1. G. SAFDAR SHAH, J.-This appeal by leave of the Court is directed against the judgment of the Lahore High Court, dated 10-3-1976, by which the application of respondent, under . Section 561-A, Cr. P. C., was accepted and consequently the proceedings against him under section 18 read with section 27 of the Drugs Act, 1940, pending in the Court of Mr. Basharatullah Khan, Magistrate First Class, Lahore, were quashed.
2. The facts leading to this appeal are as follows :-- On 31-8-1975, Ch. Nadir Khan, Drugs Inspector (appellant No. 2 in this case) visited the premises of Standard Medical Store, Railway Road, Sialkot and took from the stock of medicines a sample of paracetamol Elixir, Batch No. 1265, manufactured by Nawabsons Laboratories Limited, Lahore, of which the respondent herein is the Managing Director. In due course the sample in question was sent by him to the Government Analyst for examination who in his report, dated September 15, 1975, expressed the opinion that the drug was of substandard quality. On the basis of the said report a case was, there--fore, registered against the respondent under section 18 of the Drugs Act, 1940, punishable under section 27 thereof. But when the news of the registration of the said case reached Messrs Nawabsons Labora--tories Limited, Lahore, a Private Limited Company, incorporated under the Companies Act, 1913, it filed in the Lahore High Court Writ Petition No. 2367 of 1975 challenging therein the authority of the Federal Investigating Agency (F. I. A.) as well as that of Chaudhry Nadir Khan in regard to the registration and investigation of the said case or in regard to the institution of any prosecution against the Company or any member of the Board of its Directors or any of its Officers. This petition, which was contested by the appellants herein, was, however, dismissed by the High Court, vide its judgment dated 14-1-1976. In the concluding part of the judgment, however, it was observed that "the prosecution is, therefore, to be launched in Court by the Inspector and before that is done, the power of police to effect arrest as also to register a case is not ousted"
3. After the dismissal of the writ petition of Nawabsons Laboratories Limited, the investigation of the case was finally completed by the F. I. A. Thereafter the F. I. A. On 18-10-1975 submitted against the respondent a written charge-sheet under the joint signature of one of its Sub-inspectors and Chaudhry Nadir Khan, the Drugs Inspector, in the Court of Mr. Basharatullah Khan, M. I. C., Lahore. On receipt of the said challan, Mr. Bashratullah Khan summoned the respondent to his Court for 13-I1- 1975. On this date the respondent appeared in the Court when he was given the copies of the statements of P. Ws., recorded under section 161, Cr. P. C., and then the case adjourned to 11-12-1975 for evidence. On 20-1-1976, the respondent herein filed in the High Court Criminal Miscellaneous Application No. 48/Q of 1976 praying therein that in the exercise of its power under section 561-A, Cr.
4. P. C. The proceedings against him under section 18 read with section 27 of the Drugs Act, pending in the Court of Mr. Basharatullah Khan, M. I. C., Lahore, may be quashed. In due course this petition came up for hearing before a learned Single Judge of the Lahore High Court who, having gone through the provisions of the Drugs Act, allowed the same observing that "a fair reading of the final report submitted under section 173, Cr. P. C. Shows that it has been lodged jointly by the Drugs Inspector and the Sub-Inspector of the Federal Investigation Agency. In these circumstances, it is not possible to disregard the signatures of one author of the report and rely exclusively on that of the other. The reference to the Bombay case is not in point as in that case there were separate complaints by the Police and the Drugs Inspector, and if one complaint was treated as superfluous, the other could be relied upon. This procedure cannot be adopted when one complaint is jointly lodged by both. The error committed is not merely a technical error or a curable irregularity, because in the absence of the prosecution being launched by the Drugs Inspector, the Magistrate could not legally take cognizance of the case under section 190 of the Code of Criminal Procedure and the proceedings pending before him cannot, therefore, continue. In this connection the decision of this Court in Mumtaz Begum v. State (1968 P Cr J 97) can carefully be referred to".
5. Leave against the impugned judgment of High Court was granted to the petitioners by the order of this Court, dated May 19, 1976, to consider whether the High Court had correctly interpreted section 32 of the Drugs Act and was justified in quashing the proceedings pending against the respondent in the criminal Court.
6. The need to consider the true scope of section 32 of the Drugs Act, 1940 was felt by this Court because in the proceedings in the High Court the main attack of the respondent, against the case pending against him in the Court of Mr. Basharatullah Khan, M. I. C., Lahore, was based on the said Section which in relevant parts runs as under :-- "32. Cognizance of offences.-(1) No prosecution shall be instituted except by an Inspector.
