SLP 2000 Part 1
Sunday, 30 May 2010 22:36
IN THE SUPREME COURT OF INDIA
[ORDER XVI RULE 4 (1) (A)]
SPECIAL LEAVE PETITION (Civil) No. 5203 of 2000
(WITH PRAYER FOR INTERIM RELIEF)
SYNOPSIS AND LIST OF DATES
The State of Kerala has drawn global attention for many years for achieving the social indicator for good health care while having low income. This State has a life expectancy of 69 for men and 74 for women and infant mortality rate of 13% per thousand live births as against the National average of 71%. Many social indicators including health indicator are far superior to national averages and approaching those of the developed countries. This has been achieved against the low gross national product which is US $ 275 per person per year in Kerala as against the national average of US $ 350 and US $ 23,090 of the developed countries. This impressive results could be achieved because of the presence of small and medium hospitals/clinics spread out throughout the State. It is a fact that 80% of the medical relief is rendered by these private clinics and hospitals and the individual Medical Practitioners. There are 4,288 Private Allopathic Clinics and Hospitals in this geographically small State and there are 4,922 Private Ayurveda Hospitals and 3,118 Homeo Hospitals. These are small and medium size hospitals which are no way comparable to the big hospitals like Apollo Hospital or Escorts which mainly cater to the rich and famous in the cities. These small and medium size hospitals are spread out in every nook and corner of the State and functioning round the clock throughout the year: 24 hours medical care is rendered. Precisely because of this 95% of pregnant women get antenatal care and 92% of deliveries are Institutional as against the national average of 25%.
In this background of creditable performance in the field of public health care, for which the contribution of small and medium size hospitals/clinics is substantial, there is absolutely no reason to implement a rule for the first time restricting the functioning of hospital pharmacy, after more than half a century (60 years) of the enactment of Drugs and Cosmetics Act 1940. As per the implementation of the rule in question, the pharmacies which dispense medicine as a part of treatment to its patients and not at all indulging in sale of medicines across the counter has to take a license to stock and dispense medicines to the patients who come for treatment - outpatients as well as inpatients. The implementation of the said Rule has, apart from the legal infirmity, far reaching social consequences. Because of the presence of these small and medium hospitals (when the presence of Government hospitals are far and few) the needy people get 24 hours medical care. If such medical relief is to be dispensed, the hospital pharmacy has to function 24 hours throughout the year.
If the hospital pharmacy can function only with a licence, then the medicine should be dispensed by Registered Pharmacists only. The Pharmacists in Kerala are a well organised group. Their working hours are limited to 8 hours a day and they have to be provided with holidays and off-days. They work only with the assistance of salesman. So in a hospital pharmacy the requirement will be a minimum of 4 pharmacists, (8 × 3 + holidays) and salesmen. This would certainly increase the financial burden on the small and medium hospital as their income can only be nominal as is evident from low gross national product which is US $ 275 per person per year in Kerala. If these small and medium size hospitals do not stock and dispense medicines, it would result in denial of medical relief to the public at odd hours. These medium and small-scale hospitals are the only source of availing medication as a part of treatment at odd hours. Medical stores and Chemists close their shops by evening and a 24 hours medical store is an unknown phenomena for the rural people.
By insisting with the implementation of the said Rule in the State of Kerala, when according to the petitioner's knowledge, no other State in India has implemented this Rule in the last 60 years of the enactment of the above Act, had degraded hospital pharmacy and equated them with a medical store which sell the medicine across the counter to everybody.
The Government order implementing the said Rule after the gap of 60 years is not based on any material which necessitated such an implementation. Apart from that, they were insensitive to the consequences thereof inasmuch as there are lot of rigors and restrictions if the hospital pharmacy is to be governed by a licence. If these small and medium-size hospitals, in order to avoid harassment from the Drug Inspectors, and other restrictions, choose to not to stock medicine in the hospital, the needy people would be deprived of timely administration of medicine. It takes time to procure medicines against prescriptions and in almost every occasion there may not be any chemist shop nearby. Secondly, all the patients may not come to the hospital with attendants who can run and get medicine against prescriptions.
The said Rule is contrary to the Medical Council's Ethical Rules which prohibits Medical Practitioners running a shop for sale of medicine. The Rule insisting the Hospital Pharmacy to have a licence has the effect of converting the said pharmacy into a medical shop and the doctor as a trader. In hospital, there is no sale of medicine and the medicine which is dispensed is a part of treatment either to prevent a disease or to cure a disease which was diagnosed by the doctor himself. The presence of a Pharmacist in the hospital pharmacy will have the effect of the doctors being supervised by a paramedical personnel. The legal infirmity with regard to the order has been urged in detail in the grounds of the petition.
10.4.1940
The Drugs & Cosmetics Act, 1940, hereinafter referred to as the Drugs Act was enacted.
The relevant provisions of Section 18 thereof which falls under Chapter IV is as follows:
"18. Prohibition of manufacture and sale of certain drugs and cosmetics.— From such date as may be fixed by the State Government by notification in the Official Gazette in this behalf, no person shall himself or by any other person on this behalf —
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(c) manufacture for sale (or for distribution), or sell, or stock or exhibit (or offer) for sale, or distribute any drug (or cosmetic), except under, and in accordance with the conditions of, a licence issued for such purpose under this Chapter."
Section 33 (q) provides that the Central Government can exempt certain drugs from the application of Chapter IV of this Act.
21.12.1945
In exercise of the powers conferred by Section 6 (2), 12, 33, & 33 (N) of the Drugs Act, the Central Government, enacted the Drugs & Cosmetics Rules, 1945, thereto (hereinafter referred as 'the Rules').
Rule 123 of the 1945 Rules inter alia provides that the Drugs specified in Schedule K shall be exempted from the provisions of Chapter IV of the Act and the Rules made thereunder to the extent and subject to the conditions specified in that Schedule.
Clause 5 of Schedule K grants exemptions with regard to the Drugs supplied by a Registered Medical Practitioner to his own patients subject to the conditions provided therein. The relevant provision of Clause 5 and 5 (A) reads as under:
"5. Drugs supplied by a registered medical practitioner to his own patient or any drug specified in Schedule C supplied by a registered medical practitioner at the request of another such practitioner if it is specially prepared with reference to the condition and for the use of an individual patient provided the registered medical practitioner is not (a) keeping an open shop or (b) selling across the counter, or (c) engaged in the importation, manufacture, distribution or sale of drugs in India to a degree which render him liable to the provisions of Chapter IV of the Act and the rules thereunder."
All the provisions of Chapter IV of the Act and the Rules made thereunder, subject to the following conditions:
"(1) The drugs shall be purchased only from a dealer or a manufacturer licensed under these rules, and records of such purchases showing the names and quantities of such drugs, together with their batch numbers and names and addresses of the manufacturers shall be maintained. Such records shall be open to inspection by an Inspector appointed under the Act, who may, if necessary, make enquires about purchases of the drugs and may also take samples for test.
(2) In the case of medicine containing a substance specified in Schedule G, H, or X the following additional conditions shall be complied with:
(a) the medicine shall be labelled with the name and address of the registered medical practitioner by whom it is supplied;
(b) if the medicine is for external application, it shall be labelled with the words "For external use only" or, if it is for internal use with the dose;
(c) the name of the medicine or ingredients of the preparation and the quantities thereof, the dose prescribed, the name of the patient and the date of supply and the name of the person who gave the prescription shall be entered at the time of supply in register to be maintained for the purpose;
(d) the entry in the register shall be given a number and that number shall be entered on the label of the container;
(e) the register and the prescription, if any, on which the medicines are issued shall be preserved for not less than two years from the date of the last entry in the register or the date of the prescription, as the case may be.
(3) The drug will be stored under proper storage conditions as directed on the label."
Similarly in case of Drugs supplied by a hospital or dispensary maintained or supported by Government or local body Clause 5 A provides exemptions from the provisions of Chapter IV of the Act and the Rules thereunder which require them to be covered by a sale licence, subject to the following conditions:
(1) the dispensing and supply of drugs shall be carried out by or under the supervision of a qualified person;
(2) the premises where drugs are supplied or stocked shall be open to inspection, by an Inspector appointed under the Drugs and Cosmetics Act who can, if necessary, take samples for test;
(3) the drugs shall be stored under proper storage conditions."
Even after more than four decades of the coming into effect of the Drugs Act and the Rules made thereunder, there has been no restrictions, insistence nor instructions by any of the Respondents to take out any Drugs License by private hospitals.
6.10.1990
The petitioners came to know from a press release by the Drugs Controller in the Mathrubhoomi Daily that a decision was taken inter alia to impose or to insist upon drugs license by all private hospitals in the State of Kerala and also issuance of bills by such private hospitals showing the details of medicines given to the patients, amounts received, to be imposed compulsorily.
