(Non-IP) Constitutionality of Rule 106B of the Drugs and Cosmetic Rules, 1945

By Tanya Srivastava, III BSL LLB, ILS Law College, Pune
tanya.srivastava2003@gmail.com 

In 1994, Rule 106B was inserted vide a Notification to the Drugs and Cosmetic Rules, 1945; due to a tragedy which resulted in the loss of human lives because of the use of spurious alcohol based medicinal preparations.

“Rule 106B -Prohibition of quantity and percentage.
No Homoeopathic medicine containing more than 12% alcohol (Ethyl Alcohol) shall be packed and sold in packing or bottles of more than 30 millilitres, except that it may be sold to hospitals/dispensaries in packings or bottles of not more than 100 millilitres”

This led to the constitution of a one-man Inquiry Committee under the Chairmanship of Justice Jagdish Chandra which was set up to give recommendations on the same. Among other recommendations, the Committee suggested that medicinal preparations containing more than 12% alcohol should be packed in smaller packages. These recommendations in turn led to the initiation of a process by which Rule 106B was introduced by way of an amendment to the Drugs and Cosmetics Rules.

The Rule so introduced prohibits packing of homeopathic medicines containing more than 12% Ethyl Alcohol in packing or bottles of more than 30 ml except in cases where the medicine is being sold to hospitals or dispensaries in which case the packing in bottles cannot be of a capacity more than 100 ml.

The introduction of this particular rule has given rise to cases, arguing that Rule 106B is invalid as it violates Article 14 and 19(1) (g) of the Indian Constitution. [1][2]

A lot of people who deal in homeopathic medicines are of the view that the said rule is discriminatory since it singles out the homeopathic medicines for a hostile treatment. This argument is not without reason because no such provision is applicable to allopathic medicines which continue to be packed and sold in bigger containers even when the alcohol content in them may be more than 12%. It has long been argued that the said Rule places an unreasonable restriction on the right to free trade and commerce.

Some learned counsels have also argued that there lies no justification for the rule making authority to restrict the size of the bottles or the packing since there is no nexus between the measures enforced by the Government and the mischief sought to be cured by the same.[3]

In R.S. Bhargava v UOI, the Delhi High Court held that Rule106B falls within the rule making authority of the Government since the evidence placed before the court showed that while introducing Rule 106B, the Government had consulted Drugs Technical Advisory Board constituted under Section 5 of the Act. Thus, Rule 106B is not discriminatory from other medical systems since the other systems like ayurveda, unani, allopathy are different in their context and approach. And because such systems of medicines are different in their approach and formation, it justifies that rules for each will be different. Rule 106B is not contrary to Article 14, since reasonable restrictions and limitations can be imposed on a person as long as they are not arbitrary or are of excessive nature. Addressing the violation of Article 19(1)(g), the Court held that a proper balance is required between freedom guaranteed in Article 19(1)(g) and the sufficient rulemaking authority to act in public interest. And thus, the rule is not ultra vires of the Indian Constitution.

Another such writ petition was filed in the Calcutta High Court[4] very recently and the case is still ongoing; but the Court passed an interim order stating that the Rule is ultra vires, as it did not follow the procedure laid down in the Act, which states that an amendment to any rule in the Act, must be presented in front of both houses of the Parliament. Such procedure was not followed when the amendment was made in 1994 and procedural informalities; thereby rendering the Rule ultra vires to the Act itself.

Having two different judgments from two different High Courts on the same issue, gives rise to a very important question: Does an order/judgment passed by a High Court have effect outside its territorial jurisdiction?

Because if it does, it would mean that a homeopathic retailer, who resides and operates outside the territory of West Bengal, can now sell containers with bottles measuring more than 30 ml.

Common sense (and a little legal knowledge) would automatically tell you that it would not. Since the jurisdiction and hierarchy of Indian Courts is given under the Constitution of India. But does the same law apply to Central Legislations?

A Controversy within the Controversy

There are two prominent judgments regarding the effect of a High Court holding a Central Legislation invalid given by the Supreme Court.

The first is the case of Kusum Ingots & Alloys Ltd vs Union Of India[5], in which the Supreme Court clearly held that, “An order passed on a writ petition questioning the constitutionality of a Parliamentary Act whether interim or final keeping in view the provisions contained in Clause (2) of Article 226 of the Constitution, would have effect throughout the territory of India subject of course to the applicability of the Act.”

The Court analysed that the cause of action regarding a Central Legislation can fall outside the High Court’s territorial jurisdiction, and in such a circumstance, the High Court’s judgment will have effect outside its territory.

This decision was partially over-ruled in 2008 by the Supreme Court, in Durgesh Sharma v. Jayshree[6], the court held that, the power to transfer suits by a High Court to a court that is subordinate to another High Court, rests purely with the Supreme Court. In effect, ruling that a High Court’s territorial jurisdiction cannot be expanded to interfere with another High Court’s jurisdiction. Thus, laying down the principle that a High Court’s judgment will be effective only in the territorial jurisdiction the court covers and it cannot have jurisdiction over another High Court’s territorial jurisdiction.

But, the manner in which the cases have developed over the years regarding the extra- territorial jurisdiction of a High court judgment has been the least bit straight-forward.

In 2014, the Madras High Court relied on Kusum Ingots and held that Article 226(2) of the Indian Constitution empowers High Courts to declare even Central Legislation as invalid, which will have effect throughout the territory of India, if the enactment was extended throughout the territory of India.[7]

In the same year, the Karnataka High Court also relied on Kusum Ingots and held that the Kerala High Court’s pronouncement on the constitutionality of a provision of a Central Act would be applicable throughout India.[8]

This leaves a lot of questions about the unconstitutionality of a Central Legislation. According to the principle of precedent, the judgment given in the case of Durgesh Sharma, should invalidate both of the above High Court judgments.

In the absence of any clear instructions or any judgement on this particular issue by the Apex court. The High Courts as well as the general public finds itself to be in disarray, especially regarding the Rule 106B, which many homeopathic retailers find arbitrary and unconstitutional.

[1] R. S. Bhargava Pharmacy v. Union of India 148(2008)DLT91.

[2] Shri Krishna Homeo Pharmacy Vs. Union of India 2006 (1) AllMR 129.

[3] Supra 1.

[4] Bengal Homoeopathic Manufacturers’ Association vs. Union of India, W.P. 8062 of 2015.

[5] AIR 2004 SC 2321.

[6] AIR 2009 SC 285.

[7] Union of India v Textile Technical Traders 2014 (6) CTC 427.

[8] Shiv Kumar v Union of India AIR 2014 Kant 73.

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