Syngenta India Ltd. vs Uoi Through Department Of ...
2009 Latest Caselaw 3098 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI
                                                                     #33
+      LPA 367/2009

       SYNGENTA INDIA LTD.                     .... Appellant
                     Through Mr. Mukul Rohatgi, Senior
                     Advocate with Ms. Ruchi Agnihotri Mahajan,
                     Adv.


                   versus


       UOI THROUGH DEPARTMENT OF AGRICILTURE
       & CO- OPRATION & Ors.                  ..... Respondents
                     Through Mr. A.S. Chandhiok, ASG with Mr.
                     Gaurav Duggal, Mr. Ritesh Kumar, Mr.
                     Sandeep Bajaj, Advs. for R-1/UOI.
                     Mr.S. Ganesh and Mr. Sudhir Nandrajog,
                     Senior Advocates with Mr. Laliet Kumar and
                     Mr. Santosh Sharma, Advs. for R-3.

       CORAM:
       HON'BLE THE CHIEF JUSTICE
       HON'BLE MR. JUSTICE MANMOHAN

       1.Whether reporters of the local news papers
          be allowed to see the judgment?
       2.To be referred to the Reporter or not ?
       3. Whether the judgment should be reported in the Digest ?


                      ORDER

% 11.08.2009

The appellant Syngenta India Ltd. has preferred this appeal

against the judgment and order dated 1.7.2009, passed by S.

Ravindra Bhat, J. in W.P(C) No. 8123/2008. In the writ petition the

appellant impugned the decision of the Department of

Agriculture, Government of India, dated 5.11.2008, rejecting its

appeal under Section 10 of the Insecticides Act, 1968 ("the Act")

against the decision of the Registration Committee ('Committee'

for short) for granting registration for Emamectin Benzoate 5%

SG to the third respondent - M/s Jaishree Agro Industries Ltd. in

its 293rd meeting held on 26.9.2008. The learned Judge came to

the conclusion that the litigation was speculative, as the attempt

was clearly to invite the Court to make a policy declaration, which

could not have been made under any circumstances and the

pendency of this proceeding had also resulted in prejudice to the

third respondent, who was constrained to give an undertaking not

to give effect to its registration that has subsisted all this while.

Consequently, the learned Judge dismissed the petition with

heavy costs.

2. The facts necessary for deciding this appeal are as follows :

In 2003 the appellant filed an application for registration

under Section 9(3) of the Act for import of technical (TIT) sourced

from its parent factory in Switzerland, and for indigenous

manufacture of formulation (FIM) for the insecticide, Emamectin

Benzoate 5 % Soluble Granules ("Emamectin 5% SG"). The

Committee noted that its (appellants') data was incomplete on

various parameters like toxicity and bio-efficacy, in its meeting

held on 2.7.2004. The appellant, therefore, could not be granted

a registration under Section 9 (3) of the Act. The appellant,

however, was in the meanwhile, asked by the Committee to

convert its application to one under Section 9(3-B), on account of

an infestation of cotton crop by bollworm at the relevant time, as

Emamectin is known to be effective in controlling such

infestation. Thus, a decision was taken by the Committee to

grant a provisional registration under Section 9 (3B) of the Act to

the appellant in the same categories of TIT (Import of Technical)

and FIM (Indigenous Manufacture of Formulation). Accordingly,

on 21.7.2004, certificates for provisional registration valid till

20.7.2006 were granted to the appellant in the categories of TIT

and FIM under S.9 (3B), for Emamectin 5% SG. This provisional

registration permitted commercialization of the insecticide (since

the grant of provisional registration was only because of the

demand expressed by the State Governments); but was subject

to a limit of a total quantity of 5 (five) Metric Tonnes of Technical

Emamectin permitted to the appellant during the period of 2

years. It is stated that from this 5 MT the appellant indigenously

manufactured about 100 MT of formulation, and used it for

commercialization as well as compilation and generation of

exhaustive data. The provisional registrations granted to the

appellant in the categories of TIT and FIM lapsed on 20.07.2006.

By that time the appellant claims to have collated and completed

its deficient data. On 11.09.2006, the appellant applied afresh

under Section 9 (3) of the Act in the category FIT (Import of

Formulation). On 24.7.2007, the appellant was granted

registration under Section 9 (3) of the Act in the category of FIT

(Import of Formulation).