27.10.1990
Against the aforesaid unreasonable insistence, the petitioners made a comprehensive representation to the Hon'ble Chief Minister of the State detailing out all the facts with copies endorsed to the Drug Controller as well as to the Hon'ble Minister for Health of the State of Kerala bringing out inter alia the following facts to the notice of the Government:
"(i) Dispensation of medicine is an internal part of treatment and is a professional activity of the medical practitioners of the hospital who are qualified and licensed to do so;
(ii) Medicines are purchased from the wholesaler or retailer by the medical practitioner, stored under his direct supervision and dispensed and administered by his pharmacist and nurses under his direct supervision to the hospital patients only and not to the public at large. Therefore, there is no counter sale;
(iii) Only essential emergency medicines and few brands of required medicines for the running of the hospitals alone are stocked;
(iv) Functions 24 hours/day, throughout the year.
(v) The exemption given to Registered Medical Practitioners from taking licence will not vanish when two or more Medical Practitioners, all duly qualified, do work as associates or assistants in a hospital or otherwise."
6.12.1990
In reply of the aforesaid representation, the Drugs Controller informed the petitioner that licence will be required for the hospitals. A true copy of which is herewith produced and marked as Annexure P 1.
Pursuant to the aforesaid, the Drugs Controller informed the various private hospitals functioning within the State of Kerala that drugs licence is required for stocking/distributing/selling of drugs under the provisions of the Act of 1940.
Being aggrieved by the aforesaid actions of the Drug Controller arbitrarily insisting upon drugs licence under Drugs and Cosmetics Act, 1940, a number of Writ Petitions were filed challenging the arbitrary action of the respondent before the Hon'ble High Court vide O. P. Nos. 2179, 3669, 3769, 4393, 4483, 5231 and 5530 of 1991.
8.8.1991
At the time when the Original Petitions came up for final hearing before the Hon'ble Court the Respondents submitted that the Government was actively and seriously considering to withdraw the said direction regarding insistence on taking out licence by the private hospitals. Accordingly, based on the said submission made on behalf of the Respondents, the Hon'ble High Court disposed of the petition and further directed the respondents that no steps be taken pursuant to the notices issued to the various hospitals till the government takes a final decision in the matter. A true copy of order dated 8th August, 1991 is herewith produced and marked as Annexure P 2.
17.3.1995
The Drug Controller vide letter No. 17323/94/DC to the Secretary, All Kerala Chemists & Druggists Association, Chemist Bhavan, Ernakulam (South), Ernakulam, informed them that the Government in August 1994 has decided that hospitals which are not exempted are to take out drugs licences and that the object of the 3rd Respondent in writing was to advise the members of the Association to quote drugs licence numbers of Hospitals in the invoices/bills issued for supply of drugs as prescribed in Rule 65 (5) for supply of any drugs after 30.4.1995. A true copy of which is herewith produced and marked as Annexure P 3.
22.3.1995
The Drugs Inspector, Pathanamthitta within whose jurisdiction St. Luke's Hospital, Pathanamthitta of the 31st Petitioner is functioning, addressed a communication No. 420/95/DI/PTA to the Administrator of the said Hospital that the Government in pursuance of the direction of this Hon'ble Court had decided in August, 1994 that private hospitals which are not exempted under the Drugs and Cosmetics Rules 1945 were to take out drugs with the provisions of the Rules, time was provided up to 30.4.1995. A true copy of which is produced herewith and marked as Annexure P 4.
23.3.1995
The Secretary to Government, Health and Family Welfare (F) Department, Thiruvanamthapuram by its communication, informed the 2nd petitioner that the Government have taken a decision to impose drug licence to private hospitals also since the private hospitals are also providing sale of drugs and they are not exempted under the provisions of the Drugs & Cosmetics Act, 1940, and the Rules thereunder. A true copy of communication 23.3.1995 which is herewith produced and marked as Annexure P 5.
It may be relevant to mention here that the petitioners were not provided the decision of the Respondent No. 1 in that regard though they have specifically asked for the same.
Being aggrieved by the action of the Respondents in insisting upon a drugs licence, and also by the action of the Respondents 1 and 3 in not furnishing the Petitioners a copy of the so called decision of the 1st Respondent stated to have been taken in August, 1994 directing private hospitals were not exempted from taking out drugs licenses, the petitioners preferred the Original Petition No. 6529/1995-B inter alia challenging the orders of the Respondents insisting upon a licence to be taken out by the petitioners. A copy of the Original Petition No. 6529/95-B is annexed herewith and marked as Annexure P 6.
In response to the Original Petition, the respondents filed their counter affidavit inter alia justifying the actions of the respondents. A true copy of the counter affidavit is annexed hereto and marked as Annexure P 7.
29.11.1999
By its impugned final judgment and order passed by the Hon'ble High Court of Kerala at Ernakulam in O. P. No. 6529/1995-B and other connected OPs, the Hon'ble High Court dismissed the said Original Petitions inter alia holding that the impugned circular issued by the Drugs Controller directing the petitioners who are running private hospitals to take out a licence under Section 18 of the Act for sale or storage of drugs is one issued in the public interest.
29.2.2000
Hence, the present Petition for Special Leave to appeal before this Hon'ble Court.
Petitioners & Respondents in O. P. No. 6529/95-B
Petitioners:
Respondents:
IN THE SUPREME COURT OF INDIA
[ORDER XVI RULE 4 (1) (A)]
SPECIAL LEAVE PETITION (Civil) No. 5203 of 2000
(Under Article 136 of the Constitution of India)
(WITH PRAYER FOR INTERIM RELIEF)
1. Qualified Private Medical Practitioners'
Association, 68 HB Colony, Panampilly Nagar
Kochi 682036
Represented by its President Dr. O. Baby,
QPMPA/MAPS Office, 5th Floor, Vallamattam
Estate, MG Road, Ravipuram, Kochi 682015 Petitioner No. 1
2. Dr. O. Baby, Ettumanoor Hospital,
Ettumanoor, Kottayam 686631 Petitioner No. 2
Present address being
Dr. O. Baby, Chempakasseril Hospital,
Ettumanoor 686631
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20. Dr. S. Mohanasundaram. Manohar Hospital,
Kallai Road, Kozhikode 673002 Petitioner No. 20
And:
1. State of Kerala,
Represented by the Chief Secretary.
Secretariat, Thiruvanamthapuram Contesting Respondent
2. The Union of India,
Represented by its Secretary, Ministry of Health
Central Secretariat, New Delhi Contesting Respondent
3. The Drugs Controller, Thiruvanamthapuram Contesting Respondent
4. Dr. Muhammed Babu, Dr. Kunhalu's Nursing
Home, TD Road, Kochi Proforma Respondent
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15. Dr. T. M. Paul, City Hospital, Kochi 682035 Proforma Respondent
To,
THE HON'BLE CHIEF JUSTICE OF INDIA AND HIS COMPANION JUDGES
OF THE HON'BLE SUPREME COURT OF INDIA
THE SPECIAL LEAVE PETITION OF THE PETITIONERS ABOVE NAMED
MOST RESPECTFULLY SHOWETH:
1. The petitioners above named are filing this petition under Article 136 of the Constitution of India, seeking Special Leave to appeal against the final judgment and order dated 29.11.99 passed by Hon'ble High Court of Kerala at Ernakulam in O. P. No. 6529 of 1995 whereby the Hon'ble Division Bench of the High Court was pleased to dismiss the Original Petition filed by the petitioners.
2. QUESTION OF LAW:
2.1. Whether the circular of the Drug Controller directing the private hospitals in the State of Kerala to take out a licence under Section 18 of the Drugs and Cosmetic Act, 1940, is arbitrary, illegal, violative of Article 14 of the Constitution of India?
2.2. Whether Clause 5 and 5-A of Schedule K is discriminatory and violative of Article 14 inasmuch as the individual medical practitioners and hospitals run by Government and local bodies have been exempted from the applicability of Chapter IV of the Act but the private hospitals have not been exempted?
2.3. Whether the impugned circular issued by the Drugs Controller is based on any data whatsoever justifying the stand of the Drugs Controller that the circular has been issued in public interest?
2.4. Whether the condition imposed by the impugned circular directing the private hospitals to take out a licence under section 18 of the Act, is discriminatory and unreasonable inasmuch as the private hospitals now be burdened with the additional costs?
2.5. Whether the Circular is violative of the fundamental rights enshrined under Article 19 (1) (g) of the Constitution of India, of the doctors working in private hospitals?
2.6. Whether the circular is discriminatory and violative of Article 14 of the Constitution inasmuch as the private hospitals in Kerala only have been subjected to this restriction whereas the private hospitals in other States do not have such restrictions?
2.7. Whether the action of the respondents in insisting on taking out licence in case of private hospital is arbitrary, illegal and unreasonable inasmuch as for the last 45 years no such requirement was insisted upon even though the private hospitals were not exempted under the Rules from taking out a licence?
2.8. What is impact of the Medical Council Act, 1956 on Clause 5 and 5 A of Schedule K of the Drugs & Cosmetics Rules, 1945?
