1981 INSC 0267
                                      M/S. North Bihar Agency and Others

                                                           Vs

                                             State of Bihar and Others

                                          Civil Appeal No. 1411 of 1981

                                         (V. D. tulzapurkar, A. N. Sen JJ)

                                                      16.04.1981

                                                     JUDGMENT

TULZAPURKAR, J. ­

1. After hearing the counsel for the parties we are satisfied that no proper opportunity was given to
the appellants before their licences were cancelled. At any rate at the appellate stage additional
material, not furnished to them, has been relied upon and clearly they had no opportunity to meet it.
It is very clear to us that the appellate authority was greatly influenced by the fact that :

Four such drugs (resembling the reputed drugs) were sent to the Central Drugs Laboratory for test
and were declared not to be standard quality. This indicates that the petitioner (appellants) deals in
sub-standard and spurious quality of medicines and was playing with the life of the ailing
community.

This aspect of the matter was not mentioned in the show-cause notice initially served on the
appellant presumably because by that time the Laboratory Test Report had not been received but as
and when it was received it ought to have been furnished to the appellants before reliance was
placed thereon for the purpose of confirming the cancellation order passed by the authority in the
first instance. The appellate authority has also stated that non-production of godown licence etc. was
violative of the Drugs Rules. If, as explained by the appellants in their reply dated December 17,
1979 the said licence had been deposited in the office of the Civil Surgeon for renewal, how could it
be produced. It shows non-application of mind by the appellate authority to the explanation
furnished and there is nothing to indicate that the explanation was false.

2. In the circumstances, both the impugned orders - initial order the State Drugs Controller dated
August 23, 1980 as well as the order of the appellate authority dated October 30, 1980 are set aside
and we direct that the respondent should proceed afresh to deal with the appellants in the matter of
cancellation of their licence after giving them proper opportunity and following the principles of
natural justice.

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