TaxTMI 
TaxTMI 
2020 (4) TMI 671
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....Mr. Jagjit Singh Chhabra, AOR Mr. B. V. Balaram Das, AOR Mr. Nishe Rajen Shonker, AOR Mr. B. Krishna Prasad, AOR Mr. Vipin Nair, AOR Ms. Jaspreet Gogia, AOR Ms. Sneha Kalita, AOR Mr. Parthivan,Adv. Mr. Zoheb Hossain, AOR Mr. Kalrav Mehrotra,Adv JUDGMENT M. R. Shah, J. Not agreeing with the view taken by this Court in the case of E. Micheal Raj v. Intelligence Officer, Narcotic Control Bureau (2008) 5 SCC 161 taking the view that when any narcotic drug or psychotropic substance is found mixed with one or more neutral substance/s, for the purpose of imposition of punishment it is the content of the narcotic drug or psychotropic substance which shall be taken into consideration (paragraphs 15 and 19), the following questions are referred to a three Judge Bench, vide order dated 3.7.2017: (a) Whether the decision of this Court in E. Micheal Raj (supra) requires reconsideration having omitted to take note of entry no. 239 and Note 2 (two) of the notification dated 19.10.2001 as also the interplay of the other provisions of the Narcotic Drugs and Psychotropic Substances Act, 1985 (for short "the NDPS Act") with Section 21? (b)Does the impugned notification issu....
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....lying upon the decision in the case of Ouseph v. State of Kerala (2004) 4 SCC 446 as the said decision was not binding as precedent as it passed sub-silentio the issue with which E Micheal Raj (supra) was seized with; 2.2 While deciding the case in the case of E Micheal Raj (supra), this Court has ignored material provisions of the NDPS Act and the entire statutory scheme to reach a conclusion which was not borne out both by the spirit and the terms of the statute and defeated the very object behind the enactment and the amendment; 2.3 The NDPS Act, as originally enacted in 1985 included in Section 2(xx) the definition of 'preparation'. It is submitted that the definition of 'preparation' reveals that preparation means "in relation to NDPS" one or more drugs or substance in dosage or solution or mixture. The 'mixture' is defined as mechanical mixture or two or more substances as distinct from chemical combination or a fluid with foreign substance in suspension or foreign element in a composition. The 'solution' is defined as a liquid or semi-liquid preparation obtained by the combination of a solid with the solvent. The 'dosage' means a definite quantity or something regarded....
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....ions, additions were made and more drugs were included in the list. Therefore the "small quantity" under the amended Act is much higher than that specified in the earlier notification under the original NDPS Act. Thus, the NDPS Act, as originally enacted, insofar as narcotic drugs and psychotropic substances are concerned, only recognized "small quantity where possession was for personal consumption or there was consumption. The punishment prescribed under the NDPS Act, originally enacted except in Section 20 which in some circumstances contemplated imprisonment up to 5 years, provided for punishment of not less than 10 years, but extendable to 20 years. The NDPS Act, as originally enacted, covered preparations of the narcotic drugs and psychotropic substances and not merely their pure drug content; 2.6 That in the year 1989, the NDPS Act was amended by Act No.2 of 1989. That notwithstanding the amendment, the original scheme of punishment under NDPS Act covering preparations and not just pure content was not interfered with. In the year 2001, the NDPS Act was further amended and clauses (viia) defining "commercial quantity" and (xxiiia) defining "small quantity" were added. A b....
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....ow mentioned in the notification is much higher than the "small quantity" in the NDPS Act as originally enacted. It is for this reason that both Sections 27 and Section 64A have also been amended. The possession having been taken out of Section 27, there was no need to provide for milder punishment for possession as under Section 27 of the original NDPS Act. Section 27 as amended therefore is confined to "consuming" any narcotic drugs or psychotropic substance only and the immunity under Section 64A is limited to 'addicts' amongst those to whom Section 27 applies, in other words, possession even of "small quantity" is outside Section 27 of the amended Act and immunity is not available to all the persons to whom Section 27 applies but, only to such of them as are 'addicts'. This is a change consequential upon the grading of punishment but, the punishment continues to relate only to the quantities of the narcotic drugs and psychotropic substance which includes their preparations and not the pure drug content; 2.9 Even without Note 4 of the notification, the NDPS Act would apply to the entire mixture or solution of the narcotic drugs and psychotropic substance. It is further submit....
