Bombay High Court
M/S. National Pharmaceuticals Thr. Its ... vs Join Commissioner ( K.D. ) Food And Drug ... on 22 September, 2025
Author: N. J. Jamadar
Bench: N. J. Jamadar
2025:BHC-AS:39824
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Arun Sankpal
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 10602 OF 2025
National Pharmaceuticals Through its Director ..Petitioner
Mrs Nutan Tiwari, G-18/1, M.I.D.C., Tarapur,
Boisar, District Palghar, 401506.
Versus
ARUN
RAMCHANDRA
SANKPAL
1. Joint Commissioner (K.D.)
Digitally signed by
ARUN RAMCHANDRA
SANKPAL Food and Drug Administration, M.S.,
Date: 2025.09.22
20:34:47 +0530
1st Floor, Vardan (MIDC) Building,
Old Passport Office, Wagale Estate,
Road No. 16, Thane (West) - 400 604.
2. The State of Maharashtra,
through the Government Pleader,
Minister of Food and Drug Administration
Mantralaya, Mumbai 400 032
3. Deputy Drug Controller (India),
CDSCO (West Zone), ...Respondents
4th Floor, Zonal FDA Bhavan, GMSD compound
Bellasis Road, Mumbai Central,
Mumbai 400 008.
WITH
WRIT PETITION NO. 10603 OF 2025
AVEO Pharmaceuticals Pvt Ltd,
Through its Director- Vinod Kumar Sharma,
Plot No. C/13, M.I.D.C., Tarapur, Boisar,
District Palghar - 401506. ..Petitioner
1/19
::: Uploaded on - 22/09/2025 ::: Downloaded on - 22/09/2025 21:30:41 :::
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Versus
1. Joint Commissioner (K.D.)
Food and Drug Administration, M.S.,
1st Floor, Vardan (MIDC) Building,
Old Passport Office, Wagale Estate,
Road No. 16, Thane (West) - 400 604.
2. The State of Maharashtra,
through the Government Pleader,
Minister of Food and Drug Administration
Mantralaya, Mumbai 400 032
3. Deputy Drug Controller (India),
CDSCO (West Zone),
4th Floor, Zonal FDA Bhavan, GMSD compound
...Respondents
Bellasis Road, Mumbai Central,
Mumbai 400 008.
Mr. Amir Arsiwala, with Omprakash Jha, Kalpesh Ulhas Patil &
Shraddha Prakash Gajbhiv, for the Petitioner in Writ Petition
NO. 10602 of 2025 and Writ Petition No. 10603 of 2025.
Mrs. Vaishali Nimbalkar, AGP, for Respondent No.2-State in
WP/10602 of 2025.
Mrs. M.S. Srivastav, AGP, for Respondent No.-2-State in
WP/10603/2025.
Mr. D.P. Singh, for Respondent No.3 in WP/10602/2025 and
WP/10603/2025.
CORAM: N. J. JAMADAR, J.
RESERVED ON : 26th AUGUST 2025
PRONOUNCED ON : 22nd SEPTEMBER 2025
JUDGMENT:
1. Rule. Rule made returnable forthwith, and, with the consent of
the learned Counsel for the parties, heard finally.
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2. As both the Petitions arise out of, by and large, similar set of facts,
the Petitions were heard together and are being decided by this common
judgment.
3. These Petitions assail the legality, propriety and correctness of the
orders dated 10th July 2025 passed by the Minister, Department of Food
and Drugs, Government of Maharashtra, (R2) in Appeal Nos. 490 of
2025 and 579 of 2025, whereby the Appeals preferred by the Petitioners,
in the respective Petitions, against the orders passed by the Joint
Commissioner and Licencing Authority, Food and Drugs Administration
(R1), directing the Petitioners to completely stop the production of the
medicines, came to be dismissed.
4. For the sake of convenience and clarity, the facts in Writ Petition
No. 10602 of 2025, are noted in a little detail; followed by the facts in
Writ Petition No. 10603 of 2025, in brief.
