1. Since identical reliefs are prayed for in both these petitions under Article 226 of the Constitution of India, and the facts and contentions are also common, the same were taken up for hearing together and are decided by this common judgement.
2. In Special Criminal Application No.2014 of 2006, the petitioner seeks the following relief:
“[16] In the premises aforesaid, the Petitioner prays :
[a] That the Hon'ble Court may be pleased to quash the Complaint Case No. Sessions Spl. 348(K) 05 filed in District and Sessions Judge Kamrup, Guwahati in connection with Shillong Customs Case No.3 & 3A/NDPS/HQ. Prev/SH/2005 dated 13.08.05 and 28.09.05 for contravention of provisions of Section 8 of the Narcotic Drugs & Psychotropic Substances Act, 1985 (Annex-1 hereto) and be further pleased to quash and set aside the Order of the District and Sessions Judge, Kamrup, Guwahati dated 8.6.2006 in Complaint Case No. Sessions Spl. 348(K) 05 (Annexure 2 hereto);
in the alternative -
[b] that the Hon'ble Court be pleased to issue a writ of mandamus or writ in the nature of mandamus or any other writ direction or an order commanding the Respondent to withdraw the Complaint Case No. Sessions Spl. 348(K) 05 from the District and Sessions Judge, Kamrup, Guwahati and file the same in the District & Sessions Court, Surendranagar.
16[b] That this Hon'ble Court be pleased to issue a writ of mandamus or writ in the nature of mandamus or any other writ, direction or order quashing and setting aside the Complaint Case No. Sessions Spl. 348(K) 05 from the District and Sessions Judge, Kamrup, Guwahati in connection with Shillong Customs Case No.3 & 3A/NDPS/NQ. Prev/SH/2005 dated 13.08.05 and 28.09.05 for contravention of provisions of section 8 of the Narcotic Drugs & Psychotropic Substances Act, 1985 (Annex-1 hereto) and be further pleased to quash and set aside the Order of the District and Sessions Judge, Kamrup, Guwahati dated 8.6.2006 in Complaint Case No. Sessions Spl. 348(K) 05 (Annexure 2 hereto) and also be pleased to direct the District & Sessions Judge, Kamrup, Guwahati to return the Complaint Case No. Sessions Spl. 348(K) 05 filed in connection with Shillong Customs Case No.3 & 3A/NDPS/NQ. Prev/SH/2005 dated 13.08.05 and 28.09.05 to the respondent.”
3. Special Criminal Application No.2015 of 2006, has been filed with the following prayers:
“[15] In the premises aforesaid, the Petitioner prays :
[a] That the Hon'ble Court may be pleased to quash the Complaint Case No. Sessions Spl. 348(K) 05 filed in District and Sessions Judge Kamrup, Guwahati in connection with Shillong Customs Case No.3 & 3A/NDPS/HQ. Prev/SH/2005 dated 13.08.05 and 28.09.05 for contravention of provisions of Section 8 of the Narcotic Drugs & Psychotropic Substances Act, 1985 (Annex-1 hereto) and be further pleased to quash and set aside the Order of the District and Sessions Judge, Kamrup, Guwahati dated 8.6.2006 in Complaint Case No. Sessions Spl. 348(K) 05 (Annexure 2 hereto);
in the alternative -
[b] that the Hon'ble Court be pleased to issue a writ of mandamus or writ in the nature of mandamus or any other writ direction or an order commanding the Respondent to withdraw the Complaint Case No. Sessions Spl. 348(K) 05 from the District and Sessions Judge, Kamrup, Guwahati and file the same in the District & Sessions Court, Surendranagar.
[Draft amendment carried out as per court's order dated 07.12.2006) :
15[b] That this Hon'ble Court be pleased to issue a writ of mandamus or writ in the nature of mandamus or any other writ, direction or order quashing and setting aside the Complaint Case No. Sessions Spl. 348(K) 05 from the District and Sessions Judge, Kamrup, Guwahati in connection with Shillong Customs Case No.3 & 3A/NDPS/NQ. Prev/SH/2005 dated 13.08.05 and 28.09.05 for contravention of provisions of section 8 of the Narcotic Drugs & Psychotropic Substances Act, 1985 (Annex-1 hereto) and be further pleased to quash and set aside the Order of the District and Sessions Judge, Kamrup, Guwahati dated 8.6.2006 in Complaint Case No. Sessions Spl. 348(K) 05 (Annexure 2 hereto) and also be pleased to direct the District & Sessions Judge, Kamrup, Guwahati to return the Complaint Case No. Sessions Spl. 348(K) 05 filed in connection with Shillong Customs Case No.3 & 3A/NDPS/NQ. Prev/SH/2005 dated 13.08.05 and 28.09.05 to the respondent.”
4. The facts giving rise to these petitions as averred in the memorandum of the petitions are as follows:
4.1 Special Criminal Application No.2014 of 2006 has been filed by Cadila Healthcare Limited, (hereinafter referred to as “Cadila”) a Company incorporated under the Companies Act, 1956, and is a leading pharmaceutical company in India. One German Remedies Limited (hereinafter referred to as “GRL”) was carrying on the business of manufacturing and marketing pharmaceutical products. GRL used to purchase Codokuff Cough Linctus cough syrup, containing Codeine as an active ingredient, on a principal to principal basis, from M/s Biodeal Laboratories Ltd. (hereinafter referred to as “Biodeal”). Codokuff Cough Linctus cough syrup purchased by GRL was directly transported from the Biodeal manufactory to the C&F agents of GRL, across the country. GRL was merged with Cadila with effect from 1.4.2002. Pursuant to the merger, GRL became a division of the petitioner company and the said division continued to purchase, in the same manner, Codokuff Cough Linctus cough syrup on principal to principal basis.
4.2 Special Criminal Application No.2015 of 2006 has been filed by Shri Arun Kumar Jamnadas Patel, Director of M/s Biodeal Laboratories Ltd. (hereinafter referred to as “Biodeal”). Biodeal has its registered office and manufacturing facilities at Surendranagar, Gujarat. The said facilities are certified by the World Health Organization (hereinafter referred to as “WHO”) as following Good Manufacturing Practices (hereinafter referred to as “GMP”) and regularly inspected by WHO for the purpose of GMP certificate. Biodeal had obtained permission to manufacture Codokuff Cough Linctus cough syrup from the Commissioner, Food & Drugs Control Administration, Gujarat. Codokuff Cough Linctus cough syrup is not included in the Indian Pharmacopoeia and is a Patent and Proprietary medicine, as defined under section 3(h) of the Drugs & Cosmetics Act, 1940 (hereinafter referred to as “the Drugs Act”). Accordingly, Biodeal is required to furnish along with its application for permission to manufacture, the tests for identification of the active ingredient and the method of its assay. Biodeal had, accordingly, submitted such data and method for testing medicinal preparations.
4.3 Biodeal and German Remedies Ltd. had entered into: (i) a manufacturing and marketing agreement, under which GRL used to purchase on “principal to principal” basis Codokuff Cough Linctus cough syrup, containing Codeine as an active ingredient; and (ii) an agreement whereby GRL licensed its Trade Mark for the cough syrup, to facilitate its manufacture by Biodeal under the said agreement. After its merger, with Cadila, GRL continued to purchase Codokuff Cough Linctus cough syrup (hereinafter referred to as “Codokuff”) on “principal to principal” basis from Biodeal.
4.4 The respondent herein lodged a complaint in the Court of the learned District & Sessions Judge, Kamrup, at Guwahati being Complaint Case No. Sessions SPL-348(k) 05 against M/s Biodeal Laboratories Pvt. Ltd., M/s German Remedies Ltd., M/s Cadila Healthcare Ltd. and the officers and certain staff members of the said three companies wherein it was stated that the respondent – Inspector of Customs, posted in the Headquarter Customs Preventive Unit, Shillong, Office of the Commissioner of Customs, NER, Shillong, having jurisdiction over entire North-Eastern Region under the Narcotic Drugs & Psychotropic Substances Act, 1985 (hereinafter referred to as “the NDPS Act”) had filed the complaint for the purpose of section 53 of the said Act. According to the complainant, intelligence was gathered by the officers of the Headquarter, Customs Preventive Unit, Shillong, to the effect that Codokuff Cough Linctus containing Codeine Phosphate manufactured by M/s Biodeal Laboratories Pvt. Ltd. and marketed by M/s German Remedies Ltd. are being abused as alternative narcotic drugs. The modus operandi adopted was to procure Codeine Phosphate from legal channel and divert a part of it for illegal use by under-utilizing the narcotic substance in the said cough formulation. It was further gathered that most of this cough formulation is being sent to a few firms in Agartala, Tripura who send the same to Bangladesh in small quantities through clandestine channels, where the cough formulation is used as an alternative narcotic drug. On a preliminary inquiry, it appeared that Codokuff Cough Linctus, containing Codeine Phosphate, is manufactured by Biodeal at Wadhwan city, Surendranagar, Gujarat and marketed by GRL, a marketing arm of M/s Cadila Healthcare Ltd. of Zydus Group of Companies. It was gathered that the concentration of Codeine Phosphate in the above mentioned cough formulation is less than that shown in the composition of the medicine. In case of such lower concentration of Codeine Phosphate, it appeared that the unutilized quantities of the same have to be diverted for illicit use.
4.4.1 It is further stated in the complaint that a sample of Codokuff Cough Linctus from batch No.B-178 was collected on 21.7.2005 from a consignee agent of GRL, viz. M/s Wellcare, located at Guwahati and was sent for chemical analysis to the Forensic Science Laboratory, Kahilipara, Guwahati. Upon being tested, it was found that the quantity of Codeine Phosphate was 7.29 mg per 5 ml which was less than what was mentioned on the label of the bottle, where the composition was shown to contain 10 mg of Codeine Phosphate per 5 ml of the cough linctus. According to the complainant, this meant, in the 100 ml bottle of Codokuff Cough Linctus, there was 145.8 mg of Codeine Phosphate instead of 200 mg. The records/invoices for the period April 2004 to July 2005 of M/s Well Care, the consignee agent for GRL was obtained and it was seen that an overwhelming majority of these cough preparations were sent to only two firms of Agartala, Tripura, who were the authorized stockists/distributors of GRL.
4.4.2 On 13.8.2005, the officers of Headquarters, Customs Preventive Unit, Shillong, searched the premises of M/s Well Care, the consignee agent for GRL for the NE Region at Guwahati and seized 324875 bottles, each bottle containing 100 ml of Codokuff cough linctus belonging to 21 (twenty one) different batches, under section 42 of the NDPS Act, 1985 vide seizure Case No.3/NDPS/HQRS.PREV/SH/05 dated 13.8.2005, valued at Rs.1,42,44,326.10 on the reasonable belief that these cough formulations contain less Codeine Phosphate (which is a narcotic substance under the NDPS Act) indicating the huge diversion of legally acquired Codeine Phosphate for illicit use and hence, these bottles containing the said cough linctus were vital material evidence for the case. In all, Codokuff cough linctus belonging to 30 (thirty) different batches were seized on 13.8.2005 and 28.9.2005.
4.4.3 A total of 30 representative samples (in duplicate) were drawn from all the 30 different batches of the seized cough formulation which were sealed in duplicate in presence of the consignee agent and independent witnesses for chemical analysis. These were sent to the FSL, Guwahati, in two batches on 16.08.2005 and 03.10.2005 to ascertain the exact quantum of Codeine Phosphate in each 5 ml of the said cough formulations.
4.4.4 After the search and seizure, the statement of Shri Shrimanta Paul, proprietor or M/s Well Care, the consignee agent was recorded under section 67 of the NDPS Act. Searches were also conducted at the Corporate Office of GRL at Mumbai and at the factory and office of Biodeal at Wadhwan city, Gujarat, with the help of local Customs and Central Excise Units to confirm the diversion of legally acquired Codeine Phosphate for possible illicit use. The records/documents resumed from Mumbai and Wadhwan city were forwarded by the respective Customs formations to the office of the Commissioner of Customs (Preventive), NER, Shillong. Some more records and statements including original Batch Manufacturing Records of all 81 batches of Codokuff cough linctus manufactured so far, details of Codeine Phosphate received and used by the manufacturer and other related documents were also submitted by the accused No.10 and 14 who were employees of Biodeal, when they appeared at Shillong.
4.4.5 Upon studying the batch manufacturing records, it was revealed that Biodeal, manufacturer of Codokuff Cough Linctus on behalf of GRL received a total quantity of 746.91 kgs of Codeine Phosphate from the Government Opium and Alkaloid Works, Neemuch/Ghazipur, for manufacture of Codokuff Cough Linctus during the period 23.01.2002 to 30.03.2005 at the rate of Rs.33,000/- per kg. During the same period, they manufactured 3566900 bottles of said Cough Linctus (100 ml and 50 ml bottles) in a total of 81 batches. As per the declaration in the labels of the bottles as well as in the BMRs, each 5 ml of the Cough Linctus contained 10 mg of Codeine Phosphate. From the records of the manufacturing unit, it was found that they used 694 kgs of Codeine Phosphate for manufacturing the above-mentioned quantity of cough linctus. They also used a total of 0.175 kgs of Codeine Phosphate as samples for testing the purity of the same. The remaining quantity, that is, 52.735 kgs was reflected in their stock register, as on 31.03.2005. It also appeared from the records for 2005-06 of Biodeal that during the period May-June, 2005, the previous balance of 52.735 kgs plus another 50 kgs received on 28.05.2005 was used to manufacture Silencer Cough linctus on behalf of M/s Parenteral Drugs India Limited, Indore, leaving a balance of 0.710 kgs of Codeine Phosphate in their stocks when the investigation was launched. The study of the dispatch records of Codokuff Cough Linctus in the records of GRL indicated that an overwhelming majority of the cough linctus so manufactured were sent to the consignee agent at Guwahati, who, in turn, sent a majority of these to Agartala, Tripura, as per the instructions of the company. Thus, while 67% of the total production was sent to Guwahati, 70% of the total sales from Guwahati were sent to Tripura State, far in excess of the State's actual requirement, indicating illegal export to Bangladesh, where cough formulations containing Codeine Phosphate are popular as alternative narcotic drugs.
4.4.6 It is further the case of the complainant that Forensic Science Laboratory, Guwahati vide reports dated 27.09.2005 and 10.11.2005 in respect of the samples of the seized Codokuff Cough Linctus belonging to 30 different batches confirmed underutilization of Codeine Phosphate in all the samples tested. On analysis by the FSL, the samples of Codokuff Cough Linctus were found to contain 5.99 mg to 8.50 mg of Codeine Phosphate per 5 ml of different batches of the cough linctus against the declared 10 mg per 5 ml. According to the complainant, this meant that in the thirty batches tested, each 100 ml bottle of different batches contained between 119.80 mg to 170.00 mg Codeine Phosphate against the required 200 mg. Since these thirty batches consisted of 1418800 numbers of 100 ml bottles, it was found that a total amount of 82.338 kgs of Codeine Phosphate was underutilized although this quantity was taken out of the stock. Since the underutilized quantity was not reflected/re-entered in the stock register, it was reasonably believed that a total quantity of 82.338 kgs of legally procured Codeine Phosphate has been diverted for illegal use, instead of being used for medicinal purposes, that is, for the manufacture of the cough linctus. This, according to the complainant, is clearly a violation of the provisions of section 8(c) of the NDPS Act and is punishable under Chapter IV of the NDPS Act.