3. DECLARATION IN TERMS OF RULE 4 (2):
The petitioners state that they have not filed any other petition seeking leave to appeal against the impugned final judgment and order.
4. DECLARATION IN TERMS OF RULE 6:
The annexure P1 to P7 produced along with the Special Leave Petition are true copies of the pleadings/documents which formed part of the records of the case in the Court/Tribunal below against whose order the leave to appeal is sought for in this petition.
5. GROUNDS:
Aggrieved by the aforesaid impugned judgment, the petitioners are filing the special leave petition inter alia on the following grounds each of which is without prejudice to the others:
5.1. Because the impugned judgment is contrary to the facts and circumstances of the case and also to the well settled proposition of law.
5.2. Because the High Court erroneously rejected the well founded contentions of the petitioners that the circular violates the fundamental rights of the petitioners enshrined under Article 14 of the Constitution of India and the same is discriminatory inasmuch as the hospitals run by the government and local body are exempted from the purview of the Act as per Clause 5 A Schedule-K of the Act whereas the petitioners who are running private hospitals, are being directed to take out a licence under Section 18 of the Act. It is submitted that the High Court did not advert to the fact that for the first time in 1990, the Government had tried to insist upon the condition of taking out licence by the private hospitals but reconsidered the same and did not insist upon the same till 1995. It is submitted that the Government did not explain as to why it changed its mind. In the absence of any explanation on the part of the Government, the High Court ought to have held that the decision to insist upon taking out license was arbitrary and is not based on any relevant material. It is submitted that there was no material whatsoever before the High Court that the private hospitals run by the petitioners and the pharmacies attached thereto are supplying spurious or any substandard drugs and because of which public interest has suffered. It is further submitted that just because pharmacies attached to the government hospitals are being supervised by the Government Personnel, it cannot be said that they are the best equipped pharmacies and the pharmacies which are not being supervised by the government are not best equipped pharmacies. It is submitted that there was no material whatsoever before the High Court to reject the contentions of the petitioners of hostile discrimination. The High Court has not appreciated the case in a correct perspective and erroneously rejected the well-founded contentions of the petitioners.
5.3. That the High Court has based its conclusion only on conjecture and surmises and reached on an erroneous conclusion that the aforesaid impugned circular was issued in public interest, i.e., to safeguard the public from the damages and spurious, substandard and time expired drugs. It is submitted that there was no material whatsoever before the High Court to reach this conclusion. On the other hand the available data speaks that the hospitals run by the local body are much more efficient and result oriented than the hospitals run by the government.
5.4. It is submitted that the High Court ought to have appreciated that compelling the private hospitals who have to necessarily to supply the medicines to their patients during the course of their treatment to obtain a drug licence for such supply under the provisions of the Drugs and Cosmetics Act and Rules framed thereunder is wholly illegal and arbitrary. The High Court ought to have appreciated that supply of medicines to the patients from the hospital stores or pharmacies cannot be equated to sale of medicines or a clinic shop. The impugned decision of the government to insist on a drug licence to be obtained by the private hospitals will prejudice the private practitioner who are running hospitals and is violative of their rights under Article 14 (1) (g) of the Constitution of India.
5.5. Hospitals, even if be private or establishments managed either by a single medical practitioner or a group of medical practitioners, in any case drugs are stored in such private hospitals in separate store room or pharmacy or dispensary manned by the a qualified pharmacist or dispensist. The conditions specified in condition 3 of entry 5 of the Schedule K are satisfied in such storage, unlike a dealer or retailer, the store/pharmacy/dispensary of a private hospital is not open to the public. The drugs stored in such places in the hospital irrespective of the category are available only to the patients of medical practitioner/medical practitioners requiring treatment in the hospital. It is not an open shop or selling across the counter or engaged in the importation, manufacture, distribution of sale of drugs in India to a degree which render such medical practitioner liable to the provisions of Chapter IV of the Act and the Rules thereunder. Therefore, the insistence on the private hospitals to obtain drugs licence is unsustainable, contrary to the provisions of the Act and the Rules and hence liable to be interdicted by this Hon'ble Court.
5.6. It is submitted that if the object of the circular is to ensure the quality of drugs, there exists no grounds whatsoever to exempt the hospitals run by the government or the local body from the operation of the Act. The petitioner submits that the objection is to ensure the quality not to provide protection to the hospitals run by the government or the local body.
5.6 (a). That the High Court did not appreciate that since 1945 private medical hospitals and the medical practitioners were not treated as two separate entities and has in fact been treated at par with medical practitioners and were not insisted to take out license. A perusal of Clause 5 of Schedule K shows that even the private medical practitioner are subjected to certain supervisory conditions even though they have been expressively exempted from taking out a license under section 18 (c) of the Drugs Act, 1940. The High Court erroneously came to the conclusion that medical practitioners are different and distinct from the medical practitioner working in private hospitals and they are not subjected to any supervisory control. This is contrary to the expressed supervisory conditions stipulated under Clause 5 of Schedule K. Therefore the assumption of the Hon'ble High Court that insistence for taking out a licence would give government and enhence effective control, supervisory control over dispensation of medicine by medical practitioners working in private hospitals is without any basis whatsoever. This move on the part of the Government tantamount to denigration of a noble profession as a mere mercantile activity equating medical profession with selling of medicine from a medical shop.
5.6 (b). It is submitted that under Clause 5 of Schedule K medical practitioners whether working individually or working collectively in private hospitals have always been, since 1945, under the supervisory control of the authorities under the Act as provided in the conditions for exemption. The medical practitioner working in private hospitals are willing and continue to abide by and fulfil strictly conditions stipulated in Clause 5. It is therefore submitted that the High Court is wrong in treating these two entities separate and distinct. Furthermore, there was no material before the High Court in support of the contentions that the private hospitals are not complying with the conditions stipulated under Clause 5. It is submitted that since 1945 the authorities under the Act have been treating medical practitioner practising individually and medical practitioner practising collectively in private hospitals as one and the same entity and rightly so. Now, after 50 years of the coming into force of the Act as well as the rules to create a class within a class, without any differentia but intelligible conditions whatsoever, is violative of Article 14. It is submitted that the impugned circular purporting to direct the private hospitals to take out a licence is ultra vires of the Act as well as the Rules.
5.6 (c). Without prejudice to the above, it is further submitted that under the rules providing exemptions are arbitrary inasmuch as even the drugs supplied by - (i) Multipurpose workers attached to Primary Health Centres/Sub-centres, (ii) Community Health Volunteers under the Rural Health Scheme, (iii) Nurses, Auxiliary Nurses, Midwives and Lady Health Visitors attached to Urban Family Welfare Centres/Primary Health Centres/Sub-Centres, and (iv) Anganwadi Workers have been exempted whereas the private hospitals are being forced to take out licence. Private Hospitals are run on the basis of quality of services and efficiency. It is unbelievable to think that private hospitals would indulge in supply or distribution or stock or sell any drug which is spurious or substandard. The private hospitals are now run on this basis of their reputation, quality of services and of drugs provided in their hospitals.
5.7. In exercise of the powers conferred by Section 6 (2), 12, 33 & 33 (N) of the Drugs Act, the Central Government, enacted the Drugs & Cosmetics Rules, 1945, thereto (hereinafter referred as 'the Rules').
Rule 123 of the 1945 Rules inter alia provides that the Drugs specified in Schedule K shall be exempted from the provisions of Chapter IV of the Act and the Rules made thereunder to the extent and subject to the conditions specified in that Schedule.
Clause 5 of Schedule K grants exemptions with regard to the Drugs supplied by a Registered Medical Practitioner to his own patients subject to the conditions provided therein. The relevant provision of Clause 5 and 5 (A) reads as under:
"5. Drugs supplied by a registered medical practitioner to his own patient or any drug specified in Schedule C supplied by a registered medical practitioner at the request of another such practitioner if it is specially prepared with reference to the condition and for the use of an individual patient provided the registered medical practitioner is not (a) keeping an open shop, or (b) selling across the counter, or (c) engaged in the importation, manufacture, distribution or sale of drugs in India to a degree which render him liable to the provisions of Chapter IV of the Act and the rules thereunder."
All the provisions of Chapter IV of the Act and the Rules made thereunder, subject to the following conditions:
(1) The drugs shall be purchased only from a dealer or a manufacturer licensed under these rules, and records of such purchases showing the names and quantities of such drugs, together with their batch numbers and names and addresses of the manufacturers shall be maintained. Such records shall be open to inspection by an Inspector appointed under the Act, who may, if necessary, make enquires about purchases of the drugs and may also take samples for test.
(2) In the case of medicine containing a substance specified in Schedule G, H or X the following additional conditions shall be complied with:
(a) the medicine shall be labelled with the name and address of the registered medical practitioner by whom it is supplied;
(b) if the medicine is for external application, it shall be labelled with the words "For external use only" or, if it is for internal use with the dose;
(c) the name of the medicine or ingredients of the preparation and the quantities thereof, the dose prescribed, the name of the patient and the date of supply and the name of the person who gave the prescription shall be entered at the time of supply in a register to be maintained to the purpose;
(d) the entry in the register shall be given a number and that number shall be entered on the label of the container;
(e) the register and the prescription, if any, on which the medicines are issued shall be preserved for not less than two years from the date of the last entry in the register or the date of the prescription, as the case may be.