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....ory 10 year minimum sentence for any person who distributes "100 grams or more of ... PCP...or 1 kilogram or more of a mixture or substance containing a detectable amount of .. PCP..." Thus, with respect to these two drugs, Congress clearly distinguished between the pure drug and a "mixture or substance containing a detectable amount of" the pure drug. But with respect to drugs such as LSD, which petitioners distributed, Congress declared that sentences should be based exclusively on the weight of the "mixture or substance". Congress knew how to indicate that the weight of the pure drug was to be used to determine the sentence, and did not make that distinction with respect to LSD." "...A "mixture" is defined to include "a portion of matter consisting of two or more components that do not bear a fixed proportion to one another...." "...By measuring the quantity of the drugs according to the "street weight" of the drugs in the diluted form in which they are sold, **1928 rather than according to the net weight of the active component, the statute and the Sentencing Guidelines increase the penalty for persons who possess large quantities of drugs, regardless of their....
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....ith the street weight of the drugs in the diluted form in which they are sold and not the net weight of the active component. The legislature know that the inactive ingredients will be combined with the pure drugs and substances and it would be the drugs or substances so prepared that would be sold to the consumers. He argued, if the arguments of the appellants are accepted, the legislative intent would be frustrated through a construction which will render the Act sterile and which in the circumstances in which the Act is to operate cannot be called either rational or sensible. 2.13 Shri Lekhi, learned Additional Solicitor General of India has also relied upon the decision of this Court in the case of urlidhar Meghraj Loya and another v. State of Maharashtra and others (1976) 3 SCC 684, as well as, Reema Aggarwal v. Anupam and others (2004) 3 SCC 199 in support of his submission that while interpreting and/or considering a particular statute, a judge must not alter the material of which the Act is woven, but he can and should iron out the creases. The appellants want this Court to alter the material of which the NDPS Act is woven. In the case of Rajinder Singh v. State of Punja....
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....t, included vide Notification S.O. 1055 (E) dated 19.10.2001, whereby the notification was issued specifying "small quantity" and "commercial quantity" of the narcotic drugs or psychotropic substances mentioned in column nos. 5 & 6 of the table, in relation to the narcotic drugs or psychotropic substances mentioned in the corresponding entry in column nos. 2 to 4 of the said table; 3.3 The result of the issuance of the impugned notification is that the offender would be awarded the punishment by looking into the total quantity of the material found in possession of the offender even if on chemical analysis it is found that the actual content of the narcotic drug or psychotropic substance is covered under the "small quantity", but by adding the neutral material the punishment awarded is for "commercial quantity". For instance, there are two offenders. One "A" is having quantity of 4 grams heroin which is less than the "small quantity" which is 5 grams, mentioned in column no.5 of the table. Another "B" is in possession of 1 gram of heroin, but has mixed it with "neutral material" of 250 grams, it becomes 251 grams, more than the "commercial quantity" which is 250 grams as p....
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....hed only to the extent it has been specifically provided under the provisions of the NDPS Act. If a person has to be punished then there must be specific power and provision for punishment and only to the extent the punishment has been provided for the commission of a particular contravention and for a particular specified substance as mentioned under column nos. 2 and 4of the schedule appended to the Act and not otherwise. Under the NDPS Act, Section 21 provides for punishment for contravention in relation to manufactured drugs and preparations thereof. Section 22 deals with punishment for contravention in relation to psychotropic substances. But there is no punishment for "neutral material" under the NDPS Act; 3.9 It is settled law that what cannot be done directly can also not be done indirectly. The NDPS Act was enacted by the Parliament. When in the NDPS Act itself the "neutral substance" has not been made punishable, the "neutral substance" cannot be made punishable by the exercise of the executive power by the Central Government by issuing he impugned notification. Where ever "neutral material" was to be included it has been specified under the NDPS Act itself. It cannot ....
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....here was no need to discuss Entry No. 239 of the 2001 notification in detail in the said judgment as Entry No. 239 was contained merely in a notification and was not the source of power. Therefore, E.Micheal Raj (supra) rightly concludes that the punishment should be commensurate to the quantity of the "offending substance" only; 5. Shri Anand Grover, learned Senior Advocate appearing on behalf of the proposed Intervenor - the applicant - Indian Drug Manufacturers' Association has, by and large, made the same submissions which are made by the learned Senior Advocate(s)/Advocate(s) appearing on behalf of the appellants. In addition, the following submissions are made: 5.1 In laying down thresholds for "small quantity" and "commercial quantity" for narcotic drugs and psychotropic substances vide the 2001 notification, the Central Government refers to the "chemical name" of the concerned drug in column 4 of the table. Thus, the "chemical name", which identifies a particular substance in terms of its actual chemical composition, is relevant for determining the quantity of such substance. If it were not, there would be no need to have column 4 and the chemical description of a sub....