4.4.7 The complainant has, thereafter, referred to the statements of Shri Arun Kumar Jamnadas Patel, Director of Biodeal, Shri Malay Kumar Chakraborty, Zonal Sales Manager (Eastern & North Eastern Region) for German Remedies Division; Shri Jayant Chimanlal Jani, Executive Director of Cadila, Mumbai; Shri G. M. Shirgavi, Senior Manager, Quality Control of German Remedies Division of Cadila; Shri D. H. Vartak, Manager, Logistics of M/s German Remedies division of Cadila; Shri A. P. Pandit, General Manager Finance of General Remedies Division of Cadila; Shri Manish H. Dave, Manager (Excise), Biodeal; Shri Murlidhar Phool Singh Sahu, Manager (Technical), Biodeal and Shri Thobanbhai Khurjibhai Patel, Managing Director of Biodeal recorded under section 67 of the NDPS Act.
4.4.8 Based upon the statements of the aforesaid persons as well as the manufacture and sale figures and other record, the complainant has expressed the view that the Directors and Managers of both GRL and Biodeal, at some stage or the other, contradicted their own statements or the statements given by the others. Whenever any question was found difficult by them to answer, especially when confronted with the FSL reports and diversion of Codeine Phosphate, they evaded direct replies by either claiming ignorance in the matter or by shifting the onus of replying the questions to their subordinates. The responsibility for diversion of Codeine Phosphate, as brought out in the FSL reports, was attempted to be shifted to the manufacturers by the officials of GRL. Again the responsibility for diversion of Codeine Phosphate, as brought out in the FSL reports, was attempted to be shifted on junior, ground level staff by the officials of Biodeal, which according to the complainant, smacked of mens rea and mala fide intention on the part of the Directors and Managers of both GRL and Biodeal, inter alia indicating their knowledge and involvement in the diversion. It is the case of the complainant that Biodeal, the manufacturer of Codokuff Cough Linctus has violated the provisions of section 8(c) of the NDPS Act by not using a substantial part of legally procured Codeine Phosphate for the purpose for which it was procured by them, viz., for medicinal use, but instead, diverting the same for illicit use by way of underutilizing the Codeine Phosphate in the cough formulation, using less quantity than prescribed and as declared on the labels of the bottles, in each bottle of the said cough linctus and thus, making themselves liable to punishment under sections 21, 25, 27A and 29 of the NDPS Act.
4.4.9 Cadila had committed an offence punishable under sections 21, 27A and 29 of the NDPS Act, inasmuch as they are responsible for policy matters, decision-making and financing in respect of GRL and also dictate and monitor all the activities of GRL and they are, thus, as much responsible for knowingly financing the large scale illegal diversion of Codeine Phosphate by Biodeal. They would not have been doing so if there were no profit for them in this illegal diversion of the narcotic substance. Similarly, allegations have been made against the Managing Director, Directors and other co-accused, alleging that they have violated the provisions of section 8(c) of the NDPS Act by diverting a part of legally procured Codeine Phosphate for illicit use and along with others, entered into a criminal conspiracy with each other and systematically diverted a large quantity of the narcotic substance by way of underutilizing Codeine Phosphate in each bottle of the cough formulation, by using less quantity than the quantity formulated and mentioned in the labels of the bottles of Codokuff Cough Linctus.
4.5 Upon lodging of the aforesaid complaint, the learned Sessions Judge, Kamrup, Guwahati, after hearing the learned counsel appearing for the Union of India, by an order dated 8.6.2006, directed issuance of summons to the accused. It is at this stage that the petitioners have lodged the present petitions seeking the reliefs noted hereinabove.
5. At the outset, Mr. H. C. Buch, learned standing counsel for the respondent raised a preliminary objection to the very maintainability of the petition by contending that the complaint having been lodged with the District Court, at Kamrup, Guwahati, this Court has no jurisdiction to entertain and decide the present writ petitions. It was, accordingly, submitted that the question of jurisdiction is required to be decided as a preliminary issue before examining the matter on merits.
5.1 Apropos the above contention, considering the fact that this court by an order dated 7.12.2006, after hearing the learned counsel for the respective parties, has issued rule in the matter and had granted interim relief staying further proceedings pursuant to the complaint, in the opinion of this court, the petitions are required to be decided both on the question of jurisdiction as well as on merits. Accordingly, the learned counsel for the respective parties, have been heard on both the counts.
6. Mr. Mihir Thakore, Senior Advocate, learned counsel for the petitioners made three fold submissions. Firstly that the entire cause of action for lodging the complaint in question arises within the jurisdiction of the court at Wadhwan and as such, the learned Sessions Judge, at Kamrup, Guwahati does not have any jurisdiction to entertain the complaint. Secondly, that the assuming that part of the cause of action arises at Kamrup, Guwahati, even then this court has the jurisdiction to exercise powers under Article 226 of the Constitution of India in respect of the complaint lodged at Kamrup, Guwahati. And, thirdly, that on the averments made in the complaint, no offence as alleged can be said to have been made out and as such, the complaint in question deserves to be quashed.
6.1 Elaborating upon the said submissions, the learned counsel submitted that the factory of Biodeal is situated at Wadhwan, District Surendranagar where Codokuff Cough Linctus is manufactured. The alleged offence is said to have taken place in the manufacture or while manufacturing the cough syrup, all of which could happen only at Wadhwan, Surendranagar district. Referring to the provisions of sections 177 and 178 of the Code of Criminal Procedure, 1908 (hereinafter referred to as “the Code”), it was submitted that section 177 provides that every offence shall ordinarily be inquired into and tried by a court within whose local jurisdiction it was committed. Section 178 of the Code can be invoked where the offence has been committed partly within the jurisdiction of one court and partly within the jurisdiction of another court. Adverting to the facts of the present case, it was submitted that the allegation against the petitioners is that there is a diversion of Codeine Phosphate in the manufacture of Codokuff, on a presumption that Codeine Phosphate was found to be less upon analysis of the same. Assuming that the allegation is true, even then such diversion had taken place at Wadhwan. There is not a single allegation that the diverted Codeine has been sent to Guwahati. Thus, the entire offence is alleged to have taken place while manufacturing the cough linctus in Wadhwan, Surendranagar in Gujarat and not partly at Wadhwan and partly at Guwahati and as such, the cause of action has wholly arisen within the jurisdiction of the court at Wadhwan and conversely, the Sessions Judge, Kamrup within whose territorial jurisdiction, no part of cause of action has arisen, has no jurisdiction to entertain the complaint. In support of the said submission, the learned counsel placed reliance upon the decision of the Supreme Court in the case of Narumal v. State of Bombay, AIR 1960 SC 1329, for the proposition that section 177 provides that every offence shall ordinarily be inquired into and tried by a court within the local limits of whose jurisdiction it was committed. The rule laid down by this section is one of general application and governs all criminal trials held under the provisions of the Code. It is true that the section has used the word “ordinarily”, but it is not disputed that the said word means “except where provided otherwise in the Code”. It was, accordingly, contended that the jurisdiction in respect of the offence in question rests only with the Surendranagar Court and as the offence is alleged to have taken place within the State of Gujarat, this court in exercise of its powers under Article 226 of the Constitution has the jurisdiction to quash the complaint even if the same is lodged at Kamrup, Guwahati as well as to decide the issue as to whether or not the learned Sessions Judge, Kamrup has jurisdiction to entertain the complaint.
6.2 Reference was made to the decision of the Supreme Court in the case of Navinchandra N. Majithia v. State of Maharashtra and others, (2000) 7 SCC 640, wherein it has been held that from the provision in clause (2) of Article 226, it is clear that the maintainability or otherwise of a writ petition in the High Court depends on whether the cause of action for filing the same arose, wholly or in part, within the territorial jurisdiction of that court. So far as the question of territorial jurisdiction with reference to a criminal offence is concerned, the main factor to be considered is the place where the alleged offence was committed. The court observed that the mere fact that the FIR was registered in a particular State is not the sole criterion to decide that no cause of action has arisen even partly within the territorial limits of jurisdiction of another State. In the facts of the said case, the court found that the major portion of the facts which led to the registering of the FIR had taken place at Bombay, and accordingly, held that in the aforesaid situation, it was impossible to hold that not even a part of the cause of action has arisen at Bombay so as to deprive the High Court of Bombay of total jurisdiction to entertain the writ petition filed by the petitioner.
6.3 The learned counsel further submitted that there are two aspects on the question of jurisdiction. The aspect is as regards the jurisdiction of this court to entertain the present writ petition. As far as this aspect is concerned, the Supreme Court has clearly overruled the view taken by this court in the case of Rajendra J. Damani v. State of Gujarat and others, 1997 (3) GLR 2536, to the effect that this High Court cannot exercise powers in respect of an FIR or a complaint lodged in a court not falling within the jurisdiction of this court. That the power under Article 226 is available where it is not available under section 482 of the Code. It was submitted that jurisdiction is available where there is a cause of action which in the present case is the offence in question. Secondly, it was submitted that no part of the cause of action has arisen at Kamrup. Hence, the complaint could have been lodged only at Wadhwan in Surendranagar. According to the learned counsel, though various decisions on the question of jurisdiction have been rendered by the Supreme Court subsequent to its decision in the case of Navinchandra N. Majithia (supra), the said decision still holds the field and has not been overruled. Reference was also made to the decision of the Supreme Court in the case of Mosaraf Hossain Khan v. Bhagheeratha Engg. Ltd., (2006) 3 SCC 658, to submit that this court has the jurisdiction to entertain the present writ petition. Reliance was also placed upon the decision of the Supreme Court in the case of Y. Abraham Ajith v. Inspector of Police, Chennai, (2004) 8 SCC 100, wherein the court in the facts of the said case held that no part of the cause of action arose in Chennai and therefore, the Magistrate concerned had no jurisdiction to deal with the matter, and had quashed the proceedings. It was directed that the complaint be returned to the second respondent, who, if he so chooses, may file the same in the appropriate court to be dealt with in accordance with law. Adverting to the facts of the present case, it was submitted that on this sole issue of cause of action, the complaint in question is required to be quashed.
6.4 On the merits of the case, the learned counsel submitted that the allegations made in the complaint taken as a whole do not constitute any offence. The highest allegation is of diversion of Codeine Phosphate without being coupled with any allegation of sale, storage etc. In the absence of either of these things, mere diversion is not an offence under the Act. Besides, allegation of diversion is not based on any cogent evidence, but only multiplying the quantity with the number of bottles.
6.5 Next it was submitted that what was tested was not a narcotic, but a drug under the Drugs Act which could have been tested only in the manner provided under the said Act by the authorities under the said Act, whereas all contemporaneous record shows otherwise. It was argued that assuming that diversion per se is an offence, there is no legal evidence adduced to prove the charge. Inviting attention to the contents of the complaint, it was pointed out that what is alleged is that there is underutilization of legally procured Codeine Phosphate and thereby, diversion of such Codeine Phosphate. The entire basis for the conclusion that there is diversion for illicit use is based upon the report of the FSL indicating underutilization of Codeine Phosphate. Referring to the offences alleged under the NDPS Act, it was pointed out that insofar as Biodeal and its officers are concerned, the allegation is of commission of the offence under sections 8(c), 21, 25, 27-A and 29 of the NDPS Act and against Cadila and its employees, the allegation is of the offence punishable under sections 21, 27A, 29 and 38 of the NDPS Act.
6.6 Referring to the provisions of section 8(c) of the NDPS Act, it was submitted that for the purpose of constituting an offence under the said section, a person is required to produce, manufacture, possess, sell, purchase, transport, warehouse, use, consume, import inter-State, export inter-State, import into India, export from India or transship any narcotic drug or psychotropic substance. It was submitted that in the entire complaint, none of the acts envisaged under clause (c) of section 8 of the NDPS Act have been mentioned. According to the learned counsel, diversion per se without the conditions envisaged under section 8(c) of the NDPS Act, would not constitute an offence under the said section. It was argued that merely on the basis of the FSL reports, the respondent has drawn a conclusion of underutilization and on the basis of such alleged underutilization, has arrived at the conclusion that there is diversion of Codeine Phosphate. It was submitted that for sustaining such an allegation, there has to be some iota of evidence of possession, sale etc. as envisaged under section 8(c) of the NDPS Act. An offence under section 8(c) of the NDPS Act would not be complete when Codeine Phosphate is diverted, but only when it is found that the accused had stored, used, manufactured or possessed such narcotic drug or psychotropic substance. Thus, for making out an offence under section 8(c) of the NDPS Act, such allegation is required to be made, till then, the offence is not complete. Under the circumstances, on the allegations made in the complaint, no offence under section 8(c) of the NDPS Act can be stated to have been made out.
6.7 Referring to section 21 of the NDPS Act, which makes provision for punishment for contravention in relation to manufactured drugs and preparations, it was submitted that reading the said section with section 8(c) of the said Act, the respondent has to show that the accused possessed, sold or transported the narcotic drugs. It was argued that these ingredients of the offence have to be strictly satisfied, failing which no offence as alleged can be stated to have been made out. Reference was made to section 25 of the NDPS Act, which makes provision for punishment for allowing premises, etc. to be used for commission of an offence, to submit that the premises should actually have been used for such an offence. A presumptive allegation of diversion cannot make an offence, nor can it be stated that the premises have been used for commission of an offence.
6.8 The learned counsel invited the attention of the court to the provisions of section 2(xi)(b) of the NDPS Act, which defines “manufactured drug”, to mean any other narcotic substance or preparation which the Central Government may, having regard to the available information as to its nature or to a decision, if any, under any International Convention, by notification in the Official Gazette, declare to be a manufactured drug. The attention of the court was drawn to the Notification No So- 826(E) dated 14.11.1985 issued in the exercise of powers under sub-clause (b) of clause (xi) of section 2 of the NDPS Act, whereby the Central Government has declared various narcotics substances and preparations to be manufactured drugs. Reference was made to Item No.35 thereof, to submit that under the said notification, Codeine has been declared to be a manufactured drug. Reference was also made to clause (xvi) of section 2, which defines “opium derivative”, to submit that Codeine is covered under clause (c) thereof. It was submitted that in view of the fact that Codeine has been notified to be a manufactured drug, it ceases to be a narcotic drug.
6.9 Next it was submitted that Biodeal manufactures patent and proprietary medicine Codokuff Cough Linctus containing Codeine Phosphate and Chlorpheniramine Maleate as active ingredients. The said medicine was being sold on “principal to principal basis” to German Remedies Ltd. and after its merger with Cadila Health Care Ltd. to its division, German Remedies Ltd. As per the provisions of applicable laws, Biodeal had procured a licence under section 73 read with section 83 of the Drugs Act from the Commissioner, Food and Drugs Control Administration, Gujarat for the manufacture of medicinal preparations. For the purpose of procuring Codeine Phosphate from the Government Opium and Alkaloid Works, situated at Neemuch, Madhya Pradesh and Ghazipur, Uttar Pradesh, Biodeal had from time to time applied for quota of Codeine Phosphate IP to the Foods and Drugs Control Administration, Gujarat. Pursuant to such applications, the Foods and Drugs Control Administration vide allocation orders issued from time to time, allocated to Biodeal, specific quantity of Codeine Phosphate mentioned therein, directing that the quota allocated should be lifted from Ghazipur/Neemuch factory before a specified date. On receipt of such allocation orders, Biodeal would request the Sub-Inspector, Prohibition & Excise (hereinafter referred to as “Officer in-charge”) to issue indent to the Government Opium and Alkaloid Works. The Officer in- charge issues indents under rule 30 of the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956 (hereinafter referred to as “the M & T Rules”) in the prescribed Form No.ID-1, which is also countersigned by a representative of Biodeal. Biodeal also obtains authorization for the inter-provincial import of manufactured drugs into the State of Gujarat from the Superintendent of Prohibition and Excise. On submission of the above, the Government Opium and Alkaloid Works, Neemuch/Ghazipur hands over the specified quantity of Codeine Phosphate I.P. in a sealed container to Biodeal's representative for being transported from the said Works to Biodeal's factory at Surendranagar, Gujarat, where the same is handed over to the Officer in-charge to be kept in his custody. To enable Biodeal to possess the manufactured drug, namely, Codeine Phosphate I.P., Biodeal is required to obtain licence from the Superintendent, Prohibition & Excise and is also required to keep the accounts of the manufactured drug received, sold and held in stock.