(3) The drug will be stored under proper storage conditions as directed on the label."
Similarly in case of Drugs supplied by a hospital or dispensary maintained or supported by Government or local body Clause 5 A provides exemptions from the provisions of Chapter IV of the Act and the Rules thereunder which require them to be covered by a sale licence, subject to the following conditions:
"(1) the dispensing and supply of drugs shall be carried out by or under the supervision of a qualified person;
(2) the premises where drugs are supplied or stocked shall be open to inspection, by an Inspector appointed under the Drugs and Cosmetics Act who can, if necessary, take samples for test;
(3) the drugs shall be stored under proper storage conditions."
5.8. It is respectfully submitted that the private medical practitioners are engaged in the treatment for sick in various private hospitals in and around the State of Kerala. The modern practice of medicines is an era of specialisation. Patients may be examined by more than one specialists in various branches to enable proper and correct diagnosis. Patients are also treated and administered medicines by more than one specialist. Patients are, also admitted in the private hospitals in which the qualified medical practitioners practice medicine and treat such patients even as inpatients. Since there are numerous drugs available, it may not be practicable for a qualified medical practitioner to have separate store room annexed to his consultation room for storing and supplying medicines. Administration of medicine is according to the prescription issued by the qualified medical practitioners. Once a patient is admitted as an inpatient and treated in a private hospital, drugs are administered to such patient, on the basis of the prescriptions issued by the qualified private medical practitioner, the drugs stored in the hospital themselves under Schedule K Item 5 A of the Drugs and Cosmetics Rules, 1945 is a hostile discrimination to insist on hospital/dispensary otherwise than maintained or supported by Government or local body alone to obtain a drugs license under the provisions of the Act, 1940, read with the Drugs and Cosmetics Rules, 1945, cannot in any circumstances be sustained.
5.9. It is submitted that the conditions insisted upon is per se arbitrary, unreasonable and discriminatory inasmuch as to the best of the knowledge of the petitioner, this condition has not been insisted upon in any other State of India except the State of Kerala. The private hospitals of the State of Kerala will be discriminated against the similarly placed private hospitals in other States if this condition is insisted upon. This condition is also arbitrary and unreasonable because of the fact that for the last 45 years this condition was never insisted upon even though the private hospitals were not exempted under Rules. It is further submitted that the respondents are arbitrarily insisting upon the compliance of this condition without any basis whatsoever or any material to show that non insistence of this condition has prejudiced public interest.
5.10. It is further submitted that the High Court did not appreciate that there is a hostile discrimination inasmuch as the private hospitals run in the State of Kerala are only required to take out licence under Section 18 (c) whereas the private hospital similarly placed in other States are not required to take out licence as there exists no such insistence in those States.
5.11. The Hon'ble High Court erred in not appreciating that there is a far distinction between Hospitals, Pharmacy and the Medical shops with Drug License attached to hospitals or otherwise. The broad parameters of the distinguishable features are enumerated as under:
Hospital Pharmacy & Medical Shops with Drug Licence attached to a Hospital or otherwise:
1. Place of professional activity.
2. Medicines are purchased from the wholesaler or retailer by the medical practitioner, stored under his direct supervision and dispensed and administered by his pharmacist and nurses under his direct supervision to the hospital patients only. (No counter sale.)
3. Only essential emergency medicines and few brands of required medicines for the running of the hospitals above are stocked.
4. Functions 24 hours/day, throughout the year.
This is the professional activity of the medical practitioners of the hospital who are qualified and licensed to do so.
1. Place of commercial activity.
2. Medicines are sold to the public as per the prescriptions of all doctors, by the pharmacist, supervised by the drug controller. (Counter sale.)
3. Almost all the brands of medicines available are stocked and sold.
4. Functions only for limited hours/day and is closed on holidays.
5.12. It may be pertinent to mention herein that only on the basis of the prescription by a Medical practitioner on a prescribed day is supplied or sold by the Medical Shops/Stores.
5.13. It is respectfully submitted that hospitals and clinics are run with the licences of local bodies. They are registered in the local bodies, and pay taxes applicable under various sections as professional tax, building tax, insurance, etc. Further hospitals or clinics in the locality are better known to the public than any other institutions in the locality. Pharmacies in private hospitals are not unauthorised outlets for the distribution of medicines. Hospital pharmacies are run directly under the supervision of registered medical practitioners (RMP). They are licensed to stock medicines and treat their patients and are superiorly qualified than the drug inspectors, who are paramedical personnel.
6. GROUNDS FOR INTERIM RELIEF:
6.1. It is submitted that the petitioners have prima facie a good and arguable case as the conditions insisted upon is per se arbitrary, unreasonable and discriminatory inasmuch as to the best of the knowledge of the petitioner, this condition has not been insisted upon in any other State of India except the State of Kerala. The private hospital of the State of Kerala will be discriminated against other States if this condition is insisted upon. This condition is also arbitrary and unreasonable because of the fact that for the last 45 years this condition was insisted upon even though the private hospital was not exempted under Rules. It is further submitted that the respondents are arbitrarily insisting upon the compliance of this condition without any basis whatsoever or any material to show that non insistence of this condition has hurt public interest.
6.2. It is respectfully submitted that in the facts and circumstances of the case it is not only fit and proper but also in the interest of justice that the operation of the impugned judgment be stayed till the final disposal of this Special Leave Petition.
6.3. It is submitted that balance of convenience is in favour of the petitioners as for the last 45 years this condition was not insisted upon and no harm will be caused if this condition is not insisted upon till the final disposal of this special leave petition.
6.4. It is submitted that after the impugned judgment of the High Court, the Drug Controller has directed all private hospitals in the State to apply for licences for the storage of drugs and their supply from their establishments before the end of February, 2000 and he further directed them to obtain these before March 31,2000. He claims to have issued these directives in compliance with the impugned judgment. It is submitted that for this reason also this impugned judgment be stayed.
6.5. This application is filed bona fide and in the interest of justice.
7. MAIN PRAYER:
It is, therefore, most respectfully prayed that this Hon'ble Court may graciously be pleased to:
(a) grant the petitioners special leave to appeal against the impugned final judgment and order dated 29.11.99 passed by Hon'ble High Court of Kerala at Ernakulam in O. P. No. 6529 of 1995;
(b) pass such further order or orders as this Hon'ble Court may deem fit and proper.
8. INTERIM RELIEF:
It is, therefore, respectfully prayed that this Hon'ble Court be pleased to:
(a) grant ex-parte ad-interim stay of the impugned judgment dated 29.11.99 passed by the High Court of Kerala at Ernakulam in O. P. No. 6529/95-B, during the pendency and final disposal of the present petition;
(b) confirm the ex-parte ad-interim order in terms of prayer (a) above on return of motion;
(c) pass such other and further orders as this Hon'ble Court may deem fit and proper in the facts and circumstances of the present case.
Drawn on : 26.02.2000
New Delhi: 29.02.2000
CERTIFICATE:
Certified that the Special Leave Petition is confined only to the pleadings before the Court/Tribunal whose order is challenged and the other documents relied upon in those proceedings. No additional facts, documents or grounds have been taken therein or relied upon in the Special Leave Petition. It is further certified that the copies of the documents/Annexures attached to the Special Leave Petition are necessary to answer the question of law raised in the petition or to make out grounds urged in the Special Leave Petition for consideration of this Hon'ble Court. This Certificate is given on the basis of the instructions given by the petitioner/person authorised by the petitioner whose affidavit is filed in support of the Special Leave Petition.
New Delhi, 29.02.2000
IN THE SUPREME COURT OF INDIA
[ORDER XVI RULE 4 (1) (A)]
SPECIAL LEAVE PETITION (Civil) No. 5203 of 2000
(Under Article 136 of the Constitution of India)
In the matter of:
Versus
State of Kerala & Ors. ... Respondents
AFFIDAVIT
I, Dr. O. Baby, S/o. late M. Kochumman, President, Qualified Private Medical Practitioners' Association, Chempakasseril Hospital, Ettumanoor - 686631, Kerala, now at New Delhi, do hereby solemnly affirm and state as under:
1. That I am the President of Petitioner No. 1 above named and as such I am fully familiar with the facts and records of the case and am authorised to swear this affidavit on behalf of the other petitioners as well.
2. That I have read and understood the contents of the accompanying Special Leave Petition paragraphs 1 to 8 from pages 10 to 31 and the synopsis/list of dates from pages B to K and the prayer for interim relief and I say that the facts stated therein are true to my knowledge based on the records of the case and the submissions are based on legal advice which I believe to be true and correct.