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....under sections 2(viia) and (xxiiia) for notifying 'commercial' and 'small' quantities of narcotic drugs and psychotropic substances under the NDPS Act. Accordingly, it sought to introduce legislative amendments in 2011 by introducing the NDPS (Amendment) Bill, 2011 (Bill 78 of 2011) in the Lok Sabha on 8th September, 2011. The Proposed amendments in section 2(viia) and 2(xiiia) of the NDPS Act were as follows: Section 2(viia) "commercial quantity", in relation to a narcotic drug, psychotropic substance or any preparation of such drug or such substance, means any quantity of such drug, substance or preparation of such drug or substance greater than the quantity specified, in terms of the pure drug content or otherwise, by the Central Government by notification in the Official Gazeete" (proposed amendments are underlined) Identical changes were proposed in definition of section 2(xxiiia) for 'small quantity'; 5.8 The aforesaid proposed amendments were rejected by a Parliamentary Standing Committee with the following observations: - "meanings denoted by the terms/expressions 'preparation' and 'otherwise' in proposed amendments are vague and unspecific. Such ambigu....
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....relation to ganja. Accordingly, the person from whom such seizure is effected will be liable for intermediate quantity [quantity of charas found being more than the small quantity but less than commercial quantity] and will not be able to claim the benefit of the quantity threshold for ganja, though ganja found on him is lesser than the small quantity of ganja specified in the 2001 notification; 5.11 He argued that E. Micheal Raj (supra) is decided correctly as it reviews various provisions of the NDPS Act; examines legislative intent of the NDPS Amendments in 2001; correctly decides that punitive consequences under the NDPS quantity are relatable to actual amount of offending material in the seizure; it reiterates the position stated in the statute. 5.12 It is submitted that the Supreme Court of Bangladesh in its decision dated 08.05.2012 in the case of Md. Jaffar Alam v. The State, Criminal Misc. Case No. 37461 of 2011 held that actual and real quantity of the narcotics in question be ascertained accurately and the law interpreted carefully and strictly. Discussion 6. Having heard the learned advocates for the respective parties and considering the reference order, th....
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.... mixture seized including that of the neutral substance is required to be taken into consideration. However, for the first time in the case of E. Micheal Raj (Supra), a contrary view is taken solely on considering Narcotic Drugs and Psychotropic Substances (Amendment) Act,2001, by which Section 21 of the NDPS Act came to be amended. 6.2 Therefore, first of all we would like to consider the reasoning given by this Court in the case of E.Micheal Raj(Supra). The facts indicate that what was seized in E.Micheal Raj (Supra) was 4 kgs of Heroin, which would fall in Entry 56 of the Notification dated 19.10.2001. As per the Notification dated 19.10.2001 in case of Heroin 5gms is a small quantity and 250 gm is a commercial quantity. However, this Court considered the substance seized - Heroin as Opium derivative and hence a manufactured drug and therefore, treating the seized drug as opium derivative, this Court held the seized material as small quantity and awarded punishment accordingly. While holding so, this Court considered the Statement of Objects and Reasons concerning the Amendment Act, 2001 and thereafter observed in para 12 to 15 as under: "12. The possession of offend....
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....punishment would vary depending upon the quantity of offending material. Thus, we find it difficult to accept the argument advanced on behalf of the respondent that the rate of purity is irrelevant since any preparation which is more than the commercial quantity of 250 gms. and contains 0.2% of heroin or more would be punishable under Section 21(c) of the NDPS Act, because the intention of the legislature as it appears to us is to levy punishment based on the content of the offending drug in the mixture and not on the weight of the mixture as such. This may be tested on the following rationale. Supposing 4 gms. of heroin is recovered from an accused, it would amount to a small quantity, but when the same 4 gms. is mixed with 50 kgs. of the powered sugar, it would be quantified as a commercial quantity. In the mixture of a narcotic drug or a psychotropic substance with one or more neutral substance/s, the quantity of the neutral substance/s is not to be taken into consideration while determining the small quantity or commercial quantity of a narcotic drug or psychotropic substance. It is only the actual content by weight of the narcotic drug which is relevant for the purposes of det....