6.10 It was pointed out that Biodeal's manufacturing premises are a bonded manufactory. Therefore, as stipulated in rules 22 and 23 of the M & T Rules, there is only one entrance to the said bonded manufactory and one door to each of its compartments and all the doors are secured with excise ticket locks during the absence of the Officer in-charge. The consignment of Codeine Phosphate I.P. received under bond from the Government Opium and Alkaloid Works is verified in volume and strength and the receipt thereof is entered in Form No.RG-2 Register. Biodeal maintains Form No.RG-2 Register in accordance with rule 27 of the M & T Rules. Every receipt of Codeine Phosphate recorded in RG-2 Register is signed by the Manager Excise (accused No.14) and the Officer in-charge, appointed by the Prohibition and Excise Department, who is present all throughout in the bonded manufactury of Biodeal. The received quantity of Codeine Phosphate is stored in a Strong Room (Spirit Store), as defined under rule 2(xii) of the M & T Rules which is in exclusive charge of the Officer in-charge. Codeine Phosphate is issued from the Spirit Store to the Laboratory of Biodeal on requisition made in Form No. RQ-1 to the Officer in-charge, in such quantities which are in conformity with the formula of the Codokuff Cough Linctus, displayed on the label of the container in the manner prescribed in the Drugs and Cosmetic Rules, 1943. Every quantity which is released from the Spirit Store pursuant to the requisition made vide Form No.RQ-1, is recorded in RG-2 as expended quantity, and the balance stock is also recorded in RG-2. At the time of release of such quantity, recording is made in RG-2 Register and is signed by the accused No.14 and the Officer in-charge. All the material which is issued by the Officer in-charge from the Spirit Store is added to the other material, namely, Chlorpheniramine Maleate I.P., Sugar (Food Grade), Chloroform I.P., Caramel I.P. (Beer Grade), Citric Acid (Monohydrate) I.P., Banana Flavour, Methyl Paraben I.P., Propyl Paraben I.P., Purified Water I.P. etc. in the presence of Officer in-charge, to manufacture Codokuff Cough Linctus in accordance with and as required by rule 29 of the M & T Rules. Upon manufacture of Codokuff Cough Linctus, it is registered in the RG-3 Register and bears a distinctive serial number, called the batch number. This RG-3 Register maintained by Biodeal also shows the receipt and disposal of Codeine Phosphate issued to Biodeal's laboratory from the Spirit Store by the Officer in-charge and the quantity of the finished Codokuff Cough Linctus manufactured from such Codeine Phosphate, by Biodeal. The RG-3 Register maintained by Biodeal is signed by the accused No.14 and the Officer in-charge in respect of each batch number manufactured by Biodeal. A label is attached on the manufacturing vessel for manufacture of the seized medicine, showing requisite particulars as per rule 32 of the M & T Rules and such labels are signed by the Chemist in-charge, accused No.13 and the Officer in-charge. On completion of production/manufacture of each batch of Codokuff Cough Linctus, but before the syrup is bottled, Biodeal is permitted to take a sample. Such samples, batch wise, were analyzed in Biodeal's laboratory which is approved by Foods and Drugs Control Administration, Gujarat. It was pointed out that all batch-wise analysis reports are found within the limits prescribed by the Foods and Drugs Control Administration and such reports are given to the Officer in-charge. Codokuff Cough Linctus is manufactured in a continuous process and packed in bottles of 100 ml or 50 ml and sealed and then stored in Finished Stores after being accounted for in the RG-4 Register which is signed by the accused No.14 and the Officer in-charge, from time to time. It was submitted that the copies of RG-2, RG-3 and RG-4 registers are in the possession of the complainant and there is not even an iota of allegation, much less evidence, of any complicity of the Officer in-charge or that the Officer in-charge is involved in any conspiracy. It was argued that considering the procedure which is required to be carried out, it is not possible to divert any of the Codeine Phosphate unless there is complicity of the Officer in-charge, whereas in the facts of the present case, not only is there no allegation against the Officer in-charge, but he is not even shown as a witness. The attention of the court was drawn to the list of witnesses annexed at page 65 of Paper-Book-I furnished along with the petition, to point out that all the witnesses are persons stationed at Shillong and Guwahati and that the neither the Officer in-charge, nor is any witness from the place where the alleged offence has taken place, namely, at Wadhawan, Surendranagar, is named as witness in the said proceedings.
6.11 The learned counsel next submitted that the official records which are in the custody of the Officer in-charge and are also countersigned by him, clearly show full and accurate utilization of Codeine Phosphate. Therefore, there cannot be any presumption of underutilization of Codeine Phosphate merely on the basis of the FSL reports which the petitioners have denied. It was submitted that the Codeine Phosphate is at all times in the custody of the Officer in-charge in the Strong Room and the entire manufacturing process from the stage of withdrawal of Codeine Phosphate from the custody of the Officer in-charge for the purpose of manufacture, till the final packing of the bottles, is done, in the presence of the Officer in- charge. It was submitted that there is no allegation of the complainant having found any stock of Codeine Phosphate during their search at the manufacturing facilities by Biodeal at Surendranagar, nor has any quantity of Codeine Phosphate been recovered from the premises or person of any of the accused. Under the circumstances, in the absence of any evidence of diversion, merely on the basis of presumption of diversion, which is not permissible in law, there cannot be any conviction of the accused and as such, the complaint deserves to be quashed.
6.12 It was emphatically argued that the complainant has got the sample of Codokuff Cough Linctus analyzed by the FSL, at Guwahati. Admittedly, Codokuff Cough Linctus is a patented and proprietary medicine and not a narcotic drug. Being a patent and proprietary medicine, the applicable provisions would be of the Drugs & Cosmetics Act and the Rules made thereunder and therefore, Biodeal was required to provide the method of analysis, which it did at the time of applying for permission to manufacture the medicinal preparation and also during the course of investigation leading to the complaint in question. Reference was made to the provisions of section 80 of the NDPS Act to submit that the same contemplates that the provisions of the NDPS Act and the Rules made thereunder are to be in addition to and not in derogation of, the Drugs and Cosmetic Act, 1940 and the rules made thereunder. It was argued that while the Central Government is entitled to make rules for drawing and testing of samples under section 76 of the NDPS Act, no such rules for testing of Codeine Phosphate and particularly, for testing of Codeine Phosphate as an integral part of a medicinal preparation have been framed. In the absence of such rules and in the light of section 80 of the NDPS Act as well as in view of the provisions of the Drugs and Cosmetics Rules, coupled with the necessity to test the medicinal preparation only in the manner provided by the manufacturer, who alone is aware of the composition of the medicinal preparation and the extent of its various ingredients, Codokuff Cough Linctus could and should have been tested only in terms of the provisions of the Drugs and Cosmetics Act and not by the FSL. It was argued that the FSL is not competent to test and analyze medicinal preparations which contain various ingredients, one of which may be a narcotic substance. That mere use of equipment like HPCL by itself does not ensure the correctness of the analysis report. HPCL is merely an equipment and is not a method for carrying out analysis. Analysis of a patented and proprietary medicine can only be done if the composition thereof, including the extent of the presence of various ingredients and the manner of testing/assay is known. It was argued that it is only the authorities contemplated under the Drugs and Cosmetics Act being the Government Analyst or the Central Drugs Laboratory who have the requisite ability to test and analyze medicinal preparations, and who can issue a credible report.
6.13 The next contention advanced by the learned counsel for the petitioners was that at the time when the samples were first collected on 21.7.2005, it was on a suspicion that the medicinal preparation was being abused as a narcotic drug. In other words, the complainant expected the medicinal preparation to contain excessive Codeine Phosphate. However, the first FSL report which was available on 10.08.2005 indicated that the percentage of Codeine Phosphate was less than what was prescribed. It was submitted that once it was found that the sample seized was not a narcotic drug, there was no satisfaction for carrying out searches on 13.08.2005 and 28.09.2005, inasmuch as “no reason to believe” existed in terms of section 42(1) of the NDPS Act for the subsequent searches. It was argued that if the subsequent search and seizure are by themselves bad, the complaint based upon such search and seizure would also be bad in law.
6.14 It was, accordingly, submitted that the entire charge of diversion is based upon arithmetic calculation and as such, cannot be proved. Reliance was placed upon the decision of the Supreme Court in the case of R. P. Kapur v. State of Punjab, AIR 1960 SC 866, wherein the court has laid down various criteria for exercise of inherent jurisdiction of the High Court for quashing proceedings, one of which is the category wherein the allegations made against the accused persons do constitute the offence alleged, but there is no legal evidence adduced in support of the case or the evidence adduced clearly or manifestly fails to prove the charge, to submit that the present case squarely falls within the said class. It was, accordingly, urged that no offence as alleged having been made out on the allegations made in the complaint, the same is required to be quashed and set aside.
6.15 As regards the allegations made against Cadila, the learned counsel submitted that Cadila merely buys the product which is manufactured by Biodeal on its behalf. Cadila does not buy any of the Codeine Phosphate which is used for the purpose of manufacture of Codokuff Cough Linctus. Under the circumstances, it is incomprehensible as to how the provisions of sections 21, 27-A and 29 of the NDPS Act are invoked against Cadila. It was submitted that insofar as Cadila is concerned, the main allegation in the complaint is of purchase of bottles of Codokuff Cough Linctus, which is to the effect that it has purchased bottles of Codokuff Cough Linctus and sent large quantities of the same to Assam. It was submitted that purchase of Codokuff Cough Linctus and sending the same to Assam would not amount to finance for the purpose of diversion for illicit purposes. Cadila may be marketing the goods for selling the same in Assam, but that is not the allegation against it. There is also no allegation that there is a conspiracy to sell the goods at Agartala. According to the learned counsel, merely buying Codokuff cough linctus from Biodeal and sending large quantities thereof to the eastern states would not amount to conspiracy to divert Codeine Phosphate. It was pointed out that there is no allegation in the complaint to the effect that the whole activity was done to market the goods in Assam with a view to divert Codeine Phosphate. Moreover, insofar as the alleged offences are concerned, the conspiracy alleged has to be for diversion of Codeine Phosphate and not sale of the cough linctus. It was urged that Cadila is not a party to the purchase, storage or use of Codeine Phosphate and that it only buys the manufactured goods, namely, Codokuff Cough Linctus and sells the same. In support of his submission, the learned counsel placed reliance upon the decision of the Supreme Court in the case of P. K. Narayanan v. State of Kerala, (1995) 1 SCC 142, for the proposition that the ingredients of the offence of criminal conspiracy are that there should be an agreement between the persons who are alleged to conspire and the said agreement should be for doing an illegal act or for doing by illegal means an act which by itself may not be illegal. Therefore, the essence of criminal conspiracy is an agreement to do an illegal act and such an agreement can be proved either by direct evidence or by circumstantial evidence or by both and it is a matter of common experience that direct evidence to prove conspiracy is rarely available. Therefore, the circumstances proved before, during or after the occurrence have to be considered to decide about the complicity of the accused. But if those circumstances are compatible also with the innocence of the accused persons, then it cannot be held that the prosecution has successfully established its case. An offence of conspiracy cannot be deemed to have been established on mere suspicion and surmises or inferences which are not supported by cogent evidence. It was argued that assuming that all the allegations are correct, the same still does not result in a conspiracy to divert the goods.
6.16 In conclusion, it was submitted that on the allegations made in the complaint, no offence as alleged can be stated to have been made out and as such, in the light of the settled legal position, as held by the Supreme Court in the case of, State of Haryana v. Bhajan Lal, 1992 Supp (1) SCC 335, the complaint in question is required to be quashed.
7. Vehemently opposing the petition, Mr. H. C. Buch, learned Standing Counsel for the respondent submitted that the petitions have been filed before this court under Article 226 of the Constitution of India praying for quashing a criminal case filed before the Sessions Court, Kamrup, Guwahati as well as the order passed by the Special Court issuing summons to the accused. It was submitted that the complaint at Guwahati was maintainable and the court has taken cognizance, hence this court will have no jurisdiction to quash the complaint under Article 226 of the Constitution of India as the court at Guwahati would not be subordinate to this court. Under the circumstances, the question that arises for consideration is as to whether this court would entertain the petitions, especially when the complaint is lodged at Guwahati after completion of investigation done by the Customs, Shillong and the Special Court has taken cognizance and issued summons to the accused and as to whether the court would consider the defenses raised by the petitioners in the present petitions filed for quashing the complaint.
7.1 It was submitted that the complaint having been lodged in the Special Court, at Guwahati and the order issuing process against the petitioners having been passed by the learned Special Judge, at Guwahati, this court does not have the territorial jurisdiction to entertain any petition for quashing the said complaint and/or the order passed by the Special Court. It was argued that the contention of the petitioners that the cause of action to lodge the complaint has wholly arisen within the territorial jurisdiction of this court and as such the petitions would be maintainable is fallacious. It was submitted that investigation had been made as the demand of the cough linctus at Tripura was disproportionate to its population. While making inquiry it was found that there is diversion of legally procured Codeine Phosphate for illicit use. Thus it was at Guwahati where the offence of diversion was disclosed. Therefore, the court at Guwahati also has jurisdiction and where the complainant could have legitimately lodged the complaint.
7.2 It was submitted that the cause of action for making a complaint at a particular place is different from the cause of action for filing of a petition for quashing of that complaint. Therefore, even if the said complaint is wrongly filed at Guwahati, it is only the High Court at Guwahati which will have the jurisdiction to decide the issue as the cause of action for filing such a petition for quashing the complaint in question would arise only in Guwahati and not at all the places where parts of cause of action for filing the complaint may have arisen. Strong reliance was placed upon the decision of this court in the case of Rahul Gupta s/o Babulal Gupta v. Shalini Agarwal, Under Secretary, State of Rajasthan, 2009 (3) GLR 214,8 for the proposition that the cause of action for filing a criminal complaint is different from the cause of action for filing a petition for quashing the complaint. According to the learned counsel, the cause of action for filing a petition for quashing the complaint would arise only at Guwahati as the supervisory jurisdiction of this court does not extend to the court of the learned Sessions Judge at Kamrup in Assam.
7.3 It was further submitted that the decision of the Supreme Court in the case of Navinchandra N. Majithia v. State of Maharashtra (supra), would not be applicable to the facts of the present case inasmuch as, in the said case, only a first information report was lodged at Shillong, whereas the cause of action for filing the said first information report arose in Mumbai. Whereas in the facts of the present case, the entire inquiry has been conducted by an officer under the Commissioner of Customs, Guwahati and thereafter, the complaint in the form of a police report has been filed in the Special Court, at Guwahati, pursuant to which cognizance of the complaint was taken by the said Special Court. Besides, during the course of the inquiry at Guwahati, none of the accused persons had at any point of time raised the issue of jurisdiction though they were well aware that the inquiry was being conducted with regard to underutilization and diversion of Codeine Phosphate. In fact, most of the accused persons had remained present at the time of the inquiry after they were granted anticipatory bail by the High Court at Guwahati.