3. That the annexures annexed to the petition are true copies of their respective originals.
4. I say that nothing herein is false and no material has been concealed therefrom.
DEPONENT
VERIFICATION:
I, the above named deponent do hereby verify that the contents of my above affidavit are true and correct to the best of my knowledge and belief. I say that nothing herein is false and no material has been concealed therefrom.
Verified and signed at New Delhi, on this the 29th day of February 2000.
DEPONENT
(Page numbers mentioned in 2 above refers to the pages in the Petition submitted, which is having 118 pages.)
IN THE SUPREME COURT OF INDIA
Civil Appellate Jurisdiction
SPECIAL LEAVE PETITION (Civil) No. .... of 2000
(Arising out of the judgment and final orders passed by
the High Court of Kerala at Ernakulam dated 29.11.99 in O. P. No. 6690/95
with prayer for interim relief.)
In the matter of:
Indian Medical Association Kerala Branch ... Petitioners
Versus
Union of India & Ors. ... Respondents
Advocate for the Petitioner: Mr. M. P. Vinod
(The front cover page of the Paper Book filed by IMA, Kerala)
IN THE SUPREME COURT OF INDIA
[ORDER XVI RULE 4 (1) (A)]
Civil Appellate Jurisdiction
SPECIAL LEAVE PETITION (Civil) No. .... of 2000
(Under Article 136 of the Constitution of India with prayer for interim relief)
Between: Position of Parties: In the High Court In this Court
And:
To,
(The fifth page of the Paper Book filed by IMA, Kerala.
We are not aware of the additional points raised by IMA.)
No. L. 2989/2000/DC
Sub:- Drugs & Cosmetics Act, 1940 - requirement of Drug Licence for supply of drugs by Hospitals -
Ref:- IMA/KSB/SS/309/1999-2000 dated 8.3.2000
I am to point out that the Order of the Divisional Bench of the Hon'ble High Court of Kerala has not been stayed and early implementation of the statutory provisions in accordance with the order of the Hon'ble Court is the only course of action available to this department. I, in pursuance of the Court orders and in accordance with the above principle and the principles of natural justice, had discussed the matter with the Indian Medical Association, Qualified Private Medical Practitioners' Association and the Catholic Hospital Association and the time-frame of 29.2.2000 for making application and 31.3.2000 to complete the process of licensing had been fixed with the concurrence of IMA, QPMPA and the Catholic Hospitals Association.
Indian Medical Association had made it clear during discussions, that the Association favours control of supply of drugs by corporate Hospitals but not hospitals owned and run by Medical Practitioners either individually or collectively. I am to point out that such an option is not available in the law. The request for adequate time to pursue judicial processes now made is not one which I am competent to consider as the request amounts to withholding of actions in pursuance of the Court Order.
I may be permitted to reiterate my clarifications in the issue that the Drugs & Cosmetics Act is not one which restrains or regulates the profession of Medicine in any way as spelt out in Clause 5 of Schedule of the Drugs & Cosmetics Rule. Even though the order of the Hon'ble Court was pronounced in November 1999, the department did not act in haste to jeopardise the functioning of any hospital. It was in due consultation with the representatives of various associations that a time frame was set out and this department would readily consider any request for additional time to comply with the statutory requirements. However, request to defer indefinitely implementation of statutory provisions cannot be considered at department level. I would request and appeal that Hospitals comply with the statutory requirements to avoid hardships and such a course, if adopted would in no way do away with the right and privilege of Indian Medical Association to appeal to the Apex Court.
With regards,
Note: The Members may please note that the QPMPA has never agreed for
any time-frame to take Drug License. State President
Dr. O. Baby, State President (QPMPA), Kerala
Re: SLP (C) No. 5203/2000—Qualified Pvt. Medical Practitioners' Association & Ors. vs. State of Kerala & Ors. before the Supreme Court of India
This is to confirm that we have filed Special Leave Petition (Civil) No. 5203/2000 against the decision of the Hon'ble High Court of Kerala dated 29-11-1999 in O. P. No. 6529/95-B. A complete set of paper book of the above said case is enclosed herewith for your record and reference. The case is expected to be listed for preliminary hearing for admission and for grant of interim stay in the first week of April, 2000. We shall intimate you further developments in this matter and other connected matters.
Thanking you,
Encl: As above.
The Drugs Controller,
Office of the Drugs Controller, Red Cross Road,
Thiruvanamthapuram - 37
Sub : The Drugs Licence of Private Hospitals — regarding
The QPMPA along with about 250 hospitals have filed SLP in the Supreme Court of India against the verdict of the Hon'ble Kerala High Court on Drugs Licence Case. The number of the first batch of petition is SLP (C) No. 5203/2000. The copy of the letter from our advocate is also enclosed for your reference. So, I request you to give necessary directions to the Drugs Inspectors not to harass or trouble the Institution Members of the QPMPA as well as those hospitals who have joined as parties in the case filed by the QPMPA till the decision of the Supreme Court. The list of QPMPA Institution Members as well as the list of petitioners shall be sent to you immediately. Anticipating your attention and favourable action, I remain, Thanking you,
Special Leave Petition (C) Nos. 5203, 5932, 6312, 6425, 6939, 6963, 7581, 8000,
8272, 8888, 8890, 10653, 10654, 10656 and 10657/2000
In the matter of
Qualified Private Medical Practitioners' Association, Kerala, etc. Petitioners
Vs.
State of Kerala and Others, etc. Respondents
And in the matter of
I, S. S. Venkatakrishnan son of S. V. Seshappa aged 53 years residing at X/357-A, Kodunganoor, Thiruvananthapuram–13 do hereby solemnly affirm and declare as under:
1. That I am the Respondent No. 3 in SLP Nos. 5203, 5932, 6312, and 6963, etc., and quite conversant with the facts and circumstances of this case. I have gone through the SLP filed by the petitioners and deny all averments save as are specifically admitted herein. I state and most respectfully submit that the Hon'ble High Court of Kerala had conclusively and very exhaustively dealt with the issues raised by the petitioners and as such the petition is devoid of any merit. Further no substantial question of law of public importance do arise in this case and as such the Special Leave Petition be dismissed.
2. The Petitioners herein are canvassing to quash the circular of the Drugs Controller directing the petitioners, who are running Private Hospitals, to take out a licence Under Section 18 of the Drugs and Cosmetics Act, 1940 (for short 'the Act') for sale or storage of drugs and further restraining the Drugs Controller from insisting on the private hospitals to obtain a drug licence under Section 18 of the Act.
Secondly, they say that 'since Hospitals run by the Government and local bodies are exempted from the purview of the Act as per clause 5–A of the Schedule K of the Rules, there is no justification on the part of the Drugs Controller in insisting the Petitioners to take out a Licence which amounts to hostile discrimination and arbitrary treatment.'
3. The Hon'ble High Court found that:
i) Pharmacies which are attached to private hospitals cannot by any stretch of imagination be said to be similar to pharmacies attached to hospitals run by Government or Local Bodies which are manned by qualified personnel and subject to strict Government Control. In fact, the Drugs stores in hospitals run by Government and Local Bodies are subject to periodical inspection by Officers of Government. That apart, hospitals run by Government and Local Bodies are functioning in authorised premises under the control of qualified registered Pharmacists, who are accountable to the Government for all the drugs stored and distributed by them. They are also under the supervision and control by the authorities under the Act. On the contrary, the addresses of premises of many private hospitals are not disclosed and that they are not accountable to the Government for the drugs stored and distributed by them, unless regulated.
ii) The Pharmacies in Private Hospitals cannot equate themselves with Pharmacies in Government Hospitals and Hospitals run by Local Bodies in the matter of supervision and control.
iii) The Petitioners have a further case that the State having exempted Registered Medical Practitioners from the provisions of the Act, the Petitioners felt that they were being discriminated in the matter of taking out a licence. Here again, the submission was found untenable. A Private Hospital which caters to the prescriptions of several doctors storing huge quantity of drugs cannot be equated with a registered medical practitioner who administers and supplies drugs for emergency purposes to his own patients only by storing limited quantity of such drugs of physician's sample for distribution.
iv) Further under Section 18 of the Act, we are of the opinion that even a Registered Medical Practitioner, who indulges in sale of drugs across the counter, will certainly be liable to take out a licence under the Act and will not be saved by the exemption engrafted in Clause 5 of Schedule K of the Act. Therefore, we are satisfied that the impugned circular issued by the Drugs Controller directing the Petitioners, who are running private hospitals to take out a licence under Section 18 of the Act for stocking for sale or distribution, sale or distribution of drugs is one issued in public interest, viz. to safeguard the public from the dangers of spurious, substandard and time expired drugs and the same is not liable to be assailed on all or any of the grounds mentioned.
v) If the Petitioners are not made accountable to the Controlling Authority under the Act and are permitted to function without a licence, it may not be possible for the Controlling Authorities to check the sale of substandard drugs beings distributed through unauthorised outlets in private hospitals. The action of Drugs Controller in this regard cannot be said to be arbitrary or unreasonable or violative of any of the legal or constitutional rights of the Petitioners. In our opinion, a Drugs Licence is a reasonable restriction imposed in public interest. For the aforesaid reasons we are not inclined to interfere with the circular issued by the Drugs Controller nor are we satisfied that this is a fit case which warrants issuance of a direction to the Drugs Controller restraining him from insisting on the Private Hospitals to obtain a licence under Section 18 of the Act.
