Union of India v. Sanjeev V. Deshpande (SC) BS599370
SUPREME COURT OF INDIA

Before:- R.M. Lodha, CJI, J. Chelameswar and A.K. Sikri, JJ.

Criminal Appeal No. 660 of 2007 with Criminal Appeal No. 848 of 2011 Criminal Appeal No. 855 of 2011 Criminal Appeal No. 876 of 2011 Criminal Appeal No.1711 of 2014 (Arising out of SLP (Crl.) No. 2694 of 2006) Criminal Appeal No.1713 of 2014 (Arising out of SLP (Crl.) No. 5714 of 2006) Criminal Appeal No.1710 of 2014 (Arising out of SLP (Crl.) No. 4241 of 2009) Criminal Appeal No.1712 of 2014 (Arising out of SLP (Crl.) No. 6743 of 2009) Criminal Appeal No.1714 of 2014 (Arising out of SLP (Crl.) No. 3000 of 2012) Criminal Appeal No.1715 of 2014 (Arising out of SLP (Crl.) No. 9114 of 2012) Criminal Appeal No.1716 of 2014 (Arising out of SLP(Crl.) No. 9374 of 2012) Criminal Appeal No.1717 of 2014 (Arising out of SLP(Crl.) No. 3558 of 2013). D/d. 12.8.2014.

Union of India and another - Appellants

Versus

Sanjeev V. Deshpande - Respondent

For the Appellants :- Ms. Sushma Suri, Mr. Vishwa Pal Singh, Mr. Amit Kumar, Mr. Rishi Malhotra, Ms. Anil Katiyar, Mr. B. Krishna Prasad, Mr. Ravindra Keshavrao Adsure, Mr. Pramit Saxena, Advocates.

For the Respondent :- Mr. K. N. Rai, Mr. Shreekant N. Terdal, Ms. Hemantika Wahi, Mr. D. Mahesh Babu, Mr. Yash Pal Dhingra, Mr. Rishi Malhotra, Ms. Asha Gopalan Nair, Mr. Niraj Gupta, Mr. Jatinder Kumar Bhatia, Mr. B. Krishna Prasad, Advocates.

NOTE

As per Section 37 of the Narcotic Drugs and Psychotropic Substances. Act, the presumption of innocence of the accused is departed.

A. Narcotic Drugs and Psychotropic Substances Act, 1985 Section 37 Evidence Act, Section - Accused committing an offence under NDPS Act - There is no presumption of innocence in favour of accused - Held :-

[Para 6]

B. Narcotic Drugs and Psychotropic Substances Rules, 1985, Rules 65 and 65A - Narcotic Drugs and Psychotropic Substances Act, 1985 Sections 8(c) and 9(10) - Notwithstanding the prohibition under Section 8(c), the Central Government in exercise of its power under Section 9(1)(a)(vi) has power to permit the manufacture of those psychotropic substances other than specified in Schedule-I to the Rules - Held:-

[Para 20]

C. Drugs and Cosmetics Act, 1940, Section - Drugs and Cosmetics Rules, 1945, Rule - Narcotics Drugs and Psychotropic Substances Act, Section 8(c) - Narcotic Drugs and Psychotropic Substances Rules, 1985, Rules, 53, 65 and 65-A and 63 - NDPS Act is applicable to all Psychotropic Substances mentioned in Schedule to the NDPS Act though such substance is not mentioned in Schedule to Rules - Further held :-

[Paras 22, 23 and 34]

D. Drugs and Cosmetics Act, 1940, Section - Drugs and Cosmetics Rules, 1945, Rule - Narcotic Drugs and Psychotropic Substances Act, 1985 Section 8 Drugs and Cosmetics Act, 1940 deals with various operations of manufacture, sale, purchase etc. of drugs generally whereas Narcotic Drugs and Psychotropic Substances Act, 1985 deals with a more specific class of drugs and, therefore, a special law on the subject - Further the provisions of NDPS Act operate in addition to the provisions of 1940 Act.

[Para 38]

Cases Referred :-

Collector of Customs, New Delhi v. Ahmadalieva Nodira, 2004(2) RCR (Criminal) 192 : (2004) 3 SCC 549.

State of Uttaranchal v. Rajesh Kumar Gupta, 2006(4) RCR (Criminal) 974 : (2007) 1 SCC 355.

Union of India v. Thamisharasi, 1995(2) RCR (Criminal) 531 : (1995) 4 SCC 190.

JUDGMENT

Chelameswar, J. - Leave granted in the special leave petitions.

2. This batch of matters is listed pursuant to various orders of this Court opining that these matters are required to be considered by a larger Bench.