7.4 It was submitted that in any case, the above referred decision of the Supreme Court in the case of Navinchandra N. Majithia v. State of Maharashtra (supra) was considered by this Court in the case of Rahul Gupta s/o Babulal Gupta v. Shalini Agarwal, (supra), which decision of the learned Single Judge still holds the field and is binding upon the Co-ordinate Bench in view of the decision of the Supreme Court in the case of Sombhai Madhubhai v. New Shorrock Mills, (1983) GLR 273. It was submitted that even if this court does not agree with the view taken by another learned Single Judge in the case of Rahul Gupta s/o Babulal Gupta v. Shalini Agarwal, (supra), the only course open to the court is to refer the matter to a Larger Bench. It was submitted this court in various other cases involving a similar issue have taken a similar view. Attention was invited to the decision of this court in the case of Sanjeev Rajendrabhai Bhatt v. State of Gujarat in Special Criminal Application No.6 of 1998 and Special Criminal Application No.24 of 1998, rendered on 9.7.2008, wherein the court observed that what was challenged before the court was essentially a judicial order made by the learned Chief Judicial Magistrate at Pali, Rajasthan in respect of which, summons was served upon the petitioners therein as a result of police investigation made pursuant to the said order. The court held that as the court of the learned Magistrate at Pali being situated beyond the limits of the territorial jurisdiction of this High Court, this court has no jurisdiction to examine the correctness or otherwise of the said order. It was pointed out that the said decision of this court has been confirmed by a Division Bench in the judgement reported in 1999 (1) GLH 47. Reliance was also placed upon a decision of this High Court in the case of Rajendra J. Damani v. State of Gujarat (supra), to submit that the said decision also supports the contention of the respondents on the question of territorial jurisdiction. It was argued that it is incorrect on the part of the petitioners to contend that the said decisions are prior to the decision of the Supreme Court in the case of Navinchandra N. Majithia v. State of Maharashtra (supra) in view of the fact that it has been a consistent view of this court, before as well as subsequent to the said decision of the Supreme Court, and as such this court would not exercise jurisdiction to quash the complaint which is lodged outside its territorial jurisdiction. Reliance was also placed upon the decision of the Calcutta High Court in the case of Upasana Finance Limited v. S. N. Bagla & Company & others, 2006 Cr.L.J. 833, the decision of a Full Bench of the Kerala High Court in the case of Mrs. Meenakshi Sathish v. M/s Southern Petrochemical Industries and others, 2007 Cr.L.J. 2250, as well as the decision of the Madras High Court in the case of V. Subramanian v. Union of India, reported in MANU/TN/4233/2011 for the proposition that the High Court will not quash the complaint if it is lodged outside its territorial jurisdiction. It was submitted that the said decisions have also been rendered after considering the decision of the Supreme Court in the case of Navinchandra N. Majithia v. State of Maharashtra (supra).
7.5 Reference was made to the decision of the Supreme Court in the case of Rajendra Ramchandra Kavalekar v. State of Maharashtra and another, (2009) 11 SCC 286, to submit that while considering almost similar circumstances, the court had held that when the cause of action arose within the jurisdiction of a court, investigation was completed within the jurisdiction of that court and all the records and documents pursuant to the complaint and charge sheet are before the said court, the High Court in a different State was perfectly justified in declining to entertain the writ petition filed by the accused. It was further contended that it is not permissible for the petitioners to contend that the Special Court, at Guwahati did not have the jurisdiction to entertain the complaint as the petitioners have not approached the Special Court, at Guwahati raising the contention about lack of territorial jurisdiction. In support of such submission, the learned counsel placed reliance upon the decision of the Supreme Court in the case of Krishna Kumar Variar v. Share Shoppe, 2010 Cr.L.J. 3848, wherein the court had held that in cases where the accused or any other person raised an objection about jurisdiction, the said person should file an application before the concerned trial court making this averment and giving the relevant facts. Hence, instead of rushing to the High Court against the summoning order, the concerned person should approach the trial court with a suitable application for this purpose and the trial court should after hearing both the sides and recording evidence, if necessary, decide the question of jurisdiction before proceeding further with the case. It was, accordingly, urged that instead of rushing to this court against the summoning order, the petitioners ought to have approached the learned Special Judge. That as the petitioners have not raised any objection with regard to territorial jurisdiction of the Special Court, at Guwahati to try the case before the said court, the present petition may not be entertained.
7.6 As regards the contention relating to sections 117 and 178 of the Code, it was submitted that the same is fallacious. It was argued that the provisions contained in Chapter XIII of the Code are to be harmoniously read and considered. Sections 178 and 179 of the Code are not exceptions to section 177 of the Code. Hence, over and above the place where the offence is committed, the court within whose jurisdiction one of the several acts has been done also will have jurisdiction. It was argued that the court within whose jurisdiction the consequences have ensued also shall have jurisdiction to try such offence.
7.7 Adverting to the facts of the present case, it was submitted that the act of underutilization of Codeine, which is a narcotic drug, is a part of the offence which was committed in Surendranagar. The accused persons in connivance with each other have underutilized Codeine while manufacturing a huge stock of cough linctus and have sent such stock to Guwahati for onward dispatch to Tripura and Bangladesh where the said drug is used as an alternate narcotic drug. Such act of sending huge stocks of cough linctus (containing less than the prescribed quantity of Codeine Phosphate) to Guwahati had been disclosed before the respondent at Guwahati and the entire inquiry had been carried out at Guwahati. Moreover, the entire amount of Codeine Phosphate proportionate to the stock of cough linctus sent to Guwahati should have come to Guwahati in the bottles of cough linctus. However, on account of underutilization of Codeine Phosphate in the manufacture of the Codokuff Cough Linctus, which itself is an offence, such amount of Codeine Phosphate had not reached Guwahati in the bottles of cough syrup. Therefore, at this stage, it can certainly be said that the consequences of underutilization of Codeine Phosphate had ensued in Guwahati.
7.8 Attention was invited to section 180 of the Code, which bears the heading “Place of trial where act is an offence by reason or its relation to any other offence” and lays down that where an act is an offence by reason of its relation to any other act which is also an offence or which would be an offence if the doer were capable of committing an offence, the first- mentioned offence may be inquired into or tried by a Court within whose local jurisdiction either act was done. It was submitted that in the facts of the present case, the underutilization itself is an offence and sending the bottles containing underutilized Codeine to Guwahati and selling the same at Guwahati is also an offence. Even if it were assumed that the sale of cough syrup containing less quantity of Codeine Phosphate would not be an offence under the NDPS Act, the same would still be an offence under the Drugs Act and as such, in the light of the provisions of section 180 of the Act, the Court at Kamrup would have the jurisdiction to entertain the complaint. It was, accordingly, submitted that the contention that no part of the cause of action has arisen in Guwahati, is incorrect. According to the learned counsel, if the Court at Guwahati had jurisdiction to receive the complaint, it would not be open for this Court to exercise its jurisdiction to quash such a complaint which is validly lodged at Guwahati.
7.9 The learned counsel next submitted that the provisions of Chapter XIII of the Code have to be liberally interpreted as has been done by the Supreme Court in various decisions. Reliance was placed upon the decision of the Supreme Court in the case of State of Punjab v. Nohar Chand, 1984 Cr.L.J. 1153, wherein the Court had held that manufacture of sub-standard fertilizer is to be tried along with those who marketed the substandard fertilizer manufactured by him as its agent. The Court, where the substandard fertilizer was found to be marketed, will have the jurisdiction to try the manufacturer of substandard fertilizer even if the manufacturing activity is entirely at a different place. Manufacturing substandard fertilizer by itself is an offence and marketing the substandard fertilizer itself a distinct offence, but they are so interconnected as cause and effect both can be tried at one or the other place. It was submitted that the above referred decision would be squarely applicable to the facts of the present case. Reliance was also placed upon the decision of the Supreme Court in the case of Harbans Lal v. State of Haryana, (1998) 8 SCC 319. In the facts of the said case a criminal proceeding had been initiated against the appellant therein pursuant to the complaint filed by the Deputy Collector of Customs and Excise, Chandigarh. The appellant approached the Punjab and Haryana High Court for getting the same quashed. As his contention that the court at Ambala had no jurisdiction to try that criminal case filed against him was not accepted by the High Court and his application came to be dismissed, the appellant filed the appeal before the Supreme Court. The contention of the appellant was that the alleged offence as stated in the complaint took place somewhere between Rohtak and Delhi and therefore the Court of the Special Judicial Magistrate, Ambala, could have no jurisdiction to try that offence. Having gone through the complaint, the Supreme Court found that the main allegation against the appellant and other accused was that in pursuance of the conspiracy between them gold was transported from Pakistan to the place near Bahadurgarh in Haryana. It was further stated therein that the goods had passed through Amritsar, Rohtak and then to Bahadurgarh. It prima facie appeared to the court that the goods had passed through Ambala also. Therefore, the Ambala court would have jurisdiction to try the offence as carrying of smuggled goods is also an offence. The court accordingly held that the High Court was right in dismissing the application filed by the appellant.
The learned counsel argued that the offences under the provisions of the Drugs Act are presently not alleged against the applicants. But the fact remains that the cough syrup manufactured and marketed by the petitioners contained less quantity of Codeine Phosphate. Under the circumstances, as the full quantity of Codeine Phosphate which should have reached Guwahati in the cough linctus has not reached Guwahai, the Court at Guwahati is not denuded of its jurisdiction from trying the accused especially when conspiracy is also alleged.
7.10 The decision of the Supreme Court in the case of Lee Kun Hee v. State of U. P., 2012 (2) SCALE 152, was cited for the proposition that the courts within whose local jurisdiction the repercussion/effect of the criminal act occurs would have jurisdiction in the matter. It was argued that the contention raised by the petitioners that the diversion has taken place only in Wadhwan and that the offence is complete at Wadhwan and that the unutilized stock of Codeine is not found, is erroneous. It was submitted that the act of underutilization is one of the several acts which have been committed by the accused, the effect of which has ensued at Guwahati. It was submitted that the quantity of Codeine Phosphate in the cough syrup was determined on the basis of the FSL report which is conclusive of the fact that there is underutilization of Codeine. That the explanation offered by the accused based on the stock register of receipt and use of Codeine Phosphate has prima facie been found to be false. Therefore, the said contention also does not merit acceptance. Alternatively, it was submitted that if the court comes to the conclusion that the offence took place only at Surendranagar, and therefore, the complaint should not have been filed at Guwahati, the course adopted by the court should be as held by the Supreme Court in the case of State of M. P. v. Suresh Kaushal, (2003) 11 SCC 126, namely, that instead of quashing the entire criminal proceedings, the case should be transferred to the Court which is vested with jurisdiction.
7.11 On the merits of the case, it was submitted that the petitioners are not justified in contending that underutilization is based on arithmetical computation based on the FSL reports is erroneous. It was argued that voluminous evidence has been collected from several accused and during the inquiry it has been revealed that 67% out of the total production was sent to Guwahati and 70% of the goods for sale were sent to Tripura. In support of the said contention, the learned counsel drew the attention of the court to the facts stated in paragraph 12 of the complaint. It was submitted that the cough linctus was sent in excess of the State's actual requirement, indicating illegal export to Bangladesh, where cough formulations containing Codeine Phosphate are popular as alternative narcotic drugs. It was submitted that though the accused persons have accounted for the use of Codeine Phosphate acquired from the Government agencies in their stock register, out of the total 30 samples of cough linctus which were sent for analysis to the FSL, in all the batches, it was found that there was underutilization of Codeine Phosphate. The said underutilized quantity has not been reflected/re-entered in the stock register giving reasonable cause to believe that the total quantity of 82.338 kgs of Codeine Phosphate has been diverted illegally instead of being used for medicinal purposes. Thus, the conclusion that the Codeine Phosphate to the extent of the underutilization thereof, has been illegally diverted for illicit purposes can never be termed as an arithmetic computation especially when the same is based on the report of analysis done by the FSL, Guwahati.
7.12 Dealing with the contention that the samples of cough syrup could not have been tested by the FSL, at Guwahati, it was contended that in the present case, the analysis was done by Dr. D. J. Hazarika, Scientific Officer, Drugs & Narcotics Division, FSL, Assam. During the course of inquiry, it was revealed that the analysis was done by adopting HPLC method for identification and estimation of constituents and all steps were taken to eliminate any error during analysis. In this regard, reference was made to the communication dated 22.11.2005 addressed by Dr. D. N. Deka, Senior Scientific Officer, Drugs & Narcotic Division, FSL, Assam to the Superintendent (Headquarters, Customs Preventive Unit), at page 301 of Paper Book No.I. It was submitted that the inquiry also revealed that the Drugs & Narcotic Division of FSL, Guwahati, where the analysis had been done is equipped with state of art equipments and, over and above other methods, HPLC method is also adopted to do analysis. The Scientists involved in the analysis are trained in the field of analysis of drugs and any problem relating to analysis and interpretation of drugs are often referred to the FSL, Guwahati from different parts of the country.
7.13 It was argued that the accused persons, in their statements, have admitted that they have got their medicinal drug, viz. Codokuff Cough Linctus analyzed through the HPLC method. Moreover, the assay contained in the method of analysis given by the manufacturer – Biodeal specifically stated that HPLC method is required to be followed for the purpose of analyzing the drug. Attention was invited to the certificate issued by the FSL, Guwahati (at page 301 of the paper book), to submit that it is the same method by which the analysis has been conducted. Attention was also invited to the provisions of section 80 of the NDPS Act, which postulates that the provisions of the said Act or the Rules made thereunder shall be, in addition to and not in derogation of the Drugs & Cosmetic Act, 1940 or the Rules made thereunder. It was submitted that when the FSL, Guwahati has trained Drug Analysts, who have done the analysis on the basis of the method of analysis provided in the assay of manufacture, it is not permissible for the petitioners to contend to the contrary.
7.14 The learned counsel vehemently contended that underutilization of Codeine Phosphate has been prima facie established. The allegation of diversion has strong evidence on the basis of the documents supplied by the manufacturer himself which are more particularly discussed in paragraphs 12 and 13 of the complaint. Thus, there is no substance in the contention of the petitioners that there is no evidence of diversion. In fact, the procurement of a particular quantity of Codeine Phosphate is admitted. The utilization of the said stock is admitted in the stock register and the underutilization in 67% of the stock manufactured is evident from the analysis performed by the experts. Referring to the provisions of section 54 of the NDPS Act which bears the heading “Presumption from possession of illicit articles”, and postulates that in trials under the said Act, it may be presumed, unless and until the contrary is proved, that the accused has committed an offence under Chapter IV, inter alia, in respect of any narcotic drug or psychotropic substance, it was submitted that in view of the said provision, it is for the accused persons to satisfactorily prove the procurement and proper utilization of the Codeine Phosphate.