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....poses of determining whether it would constitute "small quantity or commercial quantity". 7. Even considering the reasons while arriving at aforesaid conclusion, it appears to us that the Statement of Objects and Reasons concerning the Amendment Act, 2001 has not been properly appreciated and/or considered and/or properly construed. Considering the statement of objects and reasons concerning the Amendment Act of 2001, by which, two tier punishment was provided one for small quantity and another for commercial quantity, it cannot be said that intention of the legislature was to consider only the actual content by weight of offending drug for the purpose of determining whether it would constitute small quantity or commercial quantity. The Statement of Objects and Reasons of the Amendment Act, 2001 is as follows: " The Statement of Objects and Reasons concerning the Amending Act of 2001 is as follows: Narcotic Drugs and Psychotropic Substances Act, 1985 provides deterrent punishment for various offences relating to illicit trafficking in narcotic drugs and psychotropic substances. Most of the offences invite uniform punishment of minimum ten years' rigorous im....
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.... of the Notification dated 19.10.2001. 8. On merits whether any mixture of narcotic drugs or psychotropic substances with one or more neutral substance(s) the quantity of neutral substance(s) is not to be taken into consideration or it is only the actual content by weight of the offending drug which is relevant for the purpose of determining whether it would constitute "small quantity or commercial quantity", the Statement of Objects and Reasons of NDPS Act is required to be considered. As per the preamble of NDPS Act, 1985, it is an Act to consolidate and amend the law relating to Narcotic Drugs, to make stringent provisions for the control and regulation of operation relating to Narcotic Drugs and Psychotropic Substances. To provide for forfeiture of the property derived from or use in illicit traffic in Narcotic Drugs and Psychotropic Substance. The Statement of objects and reasons and the preamble of the NDPS Act imply that the Act is required to act as a deterrent and the provisions must be stringent enough to ensure that the same Act as deterrents. 8.1. In the case of Directorate of Enforcement vs. Deepak Mahajan and Another reported in (1994) 3 SCC 440, it is observed ....
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.... weight of offending drug which is relevant for the purpose of determining whether it would constitute small quantity or commercial quantity. Right from sub-clause (viia) and (xxiiia) of Section 2 of NDPS Act emphasis is on Narcotic and Drug or Psychotropic Substance (Sections 21, 22, 23, 24, 27 and 43). Even in the table attached to the Notification dated 19.10.2001, column no. 2 is with respect to name of Narcotic Drug and Psychotropic Substance and column nos. 5 and 6 are with respect to "small quantity and commercial quantity". Note 2 of the Notification dated 19.10.2001 specifically provides that quantity shown against the respective drugs listed in the table also apply to the preparations of the drug and the preparations of substances of note 1. As per Note 1, the small quantity and commercial quantity given against the respective drugs listed in the table apply to isomers ..., whenever existence of such substance is possible. Therefore, for the determination of "small quantity or the commercial quantity" with respect to Narcotic Drugs and Psychotropic Substance mentioned in column no.2 the quantity mentioned in the clauses 5 and 6 are required to be taken into consideration.....
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....ar is cheaper but more dangerous. These are only few examples to show and demonstrate that even mixture of narcotic drugs or psychotropic substance is more dangerous. Therefore, what is harmful or injurious is the entire mixture/tablets with neutral substance and Narcotic Drugs or Psychotropic Substances. Therefore, if it is accepted that it is only the actual content by weight of offending drug which is relevant for the purpose of determining whether it would constitute small quantity or commercial quantity, in that case, the object and purpose of enactment of NDPS Act would be frustrated. There may be few punishment for "commercial quantity". Certainly that would not have been the intention of the legislature. 8.4. Even considering the definition of "manufacture", "manufactured drug" and the "preparation" conjointly, the total weight of such "manufactured drug" or "preparation", including the neutral material is required to be considered while determining small quantity or commercial quantity. If it is interpreted in such a manner, then and then only, the objects and purpose of NDPS Act would be achieved. Any other intention to defeat the object and purpose of enactment of NDP....
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....ch, "Note 4" has been added to the Notification S.O.1055(E) dated 19.10.2001 specifying small quantity and commercial quantity of the narcotic drugs and psychotropic substance covered under the NDPS Act, 1985 is concerned, as such it can be said to be clarificatory in nature and / or by way of ex abundanti cautela / abundant caution. As observed herein above, while determining the small or commercial quantity in relation to narcotic drugs or psychotropic substances in a mixture with one or more neutral substance(s), it includes the weight of neutral substance (s) also and not only the actual content by weight of the offending drug. Therefore, even if "Note 4" which has been added vide Notification dated 18.11.2009 is not added, in that case also, it makes no difference and / or change. It appears that after the decision of this Court in the case of E. Micheal Raj (Supra) by way of abundant caution, the Union of India has come out with a Notification dated 18.11.2009 adding "Note 4". Thus, adding "Note 4" by Notification dated 18.11.2009 to the earlier Notification dated 19.10.2001 can be said to be clarificatory and by way of abundant caution only. Even otherwise, for the reasons s....