(2) No Court inferior to that of a Magistrate of the first class shall try an offence punishable under this Chapter.(3) .
7. Note.-It is conceded that "Inspector" means a Drugs Inspector.
8. The judgment of the High Court would show that the appellants were aware that under section 32
(Ibid) the competent person to institute prosecu--petition in this case would be the Drugs Inspector. And that was why they had attempted to justify that the challan submitted in the Court of Mr. Basharat--ullah Khan, M. I. C., Lahore, must be held to have been filed under the said Section, notwithstanding the fact that it bore the joint signatures of a Sub Inspector of F. I. A. And Chaudhry Nadir Khan the Drugs Inspector. With this contention the learned Judge in the High Court, however, did not agree and consequently he accepted the application of respondent and quashed the proceedings pending against him in the trial Court.
9. Before us the learned counsel for the parties have advanced on the same question extensive and elaborate arguments in an - effort to support their respective contentions. After having heard them for two days, however, it was discovered by us that all their said effort and labour could have been profitably saved for another appropriate occasion, as the case in hand could be effectively disposed of on the basis of facts which are wholly admitted but of which no notice was taken even in the High Court. Now in the challan submitted by the appellants in the Court of trial Magistrate, all that has been alleged is that on 31-8-1975, Chaudhry Nadir Khan, the Drugs Inspector bad visited the Standard Medical Store, situate on the Railway Road, Sialkot, and from the stock of its medicines had taken the sample of Paracetamol Elixir Batch No. 1265 ; that according to the report of Government Analyst, the said drug was found to be of substandard quality ; that the drug in question 'had been manufactured by Messrs Nawabsons Laboratories Limited, Lahore, of which Akhtar Hussain (the respondent herein) was the Managing Director ; and that the challan of the case is being submitted for the trial of respondent who was, however, on bail before arrest from the Court of Additional Sessions Judge, Lahore.
10. Now this being the sum and substance of the charge-sheet against the respondent, let us first glance through the provisions of the Drugs Act, 1940, before I come to consider the scope and effect of sections 18/27 thereof under which the respondent has been charged. A perusal of the Act would show that it is spread over five Chapters and consists of 41 Sections. Chapter 1, which consists of four Sections, is meant to be "Introductory" ; Chapter II provides for the constitution of "The Drugs Technical Advisory Board, The Central Drugs Laboratory and The Drugs Consultative Committee", and consists of three Sections ; Chapter III deals with the "Import of Drugs" and consists of eight Sections ; Chapter III-A deals with the "Export of Drugs" and contains three Sections ; Chapter IV deals with the "Manufacture. Sale and Distribution of Drugs", and has nineteen Sections ; and Chapter V which deals with "Miscellaneous" matters, consists of seven Sections. Evidently Chapters I, II, III and III-A have no relevancy to the facts of this case. This leaves us with Chapters IV and V but before dealing with the latter Chapter first I would like to deal with Chapter IV, which deals with the manufacture, sale or distribution of drugs and under the provisions of which, namely, sections 18 and 27, the respondent herein was sought to be ,prosecuted. Now from amongst the various sections of this Chapter, which consists of sections 16--34, sections 18, 19 and 27 alone are applicable to the facts of this case and so to reproduce them here, in so far as they are relevant would be necessary :- "18. Prohibition of manufacture and sale of certain drugs.-From such date as may be fixed by the Provincial Government by notification in the official Gazette in this behalf, no person shall himself or by any other person on his behalf- -
(a) manufacture for sale, or sell, or stock or exhibit for sale, or distribute--
(i) any drug which is not of standard quality ;
(ii) . ,to (iv)
(v) any drug, in contravention of any of the provisions of this Chapter of any rule made there under ; Provided that .
11. Provided further that Explanation.-.
12. "19. Pleas.-(1) Save as hereinafter provided in this section, it shall be no defence in a prosecution under this Chapter to prove merely that the accused was ignorant of the nature, substance or quality of the drug in respect of which the offence has been committed or of the circumstances of its manufacture or import, or that a purchaser, having bought only for the purpose of test or analysis, has not been prejudiced by the sale.
(2) .:,, ,
(a) , . - ..
(b) .
(3) A person, not being the manufacturer of drug or his agent for the distribution thereof, shall not be liable for a contravention of section 18 if he proves-
(a) that he did not know, and could not with reasonable diligence have ascertained, that the drug in any way contravened the provisions of that section, and that the drug while in his possession remained in the same state as when he acquired it ; or
(b) . _ Provided that .
