Export NOC requirement and spurious-drug confiscation failed where the exporter was licensed and the regime had dispensed with NOC.

A Drug Controller NOC was not required for the export consignment because the export took place after the public notice dated 11.12.2015 dispensing with that requirement, and the exporter was a duly licensed manufacturer of pharmaceutical products. Customs also could not sustain confiscation and penalties on a blanket allegation that the entire consignment consisted of spurious drugs, where the record showed that only one disputed product was found not of standard quality and the remaining products were found standard. The impugned order was set aside, and the appeal was allowed with consequential relief in accordance with law.

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Issues: Whether, for the export consignment in question, a No Objection Certificate from the Drug Controller was required, and whether the confiscation and penalties imposed by Customs could be sustained on the allegation that the goods were spurious drugs.

Analysis: The export was made after the public notice dated 11.12.2015 dispensing with the requirement of obtaining an NOC for export consignments, and the exporter was shown to be a duly licensed manufacturer engaged in export of pharmaceutical products. The material on record also showed that only one of the disputed products was found not to be of standard quality, while the remaining products were found to be of standard quality. In these circumstances, the basis adopted by Customs for treating the entire consignment as liable to confiscation on the strength of the spurious-drug allegation could not be sustained.

Conclusion: The NOC requirement was not attracted, and the confiscation and penalty proceedings were unsustainable.

Final Conclusion: The impugned order was set aside and the appeal was allowed with consequential relief in accordance with law.

Ratio Decidendi: Where the applicable export regime does not require a Drug Controller NOC and the exporter is duly licensed, confiscation cannot be sustained merely on an unproven allegation of spuriousness.

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