Compounding Of Offence Under Jan Vishwas Act

Jan Vishwas (Amendment of Provisions) Act, 2023 (JV Act, 2023 in short) came into force w.e.f. 11.08.2023

Sushant Mahapatra

April 6, 2024

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Sushant Mahapatra

Advocate-Supreme Court of India |
Email ID: sushant@macecorpn.com|
Website: www.macecorpn.com |

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Last Updated on September 30, 2024 by The Health Master

Jan Vishwas

Compounding Of Offence Under Jan Vishwas (Amendment Of Provisions) Act, 2023, Under Drugs And Cosmetics Act 1940,

Jan Vishwas (Amendment of Provisions) Act, 2023 (JV Act, 2023 in short) came into force w.e.f. 11.08.2023, whereby amendments were introduced to various enactments and, amongst others, provided for the compounding of offences.

It was left to the central government to notify different dates for amendments to different enactments mentioned in the schedule.

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Amongst others, three sections, i.e. 29, 30 and 32B of the Drugs and Cosmetics Act 1940, were amended by the JV Act, 2023, listed in the Schedule under Item No. 6 (A)(B)(C).

The Ministry of Health and Family Welfare issued the notification No. SO 1533 dated 28.03.2023 for enforcement of the amendment effective from 31 December 2024.

The JV Act of 2023 amended Sections 29 and 30 of the Drugs and Cosmetics Act 1940 regarding using Government Analyst reports for advertisement, whereby a Penalty substitutes a Fine.

The quantum of penalty has been prescribed at one lakh rupees, and for repeat offences, penalty u/s 30 is prescribed at five lakh rupees.

The third amendment is introduced in section 32B, which provides for “Compounding of Offences”. In aforesaid Section 32B, sections [i][27(d) and 27A(ii)] have been inserted, making it compoundable along with existing sections 13(1)(b), 28 and 28A.

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The effect of the amendment on drugs ‘Not Of Standard Quality’ cases:

Sections 27(d) and 27A(ii), which cover the offence of ‘Not of Standard Quality’, are now compoundable.

Offences under this section were punishable with imprisonment except 27A(ii).

The option has been given to the accused either to contest the proceeding or opt for compounding of offences by paying the penalty to the authority to be appointed by the state government or, as the case may be, by the central government.

Since compounding has to be done by the executives, the penalty paid shall not be deemed a conviction by the Court as there is a distinction between fine and penalty.

By such amendment, compounding before or after the institution of the prosecution is now possible before the commencement of trial.

Further, if the trial is started or the conviction is in the appeal stage, compounding is possible with the permission of the Court. The amendment shall also benefit existing complaints.

Effect on pending Complaints before the Court:

Although the amendment does not have a retrospective effect, judicial precedents support the view that a statute enacted for the benefit of the community as a whole may be construed to have retrospective operation.

It is held that when the amendment benefits the accused persons, it could also be applied to earlier cases pending in the Court.

I have no doubt that the ratio of these judicial precedents will also apply to pending cases.

Composition to be deemed as Acquittal:

The offences under section 13(1)(b), 28, 28A, are triable by the special court as are covered under section 36AC.

Sections 27(d) and 27A deal with cases triable by Magistrate.

However, as per section 320(8) of Cr.P.C., the composition of an offence under this section shall have the effect of an acquittal of the accused with whom the offence has been compounded.

Controversy:

Section 32B, after the amendment, raises a conflict in the section itself. Sections 27(d) is punishable with imprisonment and not with a fine in alternate, unlike sections 13(1)(b), 27(ii), 28 and 28A.

In such a scenario, I doubt how compounding will be possible. The condition precedent in section 32B is not satisfied. How the judicial interpretation shall be made to resolve the anomaly and conflicting provision in Section 32B must be seen.

Overall, the amendment is a welcome step for genuine manufacturers who found themselves in the dock for deterioration of the drug’s quality because of improper storage or the quality of the API itself.

Investigation in these areas is complex and controversial, and given the infrastructure available to drug inspectors, conducting an in-depth investigation will not be possible.

In such a scenario, compounding the offence will go a long way to relieve the Licensed manufacturer.

[i] The Section after amendment is read as follows:

Section 32B (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973(2 of 1974), any offence punishable under clause (b) of sub-section (1) of Section 13, [i][clause (d) of section 27 and clause (ii) of section 27A,] Section 28 and Section 28A of this Act (whether committed by a company or any officer thereof), not being an offence punishable with imprisonment only, or with imprisonment and also with fine, may, either before or after the institution of any prosecution, be compounded by the Central Government or by any State Government or any officer authorised in this behalf by the Central Government or a State Government, on payment for credit to that Government of such sum as that Government may, by rules made in this behalf, specify:

[See: Sl.6(C) of the Schedule to Section 2 of JV Act,2023]

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