7.15 The next contention advanced by the learned counsel for the respondent was that the submission of the petitioners that diversion is not possible as the stock of Codeine Phosphate remains in the possession of the Sub-Inspector of Prohibition and Excise Department, is also without any substance. It is a matter of fact that underutilization of huge stock of Codeine Phosphate has been found and no explanation is coming forth except for raising doubts as regards the FSL reports. It was submitted that the inquiry further revealed that the actual diversion could be by various modes. Even after the Codeine Phosphate is mixed with the other contents in the bottle, it is very easy to retrieve the same. Referring to the opinion of the FSL, Guwahati as well as RRL, Jorhat, it was submitted that it is possible to retrieve Codeine Phosphate from cough syrup formulations. It was, accordingly, urged that thus, it is very difficult for the Sub-Inspector of Prohibition and Excise Department to maintain and manage the process of manufacture.
7.16 It was urged that the ingredients of the offences alleged are clearly made out on the allegations made in the complaint. The principal offence under section 8(c) of the NDPS Act is clearly constituted and made out against the accused persons as they were in possession of Codeine Phosphate. It was submitted that in violation of the licence and permit to use the said Codeine Phosphate, the accused persons underutilized the same and diverted the said stock of underutilization Codeine Phosphate. It was submitted that under the NDPS Act the term “use” is defined to mean any kind of use except personal consumption. Under the circumstances, the contention that “diversion” is not provided as an offence, is erroneous. Reliance was placed upon the decision of the Supreme Court in the case of Mohd. Malek Mondal v. Pranjal Bardalai, (2005) 10 SCC 608, for the proposition the wide extraordinary power of quashing vested in the High Court is to be exercised sparingly and with caution and not to stifle legitimate prosecution. Such power is required to be exercised in a case where the complaint does not disclose any offence and it is frivolous, vexatious or oppressive. At that stage, there cannot be meticulous analysis of the case. The decision of the Supreme Court in the case of Onkar Nath Mishra v. State (NCT of Delhi), (2008) 2 SCC 561, was cited for the proposition that at the stage of framing of charge required the court is required to evaluate the material and documents on record with a view to finding out if the facts emerging therefrom, taken at their face value, disclosed the existence of all the ingredients constituting the alleged offence. At that stage, the court is not expected to go deep into the probative value of the material on record. What needs to be considered is whether there is a ground for presuming that the offence has been committed and not a ground for convicting the accused has been made out. At that stage, even strong suspicion founded on material which leads the court to form a presumptive opinion as to the existence of the factual ingredients constituting the offence alleged would justify the framing of charge against the accused in respect of commission of that offence. The learned counsel submitted that prima facie, the fact of underutilization of the narcotic drug and sending huge stock to the North-Eastern States with full knowledge that it being used as an alternate to narcotic drugs has been established, which is sufficient for framing of charge and therefore, the present petition is required to be dismissed on this ground also. It was also contended that the conduct of the petitioners also disentitles them from being granted any relief under Article 226 of the Constitution of India inasmuch as, immediately upon coming to know of the inquiry by the respondent on 21.7.2005, directions were issued by FAX to the C & F Agent of the agents to transfer 2,14,000 bottles of cough syrup to the Patna Depot. It was submitted that considering the fact that the accused persons are charged with serious offences under the NDPS Act, the extraordinary power under Article 226 of the Constitution of India may not be exercised and that the petition be dismissed at this stage.
8. In rejoinder, Mr. M. H. Thakore, learned counsel for the petitioners submitted that in the present case, no part of the cause of action has arisen at Assam. Though it is true that the suspicion that the quantity of Codeine Phosphate used in the manufacture of Codokuff cough linctus is less than the prescribed amount did take place at Assam, however, no part of the cause of action had arisen at Assam, and as such, the complaint could not have been filed in the Court at Kamrup. It was further submitted that the product in question, namely, Codokuff Cough Linctus is a medicinal drug is not a narcotic drug. Under the circumstances, even if the entire stock of such product is sent to Tripura, the same would not constitute any offence. Thus, insofar as the State of Assam is concerned, neither is the drug manufactured within its territory, nor has any diversion taken place within the said State and as such, it is only the Court at Surendranagar which has jurisdiction to entertain the complaint in question. Referring to the provisions of sections 177, 178 and 179 of the Code, it was submitted that there is no uncertainty as regards the place where the cause of action has arisen. No part of the cause of action has arisen at Assam, nor is the offence a continuing offence. It was submitted that for the purpose of invoking section 178 of the Code, either the place where the offence is committed should be uncertain which is not so in the present case, or the offence should be committed partly in one local area and partly in another. In the facts of the present case, the entire cause of action in respect of the alleged offence has arisen within the State of Gujarat and not partly within the State of Gujarat and partly within the State of Assam. The offence is also not a continuous offence as contemplated under clause (c) of section 178 of the Code. Insofar as clause (d) thereof is concerned, the offence should consists of several acts done in different local areas, in which case, some part of the acts should have been committed within the jurisdiction of the Courts at Assam, which is also not satisfied in the facts of the present case. It was submitted that as regards section 179 of the Code, no consequence of underutilization has ensued at Assam. The decisions on which reliance has been placed by the learned counsel for the contesting respondents, would, therefore, not be applicable to the facts of the present case.
8.1 Insofar as the allegation that the petitioners could have retrieved the Codeine Phosphate from the medicinal preparation after manufacture thereof, the learned counsel submitted that such contention is preposterous, as it is not the case of the respondent that any equipment of other apparatus whereby the petitioners could have retrieved the Codeine Phosphate from the manufactured medicinal preparation has been found. Apart from that, the amount of Codeine Phosphate which is found to be less per bottle is a small amount. Hence, it is inconceivable that the petitioners would undertake the exercise of retrieving such small amounts of Codeine Phosphate from packed bottles of the cough linctus. Under the circumstances, such contention which does not find place in the complaint deserves to be rejected outright.
9. In the backdrop of the aforesaid facts and contentions, two questions mainly arise for consideration. The first question is as to whether this court has the jurisdiction to entertain the present petitions? If the answer to the first question is in the affirmative, then the next question that would arise for consideration is whether the complaint in question discloses any offence.
10. Since the question of jurisdiction is normally required to be decided as a preliminary issue, it would be necessary to decide the said issue first.
11. As noted earlier it has been contended on behalf of the respondent that this court has no jurisdiction to entertain the present petitions inasmuch as what is challenged in the petition is the order dated 8.6.2006 passed by the learned District & Sessions Judge, Kamrup, Guwahati, in Complaint Case No. Sessions Spl. 348(K) 05. According to the respondent the decision of the Supreme Court in the case of Navinchandra N. Majithia v. State of Maharashtra (supra) would not be applicable in the facts of the present case. For this purpose, the learned counsel has placed strong reliance upon the decision of a learned Single Judge of this court in the case of Rahul Gupta S/o Babulal Gupta v. Shalini Agarwal, Under Secretary, State of Rajasthan (supra).
12. Before referring to the law laid down in the various decisions of the Supreme Court as well as the High Courts on which reliance has been placed by the learned counsel for the respective parties, it may be germane to refer to the relevant facts touching the question of territorial jurisdiction. A perusal of the complaint shows that the complainant is an Inspector of Customs, posted in the Headquarter Customs Preventive Unit, Shillong, Office of the Commissioner of Customs, NER, Shillong, having jurisdiction over the entire North-Eastern Region under the NDPS Act and is empowered to investigate the offences under the NDPS Act for which purpose, a notification has been issued under section 53 of the NDPS Act. Intelligence was gathered by the officers of the Headquarters, Customs Preventive Unit, Shillong, to the effect that Codokuff Cough Linctus containing Codeine Phosphate manufactured by M/s Biodeal Laboratories Pvt. Ltd. and marketed by M/s German Remedies Ltd. are being abused as alternative narcotic drugs. The modus operandi adopted was to procure Codeine Phosphate from legal channel and diverting a part of it for illegal use by under-utilizing the narcotic substance in the said cough formulation. It was further gathered that most of this cough formulation is being sent to a few firms in Agartala, Tripura who send these to Bangladesh in small quantities through clandestine channels, where the cough formulation is used as an alternative narcotic drug. It appears that pursuant to such intelligence received, Officers of Customs, Headquarters Preventive Unit, Shillong, on 13.8.2005, searched the premises of M/s Well Care, the consignee agent of GRL for the north eastern region at Guwahati and seized 3,24,875 bottles, each bottle containing 100 ml of Codokuff Cough Linctus belonging to 30 different batches, under section 42 of the NDPS Act, 1985 on a reasonable belief that these cough formulations contain less Codeine Phosphate, indicating the huge diversion of legally acquired Codeine Phosphate for illicit use. The said bottles containing Codeine Phosphate are stated to be vital material evidence for the case. It appears that subsequently, on 28.9.2005, the Customs Officers lifted the remaining 1,41,875 bottles of Codokuff Cough Linctus. A total of 30 representative samples were drawn from all the 30 different batches of the seized cough formulation and were sent to the FSL, Guwahati, to ascertain the exact quantum of Codeine Phosphate in each 5 ml of the said cough formulation. It appears that the report received from the FSL indicated that the quantity of Codeine contained in each bottle was less than the prescribed quantity. On the basis of the reports of the FSL as well as on scrutiny of the stock records of the manufacturing unit, the customs authorities found that the stock of underutilized Codeine Phosphate as reflected in the chart prepared on the basis of the FSL reports was not found in the factory stock. Computing the quantity of underutilized Codeine Phosphate on the basis of the FSL report, the complainant concluded that a total quantity of 82.338 kgs of Codeine Phosphate was underutilized and diverted by Biodeal in manufacturing 30 batches of the product. He, accordingly, came to the conclusion that the quantity of Codeine Phosphate can be reasonably believed to have been diverted for illicit use in contravention of the provisions of the NDPS Act.
13. Thus, on reading the entire complaint, it appears that it is the case of the respondent that there is underutilization of Codeine Phosphate in the manufacture of Codokuff Cough Linctus. That huge quantity of Codokuff Cough Linctus is being sent to the north-eastern States from where, the same is illegally sent to Bangladesh, where it is abused as an alternative narcotic drug. On the basis of the FSL reports, which indicated that the quantity of Codeine Phosphate contained in the manufacture of Codokuff Cough Linctus was less than the prescribed quantity, the officers had come to the conclusion that there is underutilization and diversion of Codeine Phosphate for illicit use. Insofar as the State of Assam is concerned, the concerned officers have only seized bottles of Codokuff Cough Linctus and have got the same analyzed by the FSL laboratory and on the basis of its reports, have come to the conclusion that there is underutilization.
14. At this juncture, it may be germane to refer to certain statutory provisions. Section 2 of the NDPS Act is the definition section. Clause (xi) thereof defines “manufactured drug” to mean -
(a) all coca derivatives medicinal cannabis, opium derivatives and poppy straw concentrate;
(b) any other narcotic substance or preparation which the Central Government may, having regard to the available information as to its nature or to a decision, if any, under any International Convention, by notification in the Official Gazette, declare to be a manufactured drug, but does not include any narcotic substance or preparation which the Central Government may, having regard to the available information as to its nature or to a decision, if any, under any International Convention, by notification in the Official Gazette, declare not to be a manufactured drug.
14.1 Clause (xvi) defines “opium derivative”, inter alia, to mean -
(a) xxx
(b) xxx
(c) phenanthrene alkaloids, namely, morphine, codeine, thebaine and their salts;
14.2 Thus, codeine is an opium derivative. Opium derivative is included within the definition of “manufactured drug”. Clause (xiv) defines “narcotic drug” to mean coca leaf, cannabis (hemp), opium, poppy straw and includes all manufactured drugs. Thus, manufactured drugs are narcotic drugs within the meaning of the said expression as defined under the NDPS Act. However, under clause (xi) of section 2, manufactured drug does not include any narcotic substance or preparation which the Central Government may, having regard to the available information as to its nature or to a decision, if any, under any International Convention, by notification in the Official Gazette declare not to be a manufactured drug. In this regard, reference may be made to the Notification dated 14.11.1985 issued by the Central Government in exercise of powers conferred by sub-clause (b) of clause (xi) of section 2 of the NDPS Act, whereby the Central Government has declared certain narcotic substances and preparations not to be manufactured drugs. Clause (35) thereof reads as under:
“(35) Methyl morphine (commonly known as `Codeine') and Ethyl morphine and their salts (including Dionne), all dilutions and preparations, except those which are compounded with one or more other ingredients and containing not more than 100 milligrammes of the drug per dosage unit and with a concentration not more than 2.5 per cent in undivided preparations and which have been established in therapeutic practice.”
14.3 Thus, all dilutions and preparations of Codeine and its salts which are compounded with one or more other ingredients and contain not more than 100 milligrammes of the drug per dosage unit and with a concentration not more than 2.5 per cent in undivided preparations and which have been established in therapeutic practice stand excluded from the definition of manufactured drug. Under the circumstances, Codeine Phosphate contained in Codokuff Cough Linctus, which undisputedly is less than the dosage prescribed in the above notification is not a manufactured drug and as such would not fall within the definition of “narcotic drug” as contemplated under the NDPS Act. This finding finds support in the complaint itself wherein the respondent has categorically stated in paragraph 32.2 thereof that the investigation never disputed the facts that Codokuff Cough Linctus is a Scheduled - “H” drug, that it is not a “manufactured drug”, that it is a P & P medicine nor claimed that the medicine itself falls under the purview of the NDPS Act, 1985. According to the complainant, the investigation is all about legal procurement of Codeine Phosphate (a narcotic substance) for medicinal use and large- scale illegal diversion of the said narcotic substance without using the same for the purpose it was procured, thus, violating the provisions of section 8(c) of the NDPS Act, 1985.
15. Thus, insofar as the bottles of Codokuff Cough Linctus that have been seized by the respondent are concerned, the same do not fall within the purview of the NDPS Act inasmuch as, Codokuff Cough Linctus is a Schedule - “H” drug and is not a manufactured drug. The case of the respondent is that there is underutilization of Codeine Phosphate in the manufacture of Codokuff Cough Linctus, as a result of which, there is a diversion of Codeine Phosphate for illicit use.
16. Since, what has been seized in Guwahati are bottles of Codokuff Cough Linctus, which not being a narcotic drug, admittedly do not fall within the purview of the NDPS Act. The seizure of such cough formulation would, therefore, not constitute any part of the cause of action in respect of the alleged offence under the NDPS Act. What is alleged is that by underutilization, there is a diversion of Codeine Phosphate for illicit use. In this regard, it is apparent that the act of underutilization would have taken place at the place of manufacture, namely, at the factory of Biodeal at Wadhawan. Thus, the underutilization, if at all the same constitutes an offence, such offence has taken place at Wadhawan in Surendranagar. In case there is any diversion of Codeine Phosphate as alleged, such diversion would also have taken place at the place of manufacture. It is not the case of the respondent that any part of Codeine Phosphate so diverted, had travelled to Guwahati or any place within the State of Assam. What had taken place at Guwahati was the search with an intention to find out whether excess quantity of Codeine Phosphate was being used in the manufacture of the cough formulation which was being sent to the north-eastern States, where it was allegedly abused as an alternative narcotic drug. Under the circumstances, insofar as the underutilization as alleged or diversion is concerned, the same would have taken place at Surendranagar in Gujarat and not at Kamrup in Guwahati. Insofar as Guwahati is concerned, based upon the analysis of the cough formulation from the bottles seized by the authorities, it has been found that the quantity of Codeine Phosphate is less than prescribed quantity which, according to the respondent gives rise to a presumption that legally obtained Codeine Phosphate has been illegally diverted for illicit use. The offence alleged in the complaint is not of selling Codokuff Cough Linctus with less quantity of Codeine Phosphate. The offence alleged is of diversion of Codeine Phosphate for illicit use. Such diversion as noticed earlier, would have taken place only at the place of manufacture, viz., Wadhwan in Surendranagar.
