor of a shop known as 'Popular Medical Stores, Upleta'. The witness admitted that three bottles of Vicks Balm were purchased by the respondent on 10-10-1957. After the witness had stated this, the learned Pleader for the respondent put a question to the witness whether the bottles sold by him were amongst 'the bottles attached from the respondent. But, after putting this question, for some inexplicable reason, the learned pleader dropped the question altogether. The result was that the evidence of the witness could not establish any direct connection between the attached bottles and the purchase. In cross-examination, however the witness definitely stated that the attached bottles were not purchased from his shop and the reason which he gave was that they used to put five figures on the bottles sold by them. Therefore the evidence of this witness also does not establish that any of the bottles attached from the respondent was purchased from this particular firm.
6. In this connection, it is important to notice that, according to the reply of the respondent, dated, August 35th, 1958, the bottles were purchased from four firms. The respondent has examined representatives of only two firms and, for some reason best known to him he did not make any attempt to examine the representatives of the other two firms. The result is that the evidence on the subject of the purchases and the identity of the bottles with those purchases, is in the most unsatisfactory state. The burden is on the respondent to establish his defence, and, in our judgment, having regard to the aforesaid state of the evidence, it is not possible to say that the respondent has been able to establish that any of the bottles which were before the Court had been purchased by or on his behalf from the firms mentioned by him. In arriving at this conclusion, we have borne in mind the fact that the respondent is a retail dealer; that there is no evidence in the case to show that he used to maintain accounts, and that, even if he had purchased the articles from any of these shops, there is a strong probability of the representatives of these shops not admitting that the bottles before the Court were sold by them after the fact is known that the drug in question was spurious. . It is true that the respondent will be suffering from these difficulties in the way of the establishment of his defence. But at the same time, the object of the Legislature in enacting the relevant provision of the law on the subject is quite explicit. The interests of the public have got to be adjusted as against the inconvenience which may be caused to a dealer in medicine. The Legislature in its wisdom has taken the view that the menace to the public health is so great that if any spurious drug is found with any person dealing with such drugs, then the burden of proving that he was in possession of such drug under the circumstances mentioned in Section 19 (3) is upon him and if he fails to discharge the burden, then, the law must take its own course, and though, otherwise, he may not have any hand in the matter except that he stocked or sold the drug, he would be criminally responsible for such stocking and selling, But in our judgment, even if we were to take a different view about the question of the respondent having purchased the goods from anyone of the four firms named by him, there is no doubt that the respondent must fail on the ground that he has failed to establish the second ingredient of the defence and that ingredient is that the respondent, could not with reasonable diligence, have ascertained that the drug was not of the standard quality or a misbranded drug. It is not enough for a person to prove that he did not know that the drug was not of the standard quality or a mis-branded drug. He must further prove that, with reasonable diligence, he could not have ascertained both or any of these two facts. In the present case, in our judgment, having regard to the evidence given by the witness Jayantilal, there is no doubt whatsoever that, on the container itself, there was a number of indications which, if the , respondent had exercised ordinary diligence, would have brought to his notice that the drug was a misbranded drug or probably not of standard quality. The witness has in all mentioned seven differences between the genuine bottle and the spurious bottle. It is true that some of these differences are minor; but at the same time, there are a few others which would have given notice to any reasonable person that the bottle probably was not a genuine one or at least merited further enquiry into the matter. For example, the bottle did not contain the batch number, that the printing was blurred and the shape of the bottle was different. The argument of Mr. Shukla was that the respondent was a petty dealer in medicine and could not have noticed all or any of the differences pointed out by the witness Jayantilal. We do not think that we can accept this fact as a good defence when dealing with a case under Section 19, Sub-section (3). The contravention of Section 18 has relation to not an ordinary person but a person who deals in drugs. The contravention relates to a manufacturer, a seller or a stockist or a distributor of drugs. These persons must remember that their trade leads them to deal in substances which if spurious, can play havoc with the health of the nation. Therefore, the standard of care or diligence which they are required to exhibit in the course of their dealings with, drag must be such as a person would exhibit, who is conscious of the fact that he is dealing in a trade in which, if he becomes even unconsciously an agent of those who deal in spurious drugs he to likely to jeopardise the health of the people. The diligence which he is required to exhibit is reason-able diligence and the standard of diligence must necessarily be such as to ensure the public from the ravages of the danger which is inherent in con-ducting a trade so much bound up with public health. Therefore, in our judgment, it is not merely enough for a person to show that he had purchased a drug from a recognised dealer or in the open market. If he has done so, he will certainly lay a foundation for his defence. But, if his defence does not carry him beyond this, it is not ft valid defence. In addition to this when making the purchase, it is the duty of the seller or a stockist to inspect reasonably the drug including the outward trappings in which the drag is contained so that thereby spurious articles do not come to be placed in the market and he does not become-even unconsciously an agent for passing off spurious drugs to the consumers. In our judgment, even on the assumption that the respondent had purchased the articles from the aforesaid firms, the respondent had failed to exercise that much care which it was necessary for him to do in order to make good his defence. Under the aforesaid circumstances we have come to the conclusion that the respondent has failed to establish the defence under Section 19 Sub-section (3) of the Act. In that view of the matter, in our judgment, the view taken by the learned Magistrate was correct and the respondent was wrongly acquitted by the learned appellate Judge.
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