5. FACTS IN WRIT PETITION NO. 10602 OF 2025:
5.1 M/s National Pharmaceuticals, the Petitioner, is a Company
incorporated under the Companies Act, 1956. The Petitioner
claims to be a reputed pharmaceuticals manufacturing company.
The Petitioner holds valid license under the Drugs and Cosmetics
Act, 1940 ("the Act, 1940) and the Drugs and Cosmetics Rules
1945 ("the Rules, 1945). The Petitioner has its manufacturing
facility at G-18/1, M.I.D.C., Tarapur, Boisar. It employs over 170
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workers. The Petitioner claims to have been exporting over 400
products to various countries adhering to the Good
Manufacturing Practices (GMP) and national/international
standards.
5.2 On 21st February 2025 a Circular was issued by the
Government of India, Directorate General of Health Services,
directing immediate withdrawal of the permission to manufacture
all combinations of Tapentadol and Carisoprodol.
5.3 In deference to the aforesaid directive, the Petitioner
surrendered its product license on 23rd February 2025 and the
same was approved by R1 on 24th February 2025.
5.4 A joint inspection was conducted by the officials from
Central Drugs Standard control Organization (CDSCO) (R3) and
the State Food and Drug Administration (FDA) in the
manufacturing unit of the Petitioner on 25th February 2025.
5.5 A notice dated 26th February 2025 was issued to the
Petitioner under Section 22(1)(cca) read with Section 18-B of the
Act, 1940, to produce documents relating to the manufacture for
sale of drugs manufactured under export NOCs issued by CDSCO,
West Zone Office and FDA.
5.6 Simultaneously by order dated 26th February, 2025, without
providing any opportunity of hearing the Respondent No.1
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directed the Petitioner to stop the manufacturing of all the
products which mandated the cessation of production.
5.7 Subsequently, a show cause notice was issued to the
Petitioner on 27th February 2025 under Rule 85(2) of the Rules
1945 for alleged contravention of the provisions of Act of 1940
and the Rules thereunder and for failure to achieve and follow
the requirements of the Good Manufacturing Practices and Good
Laboratory Practices.
5.8 A compliance report of Corrective Actions and Preventive
Actions (CAPA) was submitted by the Petitioner on 3rd March
2025. A reply to the show cause notice dated 27 th February 2025
was also submitted.
5.9 As the permission to resume the production was not
granted despite all the compliances, the Petitioner preferred an
Appeal before the State Government (R2) against the order
directing the Petitioner to stop production of all the products.
5.10 By the impugned order dated 10 th July 2025, the Minister,
Food & Drug Department, dismissed the Appeal without
evaluating the legality and correctness of the order passed by the
Respondent No.1; which was in clear breach of the statutory
requirements.
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6. WRIT PETITION NO. 10603 OF 2025:
6.1 The Petitioner is also a pharmaceutical manufacturing
company incorporated under the Companies Act 1956. Pursuant
to the circular issued by the Directorate General of Health
Services, CDSCO, Government of India, directing the immediate
withdrawal of the permission to manufacture all combinations of
Tapentadol and Carisoprodol, the Petitioner surrendered the
license to produce the aforesaid products on 23 rd February 2025,
and the same was approved by Respondent No.1 on 24 th February
2025.
6.2 In the meanwhile, on 21st and 22nd February 2025, a joint
inspection was conducted by the officials from Central Drugs
Standard control Organization (CDSCO) (R3) and the FDA, State
of Maharashtra (R1).
6.3 A notice dated 22nd February 2025, under Section 22(1)
(cca) read with Section 18-B of the Act, 1940, was issued to the
Petitioner, to produce the documents relating to the manufacture
for sale of drugs manufactured under export NOCs issued by
CDSCO (R3) and the FDA, Maharashtra.
6.4 Simultaneously, without providing any opportunity of
hearing, the Petitioner was directed to stop the manufacture of
all the products which mandated the cessation of production.
