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Issues: (i) Whether the order taking cognisance and issuing summons satisfied the requirements of law; (ii) Whether summons could be issued without the inquiry contemplated for accused persons residing outside the territorial jurisdiction of the Magistrate; (iii) Whether an intermediary operating a marketplace could be made criminally liable for the act of a third-party seller under the Drugs and Cosmetics Act, 1940; (iv) Whether the unexplained delay in filing the complaint was fatal to the prosecution.
Issue (i): Whether the order taking cognisance and issuing summons satisfied the requirements of law.
Analysis: The cognisance order merely recorded that the records were perused and that cognisance was taken, followed by issuance of summons. Such a cryptic order did not disclose application of judicial mind to the complaint, the role of each accused, or the basis for proceeding against them. The requirements governing cognisance and issuance of process demand a clear indication that the Magistrate has assessed whether sufficient grounds exist for proceeding.
Conclusion: The cognisance order was held to be non-compliant with law and was set aside.
Issue (ii): Whether summons could be issued without the inquiry contemplated for accused persons residing outside the territorial jurisdiction of the Magistrate.
Analysis: The complaint itself showed that the accused had no office or presence within the Magistrate's jurisdiction and were residing elsewhere. In such a situation, the statutory safeguard requiring postponement of process and inquiry before summoning an out-of-jurisdiction accused had to be followed. The order did not record any reason for bypassing that requirement.
Conclusion: Summons could not have been issued without the inquiry mandated for accused persons outside jurisdiction.
Issue (iii): Whether an intermediary operating a marketplace could be made criminally liable for the act of a third-party seller under the Drugs and Cosmetics Act, 1940.
Analysis: The marketplace entity functioned as an intermediary and had put in place contractual bans, seller terms, and policies restricting prohibited goods, including prescription medicines and drugs. The seller, not the intermediary, had listed and offered the product for sale. On the facts alleged, the intermediary did not manufacture, stock, sell, exhibit, or offer for sale the drug, and the essential ingredients of the penal provision were not satisfied against the intermediary or its directors merely by reason of their role in operating the platform.
Conclusion: The intermediary and its directors were not liable for the seller's alleged contravention under the Drugs and Cosmetics Act, 1940.
Issue (iv): Whether the unexplained delay in filing the complaint was fatal to the prosecution.
Analysis: The complaint was instituted nearly six years after the transaction, with no satisfactory explanation for the delay. In criminal proceedings, such unexplained and inordinate delay can indicate an absence of immediate bona fides and may render the prosecution unsustainable where the delay is not adequately justified.
Conclusion: The delay was held to be fatal to the proceedings.
Final Conclusion: The prosecution was found unsustainable on multiple independent grounds, including defective cognisance, non-compliance with the inquiry requirement for out-of-jurisdiction accused, absence of criminal liability of the intermediary for the seller's act, and fatal delay.
Ratio Decidendi: A cryptic cognisance order that does not show application of mind, coupled with failure to follow the mandatory pre-summons inquiry for accused outside jurisdiction, and absence of the statutory ingredients of the penal offence against an intermediary, cannot sustain criminal proceedings.
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