3. On 27.07.2007, the respondent no. 3, applied for a

registration in the categories of "TIT" (Import of Technical) and

"FIM" (Indigenous Manufacture of Formulation) for Emamectin 5%

SG under Section 9(3B) of the Act. However, the respondent no.

3, was not granted registration because the appellant was

granted the registration under Section 9(3) before respondent

No.3 and the grant of registration under Section 9(3B) is only for

introduction of the product for the first time. This fact was

intimated to the respondent No.3 vide Secretariat of Central

Insecticides Board & Registration Committee's letter

No.1/TI/9(3B)/2006-CIR.II dated 24.7.2007. Therefore, the

respondent no. 3 requested that its application may be

considered under Section 9(3) for import of the product from a

new (alternate) source, which is permissible under already

existing guidelines of the Committee requiring lesser data

package because the efficacy and safety of the product had been

established to the satisfaction of the Committee. Accordingly, an

application was submitted by the respondent no. 3 on 7.8.2007

for registration as TIT(new source) under Section 9(3). Along

with the application required information / data was also

submitted by the respondent no. 3, as was applicable and

required in respect of application under Section 9(3) for TIT (new

source). The data submitted comprised more than 4000 pages of

detailed technical studies, analysis, reports and other data,

including reports of numerous studies conducted by Jawaharlal

Nehru Krishi Vishwa Vidyalaya, Indian Agriculture Research

Institute, Tamil Nadu Agriculture University etc. which are well

known institutions in the field of agriculture. The Committee

verified the claims of the respondent no. 3 from the data

submitted to it and granted the registration to the respondent no.

3 under Section 9(3) of the Act in its 293rd Meeting held on

26.09.2008.

4. The appeal preferred by the appellant under Section 10 of

the Act to the Central Government, i.e the appellate authority,

came to be dismissed by order dated 5.11.2008, which interalia

reads as follows :

"M/s Syngenta India Limited (M/s Syngenta) have appealed against grant of registration to M/s Jaishree Agro Industries Ltd. (M/s Jaishree). They have mentioned that the Government had agreed to provide three years freeze on data submitted by the applicants for formulation import under Section 9(3) of the Act; that there is no technical Emamectin registered in the country under Section 9(3) as of how; that in terms of the policy enunciated in 284th meeting of the Registration Committee, the technical would be deemed to be registered after three years form the date of formulation import; that as Emamectin Benzoate 5% SG formulation for import was registered in their favour on 26.07.2007, the technical can be deemed to be registered only after 3 years; that the grant of registration for technical to M/s Jaishree presumes registration of technical prematurely before the expiry of 3 years; that registration for import of technical from alternate source has been granted to M/s Jaishree based on truncated data requirement; that as per guidelines for registration the registrant under section 9(3) is required to submit the complete data on its own which should be applicable for M/s Jaishree also who have relied on data furnished by M/s Syngenta instead as implied in their presentation made in the 278th meeting of the Registration Committee; that policy guidelines should be applicable prospectively and not retrospectively; that the decision of the Registration Committee taken in its 293rd meeting is contrary to the decision taken on 284th meeting; that equating registration under section 9(3) with registration under section 9(3B) for computing the 3 year period for effecting deemed registration of technical in contrary to the earlier decision and is arbitrary and illegal; that their provisional registration for Emamectin Benzoate under section 9(3B) which expired on 20.07.2006 was restricted to import of 5 MT of technical grade material to deal with exigency of bollworm infestation in cotton at the request of State Governments; that the impugned decisions taken on 293rd meeting may be stayed till the matter is decided; that the impugned decision of 293rd meeting (agenda items 6.5 and 3.7) be quashed. In the hearing held on 04.11.2008, the representatives of M/s Syngenta elaborated on these points and also asserted that the letter dated 18.02.2008 of the Government was for formulations for import and not for indigenous manufacture and

therefore the registration issued in 2004 for indigenous manufacture of the formulation to them did not come under its purview.