17. In this regard, it may be germane to notice the provisions of the Code of Criminal Procedure, 1973 (hereinafter referred to as “the Code”) in relation to the question of territorial jurisdiction. Chapter XIII of the Code bears the heading “Jurisdiction of the criminal courts in inquiries and trials” and is comprised of sections 177 to 189. Section 177 of the Code bears the heading “Ordinary place of inquiry and trial” and lays down that every offence shall ordinarily be inquired into and tried by a court within whose local jurisdiction it was committed. Section 178 of the Code makes provision for “Place of inquiry or trial” and reads as under :
“178. Place of inquiry or trial. - (a) When it is uncertain in which of several local areas an offence was committed, or
(b) where an offence is committed partly in one local area and partly in another, or
(c) where an offence is a continuing one, and continues to be committed in more local areas than one, or
(d) where it consists of several acts done in different local areas, it may be inquired into or tried by a Court having jurisdiction over any of such local areas.”
17.1 Section 179 of the Code bears the heading “Offence triable where act is done or consequence ensues” and postulates that when an act is an offence by reason of anything which has been done and of a consequence which has ensued, the offence may be inquired into or tried by a court within whose local jurisdiction such thing has been done or such consequence has ensued.
18. The facts of the present case may be examined in the light of the above statutory provisions.
19. The Supreme Court in the case of Narumal v. State of Bombay (supra) held that section 177 provides that every offence shall ordinarily be inquired into and tried by a court within local limits of whose jurisdiction it was committed. The rule laid down by this section is one of general application and governs all criminal trials held under the provisions of the Code. It is true that section has used the word “ordinarily”, but it is not disputed that the said word means “except where provided otherwise in the Code”. Thus, in the light of the provisions of section 177 of the Code, an offence is ordinarily required to be inquired into by a court within whose local jurisdiction it was committed. In the facts of the present case, it is evident that the entire cause of action arose within the jurisdiction of the Court at Wadhawan in Surendranagar district. Under the circumstances, ordinarily the offence should be inquired and tried by a court at Wadhawan.
20. Section 178 of the Code provides for four situations where an offence can be inquired into or tried by a court having jurisdiction over a local area for determining the place of trial, firstly, where it is uncertain in which of several local areas an offence was committed, secondly, where an offence is committed partly in one local area and partly in another, thirdly, where an offence is a continuing one, and continues to be committed in more local areas than one, and lastly, where it consists of several acts done in different local areas . In the present case, as rightly contended by the learned counsel for the petitioners, section 178 would not come into play as none of the four situations arise inasmuch as, there is no uncertainty as regards the local area where the offence was committed; the offence in question is not committed partly in one local area and partly in another local area, nor is it a continuous one, nor does it consist of several acts done in different local areas so as to vest jurisdiction in any court other than the court situated at Wadhwan in Surendranagar.
21. As regards the applicability of section 179 of the Code, it was vehemently contended by the learned counsel for the respondent that the offence may have taken place at Surendranagar, however, the consequences ensued at Guwahati inasmuch as, the medicinal formulation in which Codeine Phosphate was underutilized has been sent to the North-Eastern States and as such, the Court at Kamrup has the jurisdiction to take cognizance of the offence in question. In this regard, it may be noted that insofar as Guwahati is concerned, the only act that has taken place there is that the bottles of Codokuff Cough Linctus, containing Codeine Phosphate in a quantity less than that mentioned in the label, have been sent to the consignee agent at Guwahati for sale in the north-eastern region. As discussed earlier, the Codokuff Cough Linctus is a Schedule “H” drug and not a manufactured drug. It is a P & P medicine and does not fall within the purview of the NDPS Act. The quantity of Codeine Phosphate contained in the cough formulation is less than the quantity mentioned in the above mentioned notification issued by the Central Government and as such, the Codeine Phosphate contained in the Codokuff Cough Linctus is not a manufactured drug and as a natural corollary is not a narcotic drug. Therefore, what is sent to Guwahati for the purpose of sale to the north-eastern States is not a manufactured drug falling within the purview of the NDPS Act. Under the circumstances, merely sending a large stock of bottles of Codokuff Cough Linctus containing less Codeine Phosphate than the quantity stated on the label to the north-eastern States, would not amount to an offence under the NDPS Act. Consequently, no part of the cause of action in respect of the offences alleged in the complaint can be stated to have arisen within the jurisdiction of the Court at Kamrup.
22. In the aforesaid background, the contentions as regards lack of jurisdiction on the part of this court may be examined.
23. Strong reliance has been placed by the learned counsel for the petitioners on the decision of the Supreme Court in the case of Navinchandra N. Majithia v. State of Maharashtra and others (supra). In the facts of the said case, the appellant was Managing Director of a company IFPL having its registered office at Mumbai. A company known as CEL entered into an agreement with the appellant for purchase of the entire shares of IFPL for which it paid earnest money. But CEL failed to fulfill its commitment to pay the balance purchase price within the specified time and therefore, the appellant terminated the agreement. CEL filed a suit against the appellant in the High Court of Bombay for specific performance of the agreement. Two shareholders of CEL took over management and control of the Company as Directors and they formed another company JBHL at Shillong in the State of Meghalaya. Later on the said suit was withdrawn upon the appellant's returning the amount paid by CEL which was earlier forfeited by the appellant. This fact was recorded in the consent terms filed in the suit. In pursuance of the agreement JBHL made payments towards purchase of shares of IFPL. But according to the appellant as JBHL committed default in making the balance payment and thereby committed breach of the agreement, the said agreement stood terminated and the earnest money stood forfeited as stipulated in the agreement. JBHL filed a complaint against the appellant at Shillong which was false and had been deliberately filed there with the mala fide intention of exerting pressure and causing harassment to him so as to get the transaction relating to transfer of shares reversed. According to the appellant, since the entire transaction upon which the complaint was purportedly based had taken place at Mumbai and not at any other place outside Mumbai, much less at Shillong or any other place in the State of Meghalaya, the complaint could not/ought not to have been entertained by the police at Shillong. It was contended that the jurisdiction, if any, to investigate/inquire into the contents of the complaint was with the police/courts in Mumbai and the action taken by the Special SP Police, CID, Shillong in entertaining the said complaint and in taking up investigation on the basis of the same was clearly oppressive, discriminatory and malafide. With the above averments the appellant filed a writ petition before the Bombay High Court praying inter alia (a) to quash the complaint lodged by JBHL or in the alternative to issue a writ of mandamus directing the State of Meghalaya to transfer the investigation being conducted by the officers of CID at Shillong to the Economic Offences Wing, General Branch of CID, Mumbai or any other investigating agency of the Mumbai Police, and (b) to issue a writ of prohibition or any other order or direction restraining the Special SP Police, CID, Shillong and/or any investigating agency of the Meghalaya Police from taking any further step in respect of the complaint lodged by JBHL with the police authorities at Shillong. The High Court dismissed the writ petition holding that it could not entertain the writ petition since the petitioner had prayed for quashing the complaint which was lodged by the complainant at Shillong.
23.1 The Supreme Court observed that from the provision in clause (2) of Article 226, it is clear that the maintainability or otherwise of the writ petition in the High Court depends on whether the cause of action for filing the same arose, wholly or in part, within the territorial jurisdiction of that Court. So far as the question of territorial jurisdiction with reference to a criminal offence is concerned, the main factor to be considered is the place where the alleged offence was committed. After referring to the provisions of sections 177, 178 and 179 of the Code, the court held that the High Court failed to consider all the relevant facts necessary to arrive at a proper decision on the question of maintainability of the writ petition, on the ground of lack of territorial jurisdiction. It was observed that the High Court based its decision on the sole consideration that the complainant had filed the complaint at Shillong in the State of Meghalaya and the petitioner therein had prayed for quashing the said complaint. The court observed that the High Court did not also consider the alternative prayer made in the writ petition that a writ of mandamus be issued to the State of Meghalaya to transfer the investigation to Mumbai Police. The High Court also did not take note of the averments in the writ petition that filing of the complaint at Shillong was a mala fide move on the part of the complainant to harass and pressurize the petitioners to reverse the transaction for transfer of shares. The relief sought for in the writ petition may be one of the relevant criteria for consideration of the question but cannot be the sole consideration in the matter. On the averments made in the petition, the court held that it cannot be said that no part of the cause of action for filing the writ petition arose within the territorial jurisdiction of the Bombay High Court. The court further held as follows:
“(43) We make it clear that the mere fact that FIR was registered in a particular State is not the sole criterion to decide that no cause of action has arisen even partly within the territorial limits of jurisdiction of another State. Nor are we to be understood that any person can create a fake cause of action or even concoct one by simply jutting into the territorial limits of another State or by making a sojourn or even a permanent residence therein. The place of residence of the person moving a High Court is not the criterion to determine the contours of the cause of action in that particular writ petition. The High Court before which the writ petition is filed must ascertain whether any part of the cause of action has arisen within the territorial limits of its jurisdiction. It depends upon the facts in each case.
(44) In the present case, a large number of events have taken place at Bombay in respect of the allegations contained in the FIR registered at Shillong. If the averments in the writ petition are correct then the major portion of the facts which led to the registering of the FIR have taken place at Bombay. It is unnecessary to repeat those events over again as Mohapatra, J. has adverted to them with precision and the needed details.
(45) In the aforesaid situation, it is almost impossible to hold that not even a part of the cause of action has arisen at Bombay so as to deprive the High Court of Bombay of total jurisdiction to entertain the writ petition filed by the petitioner. Even the very fact that a major portion of the investigation of the case under the FIR has to be conducted at Bombay itself, shows that the cause of action cannot escape from the territorial limits of the Bombay High Court.”
25. Thus, in the facts of the said case, where the court found that the major portion of the investigation of the case in the FIR had to be conducted at Bombay, it was not possible to hold that not even a part of the cause of action had arisen at Bombay so as to deprive the High Court of Bombay of total jurisdiction to entertain the writ petition filed by the petitioner. In the facts of the present case, it may be recalled that the entire cause of action in relation to the alleged offence has arisen at Wadhwan in Surendranagar, within the territorial jurisdiction of this court.
26. The learned counsel for the respondent has sought to distinguish the judgement of the Supreme Court in case of Navinchandra N. Majithia v. State of Maharashtra and others (supra) on the ground that the writ petition therein had been directed against a first information report, whereas in the facts of the present case, the petition is directed against the process issued by the Special Court, at Kamrup. That the Court at Kamrup does not fall within the territorial jurisdiction of this High Court and as such, this court does not have the territorial jurisdiction over the court at Kamrup. Reliance was placed upon the decision of this court in the case of Rahul Gupta S/o Babulal Gupta v. Shalini Agarwal, Under Secretary, State of Rajasthan (supra) for the purpose of contending that entertaining the present petitions would amount to usurping the jurisdiction of the High Court at Guwahati.
27. In this regard, it may be noted that in the case of Rahul Gupta S/o Babulal Gupta v. Shalini Agarwal, Under Secretary, State of Rajasthan (supra) this court was dealing with a case where it was contended that since most of the alleged events constituting the offence were alleged to have taken place in Gujarat, they are required to be investigated and tried in Gujarat and that the parties on both sides also being resident of Gujarat, this court was required to exercise jurisdiction on the ground that the cause of action, wholly or partly, arises in Gujarat. The court after referring to the decisions of the Supreme Court in Navinchandra N. Majithia v. State of Maharashtra (supra), Asit Bhattacharjee v. Hanuman Prasad Ojha, AIR 2007 SC 1925, and Alchemist Ltd. v. State Bank of Sikkim, AIR 2007 SC 1812, held that it is amply clear that the decision on the issue of territorial jurisdiction of the High Court exclusively depends upon the cause of action, wholly or partly, arising within the territorial jurisdiction of the High Court concerned and the seat of Government, or authority or residence of the person against whom a writ or direction is sought is not material; and the “cause of action” means every fact which it would be necessary for the petitioner to prove, if traversed, in order to support his right to judgment of the court. The court was of the view that in the facts of the said case, in order to succeed in the petition for quashing the FIR lodged at Jaipur, it would be necessary for the petitioner to establish that the complaint in question could not have been legally lodged and registered at Jaipur and even if it were registered, it could not have been investigated by the investigating agency at Jaipur, Rajasthan. Upon perusing the complaint the court found that from that stand point, it clearly appeared that several alleged incidents, being part of the ingredients of the alleged offences, had happened at Jaipur even as many of the incidents were also alleged to have happened in Gujarat and Madhya Pradesh. Therefore, it could not be said that the complaint could not have been lodged, registered and investigated at Jaipur. The court was of the opinion that the cause of action for filing the said petition to quash such FIR could be said to have arisen exclusively in Rajasthan; although consequences of filing such FIR in Rajasthan may have to be suffered by the parties in Gujarat as both the parties were stated to be staying in Gujarat. The court observed that, ordinarily, a petition for quashing such FIR would be filed under section 482 of Cr.P.C. before the High Court having jurisdiction under the provisions of Cr.P.C. Instead, the petitioner had chosen to file the said petition exclusively under Article 226 of the Constitution, instead of adopting the appropriate alternative remedy, and pressed the grounds of expediency and convenience. The court observed that, however, the fact remains that, strictly speaking, the cause for filing the petition has arisen in Rajasthan as an allegedly false, baseless and mala fide FIR wa s registered in Rajasthan. It was further observed that the cause or causes for making the complaint at a particular place must not be confused with the cause of action for filing a petition for quashing that complaint. Even if a fraction of the cause for filing a complaint has arisen in Rajasthan, an FIR could be lodged at Jaipur. And even assuming that such filing of the FIR in Rajasthan was mala fide, the cause of action for filing a petition for quashing such FIR could arise only in Rajasthan and not at all places where parts of causes for filing the FIR may have arisen and where the FIR could have been lodged and investigated and where the ensuing criminal case could have been tried. In other words, the cause of action for filing a complaint is different from the cause of action for quashing the complaint. The provisions of sections 177 and 178 of Cr.P.C., therefore, could not and ought not to be applied for determining the issue of territorial jurisdiction of the High Court, which has to only consider the provisions of Article 226 of the Constitution. The court was of the view that the argument that the petitioners were unnecessarily and with ulterior motives dragged to face the authorities in Rajasthan and that it was a calculated move to choose the legal forum in Rajasthan, could not be accepted so as to usurp territorial jurisdiction and undermine the authority and jurisdiction of another High Court.
28. In the facts of the present case, as noted hereinabove, no part of the cause for filing the complaint had arisen in Guwahati as no part of the alleged offence had taken place at Guwahati. Thus, it is not as if part of the cause of action has arisen at Guwahati and part of it has arisen within the territorial jurisdiction of this High Court. In the present case, the entire cause of action for filing the complaint has arisen within the territorial jurisdiction of this High Court, not only that, even no consequence of the alleged offence has ensued at any place within the State of Assam.