13. ( ; . Only .-- --- . ; and - _ ,
(Il) ,. . % . _ _ "27. Penalty for manufacture, sale, etc., of drugs in contravention of this chapter.-Whoever himself or by any other person on his behalf manufactures for sale, stocks, or exhibits for sale, or distributes any drug in contravention of any of the provisions of this Chapter or any rule made thereunder shall be punishable with imprisonment which may extend to three years or with fine, or with both."
14. Now by reading these sections together, it would be easy to understand the policy of the Legislature Section 18 prohibits the manufacture and sale of any drug by any person himself or through any other person on his behalf .Which is, not of standard quality ; Section 19 deals with the pleas which would or would not be open to a person to take in defence-in -a case in which - he is prosecuted under Chapter IV ; and Section 27 proves the penalty to which a person shall be liable upon his conviction under the said Chapter.
15. The admitted, position in this case is that the substandard drug for the manufacture of which the respondent herein was sought to be prosecuted was actually manufactured by Messrs Nawabsons Laboratories Limited, Lahore, which being a private Limited Company, incorporated under the Companies Act, 1913, would be a `person' in its own right within the meaning of that expression as appearing in section 18, section 19(3) and section 27 (ibid). By the plain language of the said three sections, therefore., prima facie Messrs Nawabsons Laboratories Limited seems to have brought itself within the mischief of the law. Therefore, if the prosecution had proceeded against the said Company, in view of the bar contained in section 19 (ibid), it would not be open to it to plead in defence that it was ignorant of the nature, substance or quality of the said substandard drug or of the circumstances in which it was manufactured. In point of fact under section 19(3), its liability would seem to be total. And-consequently upon its conviction it could under section 27 be awarded the punishment of,14 fine. The difficulty in the way of the appellants, however, is that no, proceedings were drawn up against the said Company. Nor indeed the Company was made a co- accused in the challan submitted against the respondent herein in the criminal Court.
16. Furthermore, under subsection (3) of section 19 (ibid),. The liability of the manufacturer of drugs and his Agent for the distribution thereof would 1c seem to be co-extensive. But again this was not the case of prosecution to trial Court nor indeed is there anything on the record of the case to show that the respondent had acted as Agent of Messrs. Nawabsons Laboratories) Limited for the distribution of the substandard drug.
17. This brings me to Chapter V from which section 38 alone would seem to be relevant. This section runs as under :- "38. Offences by companies, etc.-Where the person guilty of an offence under this Act is a company, corporation or firm every director, partner, and officer of the company, corporation or firm with whose knowledge and consent the offence was committed shall be guilty of the like offence."
18. Now by comparing this section with sections 18, 19 and 27, which appear in Chapter IV, it would be seen that whereas it deals with all offences committed !Finder the Act, the latter three sections only deal with the offences mentioned in the various sections appearing in Chapter IV. It is true that according to section 38 if the person guilty of an offence under the Drugs Act is a company, corporation or firm, then every director, partner or officer of the company, corporation or firm, with whose knowledge and consent the offence was committed, shall be guilty of the like offence. This being the clear connotation of the said section, it would follow that under section 38 (ibiid), the principal .,accused has to be a Company, corporation of a firm. But if the prosecution would be disposed to font the liability also on the director, partner and officer of the said company, corporation or firm, then the burden would lie on it to show that the said offence had been committed within their knowledge and consent.
19. From all this discussion, therefore, I am satisfied that the High Court was wholly right to quash the proceedings against the respondent pending in the trial Court. The law in that behalf is well settled.
20. But even so it would be proper to refer to the following dictum from the judgment of this Court in the case of Ghulam Muhammad v. Muzammal Khan and 4-others (PLD 1967 SC 317):- "The High Court should be extremely reluctant to interfere in a case where a competent Court has, after examining the evidence adduced before it, come to the view that a prima facie case is disclosed and has framed charges or summoned the accused to appear, unless it can be said that the charge on its face or the evidence, even if believed, does not disclose any offence."
21. As already stated the challan submitted against -the respondent in this case contained no allegations or accusations which if allowed to go to trial, were even remotely likely to end up in his conviction. In point .Of fact whatever allegations are there against him they., do not disclose and ; offence under the Drugs Act even if the said allegations., are assumed to be true. I am, therefore, satisfied that this appeal has no force :in it and the same is hereby dismissed. s. A. H.