The Secretary, CIB&RC, vide letter no.13- 29/2008-CIR.I dated 30.10.2008, has questioned the locus standi of M/s Syngenta in the matter of grant of registration to another applicant as the matter is between the Registration Committee and another applicant. It has been stated that as per the directive of the Department of Agriculture & Cooperation dated 18.02.2008, the period of deemed registration is to be computed from the date of registration with commercialization under section 9(3B), i.e. from 21.07.2004. The registration to M/s Jai shree, who have submitted requisite data under the relevant guidelines, has been granted as per the policy of the Government and the guidelines of the Registration Committee. The provisional registration was granted to M/s Syngenta in 2004 at their own request. In view of these averments, the appeal is liable to be set aside. These points were further elaborated by Secretary, CIB&RC in the hearing on 04.11.2008.

Section 10 of the Act provides that "Any person aggrieved by the decision of the Registration Committee under section 9 may, within a period of 30 days from the date on which the decision is communicated to him, appeal in the prescribed manner..." M/s Syngenta, already holding a registration of the insecticide in question, are an interested party in the matter. It would be too narrow an interpretation if the scope of section 10 is confined to the applicant/registrant alone. The decision of the Registration Committee are in public domain and are displayed on the internet. It would not be fair to deny any person a change to appeal against a decision of the Registration Committee if he is aggrieved by that decision, provided the person has a clear interest in the decision.

Coming to the issues raised in the appeal, it is noted that the Government has been issuing directives from time to time for proper enforcement of the Insecticides Act, 1968 and the rules made thereunder, and in doing so it has been taking into account the views of the different sections of the pesticides industry. The letter dated 30.10.2007, issued in view of the instances where formulation had been registered for import without registration of

technical under section 9(3) thus blocking registration under section 9(4) and created a monopolistic situation, also took into account the industry's concern to allow data protection for 3 years till suitable legislative changes are made. The letter dated 18.02.2008 included the category of registration under section 9(3B) with commercialization in this dispensation with a view to remove the perverse tendency to continue with provisional 9(3B) registration with commercialization, thereby creating monopolistic situation. The data protection for 3 years is available to his category also. It would also be disingenuous to make a distinction between registration of formulation for import and registration of formulation for indigenous manufacture for this purpose as indefinite protection in either case would have the same consequence, i.e. existence of a monopolistic situation. Application received for grant of registration for the same product from any other source thereafter is treated under the category of new source and the data requirements for that category apply which have been met by M/s Jaishree. The registration under section 9(3B) with commercialization was granted to M/s Syngenta at their own request in 2004. The Registration Committee has taken the decision in question (agenda items 6.5 and 3.7) in its 293rd meeting in line with the policy laid down by the Government. As such there is no reason to interfere with these decisions. The appeal is, therefore, dismissed."

5. After a very elaborate and detailed consideration of the

facts and law, the learned single Judge dismissed the writ petition

challenging the order of the Central Government passed in

appeal under Section 10 of the Act.

6. Mr. Mukul Rohatgi, learned senior counsel appearing for the

appellant, inter alia raised the following four submissions before

us:

(i) that though the respondent no. 3 was effectively

seeking registration on parameters / criterion

applicable to registrations under Section 9(4) of the

Act ("Me Too") by placing substantial reliance on data

of the appellant, the Committee erroneously granted

to the respondent No.3 registration under Section 9(3)

of the Act;

(ii) that in any event the data submitted by the appellant

pertained to a technical / active ingredient having a

purity of minimum 95% whereas the maximum purity

available with the supplier of the respondent no. 3 is

90%. Thus, the data submitted by the appellant was

for an entirely different product and there could be no

reliance whatsoever on the appellant's data;

(iii) that the order of the Committee granting registration

to the respondent no. 3 amounts to unjustified dilution

of the data submitted by the appellant which is liable

to be protected under the guidelines issued by the

Government vide circular dated 30.10.2007;

(iv) that Office Memorandum (OM) dated 18.02.2008

purportedly clarifying the circular dated 30.10.2007 is

arbitrary and illegal.

7. Before adverting to the submissions made by Mr. Mukul

Rohatgi, we may briefly refer to the scheme of the Insecticides

Act, 1968 ('The Act' for short). The Act was brought into force on

2.9.1968 with the object of regulating the import, manufacture,

sale, transport, distribution and use of Insecticides with a view to

prevent risk to human beings or animals connected there with.