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6.5 The Petitioner claimed to have submitted reply to the show
cause notice and compliance report of CAPA. Yet, the permission
to stop the production was not revoked.
6.6 The Petitioner thus preferred an Appeal before the State
Government (R2). By the impugned order the Appeal was
dismissed by the Minister, Food and Drugs Department.
7. Being aggrieved the Petitioners have invoked the writ
jurisdiction.
8. As the action was initiated pursuant to the joint inspection
conducted by the officials from CDSCO and the State FDA, CDSCO (R3)
came to be implemented as a party-Respondent to these Petitions.
9. An Affidavit in Reply is filed on behalf of the Respondent No.3.
The substance of resistance put-forth by the Respondent No.3 is that
based on the information received and the article published by BBC
that, the combination of Tapentadol and Carisoprodol has significant
abuse potential and the said combination was being exported to West
African countries from India, the Respondent No.3 had directed
withdrawal of the permission for manufacture of all combinations of
Tapentadol and Carisoprodol considering their potential drug abuse and
harmful impact on the population. Under the said Circular, the
Respondent No.3 has only withdrawn the export NOCs. The said
directive was not manufacturer specific.
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10. With regard to the joint inspection conducted at the
manufacturing facilities of the Petitioners, the Respondent No. 3(R3),
contends that significant discrepancies and deficiencies were found in
the said joint inspection and the Petitioners have failed to comply with
the observations reported in the joint investigation report and
compliance verification.
11. In the wake of the aforesaid pleadings and material, I have heard
Mr. Amir Arsiwala, the learned Counsel for the Petitioners, Mrs. Vaishali
Nimbalkar, the learned AGP for the Respondent No.2-State in Writ
Petition No. 10602 of 2025, Mrs. M.S. Srivastav, the learned AGP, for the
Respondent No.2-State in Writ Petition No. 10603 of 2025, and Mr. D.P.
Singh, the learned Counsel for the Respondent No.3, in both the
Petitions. With the assistance of the learned Counsel for the parties, I
have perused the material on record.
12. Mr. Arsiwala, the learned Counsel for the Petitioners, submitted
that the impugned orders of stop production are not only in breach of
the principles of natural justice but in flagrant violation of the express
statutory provisions. Mr. Arsiwala laid emphasis on the fact that the stop
production orders were passed by the Respondent No.1 on the very day
the Petitioners were called upon to furnish the information with regard
to the inspection conducted at the manufacturing units of the
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Petitioners, purportedly under Section 22(1)(cca) read with Section
18-B of the Act, 1940.
13. Mr. Arsiwala submitted that on 22nd February 2025 the order of
stop production was passed by the Respondent No.1 in Writ Petition No.
10603 of 2025. Whereas the notice to show cause purportedly under
Rule 85(2) of the Rules, 1945 was issued two days latter on 24 th
February 2025. By the said notice the Petitioner in Writ Petition No.
10603 of 2025 was called upon show cause as to why an order to cancel
manufacturing license or suspend the same for a suitable period or any
other legal action be not initiated against the Petitioner.
14. In Writ Petition No. 10602 of 2025, the stop production order
was issued on 26th February 2025 based on inspection of the
manufacturing unit on 25th February 2025 and the show cause notice
under Rule 85(2) of the Rules, 1945 was issued on 27th February 2025.
15. Mr. Arsiwala would thus urge that, if on the basis of the show
cause notice to cancel or suspend the manufacturing licences; to which
the Reply is given by the Petitioners, any purported order is passed by
the Competent Authority, the Petitioner would work out their remedies.
However, the direction to stop production without complying with the
mandate of Rule 85 to give an opportunity to show cause, was clearly in
violation of the statutory requirements. Therefore, the impugned orders
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to stop production passed by the Respondent No.1 and affirmed by the
Respondent No.2, in Appeal, deserve to be quashed and set aside.