3. The first of such orders is dated 20th April, 2007 made in Criminal Appeal No.644 of 2007. By the said order, leave was granted in SLP (Crl.) No.4976 of 2006. The order reads as follows:-

4. Each of the remaining matters came to be tagged on to Criminal Appeal No. 644 of 2007 on the ground that the issue involved in each of these cases is identical with the issue involved in Criminal Appeal No. 644 of 2007.

5. All these cases pertain to prosecution under the provisions of the Narcotic Drugs and Psychotropic Substances Act, 1985 (hereinafter referred to as "the Act"). Each one of the accused is alleged to be in possession of some psychotropic substance mentioned in the Schedule to the Act. Eventually, the question is whether persons accused of committing an offence under the Act could be enlarged on bail in view of the stipulations contained under Section 37 of the Act. In some of these cases, bail was granted by the concerned High Court and in some cases, bail was rejected. Aggrieved by such orders, either the State or the accused preferred these appeals.

6. Section 37*[1] of the Act stipulates that all the offences punishable under the Act shall be cognizable. It further stipulates that :

In other words, Section 37 departs from the long established principle of presumption of innocence in favour of an accused person until proved otherwise.

7. To understand the exact legal quandary involved in these matters, a brief survey of the relevant provisions of the Act and also an understanding of the scheme of the Drugs and Cosmetics Act, 1940 (hereinafter referred to as "the 1940 Act") is necessary.

8. Prior to the Act, three colonial enactments to some extent dealt with the legislative subject matter of the Act. They are Opium Act, 1857, The Opium Act, 1878 and the Dangerous Drugs Act, 1930. Subsequently, various international treaties and protocols etc. dealing with the menace of narcotic drugs and psychotropic substances came into existence. India has been a party to those treaties and protocols etc. and incurred several legal obligations thereunder. Parliament opined that the existing enactments were inadequate to handle the hazard projected by the narcotic drugs and psychotropic substances, apart from the inadequacy of the existing law to enable India to comply with its international legal obligations. Hence, the Act and all the three old Acts were repealed.

9. The Act deals with narcotic drugs and psychotropic substances. Both the expressions are defined under the Act. Section 2(xiv) defines "narcotic drug" as follows :-

10. The words "coca leaf", "cannabis", "opium", and "poppy straw" occurring in the definition of narcotic drug are themselves defined under Sections 2 (vi), 2(iii), 2(xv) and 2(xviii) respectively.

11. Section 8 prohibits the cultivation by any person of any coca plant, opium poppy or cannabis plant and also prohibits the gathering of any portion of coca plant. It further stipulates that "no person shall produce, manufacture, possess, sell, purchase, transport, warehouse, use, consume" or indulge in either inter-state trade or international trade (all these prohibited activities hereinafter collectively referred to as "DEALING IN") of any narcotic drug or psychotropic substance. Section 8 itself contains certain exceptions to the general prohibition as described above. [3]* The details would be examined later.

12. Sections 9 and 10 authorise the Central Government and the concerned State Governments to make Rules permitting and regulating the various aspects of prohibition contained under Section 8.

13. Chapter IV of the Act contains various offences and the punishments for the said offences.

14. Since all the cases on hand are cases of prosecution for some contravention of the Act in relation to psychotropic substances, Sections 22 to 24 are relevant for our enquiry.

15. Section 22*[4] prescribes the punishments for the violation of various activities prohibited under Section 8(c). Depending upon the quantity of the psychotropic substance involved in the case, the punishment prescribed also varies. If the quantity is small, the punishment extends upto 6 months. The expression "small quantity" is defined under Section 2(xxiiia)*[5]. If the quantity is less than "commercial quantity" as defined under Section 2(viia), but greater than the small quantity, the punishment may extend upto 10 years of rigorous imprisonment apart from fine. When the quantity exceeds the commercial quantity, the punishment extends upto 20 years and carries a fine upto 2 lakhs and for special reasons even more. Section 23*[6] prescribes the punishment for illegal import to India or export out of India of narcotic drugs and psychotropic substance. Once again, the punishment varies depending upon the quantity of the contraband involved in the offence. Examination of the scope of Section 24 is not necessary in the context of the factual setting of the cases at hand.

16. Section 35 stipulates that in any prosecution for an offence under the Act which requires a culpable mental state of the accused, the court trying offence is mandated to assume the existence of such mental state, though it is open for the accused to prove that he had no such mental state.[7]*

17. The ambit and scope of section 37 was considered by this court in two earlier decisions in Union of India v. Thamisharasi, 1995(2) RCR (Criminal) 531 : (1995) 4 SCC 190 and Collector of Customs, New Delhi v. Ahmadalieva Nodira, (2004) 3 SCC 549. The latter of the two judgments after taking note of the earlier decision explained the context of section 37 as follows:

18. Various sets of Rules were framed by the Government of India in exercise of the power conferred under Sections 9 and 76 of the Act. Relevant for the purpose of our enquiry is the Narcotic Drugs and Psychotropic Substances Rules, 1985 (hereinafter referred to as "the 1985 Rules"). Various Chapters and Rules provide for various aspects of the control and regulation of DEALING IN narcotic drugs and psychotropic substances. The subject matter of Chapter III of the Rules is opium poppy cultivation and production of opium and poppy straw, Chapter IV manufacture, sale and export of opium, Chapter V manufactured drugs[8]*, Chapter VI import, export and transshipment of narcotic drugs and psychotropic substances into or out of India. Rule 53 thereof prohibits both import and export into or out of India of narcotic drugs and psychotropic substances specified in Schedule I to the Rules, subject of course to the provisions of Chapter VIIA. Rule 53A prohibits export of the narcotic drug or psychotropic substance etc. specified in Schedule-II to the Rules to certain countries or to the regions specified in the Schedule. The further details of the chapter are not necessary for our purpose.

19. The subject matter of Chapter VII is psychotropic substances. Rule 64 prohibits each of the activities specified under Section 8(c) of the Act, DEALING IN all the psychotropic substances specified in Schedule-I of the Rules.

Rule 64 -

In other words, Rule 64 reiterates the prohibition contained under Section 8(c) of the Act, w.r.t. some of the psychotropic substances mentioned in Schedule-I to the Act.

20. Whereas Rule 65 stipulates that with reference to the psychotropic substances other than those specified in Schedule-I to the Rules could be manufactured subject to the limitation specified under Rule 65. In other words, notwithstanding the prohibition under Section 8(c), the Central Government in exercise of its power under Section 9(1) (a)(vi) permits the manufacture of those psychotropic substances other than specified in Schedule-I to the Rules.

Rule 65A stipulates that -

Obviously, the said Rule has application only to the psychotropic substances other than those specified in Schedule-I of the Rules.

Rule 66 mandates that -

The reference to the 1945 Rules admittedly is to the Drugs and Cosmetics Rules, 1945 (hereinafter referred to as "1945 Rules") framed under the Drugs and Cosmetics Act, 1940.

21. It is submitted by Ms. Pinky Anand, learned Additional Solicitor General that the High Court of Bombay following two earlier decisions, (one of the Delhi High Court and another of the High Court of Punjab & Haryana), in its judgment, which is impugned in Special Leave Petition No.5714 of 2006, held thus :

The learned ASG submitted that such a conclusion is wholly unwarranted on the face of clear language of Section 8(c) of the Act.

22. Shri K.T.S. Tulsi, learned senior counsel appearing for some of the accused in this batch of matters submitted that possession of psychotropic substance pursuant to some authorisation under the 1940 Act or Rules made thereunder coupled with the absence of mention of a particular psychotropic substance (found in the possession of an accused) in Schedule-I to the Rules framed under the Act excludes the application of the Act.

23. It is in the background of the above submissions, the legality of the conclusion recorded by the Bombay High Court that the absence of mention of a particular psychotropic substance in Schedule-I to the Rules excludes the application of Section 8, notwithstanding the fact that such a drug is included in the Schedule to the Act, is required to be decided.

24. Before we examine the correctness of various submissions, we deem it appropriate to analyze and find out the true scope and ambit of section 8(c). Section 8(c) in no uncertain terms prohibits the DEALING IN any manner in any narcotic drug or psychotropic substance. However, an exception to such prohibition is also contained in the said Section.

The exception being that DEALING IN any narcotic drug or psychotropic substance is permitted "in the manner and to the extent provided by the provisions of this Act or the rules or orders made thereunder".

25. In other words, DEALING IN narcotic drugs and psychotropic substances is permissible only when such DEALING is for medical purposes or scientific purposes. Further, the mere fact that the DEALING IN narcotic drugs and psychotropic substances is for a medical or scientific purpose does not by itself lift the embargo created under section 8(c). Such a dealing must be in the manner and extent provided by the provisions of the Act, Rules or Orders made thereunder. Sections 9*[9] and 10*[10] enable the Central and the State Governments respectively to make rules permitting and regulating various aspects (contemplated under Section 8(c), of DEALING IN narcotic drugs and psychotropic substances.

26. The Act does not contemplate framing of rules for prohibiting the various activities of DEALING IN narcotic drugs and psychotropic substances. Such prohibition is already contained in Section 8(c). It only contemplates of the framing of Rules for permitting and regulating any activity of DEALING IN narcotic drugs or psychotropic substances.

27. Therefore, we are of the opinion that the conclusion reached by the various High Courts that prohibition contained under Section 8 is not attracted in respect to all those psychotropic substances which find a mention in the Schedule to the Act but not in Schedule-I to the Rules framed under the Act is untenable.