29. The learned counsel for the respondent also placed reliance upon the decision of the Calcutta High Court in case of Upasana Finance Limited v. S. N. Bagla & Company & others, 2006 Cr.L.J. 833, wherein the court has observed that it had no power of superintendence over the learned Metropolitan Magistrate, Chennai and, as such, his order is subject to scrutiny only by the Madras High Court or the appropriate Courts prescribed in the Code of Criminal Procedure. The decision of the Calcutta High Court in the case of Meenakshi Sathish v. M/s Southern Petrochemical Industries & others, 2007 Cr. L. J. 2250, was also relied upon for the proposition that the entire cause of action as far as the learned Magistrate was concerned, arose in Coimbatore, outside the jurisdiction of that court. So, even if the complainant has wrongly filed a complaint before the Coimbatore Court, the action of taking cognizance and issuance of the process took place outside the jurisdiction of that court. It has been contended that all the High Courts have taken a consistent view that against an order of a Magistrate taking cognizance, it is only the jurisdictional High Court which has the jurisdiction to entertain a writ petition and, accordingly, in respect of the order passed by the learned Sessionsl Judge at Kamrup, taking cognizance of the offence in question, it is only the High Court at Guwahati which would have jurisdiction to entertain a writ petition under Article 226 of the Constitution of India. Reliance was also placed upon the decision of the Supreme Court in the case of Mosaraf Hossain Khan v. Bhagheeratha Engg. Ltd. & others, (2006) 3 SCC 658, wherein the court had observed that only such High Court within whose jurisdiction the order of the subordinate court has been passed, would have the jurisdiction to entertain an application under Article 227 of the Constitution of India.
30. Testing the contentions noted hereinabove in the context of the facts of the present case, it may be noted that in Upasana Finance Limited v. S. N. Bagla & Company & others, (supra), the FIR had been lodged pursuant to a direction given by the learned Magistrate, Chennai. It is in the said backdrop that it had been contended that the High Court had no jurisdiction to entertain the writ petition as no part of the cause of action had arisen within the territorial limits of that court. The court held that it had no power of superintendence over the learned Metropolitan Magistrate, Chennai and, as such, his order was subject to scrutiny only by the Madras High Court or the appropriate courts prescribed in the Code of Criminal Procedure. The Division Bench held that the learned Single Judge lacked territorial jurisdiction to entertain the writ petitions, the sole object of which was to obtain an order of quashing of the order passed by the learned Magistrate in Chennai.
31. The Full Bench of the Kerala High Court in Mrs. Meenakshi Sathish v. M/s Southern Petrochemical Industries (supra), was dealing with the question as to whether it could be said that any part of the cause of action had arisen within the jurisdiction of the said High Court. According to the petitioner, the cause of action arose in the State of Kerala and, therefore, the writ petition would lie before the said court. Since there were conflicting decisions of two courts, the matter was referred to the Full Bench. The Full Bench, after considering the decisions of the Supreme Court in Navinchandra Majithia (supra) and Mosaraf Hossain Khan (supra) held that the cause of action which must arise in Kerala for issuing the writs of certiorari or prohibition, must relate to the commissions or omissions of an inferior Court or Tribunal amenable to the writ jurisdiction of that court and not that of a private party. The court held that it could not judicially review the actions of the first respondent therein. The first respondent may file any complaint before any court. It may do it rightly or wrongly. Since, the first respondent was a private party, it was not amenable to the writ jurisdiction of that court, and as such the court could not judicially review its actions. It was further observed that the point to be decided is whether it could judicially review the action of the Magistrate in taking cognizance under section 190(1)(a) read with section 200 of the Code, of the offence alleged against the petitioner and issuing process under section 204. It was held that the entire cause of action, as far as the action of the learned Magistrate was concerned, arose in Coimbatore, outside the jurisdiction of that court. So, even if the complainant had wrongly filed a complaint before the Coimbatore Court, the action of taking cognizance and issuance of the process took place outside the jurisdiction of that court. (Emphasis supplied)
32. In Mosaraf Hossain Khan v. Bhagheeratha Engg. Ltd., (supra), the Supreme Court held thus:
“28. We have referred to the scope of jurisdiction under Article 226 and 227 of the Constitution only to highlight that the High Courts should not ordinarily interfere with an order taking cognizance passed by a competent court of law except in a proper case. Furthermore, only such High Court within whose jurisdiction the order of the subordinate court has been passed, would have the jurisdiction to entertain an application under Article 227 of the Constitution unless it is established that the earlier cause of action arose within the jurisdiction thereof.” (Emphasis supplied).
33. Thus, in Navinchandra N. Majithia v. State of Maharashtra (supra), the Supreme Court held that the High Court of Bombay within whose territorial jurisdiction, part of the cause of action had arisen, had the territorial jurisdiction to entertain a writ petition for quashing of the criminal complaint filed at Shillong. Of course, in the said case, the petitioner had alternatively prayed that a writ of mandamus be issued to the State of Meghalaya to transfer the investigation to the Mumbai Police. Averments had also been made in the writ petition that filing of the complaint at Shillong was a mala fide move on the part of the complainant to harass and pressurize the petitioners to reverse the transaction for transfer of shares. The Supreme Court after considering the averments made in the petition, held that it was not possible to hold that not even a part of the cause of action had arisen at Bombay so as to deprive the High Court of Bombay of total jurisdiction to entertain the writ petition filed by the petitioner. Even the very fact that a major portion of the investigation of the case under the FIR had to be conducted at Bombay itself, showed that the cause of action could not escape from the territorial limits of the Bombay High Court. In the facts of the present case, as noted hereinabove, the entire cause of action has arisen within the State of Gujarat, that is, within the territorial limits of jurisdiction of this High Court. Insofar as the State of Assam is concerned, it is only the place where the alleged offence has been detected, inasmuch as, the entire case of the complainant is that there was underutilization of Codeine Phosphate in the manufacture of Codokuff Cough Syrup and consequently, there was diversion of Codeine Phosphate for illicit use. Thus, insofar as the State of Assam is concerned, no part of the alleged offence under the provisions of the NDPS Act can be stated to have been committed therein so as to vest jurisdiction in the Court situated at Assam to entertain the complaint in this regard. The entire cause of action having arisen at Wadhwan in Surendranagar district, ordinarily only the Court at Wadhawan would have the jurisdiction to entertain such complaint.
35. Insofar as the decision of the Calcutta High Court in Upasana Finance Limited v. S. N. Bagla & Company (supra) is concerned, the court was concerned with a case where the FIR had been registered pursuant to a direction issued by the learned Magistrate at Chennai. It is in these circumstances that the court observed that the High Court at Calcutta would not have the jurisdiction to entertain a petition against an order passed by the learned Magistrate inasmuch as, the complaint had been filed pursuant to an order passed by the learned Magistrate. Thus, in the said case, the cause of action was the order of the Magistrate under section 156(3) of the Code, whereas in the facts of the present case, the filing of the complaint is the cause of action. Also in the said case the whole cause of action had arisen within the territorial jurisdiction of the High Court at Tamilnadu, whereas in the facts of the present case, the whole cause of action has arisen within the State of Gujarat. Under the circumstances, the said decision would not be directly applicable to the facts of the present case. Insofar as the decision of the Full Bench of the Kerala High Court is concerned, as is apparent on a plain reading of the said decision, the court held that the writ is not tenable for quashing the complaint or for filing the complaint against a private person. Hence, any order which would be required to be quashed would be an order of such court. In the facts of the present case, what is challenged in the petition is that the complaint lodged by the respondent. Insofar as the order passed by the Special Court is concerned, the same is only consequential to the challenge to the complaint. As has been rightly contended by the learned counsel for the petitioners, in the present case, the complaint has not been filed by a private party, but by a Government authority which falls within the ambit of the expression “State” as contemplated under Article 12 of the Constitution of India. Under the circumstances, a writ petition would lie against such authority.
36. Moreover, in the facts of the present case, the fact that no part of the cause of action has arisen in Assam is a distinguishing feature. It is also pertinent to note that as no part of the cause of action has arisen within the territorial jurisdiction of the Court at Kamrup, the police could not have investigated into the offence under section 155/156 of the Code. It is only because the present complaint is filed under the provisions of the NDPS Act, to which sections 155/156 of the Code do not apply, that the investigation had taken place at Assam and the complaint came to be filed by the investigating agency at Guwahati, where no cause of action had arisen.
37. In Mosaraf Hossain Khan v. Bhagheeratha Engg. Ltd. & others (supra), on which reliance has been placed by the learned counsel for the respective parties, the Supreme Court held that only such High Court within whose jurisdiction the order of the subordinate court has been passed, would have the jurisdiction to entertain an application under Article 227 of the Constitution of India unless it is established that the earlier cause of action arose within the jurisdiction thereof. Therefore, the said decision does not lay down any absolute proposition of law to the effect that the only such High Courts within whose jurisdiction the order of the subordinate court has been passed would have the jurisdiction to entertain the challenge to the same. The court also held that the same would be subject to it being established that the earlier cause of action arose within the jurisdiction thereof. In the facts of the present case, though cognizance of the offence has been taken and process had been issued by the Learned Sessions Judge at Kamrup, the earlier cause of action, namely the commission of the offence in question, has arisen within the jurisdiction of this court alone. Under the circumstances, the contention that this court has no jurisdiction to entertain the present writ petition does not merit acceptance.
38. The decision of the Supreme Court in the case of Harbans Lal (supra) would also not be applicable in the present case, inasmuch as in the case at hand no part of the alleged offence has been committed within the territorial jurisdiction of the court at Kamrup. Besides as held by the Supreme Court in the case of Rajendra Ramchandra Kavalekar (supra) the territorial jurisdiction of a court with regard to a criminal offence would be decided on the basis of the place of occurrence of the incident and not on the basis of where the complaint was filed and the mere fact that FIR was registered in a particular State is not the sole criterion to decide that no cause of action has arisen even partly within the territorial limits of jurisdiction of another court. The venue of enquiry or trial is primarily to be determined by the averments contained in the complaint or the charge-sheet. In the present case the complaint in question is akin to a charge sheet as the same has been submitted upon conclusion of the investigation. On a reading of the complaint as referred to earlier, no part of the cause of action has arisen within the State of Assam and the entire alleged offence can be said to have been committed only at Wadhwan in Surendranagar.
39. The next and central question that arises for consideration is whether on the allegations made in the complaint, any offence as alleged can be stated to have been made out.
40. As noted hereinabove, insofar as the stock comprising of bottles of Codokuff Cough Linctus is concerned, in the complaint itself, it has been stated by the respondents that the cough linctus not constitute a narcotic drug and as such, does not fall within the ambit of the NDPS Act. The main allegation in the complaint is that Biodeal has violated section 8(c) of the NDPS Act by not using a substantial part of legally procured Codeine Phosphate for the purpose for which it was procured, that is, medicinal use, but instead diverted the same for illicit use by under-utilizing the Codeine Phosphate in the cough formulation, using less quantity than prescribed and as declared in the labels of the bottles and are, thus, liable to punishment under sections 21, 25, 27A and 29 of the NDPS Act.
41. At the cost of repetition it may be stated that in the present case, what is alleged is that there is underutilization of Codeine Phosphate which leads to a presumption that there is diversion of Codeine Phosphate for illicit use. Thus, the sole basis for alleging diversion of Codeine Phosphate is that there is underutilization. The reason for saying so is that as per the FSL reports; the quantity of Codeine Phosphate in the cough formulation is less than the prescribed quantity. In paragraph 2 of the complaint, it has been stated that intelligence was gathered to the effect that Codokuff Cough Linctus is being abused as alternative narcotic drug. The modus operandi adopted was to procure Codeine Phosphate from legal channel and diverting a part of it for illegal use by under-utilizing the narcotic substance in the said cough formulation. Most of this cough formulation is being sent to a few firms in Agartala, Tripura who send it to Bangladesh in small quantities through clandestine channels, where the cough formulation is used as an alternative narcotic drug.
42. Thus, there is a basic inconsistency in the case of the complainant. Firstly, if there was underutilization of Codeine Phosphate for the purpose of diverting the same for illegal use, such illegal use should have been established or at least there should have been material to indicate diversion for illegal use. The case that the formulation was pushed to Agartala for clandestinely sending the same to Bangladesh where it is used as an alternative narcotic drug, also is apparently fallacious, inasmuch as if the goods were to be used as an alternative narcotic drug, the quantity of Codeine Phosphate should have been more than the prescribed quantity and not less. As noticed earlier it is the categorical case of the respondent as stated in paragraph 32.2 of the complaint that “xxx it may be mentioned that the investigation never disputed the facts that Codokuff Cough Linctus is a Scheduled – ‘H’ drug, that it is not a “manufactured drug”, that it is a P&P medicine nor claimed that the medicine itself fall under the purview of the NDPS Act, 1985. The investigation is all about legal procurement of Codeine Phosphate (a narcotic substance) for medicinal use and large-scale illegal diversion of the said narcotic substance without using the same for the purpose it was procured, thus violating the provisions of section 8(c) of the NDPS Act, 1985”. Had it been the case of the respondent that the content of Codeine Phosphate in the cough linctus was more than the prescribed quantity, possibly the cough linctus would then have constituted a manufactured drug. However, the content of Codeine Phosphate being less than the prescribed quantity, it is the case of the respondent that it is not a manufactured drug and as such does not fall within the purview of the NDPS Act. If the cough formulation does not fall within the ambit of the NDPS Act, no offence under the NDPS Act can be said to have been committed within the territory of the State of Assam.
43. As regards the case of the respondent that the underutilization of Codeine Phosphate gives rise to a presumption of diversion for illicit use, what is required to be examined is as to whether it has been established or whether there is sufficient material on record to establish such underutilization. In paragraphs 13 and 14 of the complaint, it has been stated that the analysis reports submitted by the FSL, Guwahati confirmed underutilization of Codeine Phosphate in all the samples tested. Since these thirty batches consisted of 1418800 numbers of 100 ml bottles, it was found that a total amount of 82.338 kgs of Codeine Phosphate was underutilized. Since the underutilized quantity was not reflected/re-entered in the stock register, it was reasonably believed that a total quantity of 82.338 kgs of legally procured Codeine Phosphate has been diverted for illegal use, instead of being used for medicinal purposes, that is, for the manufacture of the cough linctus, which is alleged to be in violation of the provisions of section 8(c) of the NDPS Act and is punishable under Chapter IV of the NDPS Act.
44. In paragraph 19.1 (x) of the complaint, it has been recorded that Shri Jani had submitted a copy of a letter dated 26.10.2005 issued by the Drugs Controller General of India to the effect that Cough Linctus containing Codeine Phosphate as one of the ingredients falls under Schedule-H of the Drugs and Cosmetic Rules and does not fall under the provisions of the NDPS Act & Rules 1985. He has also made a written request to re-examine the batches of Codokuff Cough Linctus in question at FDA Laboratories and/or Central Drugs Laboratory, using the method of analysis used by the manufacturer.
45. From the statements of various persons recorded by the investigating agency as reflected in the complaint, it is apparent that it is the consistent case of the said persons that it is impossible to underutilize or divert Codeine Phosphate as the entire process is carried out in the presence of and under the supervision of the officials of the Gujarat Prohibition and Excise Department. It has also been contended that there is a prescribed method of testing the cough formulation and request has been made to send the same for analysis to the Central Drugs Laboratory using their method of analysis. Such contentions have been dealt with in paragraph 27 of the complaint, whereby the respondent has recorded that in view of the aspersions cast upon the competence of the Scientists of FSL, Guwahati and their testing methods, the Director, FSL, Guwahati was asked on 01.12.2005 to provide detailed information about the laboratory with special emphasis on qualification of the analyzing scientists, equipment available for analyzing narcotic substances and the testing procedures adopted. The Director, FSL, in his letter dated 14.12.2005, gave a detailed profile of the laboratory with special emphasis on their Narcotics Testing Division.