16. To buttress the aforesaid submissions, Mr. Arsiwala placed
reliance on the judgment of the Supreme Court in the case of
Nawabkhan Abbaskhan Vs The State of Gujarat, 1 a decision of the
Rajasthan High Court in the case of Santokba−The Pharmacy−OPD
(M/s.), (A Unit of Tara Medicose Pvt Ltd) 2 and a decision of the Madras
High Court in M/s Intermed Vs The Director of Drugs Control &
Licensing Authority & Ors.3
17. In opposition to this, the learned AGP for the Respondent Nos. 1
and 2-State and Mr. D.P. Singh, the learned Counsel for the Respondent
No.3, CDSCO, supported the impugned orders. The learned Government
Pleaders would urge that the Authorities were constrained to take
action against the Petitioners, in view of the exigency of the situation.
The joint inspection had revealed serious deficiencies and supply of
combinations of Tapentadol and Carisoprodol to the local suppliers in
India, instead of foreign buyers. The Petitioners have failed to
satisfactorily comply with the observations in the inspection report and,
therefore, the stop production orders are fully justified.
1 (1974) 2 SCC 121.
2 2019(1) RLW 769 (Raj.).
3 W.P. No. 7832 of 2018 and W.M.P. No. 9774 of 2018 decided on 18 th
August 2022.
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18. At the outset, it is necessary to keep in view the genesis of the
impugned action. Evidently, the action was initiated pursuant to the
circular dated 21st February 2025 issued by the CDSCO (R3). The said
circular (Exhibit "C" in Writ Petition No. 10603 of 2025) records that
the BBC has reported that the combination of Tapentadol and
Carisoprodol has significant abuse potential and the said combination
was being exported to West-African countries from India. Looking to the
potential drug abuse and its harmful impact on public, the Drug
Controller General (I), New Delhi, advised all States/UT Drug
Controlling Authorities to immediately withdraw all export NOCs and
permission to manufacture issued for the combination of Tapentadol
and Carisoprodol. The Authorities were requested to withdraw all
export NOCs and permission to manufacture issued for all combinations
of Tapentadol and all combinations of Carisoprodol which were not
approved by the importing country.
19. On 22nd May 2025, Deputy Drugs Controller (India), CDSCO
(West Zone), Mumbai, informed the Authorities in the State of
Maharashtra, Chhattisgardh, Goa and UT DNH & DD that all export
NOCs and permissions issued by CDSCO, West Zone, Mumbai Office for
all combinations of Tapentadol and all combinations of Carisoprodol
stood cancelled, until further orders.
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20. In the wake of the aforesaid advisory and cancellation of the
export NOCs and permission, by CDSCO, a joint inspection was
conducted at the manufacturing facilities of the Petitioners. As noted
above the Petitioners were called upon to furnish the requisite
information under Section Section 22(1)(cca) read with Section 18-B of
the Act, 1940. The Joint Commissioner, FDA (R1) referred to the joint
inspection carried out by the officials of CDSCO and State FDA, the
deficiency and the discrepancies noted therein, and directed the
Petitioners to stop the production, sale and distribution of medicines
under the approved licences till further written orders.
21. It would be contextually relevant to note that, there is no
controversy over the fact that the Petitioners surrendered the licences to
produce all combinations of Tapentadol and Carisoprodol and the
products surrender was approved by the Respondent No.1. Nor it could
be disputed that the show cause notices under Rule 85(2) of the Rules,
1945 were issued two days after the respective stop production order.
22. In the backdrop of the aforesaid rather uncontroverted facts, the
legality and validity of the order to stop production of medicine under
the approved licence is required to be tested. The impact of impugned
orders, it must be noted at the cost of repetition, is not confined to
combinations of Tapentadol and Carisoprodol, but the very manufacture
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of medicines under he approved license for all other products. Can such
action be sustained?