Any prospective manufacturer or importer of any insecticide /

pesticide in India is primarily governed by the regime of this Act.

No insecticide can be imported into India / manufactured

indigenously, unless the prospective importer / manufacturer has

obtained registration under Section 9 of the Act. An insecticide

contains an active ingredient or the raw material called the

technical and after adding certain additives, these result in

formulation. For each activity, there has to be an approved

registration of the formulation and/or technical as the case may

be. A desirous party can either import the technical of an

insecticide and manufacture the formulation indigenously or

import the formulation of the insecticide for direct marketing and

use in India upon obtaining the approval of the Committee.

8. Section 5 of the Act vests the power / function to scrutinize,

examine and analyze insecticides as to their safety and efficacy

on the Committee. Section 5 makes elaborate provisions for the

constitution and functions of the Committee, for enabling

registration of insecticides on the receipt of applications, after

enquiring into the safety and efficacy of the product. Under

Section 5(5), the Committee regulates its procedure and conduct

of business, including the grant of registrations of parties

desirous of importing or manufacturing insecticides, for which

purpose it has formulated guidelines. It has also issued a

Checklist specifying the various parameters on which data is

required to be submitted by an applicant along with its

application for registration. Rule 4 of the Insecticides Rules

elaborates on the functions of the Committee. Section 9 of the

Act provides for three kinds of registrations: (i) Section 9(3-B) - a

provisional registration which is granted to an applicant for a

period of two years when an insecticide is introduced for the first

time in India. It can be granted pending an enquiry and also in

the event of agricultural exigencies. This section presupposes

insufficiency of examination of data by the Committee; (ii)

Section 9(3) - regulation registration - The regular registration is

granted only after submission of complete data by an applicant.

The Committee conducts a full and in-depth study of the data and

has to be ensure itself of the efficacy, toxicity and safety (for

humans and other animals) of the insecticide before granting

registration; and (iii) Section 9 (4) provides for what is popularly

known as a "Me Too" "registration". The registration under

Section 9(4) is granted on same conditions and is only granted

when there already exists a registration under Section 9 (3) for a

particular Insecticide. It is obvious that these "same" conditions

necessarily mean and include the same source of import also.

9. At this stage, we may refer to the guidelines framed by the

Committee for the registration of insecticides and parameters /

criterion fixed by it to effectuate verification of the efficacy and

safety of the insecticides. The Committee has issued a Checklist

specifying the various parameters on which data is required to be

submitted by an applicant along with its application for

registration - like Chemistry; Bio-efficacy, toxicity, etc. The

Checklist has enumerated categories under which the registration

of an insecticide can be sought, the relevant categories (for the

present Appeal) are :

        (a)      TIT - import of technical

       (b)      FIM - indigenous manufacture of formulation.

       (c)      FIT - import of formulation.

       (d)      TIT (new source) - import of technical from a different

                / new source.

10. The Checklist framed by the Committee is at pages 151 -

156 of the compilation and the Checklist for TIT (new source),

which is at page 151, makes it clear that the Committee has laid

down that in the case of registration of an insecticide which has

already been permitted by the Committee in the past under

Section 9(3)of the Act, and which is now proposed to be procured

from a new source, only the attenuated or reduced data, material

evidence specified under column no. 12 of the Checklist is

required to be furnished and if such data is furnished then the

applicant will be entitled in law to registration under Section 9(3)

of the Act. We may also mention that the Central Government

has issued the circular dated 30.10.2007 introducing a concept of

deemed registration of the technical/active ingredient of the

formulation without a separate application being made for the

same. The circular also provides for data protection for three

years from the date of registration of the formulation. By OM

dated 18.2.2008 the Central Government has clarified that the

period of three years is to be reckoned not from the date of the

grant of registration under Section 9(3) of the Act but if

applicable, from the grant of provisional registration under

Section 9(3B), if previously granted with permission to

commercialize.

11. In the above background of the provisions of the Act, rules

and the relevant guidelines, we may now proceed to deal with the

submissions made by the learned senior counsel appearing for

the appellant.