4. a) The Drugs and Cosmetics Act, 1940 is a Central Act, (Act 23 of 1940) and is intended in particular to regulate the manufacture and sale or distribution of drugs for the purposes of the Act and prohibits uncontrolled manufacture or sale or distribution, offer for sale or for distribution the drugs except with and in accordance with the conditions of a licence. Chapter IV of the Act pertains to provisions applicable to manufacture, sale, etc. of drugs.
b) Section 33 of the Act confers power to the Central Government to make rules for the purposes of Chapter IV of the Act. Clause (q) subsection (2) of the Section 33 provides for exemptions, conditionally or otherwise from all or any of the provisions or the Chapter or the rules made thereunder.
c) Accordingly Part XI of the Drugs and Cosmetics Rules provides for exemptions. Rule 123 contained in Part XI lays down that the drugs specified in Schedule 'K' shall be exempted from the provisions of Chapter IV of the Act and the Rules made thereunder to the extent and subject to the conditions specified in that Schedule.
d) The provisions of Schedule 'K' of the Drugs and Cosmetics Rules, 1945 are detailed in the Petition. Clause 5 of the said Schedule pertains to exemption given for drug supplied by a Registered Medical Practitioner to his own patients or any drugs specified in Schedule C supplied by a registered Medical Practitioner at the request of another such Practitioner if it is specially prepared with reference to the condition and for the use of an individual patient.
e) Clause 5A which pertains to exemptions given to drugs supplied by a hospital or dispensary maintained or supported by Government or Local Body has a rational relation to the object sought.
5. The magnitude and enormous number of such unlicensed outfits masquerading as hospitals are to be regulated under the law. Drugs are supplied to consumers by Retail Medical Shops, Hospitals and Registered Medical Practitioners and an estimated Rs. 500 crores worth of drugs are sold out annually in the State of Kerala. As on 31.3.2000 there were 7,492 Retail Sales premises in Kerala. While there is no official accurate figure of the number of Hospitals in the Private Sector, the Petitioners' Association claims existence of about 4,000 such establishments. The private sector covers about 70 % of the Health care needs of the State. 50% of the drugs are estimated to reach consumers through Medical Shops and Pharmacies other than those functioning in Hospitals. Though the law does not exempt drug supplies by Private Hospitals from Drugs Licences, most of the States had not implemented this provision and this applied to the State of Kerala also. However, the State found it necessary to expedite the implementation and statutorily regulate by proper licence.
6. The Department accordingly pursued actions to implement the provisions of the Act as ordered by the Hon'ble High Court. There was no request seeking additional time for taking out Drugs Licences and to comply with the Court Orders. That however, this Hon'ble Court passed ex-parte stay of the said Circular on 7.4.2000.
7. I, most respectfully submit that there are over one hundred Private Hospitals who have taken out Drugs Licences in the State in the past few years. These have been functioning in compliance with the provisions of law. A list of such Hospitals are herewith marked annexed as Annexure R1.
8. I deny the main objections raised by the Petitioners that:-
a) Exempting Government Hospitals from taking out Drugs Licences and insisting Drugs Licenses for Private Hospitals is discriminatory;
b) The Licensing system would lead to corruption and harassment; and
c) A Hospital is an association of Medical Practitioners and the privilege given to an individual Medical Practitioner should be available to Hospital.
9. The Petitioners filed the Writ Petitions before the Hon'ble High Court in 1990. The averment in the various petitions had duly been answered by the answering Respondent. There was nothing illegal or unreasonable in the actions taken by the Department. Government never stated that Private Hospitals did not require drugs licence. Nor there is any estoppel against the State. Government only wanted to take a fresh look at the whole issue as several Registered Medical Practitioners had described the actions as infringement into their professional rights. Moreover, when the Hon'ble High Court directed the Government to consider the matter and take a decision on merits, Government did consider all aspects of the issue. The Law Department was also consulted in the matter. Till such time the decision was taken, the department did not pursue actions in the matter.
10. As the Government considered all aspects of the issue and the Petitioners cannot have any grievance that the Government took a hasty decision. The Petitioner do not have any plea that the time taken by the Government harmed their interests in any way. Government, on finding that private hospitals were not exempted from taking out Drugs Licence, on 8.8.94 took a final decision to enforce the law and directed the answering Respondent to pursue actions. The decision of the Government was communicated to all respondents who had filed original petitions before the High Court in 1990 and 1991. The 3rd respondent, in pursuance of Government Order, convened meetings of the Drugs Inspectors at different zones and decided that a fair period of time should be provided to enable the hospitals to take out Drug Licences and provided a period of six months ending on 31.3.1995 for the same. This time frame was later extended first up to 30.4.1995 and then up to 31.5.1995. The Drugs Inspectors were instructed to advise hospitals individually which they did.
11. It is also pertinent to point out that the actions initiated by the Department were in pursuance of the Audit objections of the Accountant General and on the recommendations of the Public Accounts Committee in this regard.
12. I respectfully submit that all the allegations and objections have been examined in the impugned judgment dated 29.11.1999 passed by the Division Bench of the Hon'ble High Court while disposing of their Writ Petitions and upheld inter alia the issuance of the Circular dated 17.3.1995.
13. The Petitioner's statement that "there are 4,288 Private Allopathic Clinics and Hospitals, 4,922 Private Ayurveda Hospitals and 3,118 Homeo hospitals in this Geographically small state," itself indicates the enormous expansion of uncontrolled and haphazard medical care growing in the country and the legislature considered it necessary to legislate for the purposes of safety, health and wellbeing of the people.
14. I state further that there are more than 173 Private Hospitals holding Drug Licences. A list of such Licencees at Districts of Idukki, Alappuzha, Palakkad, Kottayam, Kozhikode, Malappuram, Wynad, Pathanamthitta, Kollam, Kasaragod, Thrissur, Ernakulam, and Thiruvananthapuram are furnished in the annexure marked earlier as R1.
15. I further state that there are many Private Hospitals where the number of Doctors range from 3 to 100 (Lisie Hospital Ernakulam have an extent of 1 acre to 5 acres of land with multistorey buildings). A sample list of such hospitals with details of ownership, bed, operation of pharmacy, etc., are herewith marked as Annexure R2.
16. I state that spurious drugs can find way to a consumer through many channels in many dubious ways and the State requires necessary regulatory powers to check the channels and to take necessary measures to secure compliance of the Act and Rules.
17. I state that the Petitioners have failed to realise that the privilege given to the profession in Clause 5 of Schedule K cannot be applied to institutions which are distinct as spelt-out in Clause 5A. A Hospital is not a mere association of Doctors. It is a place of business also and it cannot survive unless it makes profit. Hospitals are owned by individuals, and corporate bodies. Several professionals discharge their duties there. They include Doctors, Nurses, Pharmacists, etc. What is expected out of Registered Medical Practitioners is rendering of medical services to ailing patients and as a part of that they may or may not dispense drugs and if they dispense drugs as part of their professional duty, the law insists of the requirement of Drugs Licenses. Running or managing a pharmacy by procuring and storing drugs and supplying against prescription is not the professional duty of a medical practitioner and such an act cannot enjoy exemption.
18. I submit that the law has not placed any unreasonable restriction on the professional rights of Registered Medical Practitioner and the Circular dated 17.3.1995 or any subsequent ones in no way infringe into their professional rights. The Drugs and Cosmetics Act does not contemplate regulation of Medical Profession and Schedule K very clearly spells this out. The Act regulates only drugs. When no licence is prescribed to Registered Medical Practitioners, they cannot have any grievance. They cannot seek extension of the privilege given to the profession to all business houses.
19. I state that issuance of licence and other requirements of the implementation of the law will ensure the hospitals to issue bills detailing the names of drugs and their individual prices in accordance with the Drugs (Price Control) Order, 1995. Several hospitals issue bills for medicines without specifying the individual drugs and prices shown in lump sum figures, as if detailing the names of individual drugs and actual prices would be disadvantageous to the Hospitals. Sample copies of such bills are herewith marked and annexed as Annexure R3.
20. I most respectfully submit that keeping the drugs supplied by Private Hospitals outside the purview of the Licensing system would keep 40% of the Drugs supplied to patients outside the regulatory provisions which is not a desirable situation and this would defeat the purpose of the legislation.
21. I state that from a perusal of the addresses of the Petitioners, one can make out many of them as corporate bodies having Managing Partners and Directors. Corporate bodies are constituted for carrying on business and their functions cannot be equated to that of discharge of professional duties of doctors. The fact that Hospitals are run by Corporate bodies show that they are business houses. The main object of the business being rendering Medical Service, a pharmacy is also run to procure, store and supply drug. Running a hospital is not a part of the professional obligation of an individual Doctor, warranting an exemption of requirement of Licence. The fact that not all doctors run hospitals to discharge their professional duties alone would go to show that running a hospital is not a discharge of professional duty.
