How the judiciary fails people even after convicting pharma companies for offences
Blog Tuesday, April 05, 2016 - 16:34

By Dinesh Thakur

In the series of blog posts leading up to this one, we have looked at how various state health regulators conduct investigations and initiate prosecution where they have a preponderance of evidence for manufacture of Not of Standard Quality (NSQ) drugs. We have seen how dysfunctional the investigatory process is, and how lack of training and poorly written guidelines allow even major violations which impact the health of patients often go unaccounted for. Let us now look at how the criminal justice system deals with rare cases which come up for adjudication despite all the challenges that they face leading up to the court. The next major problem area is the issue of sentencing by Indian judges for offences under the Drugs & Cosmetics Act, 1940 especially the offence of manufacturing and selling sub-standard drugs.

As per Section 32 of the Drugs & Cosmetics Act, 1940 all offences under Chapter IV of the Drugs & Cosmetics Act, 1940 are required to be heard before a Court of Sessions. In the hierarchy of criminal trial courts, the Court of Sessions is the highest. The only courts above the Court of Sessions are the High Courts of the respestive states and the Supreme Court of India. In our criminal justice system, under the Code of Criminal Procedure, a Court of Sessions hears only the most serious offences that are punishable with a minimum of ten years imprisonment or death. Offences attracting lesser punishment are usually tried by Judicial Magistrate First Class or lower.

Under the Drugs & Cosmetics Act, 1940, as originally envisioned, with the exception of offences mentioned in Section 27(a), which attract a minimum term of 10 years to a maximum of life, almost all the other offences are punishable with rather short term sentence of two to three years in prison (along with fines). In the normal course, these offences are tried by Magistrate level courts. However, due to an amendment to Section 32 in 2008, all of these offences are now required to be tried by Courts of Sessions – Indian Parliament in its wisdom was perhaps convinced that all offences under the Drugs & Cosmetics Act were serious enough to warrant attention of more experienced judges who preside over the Court of Sessions. This amendment however prima facie appears to be running contrary to the provisions of Section 36A (a provision inserted in 1982), which clearly states that judicial magistrate can try some offences summarily. As a result of this poor legislative drafting – a feature which is the hallmark of this law – there is confusion amongst various states on the jurisdiction of criminal courts under this law. Different High Courts have delivered conflicting judgments on whether prosecutions under Section 18(a)(i) read with Section 27(d) for manufacture and sale of NSQ drugs are to be heard by a Court of Sessions or by a Court of a Judicial Magistrate First Class. A few of the conflicting judgments on the issue of jurisdiction and the competent court to take cognizance of such crimes are available here: (i) Zest Pharma v. Drugs Inspector; (ii) Deepesh Arvindhbhai Patel & Ors. v. State of Karnataka & (iii) Rabindra Singh v. State of Bihar.

An unfortunate consequnce of this confusion is that manufacturers who have the ability to influence the system through political means, often wind up in the lower court. We have seen how hard it is to collect adequate evidence for prosecution of these crimes; how difficult it is to establish a water-tight case because our drug inspectors lack training and lawyers lack scientific background to make the case; the cherry on top is the fact that even in those rare cases where the evidence is incontrovertible, the sentencing guidelines allow enough of a leeway for a judge toward leniency for the accused. This is truly a double-whammy.

Judges hearing cases of manufacture of NSQ drugs are not complying with the mandatory minimum guidelines for sentencing prescribed under the law. Section 27(d), which addresses the offence of manufacturing NSQ drugs, mandates a minimum term of one year and a maximum term of two years of imprisonment, along with a minimum fine of Rs. 20,000. The court can waive the minimum term of imprisonment for adequate and special reasons which are required to be recorded in the judgment. In reality however, most courts appear to be invoking the exception more often than the rule by sentencing the guilty to ‘simple imprisonment till the rising of the court’ i.e., the accused is convicted but is not actually sent to jail – instead is required to be in court until the the judge rises from the court for the day. This could be as little as an hour to a maximum of few hours.

Once the judge rises from court, the convicted person is deemed to have served time and can walk out as a free bird. So much for making & selling poison to the people of India! One can only imagine the message this gives to manufacturers who produce NSQ drugs.

As a part of our research for the PILs, we procured a set of 6 judgments from the Special Court for Economic Offences in Bangalore where, despite guilty plea by the accused, all of them were sentenced only with simple imprisonment till the rising of the court! The judge chose not impose the minimum imprisonment of one year even in a single case among these. In most cases, the Court awarded this lenient sentence on the grounds that the accused had family dependent on his earnings.

C.C.No.Case title

Reason for reducing sentence below mandatory minimum

7/2014Drugs Inspector v Causeway Pharma 

1. Accused had family members as dependants; 2. Accused had employees

291/2014Surien Pharmaceuticals (P) Ltd. & Ors, Kovur1. Accused had family members as dependants; 2. Accused had employees
01/2009Drugs Inspector v Injecto Capta Pvt Ltd. and Ors, SEcundarabad1. Accused had family members; 2. Accused suffering from cardiac problem and diabetic 
400/2010Drugs Inspector v Quasar Labs Pvt. Ltd, Uttaranchal1. Accused had family members; 2. Accused's mother was suffering serious ailments
136/ 2008 Drugs Inspector v Sanchez Pharmaceuticals (P) Ltd. & Ors, Haryana1. Accused had family members; 2. Factory was shut anyway
134/2012Drugs Inspector v BRD Medilabs, Solan, Haryana, and Ors1. Accused had family members; 2. Accused's mother was suffering serious ailments


                In all of the above orders, the Court justified this lenient punishment with the reasoning that the charge against the accused was one of selling drugs which are not of standard quality, as opposed to the more serious offence of selling counterfeit medicine. The Indian pharmaceutical lobby has been very successful in creating this impression that somehow counterfiet medicines have more serious health consequences than sub-standard drugs. The court fails to understand that in several cases, sub-standard medicine can have similar, if not worse health outcomes compared to counterfeit drugs. For example, if a drug fails to dissolve or disintegrate it will have no therapeutic effect on the human body. Depending on the indication it is prescribed for, lack of such action can have serious consequences on a patient. It is therefore necessary for the Courts to seek an expert opinion from pharmacologists or medical doctors on the effect of the sub-standard medicine before deciding to let the accused off with simple imprisonment till the rising off court.

Moreover, the Supreme Court of India has been very clear that mandatory minimums need to be enforced strictly against the accused proven guilty. The Supreme Court has time and again ruled, in the context of different laws that the ‘special reasons’ exception can only be used in exceptional cases and not in a routine, casual and cavalier manner. In our PIL which the Supreme Court refused to hear, one of the prayers we asked was directed at framing guidelines for judges hearing such cases under the Drugs & Cosmetics Act because I know for a fact that the Special Court in Bangalore is not the only court handing out such lenient orders. The ‘simple imprisonment till the rising of the court’ is a sentence awarded in several other states, including Tamil Nadu, which has the most competent investigations in India.

Justice Thakur, if this is an academic exercise, I don’t know what a real one is. An effective criminal justice system is the most significant deterrent toward the intent of wrongdoing. Are we surprised that the industry continues to engage in such criminal activity knowing full well that the outcome, if caught and prosecuted, which itself is a rare achievement in India is nothing more than a slap on the wrist? No, this is not an academic exercise, Sir; the consequence of the actions of the courts affect the health of over a billion people who live in India.

(This article was first published on Dinesh Thakur's blog and has been reproduced with permission.)

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