Submissions (i) & (ii)

12. We have gone through the entire records and it is

absolutely clear to us that in the present case, the registration

which was granted to respondent no. 3 was under Section 9(3)

and not under Section 9(4) of the Act. It is also seen from the

records that for the purpose of taking the decision to grant

registration to respondent no. 3 under Section 9(3), the

Committee has followed the standard guidelines and criteria

which are set out in the Checklist framed and issued by the

Committee, in exercise of its statutory powers under Section 5(5)

read with Section 9(3) of the Act, under which it is the

prerogative of the Committee to decide the criteria, material,

evidence and data on the basis of which the Committee would

take a decision to grant registration under Section 9(3) of the Act.

Further, the record of the proceedings before the Committee also

makes it clear that the application of respondent no. 3 for

registration was only under Section 9(3) and was under the head

"Technical import from new source" i.e. TIT (new source). The

data submitted by respondent no. 3 comprises more than 4000

pages of detailed technical studies, analysis, reports etc. It is

also seen that in the 293rd meeting of the Committee the data

was verified by the Committee under Section 9(3) and on

satisfaction about the data the registration came to be granted in

favour of the respondent No.3 under Section 9(3). The Central

Government has also in its counter affidavit filed before the

learned single Judge clearly stated that the data submitted by the

respondent no. 3 was more than adequate for grant of

registration as TIT (new source). It has been further stated in the

counter affidavit of the Central Government that chemical

composition of the insecticide of the appellant and that of the

respondent no. 3 are the same.

13. Learned single Judge has minutely examined the records

and has recorded the following findings:

"34. So far as Jaishree is concerned, the application for registration was made for indigenous manufacture, under Section 9(3B) on 20.02.2006. It contends having furnished complete data reports etc. in accordance with the prescribed checklist. It sought to have the application, converted into one under Section 9 (3); later by its letter dated 6-6-2007, it requested the committee to process the application, under section 9(3), stating as follows:

"We have applied for registration of Emamectin benzoate Technical Import and its formulation Indigenous manufacture u/s 9(3b) of Insecticides Act, 1968, in February, 2006. As today, our both the applications are complete from all disciplines as per requirements of 9 (3b).

With reference to your above said letter, we are requesting to consider our above applications u/s 9(3) new source. As per the guidelines and requirements of 9(3) our both applications are completed from all disciplines except Toxicity and packaging.

Now we are submitting required information/data in both the disciplines i.e toxicity and packaging as per 9(3) New source.

Please find enclosed additional information for consideration of our applications of Emamectin Benzoate Technical for Technical Import u/s 9(3) New Source and its formulation u/s 9(3).

So far as Emamectin benzoate formulation Indigenous Manufacturer is concern, the CIB & RC has already ensured efficacy and safety to human beings and animals about the insecticide and relevant data is already available with CIB & RC. Therefore, it is not required to submit repeated data on observation in man (Health record of spray operators) and toxicity to Livestock (field trials and observations) or may be submitted later on if required..."

The subsequent letter of 14th August, 2007 by Jaishree to the committee enclosed further information on aspects such as bio-effectiveness, phytotoxicity and residue in plant. The official respondents categorically submit that the petitioner's data was not used by Jaishree; it is also averred that independent testing is not done by the committee, which only goes through the claims, and co-relates with the data furnished to it. Its contention in this regard, inter alia, is that Jaishree

"requested that their application may be considered under Section 9 (3) for import of the product from a new (alternate) source, which is permissible under already existing guidelines of the Registration Committee requiring lesser data package because the efficacy and safety of the product had been established to the satisfaction of the Registration Committee (Respondent No.2).

                     Therefore,    no    separate    or     special
                     dispensation of data was made in the
                     process    of   granting    registration    to

Respondent No.3. It may also be mentioned that no verification of sources is done in any case including that of the petitioner. The Registration Committee verifies the claims of the applicants from the data submitted to it. It is pertinent to mention here that having attained some knowledge, the Registration Committee, or any one for that matter, can further use the knowledge in routine. It is due to this reason the Registration Committee had framed and adopted the guidelines for this category

with this vision to avoid unnecessary repetition much before this case. It is more so because the chemical composition of the product of the Petitioner and that of the Respondent No.3 are same. If the product of the Petitioner could prove efficacious and safe on certain minimum data, it is not understood as to how the product of the Respondent No.3 would not be efficacious and safe with the same chemical composition.

