Price control for non-scheduled medicines can extend under the order, making overpricing potentially punishable

Medicines sold above the maximum retail price fixed under the Drugs (Prices Control) Order, 1979 could fall within the price-control regime even if not listed in Categories I, II or III of the Third Schedule. Paragraph 2 broadly defines bulk drug and formulation, and paragraph 18 applies the Order to formulations not specified in the Schedule, except paragraphs 10 to 14. Read with paragraph 21, this meant the sale-price restriction could extend to such formulations, and exceeding the fixed price could constitute a contravention punishable under the Essential Commodities Act, 1955. The acquittal was not interfered with.

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Issues: (i) Whether medicines sold above the maximum retail price fixed under the Drugs (Prices Control) Order, 1979, but not specified in Category I, II or III of the Third Schedule, could be treated as formulations and their sale punished under paragraph 21 read with paragraph 18 of the Order.

Analysis: Paragraph 2 of the Order defines bulk drug broadly as a substance used as such or as an ingredient in formulations, and defines formulation as a medicine processed out of or containing one or more bulk drugs or drugs. Paragraph 18 expressly makes the provisions of the Order applicable to formulations not specified in the Third Schedule, except paragraphs 10 to 14. Paragraph 21 controls sale prices of formulations specified in the Third Schedule, and by virtue of paragraph 18 its prohibition extends to formulations not so specified as well. A contrary construction would defeat the price-fixation scheme and render it ineffective.

Conclusion: The sale of the medicines at prices exceeding the fixed maximum retail price was capable of constituting a contravention of paragraphs 18 and 21 of the Drugs (Prices Control) Order, 1979, punishable under Section 7 of the Essential Commodities Act, 1955, but the acquittal was not interfered with.

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