28. However, it is brought to our notice that conclusion such as the one reached by the various High Courts as noted above is supported by a judgment of this Court in Rajesh Kumar Gupta (supra). At para 19, it was held;

(emphasis supplied)

29. We are unable to agree with the conclusion (reached in Rajesh Kumar Gupta's case) that the prohibition contained in Rule 63*[11] of the 1985 Rules is applicable only to those narcotic drugs and psychotropic substances which are mentioned in Schedule-I to the Rules and not to the psychotropic substances enumerated in the Schedule to the Act. Such a conclusion was reached in Rajesh Kumar Gupta's case on the understanding that Rule 53 (prohibiting the import into and export out of India of the narcotic drugs and psychotropic substances specified in Schedule-I to the Rules) is the source of the authority for such prohibition. Such a conclusion was drawn from the fact that the other Rules contained in the Chapter permit import into and export out of India of certain narcotic drugs and psychotropic substances other than those specified in Schedule-I to the Rules. Unfortunately, the learned Judges in reaching such a conclusion ignored the mandate of Section 8(c) which inter alia prohibits in absolute terms import into and export out of India of any narcotic drug and psychotropic substance. Rules framed under the Act cannot be understood to create rights and obligations contrary to those contained in the parent Act.

30. On examination of the scheme of Rules 53 to 63 which appear in Chapter VI, we are of the opinion that Rule 53[12]* reiterates an aspect of the larger prohibition contained in Section 8(c) i.e., the prohibition of import into and export out of India of the narcotic drugs and psychotropic substances specified in Schedule-I to the Rules. The proviso thereto however enables the import into and export out of India on the basis of an import certificate or export authorisation issued under the provisions of Chapter VI. The subsequent Rules stipulate the conditions subject to which and the procedure to be followed by which some of the narcotic drugs and psychotropic substances could be imported into India or exported out of India. For example, opium is a narcotic drug by definition under Section 2(xiv) of the Act whose export and import is prohibited under Section 8(c). But Rule 54[13]* authorizes the import of opium by Government opium factory. The construction such as the one placed on Rule 53 in Rajesh Kumar Gupta's case would in our opinion be wholly against the settled canons of statutory interpretation that the subordinate legislation cannot make stipulation contrary to the parent Act.

31. Chapter VII deals with psychotropic substances. No doubt Rule 64[14]* once again purports to prohibit various operations other than import into or export out of India in psychotropic substances specified in Schedule-I for the obvious reason that import and export operations are already covered by Rule 53. Rule 65 authorizes the manufacture of psychotropic substances other than those specified in Schedule-I to the Rules subject to and in accordance with the conditions of a licence granted under the 1945 Rules. The rule also provides for various other incidental matters. Rule 65A prohibits the sale, purchase, consumption or use of any psychotropic substances except in accordance with the 1945 Rules.

32. Rule 66 prohibits any person from having in possession any psychotropic substance even for any of the purposes authorised under the 1945 Rules unless the person in possession of such a psychotropic substance is lawfully authorised to possess such substance for any of the purposes mentioned under the 1985 Rules. Persons who are authorised under the 1985 Rules, and the quantities of the material such persons are authorised to possess, are specified under Rule 66(2). They are -

33. Rule 66 reads as follows

34. On the above analysis of the provisions of chapters VI and VII of the 1985 Rules, we are of the opinion, both these Chapters contain Rules permitting and regulating the import and export of narcotic drugs and psychotropic substances other than those specified in the Schedule-I to the 1985 Rules subject to various conditions and procedure stipulated in Chapter VI. Whereas Chapter VII deals exclusively with various other aspects of dealing in psychotropic substances and the conditions subject to which such dealing in is permitted. We are of the opinion that both Rules 53 and 64 are really in the nature of exception to the general scheme of Chapters VI and VII respectively containing a list of narcotic drugs and psychotropic substances which cannot be dealt in any manner notwithstanding the other provisions of these two chapters. We are of the clear opinion that neither Rule 53 nor Rule 64 is a source of authority for prohibiting the DEALING IN narcotic drugs and psychotropic substances, the source is Section 8. Rajesh Kumar Gupta's case in our view is wrongly decided.

35. In view of our conclusion, the complete analysis of the implications of Section 80[15]* of the Act is not really called for in the instant case. It is only required to be stated that essentially the Drugs & Cosmetics Act, 1940 deals with various operations of manufacture, sale, purchase etc. of drugs generally whereas Narcotic Drugs and Psychotropic Substances Act, 1985 deals with a more specific class of drugs and, therefore, a special law on the subject. Further the provisions of the Act operate in addition to the provisions of 1940 Act.

36. In the light of our above conclusion the correctness of the orders impugned in all the Criminal Appeals is normally required to be considered by the Bench of appropriate strength. However, in view of the fact that most of these matters are old matters [pertaining to years 2006 to 2013], we deem it appropriate to remit all these matters to the concerned High Courts for passing of appropriate orders in the light of this judgment.

37. Ordered accordingly. Appeals stand disposed of.

.