(emphasis supplied)

35. It is evident from the above extract, that the committee adopted, on a uniform basis, guidelines which had been evolved earlier that if the efficacy of a product is established, then, in the case of a different source, the authorities would only verify, on application of the prescribed parameters about the safety of such new source, to human beings and animals. The same yardstick was applied to the petitioners and Jaishree.

36. The above discussion should have been sufficient to deal with the petitioners' contention that Jaishree used its data; however, since parties had urged factual contentions, in order to satisfy itself that the committee's approach was correct, the court examined the materials. The petitioner, for bio-efficacy of emamectin benzoate 5% SF conducted six studies on Okra, three at University of Agricultural Sciences Dharwad, during different seasons; two at TN Agricultural University, Coimbatore, 2003-04 and 2006 and one at Punjab Agricultural University, Ludhiana. Jaishree, on the other hand, relied on TN Agricultural University study at Location Allapalayam, Season 2005-06 and location Maampali, season 2006. The four other studies' locales were Malwa Plateau and Nimar Valley, for different seasons, through the Jawaharlal Nehru Krishi Vishwa Vidyalaya, Khargone. The petitioners' cotton studies were from All India Co-

ordinated Cotton Improvement Project, Coimbatore ( two studies) and Tamil Nadu Agricultural University, Coimbatore ( three studies). Jaishree's studies, on cotton, on the other hand, were four studies from the Jawaharlal Nehru Krishi Vishwavidyala, during different seasons, two studies from the Indian Agricultural Research Institute, Delhi and two studies of the Tamil Nadu Agricultural University. It would not be necessary to go into greater details, save

noticing that the Union's stand is in support of Jaishree, and that the materials on record justify their position that the petitioner's data was not used, in support of Jaishree's claim.

14. In our opinion therefore submissions (i) & (ii) are

without any merit.

Submissions (iii) & (iv)

15. Insofar as the allegation of dilution of data is concerned it is

required to be noted that no provision of the Act, or Rules,

prescribe or enact data exclusivity or protection. The October

2007 guidelines, directing a data exclusivity provision, was

brought into force after the appellant's registration certificate

was issued. As per the circular dated 30.10.2007, as amended by

OM dated 18.2.2008, the exclusivity is only for a period of three

years from the date of the provisional registration. Thus the

period prescribed under the circular had already expired before

the registration granted to the third respondent. It is also

pertinent to note that no challenge has been raised to the OM

dated 18.2.2008 in the writ petition though submission appears

to have been raised across the Bar questioning the OM on the

ground of the arbitrariness. In any event, we find that the

submission regarding the data protection is completely

misconceived. It is not the case of the appellant that the

respondent no. 3 in importing its "TIT" has in any way violated

the confidentiality of appellant's data. Mr.Ganesh, appearing for

the respondent No.3, submitted and in our opinion, rightly, that in

a case of registration of "TIT" (new source) it is not as if the

applicant is utilizing the materials or the intellectual property of

the earlier applicant. The correct position is that since the

Committee has, on an earlier occasion after fully and carefully

studying all the relevant and applicable materials, approved a

particular insecticide there is no need thereafter for another

applicant who wishes to import the same insecticide albeit from a

different source to reinvent the wheel as it were and to place on

record the entire mass of material and data which was required

to register the said insecticide originally. In such a situation that

the Committee, which is a high powered technical body, has

considered it appropriate to issue a Checklist providing that when

a person desires to import the same insecticide, but from a

different source, the requirement of submission of data are

appropriately reduced. The respondent no. 3 has fully complied

with the guidelines of the requirements of the Checklist issued by

the Committee. In our opinion, therefore there is no illegality in

the action of the Committee in granting registration in favour of

the third respondent. In our opinion, the whole object of initiating

these proceedings is to somehow continue the monopoly of the

appellant in the product and sale of the insecticide in question. It

is pertinent to note that now the third respondent is selling the

same insecticide approximately at the rate of Rs.5,000 per kg.

which has been all along sold by the appellant at the rate of

about Rs.9,000/- per kg.

16. We dismiss the appeal with costs of Rs.1 lac, which will be

paid by the appellant to the respondent nos. 1 and 3 in equal

proportion.

CHIEF JUSTICE

MANMOHAN, J AUGUST 11, 2009 dk/v