23. Rule 85 of Rules, 1945 regulates the procedure for cancellation
and suspension of license. In the instant case, we are primarily
concerned with the Sub-Rule (2) of Rule 85. It reads thus:
"85. Cancellation and suspension of licences
(1) .........
(2) The Licensing Authority may, for such licences granted
or renewed by him, after giving the licensee an opportunity to
show cause why such an order should not be passed, by an
order in writing stating the reasons therefor, cancel a licence
issued under this Part or suspend it for such period as he
thinks fit, either wholly or in respect of any of the drugs to
which it relates, or direct the licensee to stop manufacture,
sale or distribution of the said drugs and thereupon order the
destruction of drugs and the stocks thereof in the presence of
an Inspector, if in his opinion, the licensee had failed to
comply with any of the conditions of the licence or with any
provisions of the Act or rules made thereunder."
24. A plain reading of Sub-Rule (2) would indicate that the Licensing
Authority is empowered to cancel a license or suspend it for such a
period as it thinks fit or wholly or in respect of any of the drugs to
which it relates, or direct the licensee to stop manufacture, sale and
distribution of the specified drugs if, in his opinion, the licensee had
failed to comply with any of the conditions of license or with any
provisions of the Act or Rules made thereunder. However, there is a
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Caveat. The Licensing Authority, before taking any of the aforesaid
actions, is enjoined to give the licensee an opportunity to show cause
why such an order should not be passed. Moreover, action of
cancellation or suspension of license or directing the licensee to stop
manufacture, sale or distribution of the specified drugs must be by an
order in writing disclosing the reasons therefor.
25. The aforesaid Rule, thus, warrants a pre-decisional hearing in the
form of a show cause notice which subsumes in its fold an opportunity
to show cause against the proposed action. The Licensing Authority is
also enjoined to consider the explanation or cause shown by the
licensee and then pass a reasoned order. This obligation to pass
reasoned order, post an opportunity to show cause, is impregnated with
the requirement of application of mind.
26. It is trite even administrative decisions which impinge upon the
fundamental rights and have detrimental civil consequences, are not
immune from the imperativeness to adhere to the principles of natural
justice. Where there is a statutory requirement to provide an
opportunity of hearing, the failure to do so has invariably the vitiating
effect. The omission to give an opportunity of hearing where the statute
or Rule warrants, constitutes a flagrant violation of a defined decision
making process and, in a given case, erodes the very authority to make
the decision.
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27. In the case of Nawabkhan Abbaskhan(Supra), in the context of an
Externment order, the Supreme Court enunciated that where hearing is
obligated by the statute, the failure to comply with such a duty is fatal.
Any act in breach of such a statutory duty is, in its inception, void. The
observations of the Supreme Court in paragraph 14 read as under:
"14. Where hearing is obligated by a statute which
affects the fundamental right of a citizen, the duty to
give the hearing sounds in constitutional requirement
and failure to comply with such a duty is fatal. May be
that in ordinary legislation or at common law a
Tribunal, having jurisdiction and failing to hear the
parties, may commit an illegality which may render
the proceedings voidable when a direct attack is made
thereon by way of appeal, revision or review, but
nullity is the consequence of unconstitutionality and so
without going into the larger issue and its plural
divisions, we may roundly conclude that the order of
an administrative authority charged with the, duty of
complying with natural justice in the exercise of power
before restricting the fundamental right of a citizen is
void and ab initio of no legal efficacy. The duty to hear
manacles his jurisdictional exercise and any act is, in
its inception, void except when performed in
accordance with the conditions laid down in regard to
hearing. May be, this is a radical approach, but the
alternative is a travesty of constitutional guarantees,
which leads to the conclusion of post-legitimated
disobedience of initially unconstitutional orders."
