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2017 (12) TMI 1737 - SC - Indian LawsInterpretation of statute - Section 26A of the Drugs and Cosmetics Act, 1940 - prior consultation of the Drugs Technical Advisory Board (DTAB) set up under Section 5 of the said Act - mandatory condition precedent for the exercise of the power by the Central Government under Section 26A of the Drugs Act - HELD THAT - Section 26A has been introduced by an amendment in 1982. A bare reading of this provision would show, firstly, that it is without prejudice to any other provision contained in this Chapter (meaning thereby Chapter IV). This expression only means that apart from the Central Government s other powers contained in Chapter IV, Section 26A is an additional power which must be governed by its own terms. Under Section 26A, the Central Government must be satisfied that any drug or cosmetic is likely to involve (i) any risk to human beings or families; or (ii) that any drug does not have the therapeutic value claimed or purported to be claimed for it; or (iii) contains ingredients in such quantity for which there is no therapeutic justification - The power exercised under Section 26A must further be exercised only if it is found necessary or expedient to do so in public interest. When the power is so exercised, it may regulate, restrict or prohibit manufacture, sale or distribution of any drug or cosmetic. Section 26A was brought in by an amendment in 1982. The amendment specifically made changes in Sections 33 and 33N in which it added the words on the recommendation of the Board . From this, it is clear that Parliament in the very Amendment Act which introduced Section 26A made certain changes which involved the DTAB under Section 5 of the said Act. It is clear that the additional power that is given to the Central Government under Section 26A does not refer to and, therefore, mandate any previous consultation with the DTAB. If the power under Section 26A is exercised on the basis of irrelevant material or on the basis of no material, the satisfaction itself that is contemplated by Section 26A would not be there and the exercise of the power would be struck down on this ground. - Also, as a matter of statutory interpretation, words can only be added if the literal interpretation of the Section leads to an absurd result. As has been stated by us, the construction of Section 26A on a literal reading thereof does not lead to any such result. Petition disposed off.
Issues Involved:
1. Interpretation of Section 26A of the Drugs and Cosmetics Act, 1940. 2. Mandatory consultation with the Drugs Technical Advisory Board (DTAB) before exercising power under Section 26A. 3. Validity and process of banning Fixed Dose Combinations (FDCs). 4. Judicial review of the Central Government's decision under Section 26A. 5. Procedural fairness and requirement of hearing before banning drugs. Detailed Analysis: 1. Interpretation of Section 26A of the Drugs and Cosmetics Act, 1940: The Supreme Court examined the scope and application of Section 26A, which allows the Central Government to regulate, restrict, or prohibit the manufacture, sale, or distribution of drugs or cosmetics if they pose a risk to human beings or animals, lack therapeutic value, or contain unjustified ingredients. The Court emphasized that the Central Government must be "satisfied" based on relevant material before exercising this power. 2. Mandatory Consultation with the DTAB: The primary issue was whether consultation with the DTAB is mandatory before the Central Government exercises its power under Section 26A. The Court noted that unlike other sections of the Drugs Act, Section 26A does not explicitly require consultation with the DTAB. The Court concluded that the absence of such a requirement in Section 26A was deliberate, as evidenced by the 1982 amendment which included references to the DTAB in other sections but not in Section 26A. 3. Validity and Process of Banning FDCs: The Court reviewed the process leading to the ban on 344 FDCs based on the Kokate Committee's recommendations. The Committee categorized FDCs into those that were irrational, required further deliberation, were safe and effective, or needed further data. The Court found that while the Committee's recommendations were based on expert analysis, the reasons for declaring certain FDCs as irrational were not clear. 4. Judicial Review of the Central Government's Decision: The Court highlighted that judicial review of the Central Government's decision under Section 26A is limited to ensuring that the decision is based on relevant material. The Court rejected the argument that the power under Section 26A should be constrained by mandatory consultation with the DTAB, as this would unduly limit the Central Government's ability to act in public interest based on other relevant materials. 5. Procedural Fairness and Requirement of Hearing: The Court did not delve into whether Section 26A is legislative in nature and thus excludes natural justice. However, it directed that the DTAB or a Sub-Committee should re-examine the banned FDCs, providing a hearing to the affected parties and considering submissions from the All India Drugs Action Network. The DTAB/Sub-Committee must clearly indicate why any of the three factors under Section 26A are attracted and whether it is necessary to regulate, restrict, or prohibit the FDCs in public interest. Conclusion: The Supreme Court set aside the Delhi High Court's judgment requiring mandatory consultation with the DTAB before exercising power under Section 26A. The Court directed that the DTAB/Sub-Committee re-examine the banned FDCs and submit a report to the Central Government within six months. The Central Government must then consider this report and any other relevant information before making a final decision on the notifications. The status quo regarding the banned FDCs will continue until fresh notifications are issued.
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