22. It is submitted by the petitioner that many Hospitals in Kerala are small ones and are not comparable to Apollo Hospital or the Escorts. There are several hospitals in the State which are speciality hospitals or multi bedded hospitals. They attend to the needs of 70% of the health care in the State. In a State where Rs. 500 crores worth of drugs are supplied to patients and where almost 40% of the supplies are through Private Hospitals, the quantity of drugs that reaches the consumers through these establishments are not small and require the necessity of regulation.
23. I deny the allegation that there will be insurmountable difficulties and problems, if licenses are taken. These problems projected are not germane to the issue whether requirement of a licence is illegal or violating any right of the Petitioners. It has an object to achieve and eliminate persons, indulging in the practice of procuring, storing and dispensing drugs by employing unqualified hands. There is urgent need to exercise control rather than providing immunity by doing away with the regulatory norms. A Pharmacy is a pharmacy wherever it is and it is to be manned by a Pharmacist. I deny the allegation of the petitioners about any harassment by Drugs Inspectors as it is evident that no such incidence has been reported by any of the Hospitals already licensed or by the other 10,000 or more sales outlets in the State.
24. The statement that the Hospitals of the Petitioners are not comparable to Escorts or Appollo is an effort to present a distorted picture as it appears that the Petitioners are of the view that only hospitals like Escorts or Appollo are to take out Drug Licences for supply of Drugs. The status of some of the Petitioner Hospitals are detailed as under.
i. The following hospitals belong to the Petitioners and are owned and run by Missionaries and not by Medical Practitioners alone:-
a) Little Flower Hospital, Angamali
b) Udyagiri Multi Speciality Hospital, Changanassery
c) Sacred Heart General Hospital, Cherthala
d) Lisie Hospital, Ernakulam
e) Lourdes Hospital, Ernakulam
f) Malankara Orthodox Mission Hospital, Kozhencherry
g) Benziger Hospital, Kollam
h) Devamatha Hospital, Koothattukulam
i) Carithas Hospital, Kottayam
j) Holy Chest Mission Hospital, Muttachira
k) Sanjoe Hospital, Perumbavoor
l) Good Samaritan Hospital, Ponkunnam
m) Pushpagiri Hospital, Tiruvalla
ii. The following among the Petitioner Hospitals are other major Hospitals:-
a) KVM Hospital, Cherthala
b) City Hospital, Kochi
c) Cochin Hospital, Kochi
d) Krishna Nursing Home, Kochi
e) Nairs Hospital, Kollam
f) Upasana Hospital, Kollam
g) Christuraj Hospital, Kottarakkara
h) Mundakappadam Mandiram Hospital, Kottayam
i) Muthoot Medical Centre, Kozencherry
j) Chest Hospital, Kozhikode
k) KMK Hospital, N. Parur
l) Chithra Hospital Complex, Pandalam
m) Samaritan Hospital, Pazhanganad
n) Moulana Hospital, Perinthalmanna
o) Sanjeevani Hospital, Shornur
p) PRS Hospital, Thiruvananthapuram
q) SUT Hospital, Thiruvananthapuram.
25. I state that most of these are multi speciality Hospitals. M/s SUT Hospital, Thiruvananthapuram is one where even Bye Pass Surgeries are conducted apart from other facilities. Its assets could run into crores of Rupees. Similar is the case with most of the other major hospitals in the Private Sector also. The private sector which cater to 70% of the State's Health Care needs, could by no means are small entrepreneurs though there could be several which are eligible for the privilege under Clause 5 of Schedule K.
26. I deny the averments of the Petitioners that the provisions of the Drugs and Cosmetics Rules are contrary to those of the Medical Council's Rule which prohibits Medical Practitioners from running a shop for sale of medicines. This again is a strange plea. In the first place it is the pharmacy which is licenced and in the second place there are a number of hospitals which are corporate bodies run by doctors. It is submitted that corporate bodies are nothing but business establishments. Hospitals have already been covered by Shops and Establishments Act. It is not known how they can be considered otherwise. However, in every hospital there are consultation rooms of medical practitioners where they keep drugs including Physicians samples and supply to their patients. Such practices are done at Doctor's residence also. These acts are exempted under Clause 5 of Schedule K. It is equally strange that the Petition states that the presence of Pharmacist in the Hospital Pharmacy will have the effect of Doctors being supervised by a paramedical personnel. The Hospital is a place where there are several professionals discharging different duties and there is no need for such feeling.
27. A careful examination of the provisions of Schedule K would show that dispensing of drugs by a Registered Medical Practitioner to his own patient has been clearly distinguished from distribution of drugs by Hospitals. In the former case, a Registered Medical Practitioner buy drugs and give it to his own patients. Providing or prescribing medicines is a part of the duties of a Registered Medical Practitioner and the law recognises and exempts it from taking out Drugs Licenses. Hospitals are owned by Registered Medical Practitioner(s), Person(s) other than Registered Medical Practitioner(s) or by both. In the case of a hospital owned by the Registered Medical Practitioner(s) where several doctors prescribe drugs, drugs are usually stored in a central store and dispensed according to prescriptions. This is not a case of Registered Medical Practitioner supplying drugs to his own patient but is one of Registered Medical Practitioners supplying drugs to his own patient and to the prescriptions of other Medical Practitioners also. In the case of Hospitals owned by persons other than Registered Medical Practitioners, drugs are purchased and sold/distributed by the said person(s) and not by the Registered Medical Practitioners, who is only an employee. In the case of Hospitals run by the Partnership firms, or companies it is the firm/company which distributes drugs and not the Registered Medical Practitioners. Most of the Private Hospitals sell drugs. Many of them however, do not issue bills detailing the price of individual drugs, but mention as cost of medicines and collect a lump sum amount. Where the patients are eligible for medical reimbursement, the hospitals do give bills detailing individual sale. Where the question of collecting the cost of the medicine arises it is a question of sale.
28. The provisions of the Drugs and Cosmetics Act do not in any way interfere with the medical profession. No restriction is imposed for any of the acts of the Medical Practitioners in the course of his practice of his profession. The Drugs and Cosmetics Act is concerned solely with the matter of ensuring the quality of drugs. It lays down conditions for manufacture of drugs and prescribes various regulations to ensure that the drug is manufactured in compliance with the provisions of law retains its potency till it reaches the patient. One of the regulations made to achieve this object is to prescribe Drugs Licences for stocking for sale or for distribution of drugs. The law exempts all Registered Medical Practitioners and a few categories of hospitals from taking out Drugs Licences and prescribe licenses for all other classes. The mere fact that a hospital is required to take out Drugs Licenses for stocking and distributing drugs is not an interference or unreasonable restriction with the right or duty or privilege of Registered Medical Practitioners. It is the hospital, or the institution or establishment which is to take out Drugs Licenses and not the individual. The Hospital can do so after taking out Drugs Licenses also.
29. I deny the averment of the Petitioner that the act of requiring Hospitals to take out Drugs Licence would amount to interference with the medical profession or infringement of the fundamental rights guaranteed in the Constitution of India.
30. I emphatically state and submit that there is no intention of harassing the Medical Practitioners. All that is contemplated in the enforcement of the provisions of the Drugs and Cosmetics Act to regulate the supply of medicine as they apply to hospitals. No Registered Medical Practitioner, who supplies drugs to his own patient is required to take out Drugs Licence. Licence is required only for Hospitals.
30. A. That no facts which were not pleaded before the Courts below have been pleaded in this Affidavit.
31. I state the annexures accompanying the Counter Affidavit are true copies of their respective originals and I state the contents of para 1 to 30 herein are true to my knowledge and no new material had been pleaded in this counter affidavit which had not formed part in the courts below.
On these premises, I most respectfully pray the Special Leave Petition be dismissed with costs to the Respondent No. 3.
Sd/- Deponent
Verification
Verified at Ernakulam on this the 7th day of September, 2000 that the contents of my above affidavit are true and correct to the best of my knowledge and belief.