46. In paragraph 28 of the complaint, the respondent has stated that the question of re-testing of the samples at a laboratory other than FSL, Guwahati, as requested by J. C. Jani and T. K. Patel does not arise, since the same is not provided for in the NDPS Act, 1985. In this regard, it may be noted that what was tested at Guwahati was not a narcotic drug, but a Schedule “H” Drug, that is, a P & P medicine. Hence, the ground on which the request for sending the samples for re- testing is not germane as for the purpose of testing a scheduled drug, the provisions of the Drugs and Cosmetics Act and not the NDPS Act would be required to be followed. Besides, a perusal of the letter dated 14.12.2005 of the Director, FSL (page 302 of paper-book – 1), on which strong reliance has been placed by the learned counsel for the respondent, shows that according to the Director, FSL, Guwahati, the said laboratory is fully equipped to carry out analysis of narcotic and psychotropic substances. It may be noted that none of the eleven independent divisions referred to therein, relate to testing of drugs under the Drugs & Cosmetics Act. On a close reading of the said communication, it appears that the reference to “drug” therein is in relation to “narcotic drug” as contemplated under the NDPS Act and not “drug” as defined under section 3(b) of the Drugs Act. Thus, it appears that the case of the Director, FSL is that the said laboratory is fully equipped to analyze narcotic drugs. The said letter, therefore, cannot be read to mean that the said laboratory is equipped to analyze drugs under the Drugs and Cosmetics Act.
47. Reference in this regard may also be made to the communication dated 27.12.2005 of the Government of India, Central Bureau of Narcotics (page 374), wherein pursuant to a query raised in respect of Codeine Sulphate tablets as to whether the same is a manufactured drug or not, and whether it requires licence under rule 37 of the Narcotic Drugs & Psychotropic Substances Rules, 1985, the Deputy Narcotics Commissioner has, inter alia, replied that in respect of liquid preparations also, if the preparation is with the concentration of not more than 2.5 per cent in undivided preparation, the same would not come under the definition of “manufactured drug”.
48. Thus, what was analyzed by the FSL, at Guwahati was not a narcotic drug. The same was a Schedule “H” Drug and P & P Medicine. Insofar as the drugs falling within the ambit of the Drugs & Cosmetics Act are concerned, the same would be governed by the provisions of the said Act. Chapter IV thereof makes provision for “Manufacture, Sale and Distribution of Drugs and Cosmetics” and is comprised of sections 16 to 33A.
Section 20 thereof makes provision for “Government Analysts” and empowers the State Government as well as the Central Government to appoint such persons as it thinks fit, having the prescribed qualifications, to be Government Analysts as provided thereunder by notification in the Official Gazette. By virtue of the provisions of section 25 of the said Act, the report of the Government Analyst under the said Chapter is evidence of the facts stated therein and such evidence is treated to be conclusive unless the person from whom the sample was taken has within twenty eight days of the receipt of a copy of the report, notified in writing the Inspector or the Court before which any proceedings in respect of the sample are pending that he intends to adduce evidence in controversion of the report. Sub-section (4) lays down that unless the sample has already been tested or analysed in the Central Drugs Laboratory, where a person has under sub-section (3) notified his intention of adducing evidence in controversion of a Government Analyst’s report, the Court may, of its own motion or in its discretion at the request either of the complainant or the accused: cause the sample of the drug or cosmetic produced before the Magistrate under sub-section (4) of section 23 to be sent for test or analysis to the said Laboratory, which shall make the test or analysis report in writing signed by or under the authority of, the Director of the Central Drugs Laboratory the result thereof, and such report shall be conclusive evidence of the facts stated therein. Thus, under the provisions of the Drugs & Cosmetics Act, the sample of a drug is required to be tested by the Government Analyst whose report is to be accepted as evidence of the facts stated therein unless a test analysis of the report is carried out by the Director of the Central Drugs Laboratory in which case, such report is to be treated as conclusive evidence. The above provisions, therefore, constitute a complete code for testing and analysis of a drug or cosmetic under the Drugs and Cosmetics Act. The said Act does not envisage testing and analysis of samples of drugs and cosmetics by any other agency except the Government Analysts and the Director of the Central Drugs Laboratory.
49. In the facts of the present case, admittedly what was tested by the FSL, Guwahati was a drug falling within the ambit of the Drugs Act and Cosmetics Act and as such, the same could have been tested and analysed properly only by the Government Analyst appointed under the Drugs & Cosmetics Act. Moreover, assuming that the report of the FSL, Guwahati were to be accepted, the same only says that the quantity of the Codeine Phosphate is less than the prescribed quantity. At the cost of repetition, it may be noted that the Codokuff Cough Linctus by itself is not a narcotic drug, as is admitted in the complaint itself, but the same is a P&P Medicine. Under the circumstances, if such sample contains less quantity of Codeine Phosphate than shown on the label, the same constitutes an offence under the Drugs and Cosmetics Act and not under the NDPS Act. Under the circumstances, in respect of an offence under the Drugs Act, the provisions for testing and analysis under the said Act would be required to be followed, which admittedly has not been done in the facts of the present case. Moreover, the allegations made in the complaint relate to the provisions of the NDPS Act and not the Drugs & Cosmetics Act.
50. As noticed earlier, the entire alleged offence insofar as the provisions of the NDPS Act are concerned, is stated to have been committed at Wadhawan in Surendranagar. The entire case of the respondent is based upon the FSL report submitted by the FSL Laboratory, at Guwahati which discloses that the quantity of Codeine Phosphate used in the manufacture of Codokuff Cough Linctus is less than the prescribed quantity. Thus, on the basis of the alleged underutilization, the respondent has concluded that there is diversion of Codeine Phosphate. As noted hereinabove, the tests have been carried out by the FSL Laboratory, at Guwahati in the context of the provisions of the NDPS Act and not in the context of the Drugs & Cosmetics Act. The authenticity of such tests, therefore, is doubtful and as such, the results thereof cannot be made the sole basis for making out an offence. On a reading of the complaint as a whole, it is amply clear that except for the fact that the quantity of Codeine Phosphate contained in the medicinal formulation is stated to be less than the prescribed amount, there is no other allegation or evidence to the effect that such Codeine Phosphate has actually and in fact been diverted. From the complaint, it is apparent that the premises of Biodeal came to be searched and records came to be examined. However, there is no evidence worth the name to show the involvement of any of the accused in the diversion. There is no material on record to indicate that any of the accused were in fact in possession of any narcotic drug or had indulged in the sale, purchase, transport, use, consumption of any narcotic drug or substance as contemplated in section 8(c) of the NDPS Act.
51. It may be recalled that in the present case, neither has the cause of action in respect of the alleged offence arisen within the jurisdiction of the Sessions Court at Guwahati, nor has any consequence thereof been suffered at Guwahati. In relation to an offence under the NDPS Act, the consequences of the offence can be said to have been suffered at the place where the narcotic drug or substance is sold, purchased, used, consumed, etc. Utilization of less quantity of Codeine in the manufacture of the cough linctus and selling such cough linctus at Guwahati is not a consequence of the offence under the NDPS Act, inasmuch as considering the content of Codeine Phosphate in the cough formulation; the preparation does not amount to a narcotic drug. The allegation that the cough linctus is pushed into the north-eastern States where the same is abused as an alternative to narcotic drugs would not amount to an offence under the NDPS Act, inasmuch as when the cough linctus is admittedly not a narcotic drug or substance, the sale of a large quantity thereof at a particular place would not amount to any offence under the NDPS Act. At the cost of repetition, it is reiterated that the entire case of the respondents is that by underutilization of Codeine Phosphate in the manufacture of Codokuff Cough Linctus, such Codeine Phosphate has been diverted for illicit use. However, except for the bare say of the respondent, which in turn is based upon the FSL reports, there is no other supporting evidence to show that Codeine Phosphate has in fact been diverted. No stock of Codeine Phosphate has been recovered during the course of search; none of the accused has been found to be in possession thereof; nor is there any evidence of sale, purchase, transfer, use etc. of the alleged unutilized Codeine Phosphate. Besides, though the entire alleged offence can be stated to have taken place only within the State of Gujarat, none of the witnesses named by the respondent in the list submitted by him are from that State. More significantly, the officer in-
charge, who was posted at the factory of Biodeal, and under whose supervision and control the manufacture of Codokuff Cough Linctus had taken place is not arraigned as an accused nor even as a witness. Considering the manner in which the drug is procured and utilized, it is apparent that the same cannot be diverted without the connivance of the said officer. Evidently, therefore, there is no legal evidence against the petitioners and the entire case of the prosecution is based upon the presumption of diversion of Codeine Phosphate without there being any legal evidence in support thereof.
52. Insofar as underutilization of Codeine Phosphate in the manufacture of the cough formulation, namely, Codokuff Cough Linctus is concerned, the same at best constitutes an offence under the Drugs and Cosmetics Act. However, there is no allegation of any offence having been committed under the Drugs and Cosmetics Act in the complaint, nor have the provisions of the said Act been invoked. The Supreme Court in the case of Roy V. D. v. State of Kerala, (2000) 8 SCC 590, has in the context of the provisions of the NDPS Act, held that the power under section 482 of the Code has to be exercised by the High Court, inter alia, to prevent the abuse of the process of any court or otherwise to secure the ends of justice. Where criminal proceedings are initiated based on illicit material collected on search and arrest which are per se illegal and vitiate not only a conviction and sentence based on such material but also the trial itself, the proceedings cannot be allowed to go on as it cannot but amount to abuse of the process of the court; in such a case not quashing the proceedings would perpetuate abuse of the process of the court resulting in great hardship and injustice to the accused.
The court also observed that the life and liberty of an individual is so sacrosanct that it cannot be allowed to be interfered with except under the authority of law. It is a principle which has been recognized and applied in all civilized countries. In our Constitution, Article 21 guarantees protection of life and personal liberty not only to citizens of India but also to aliens. In the facts of the present case, it may be recalled that the cough formulation in question has been subjected to analysis by the FSL laboratory at Guwahati which appears to be equipped for analyzing narcotic drugs and substances. It is an admitted that the cough formulation in question does not fall within the ambit of “manufactured drug” and is, therefore, not a “narcotic drug”. The cough formulation is admittedly a P & P medicine falling within the ambit of the Drugs & Cosmetic Act. In case the quantity of Codeine Phosphate in the cough formulation is less than that declared on the label of the bottle, the same would amount to a mis-declaration under the provisions of the Drugs & Cosmetics Act and would attract penalty under the said Act. However, under the Drugs & Cosmetics Act, a sample of any drug is required to be submitted for testing or analysis to the Government Analyst under the provisions of section 25 of the said Act. A report of the Government Analyst is conclusive evidence of the facts stated therein, unless the person from whom the sample was taken or other persons whose names have been disclosed under section 18A, have within the prescribed time limit, notified in writing the Inspector of the Court before which the proceedings are pending that he intends to adduce evidence in controversion of the report. Sub-section (4) of section 25 of the said Act makes provision for sending the sample for testing or analysis to the Director of Central Drugs Laboratory and the result of such report would be conclusive evidence of the facts stated therein. The report of the Director of Central Drugs Laboratory, therefore, supersedes the report of the Government Analyst. Thus, under the scheme of the Drugs & Cosmetics Act, provision has been made for a Government Analyst to test and analyze the samples of drugs. Such tests, therefore, can be carried out only by the Government Analyst and no other authority. In case any person desires to controvert the report of the public analyst, he may request the Magistrate for sending a sample for test or analysis to Central Drugs Laboratory. Thus, the right to get the sample tested through the Central Drugs Laboratory is a valuable right vested in a person from whom the sample has been taken or against whom the proceedings are initiated under the Act. In the facts of the present case, the samples so seized have been sent for analysis not to the Government Analyst who is the competent authority to test such drugs under the Drugs and Cosmetics Act, but to the FSL Laboratory. As has been specifically stated in the complaint itself, the petitioners had made a request for sending the sample for analysis to the Central Drugs Laboratory, but such request had been turned down on the ground that there is no provision under the NDPS Act for sending such sample for testing at the request of an accused. While doing so, the respondent has lost sight of the fact that the drug of which the sample was sent for testing was not a narcotic drug, but a drug under the Drugs and Cosmetics Act. Thus, the test report of the FSL Laboratory is not conclusive evidence of the facts stated therein insofar as the Drugs & Cosmetics Act is concerned and insofar as the test and analysis of the sample in question is concerned. However, on the basis of such test report, the respondent has come to the conclusion that there being a deficit in the quantity of Codeine Phosphate used in the manufacture of drug, there is underutilization of Codeine Phosphate and consequently, diversion by the accused person of Codeine Phosphate for illicit use. The entire edifice of the case of the respondent is built upon the deficiency of Codeine Phosphate in the cough formulation.
53. The upshot of the above discussion is that the alleged offence having taken place solely within the territorial jurisdiction of this High Court, this court has the jurisdiction to entertain the present writ petitions under Article 226 of the Constitution of India. True it is that the process issued by the learned Sessions Judge is also subject matter of challenge in these petitions; however, the same is only in the nature of consequential relief. The main relief prayed for is for quashing the complaint which has been filed by the respondent, an authority falling within the ambit of the expression “the State” as defined under Article 12 of the Constitution and as such is amenable to the writ jurisdiction of this court. On the averments made in the complaint, none of the offences alleged therein, namely the offences under the NDPS Act, are made out. The entire case is based upon presumption, without there being any legal evidence whatsoever, to establish the offence against the petitioners and other accused persons. Insofar as the offences under the Drugs and Cosmetics Act are concerned, there is no allegation of commission of any such offence. Moreover, the respondent having not sent the samples for testing to the Central Drugs Laboratory, the petitioners are deprived of a valuable right under the provisions of section 25 of the Drugs and Cosmetics Act which would vitiate the entire proceedings, had they been initiated under the said Act.
54. At this stage reference may be made to the decision of the Supreme Court in the case of State of Haryana v. Bhajan Lal (supra) wherein the court after referring to various relevant provisions of the Code and the principles of law enunciated by it in a series of decisions relating to exercise of the extraordinary power under Article 226 or the inherent powers under section 482 of the Code has given the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any court or otherwise to secure the ends of justice:
“(1) Where the allegations made in the first in- formation report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused.
(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an in- vestigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code.
(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused.
(4) Where, the allegations in the FIR do not con- stitute a cognizable offence but constitute only a non- cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as con- templated under Section 155(2) of the Code.
(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for pro- ceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly at- tended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreak- ing vengeance on the accused and with a view to spite him due to private and personal grudge.”
55. In the backdrop of the findings recorded hereinabove, the present case would clearly fall under category (3) above, viz., the uncontroverted allegations made in the complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused. This is, therefore, a fit case for exercise of powers under Article 226 of the Constitution of India for quashing the complaint.
56. In the light of the above discussion, the petitions succeed and are, accordingly, allowed. The complaint being Complaint Case No. Sessions Spl. 348(K) 05 filed in the District and Sessions Court, Kamrup, Guwahati in connection with Shillong Customs Case No.3 & 3A/NDPS/HQ. Prev/SH/2005 dated 13.08.05 and 28.09.05 (Annex-1 to each of the petitions) is hereby quashed and set aside. Consequently, the order dated 8.6.2006 passed by the learned Sessions Judge, Kamrup, Guwahati (Annexure 2 to each of the petitions), would no longer survive. Rule is made absolute accordingly in both the petitions.
[HARSHA DEVANI, J.] parmar*