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28. Closer home to the fact of the case at hand, in the case of
Santokba (Supra), in the context of Rule 66 of the Rules, 1945, the
Rajasthan High Court held that the Licensing Authority is fastened with
the liability that before it takes extreme step of either suspending or
cancelling the license, at least a notice is required to be given or
opportunity to show cause is to be afforded. Once there is a provision in
the Rules, 1945 mandating an opportunity of hearing, the Authorities
cannot be allowed to plead that the notice to the affected party would
be an empty formality.
29. In the case of M/s Intermed (Supra), wherein the Licensing
Authority while issuing show cause notice itself had prohibited the
licensee from manufacturing or selling the drugs from the premises in
dispute, a learned Single Judge of the Madras High Court after
adverting to Rule 85(2) of the Rules, 1945 (extracted above) held that
from a reading of the Rule, it is clear that the Licensing Authority was
required to give an opportunity to licensee and hear him before passing
an order. It was clear from the records that no opportunity had been
given to the Petitioner before an order was passed. It would be one
thing to issue a show cause notice and it is another to require the
licensee to stop manufacturing. The Authority therein had passed a
rolled up order and required the Petitioner to stop manufacturing while
issuing a show cause notice and that was in contravention of Rule 85.
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30. In the case at hand, the action of prohibiting the production
stands on an even weaker foundation. As noted above, the stop
production order was passed two days prior to the issue of show cause
notice under Rule 85(2) of the Rules, 1945. No show cause notice, as
such, was given before the Respondent No.1 passed the stop production
order. The endeavour of Respondents to salvage the position by clinging
to the slim thread of the show cause notice, issued after two days of the
impugned action, is too fragile to merit countenance. The impugned
actions of prohibiting manufacture for sale and distribution of all the
medicinal products was in clear violation of the statutory requirements.
31. The Respondents made an endeavour to justify the impugned
action by alluding to the potential drug abuse and its grave impact and
injurious ramifications on the public de hors the failure to comply with
the mandatory requirement of the Rule. This submission though
attractive at the first blush, looses significance if subjected to close
scrutiny. The genesis of the entire action is required to be revisited.
32. As per the Advisory of the Government of India, issued with a
view to arrest the potential drug abuse of all combinations of
Tapentadol and Carisoprodol, indisputably, both the Petitioners had
surrendered the licences to produce the drugs of all combinations of
Tapentadol and Carisoprodol, under a couple of days of the said
advisory. The Petitioners thus had no subsisting license to produce the
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drugs of all combinations of Tapentadol and Carisoprodol. Therefore,
the impugned action prohibiting manufacturing of all the medicines of
all other products operates onerously and impinges upon the rights of
the Petitioners and all the stake holders in the manufacture of the other
medicines. Therefore, the endeavour of the Respondents to sustain the
impugned action by adverting to the gravity of potential drug abuse
cannot be acceded to.
33. The conspectus of the aforesaid consideration is that, the
impugned orders deserve to be quashed and set aside. However, it is
necessary to clarify that the Competent Authority is free to take
appropriate decision in relation to the proposed action of cancellation
or suspension of the manufacturing licences, pursuant to the show
cause notices issued under Rule 85(2) of the Rules, 1945, in accordance
with law.
34. Hence the following order:
:ORDER:
(i) The Petitions stand allowed.
(ii) In Writ Petition No. 10603 of 2025, the
dated 22nd February 2025 as well as the order dated
10th July, 2025 passed in Appeal by the Respondent
No.2, stand quashed and set aside.
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(iii) In Writ Petition No. 10602 of 2025, the
dated 26th February 2025 as well as the order dated
10th July, 2025 passed in Appeal by the Respondent
No.2, stand quashed and set aside.
(iv) It is, however, clarified that the Competent
Authority may pass appropriate orders in relation to
the proposed action of cancellation or suspension of
the manufacturing licence pursuant to the show cause
notice under Rule 85(2) of the Rules, 1945, in
accordance with law. The observations in this
judgment will not be construed as an expression of
opinion on the said aspect of the matter.
(v) Rule is made absolute to the aforesaid
extent.
(vi) No costs.
[N. J. JAMADAR, J.]