Solemnly affirmed and signed by the deponent whom I know before me on this the day of 7th day of September, at the office of the Advocate General, Ernakulam
(This Counter Affidavit is in response to the Petition filed by the QPMPA, published in our April 2000 issue of the Journal. Can also be read in www.qpmpa.com)
Annexure R1
Idukki (9)
1. Holy Family Hospital, Muthalakkodam, Thodupuzha
2. Devamatha Hospital, Rajakumari
3. Mercy Hospital, Rajakkad
4. Medical Trust Hospital, Nedumkandam
5. Karuna Hospital, Nedumkandam
6. Grandby Hospital, Vandiperiyar
7. HOP Plantation Woodland Group Hospital, Peerumedu
8. Vandiperiyar Group Medical Hospital, Vandiperiyar
9. Tata Tea Ltd. General Hospital, Munnar
Alappuzha (5)
10. Central Travancore Specialist Hospital, Chengannur
11. BJSM CSI Hospital, Kodukulanji
12. Huda Trust Hospital, Haripad
13. KVM Hospital, Cherthala
14. Elite Hospital, Karthikappally
Palakkad (15)
15. Palakkad Medical & Research Centre, Palakkad
16. Fort Hospital, Palakkad
17. Devaprabha Hospital & Medical Centre, Palakkad
18. Venketasa Hospital, Palakkad
19. Co-op. Hospital Medical Store, Palakkad
20. Sankar Hospital, Cherplacherry
21. Assumption Hospital, Kanhirappuzha
22. Marie Anu Hospital, Ongallur
23. Pattambi Nursing Hospital, Pattambi
24. Modern Hospital Pharma, Kootanadu
25. Crescent Hospital, Alathur
26. Sree Krishna Hospital, Alathur
27. Dharmagiri St. Joseph Hospital, Vadakkancherry
28. MJM Holistic Healing Centre, Malampuzha
29. St. Joseph Hospital, Mundur
Kottayam (6)
30. St. Francis Hospital, Arumanoor
31. Mannam Memorial NSS Medical Mission Hospital, Karukachal
32. Indo-American Hospital, Vaikom
33. Indo-American Hospital Brain & Spine Centre, Chemmanakari, Vaikom
34. Word & Deed Health Care Centre, Edamattom
35. NSS Medical Mission Hospital, Kummannoor
Kozhikode (25)
36. Fathima Hospital, Block 3
37. PVS Hospital, Pvt. Ltd., Calicut
38. Santhi Clinic, Calicut-2
39. National Pharmacy, Calicut
40. Dr. Raman Memorial Hospital, Calicut
41. Taj Hospital Pharmacy, Calicut-32
42. Baby Memorial Hospital Pharmacy, Kozhikode
43. District Co-op. Hospital, Eranhipalam
44. Chest Hospital Pharmacy, Calicut
45. Shiba Surgery & Urology Centre, Kozhikode
46. CPR Polyclinic, Kakkodi
47. Elathur Panchayath Co-op. Dispensing Society Ltd., Elathur
48. Farook Hospital, Farook
49. MPC Hospital, Koduvally
50. Santhi Hospital, Omassery
51. Valley View Hospital, Thamarassery
52. St. Joseph Hospital, Agarthiamuzhi
53. Ceeyem Hospital (P) Ltd., Vatakara
54. Janatha Hospital, Vatakara
55. CH Mohammed Koya Memorial Co-op. Hospital Ltd., Orkaltery
56. City Hospital Pharmacy, Vatakara
57. CKM Hospital, Balussery
58. Badagara Sahakarana Asupathri
59. Rakesh Hospital, Koyilandi
60. Rajeeva Clinic, Balussery
Malappuram (15)
61. Alukkas Hospital, Tirur
62. Bright Hospital, Manjeri
63. Bawa Memorial Hospital, Pulikkal
64. Chitra Gopinath Edappal Hospital (P) Ltd., Edappal
65. Dr. K. S. Amrutha Kumar Edappal Hospital (P) Ltd., Edappal
66. Elamukulam Maternity & Child Health Hospital, Nilambur
67. Kalliyath Hospital, Tirur-7
68. MK Haji Orphanage Hospital Ltd., Tirurangadi
69. Pathur Nursing Home, Chemmad
70. Tirur Nursing Home, Tirur
71. MB Hospital Medicals, Downhill
72. Tirurangadi Nursing Home, Chemmad
73. Tavannur Maternity Hospital, Tavanur
74. Crescent Clinic, Vengara
75. Soorya Maternity Hospital, Mangattiri
Wayanad (9)
76. Leo Hospital, Kalpetta
77. PBM Hospital, Wayanad
78. Wayanad Hospital Pharmacy, Sultan Bathery
79. Fair Price Medical Store, Dist. Hospital, Mananthavady
80. Louise Mount Hospital, Wayanad
81. St. Vincents Hospital, Mananthavady
82. Santhi Hospital Pharmacy, Padinjarathara
83. Marhia Medical Centre, Ambalavayal
84. Fathimamatha Mission Hospital, Kalpetta
Pathanamthitta (15)
85. People's Clinic, Pathanamthitta
86. Veda Nursing Home, Omalloor
87. St. Thomas Mission Hospital, Kozhencherry
88. Maria Hospital, Adoor
89. Holy Cross Hospital, Adoor
90. St. Vincent's Hospital, Thuvayoor
91. NSS Mission Hospital, Pandalam
92. Marthoma Hospital, Ranny
93. Poyyanil Hospital, Kozhencherry
94. St. George Hospital, Kaipattoor
95. Muthoot Medical Centre, Kozhencherry
96. Janatha Hospital, Adoor
97. Menathottam Hospital, Adoor
98. St. Stephen's CSI Hospital, Mundiyappally
99. St. George Hospital, Eraviperoor
Kollam (12)
100. Mercy Hospital, Valakom
101. KNS Hospital, Kottarakkara
102. Assisi Atonement Hospital, Perumpuzha
103. Loka Rakshaka Hospital, Thevalakkara
104. Dr. M. O. Raghavan Memorial Prathibha Hospital, Kadppakkada
105. Vijaya Hospital, Pulamon
106. St. Joseph Hospital, Pathanapuram
107. Jaymatha Hospital, Pathanapuram
108. N. S. Hospital and Maternity Home, Kadappakkada
109. Holy Cross Hospital, Kottiyam
110. Upaharamatha Hospital, Kallada
111. Vimala Hospital, Kalluvathikkal
Kasaragod (16)
112. Care and Cure Hospital, Kanhangad
113. Deepa Nursing Home, Kanhangad
114. Krishna Nursing Home, Kanhangad
115. Arimala Clinic, Kanhangad
116. KHM Medicals, Kanhangad
117. Padma Poly Clinic, Kanhangad
118. Manzoor Hospital, Mamkoth, Kanhangad
119. Janardhana Maternity Nursing Home, Kasaragod
120. Fathima Hospital, Kasaragod
121. Carewell Hospital, Kasaragod
122. Kasaragod Dist. Co-op. Hospital, Kumbala
123. KNH Hospital, Uppala
124. City Nursing Home, Kanhangad
125. Ibnuseena Hospital, Bekal
126. EMS Memorial Hospital, Padanna
127. Sa-Adiya Hospital, Deli, Kasaragod
Thrissur (30)
128. West Fort Hospital, Thrissur
129. GEM Hospital, Thrissur
130. Elite Hospital, Talikulam
131. Ittimani Memorial Hospital, Kunnamkulam
132. Royal Hospital, Kunnamkulam
133. Malankara Orthodox Syrian Church Medical Mission Hospital
134. Thahani Hospital, Guruvayoor
135. Dist. Co-op. Hospital, Thrissur
136. Sanjos Parish Hospital, Pavaratty
137. Karuna Hospital, Vatanappally
138. MI Hospital, Engandiyoor
139. Holy Cross Hospital, Pudukkad
140. Kaipamangalam Medical Centre, Kaipamangalam
141. Metropolitan Hospital, Thrissur
142. Irinjalakkuda Co-op. Hospital
143. Our Hospital, Irinjalakkuda
144. Al Iqbal Hospital, Centhrappinni
145. Ansar Hospital, Perumpilavu
146. Bishop Alappat Mission Hospital, Karanchira
147. Chandramathy Amma Memorial Hospital, Olari
148. Dhanya Mission Hospital, Potta
149. Holy Family Hospital, Ollur
150. Elite Mission Hospital, Thrissur
151. Lourde Hospital, Mannuthy
152. Lal Memorial Hospital, Irinjalakkuda
153. Mother Hospital, Pullazhi
154. Sacred Heart Mission Hospital, Pullur
155. Trichur Heart Hospital, Thrissur
156. Unit Health Services, Kanipayyur
157. Divine Medical Centre, Wadakkancherry
Ernakulam (6)
158. The Thrikkakkara Grama Panchayat Hospital
159. Skin Clinic, Cochin-15
160. The Koothattukulam Co-op. Hospital Ltd., No. E, Koothattukulam
161. Divya Hospital, Pattimattom
162. VG Saroja Memorial Hospital
163. KMK Hospital, N. Parur
Thiruvananthapuram (10)
164. S. P. Forte Hospital, Thiruvananthapuram - 23
165. PRS Hospital, Killippalam
166. Kalyan Hospital, Killippalam
166. Cosmopolitan Hospital, Pottakkuzhi
167. Bavas Hospital, Attingal
168. SK Hospital, Avanakuzhi
169. St. Anne's Hospital, Thumba
170. Al-Arif Hospital, Ambalathara
171. Fathima Hospital, Muttathara
172. PNM Hospital, Kattakkada
173. Karette Medical Centre, Karette.
Annexure 2 & 3 not published.