Del HC | Seizure by police of oxygen concentrators and covid related equipments sold at high profit margins. Is it illegal? HC answers

Delhi High Court: Yogesh Khanna, J., observed in view of the plethora of decisions that

“…even if there was an irregularity at the time of making a seizure, procedural or otherwise, it would not ipso facto vitiate the seizure.” 

Instant petition was filed for direction to the respondent to immediately release the products/stock seized by it from the petitioner’s Collection Centre at Lodhi Colony and the petitioner’s office premises.

On search of a restaurant in the name and style of Nege Ju 32 boxes of Oxygen Concentrators of 9 and 5 litres capacity; one box of the thermal scanner and KN-95 Masks were recovered.

In view of the above stated, an FIR was filed under Section 3/7 of the Essential Commodities Act, under Section 3 of the Epidemic Diseases Act and Section 420/188/120B/34 Penal Code, 1860 and four accused persons were arrested in this regard.

Black Marketing of COVID-19 Treatment-related equipment’s

During the course of investigation, at the instance of the accused persons, 387 oxygen concentrators; 112 boxes containing KN-95 marks, 95 Oximeter were recovered from Matrix Cellular International Services Private Limited. The accused persons allegedly disclosed regarding black marketing of oxygen concentrators and other COVID-19 treatment related equipment from various sources and supply/sold to highest payer and needy person.

Oxygen Concentrators were also recovered from Khan Chacha Restaurant and further invoices in the name of Dayal Opticals for selling 250 Oxygen Concentrators were recovered at the instance of accused.

Petitioner argued that it is dealing in oxygen concentrators and not oxygen cylinders and the equipments which are seized from the petitioner are sold over the counters and is not a regulated/controlled item. These items are being sold by Amazon and other online portals and the acts of petitioner have been carved out separately is a mischief of the concerned Investigating Officer.

Thus, it was argued that only if the State had regulated the import and capped the price of concentrators only then these could have been seized; hence without any order under Essential Commodities Act or without any regulation under The Epidemic Diseases Act, the act of the State is wholly illegal and hence the articles need be returned. 

Analysis, Law and Decision

Bench stated that it will examine whether the act of respondent in seizing the above-stated articles was legal?

State also relied upon the orders and notifications issued by the Government from time to time to fight the pandemic.

It was noted that the oxygen concentrator, being a device was covered within the definition of Drug per Section 3(b)(iv) of the Drugs and Cosmetics Act.

Notification dated 11-02-2020 stated that device includes an instrument, apparatus, used for treatment, sustaining life etc. and Order dated 31-03-2020 stated that medical device, intending for use in human being shall be governed by provisions of Drug Price Control Order 2013. Further, an Order dated 29-062020 warned of increasing MRP of the concentrators, more than 10% a year.

Therefore, respondent acted arbitrarily, or their action had no legal backing was all wrong.

Seizure had been made under Section 102 CrPC. It gives the power to any police officer to seize any property which may be alleged or suspected to have been stolen, or which may be found under circumstances that create suspicion of the commission of any offence.

Adding to its analysis, Court also stated that the seized items were found under suspicious circumstances where individuals were in alleged violation of the Covid-19 lockdown measures imposed at that time, and accordingly, police was authorised to seize the oxygen concentrators lying at the spot.

Police officer is empowered under CrPC to investigate upon information received or otherwise, if he suspects the commission of a crime that he is empowered to investigate under Section 156 of the Cr PC, and since the investigation includes collection of evidence hence, it authorizes the Investigating Officer to seize any property for the purpose of the collection of evidence. Unlike Section 156 Cr P C, under Section 102 Cr P C the police is empowered to investigate cognizable cases and the police can seize any property without an FIR. 

Bench noted that the Court needs to be careful in scrutinizing the seizure memo, as the law is crystallized over the years viz Pooran Mal v. Director of Inspection (Investigation) (1974) 1 SCC 345 and State of Maharashtra v. Natwarlal Damodardas Soni (1980) 4 SCC 669.

Conjoint reading of the FIR, invoices and receipts produced by the petitioner along with the fact that the seized oxygen concentrators were allegedly sold at huge profit margins in contravention of laws, rules and executive orders.

The facts of the present matter show that the petitioner was engaged in selling untested oxygen concentrators to people desperate for these devices and at exorbitant prices through false representations, especially, when the State and the whole country saw an unprecedented surge of covid-19 infections and sever lack of oxygen cylinders and/or concentrators.

Hence, no illegality in the act of respondent especially when the State was reeling in acute shortage of drugs, cylinders, concentrators and attendants of patients were running pillar to post, ready to part with their life savings for its purchase.

High Court lastly added while dismissing the petition that the concentrators so seized be put an identification mark(s) and its coloured photographs are kept for future reference. [Matrix Cellular (International) Services Ltd. v. State (NCT of Delhi), 2021 SCC OnLine Del 2566, decided on 27-05-2021]


Advocates before the Court:

For the Petitioner:

Mr Mohit Mathur, Mr Trideep Pais, Senior Advocates with Mr Samudra Sarangi, Ms Shruti Raina, Ms Srishti Khare, Ms Abhilasha Khanna, Ms Nishtha Aggarwal, Ms Moha Paranjpe, Mr Sumit Misra, and Ms Sanya Kumar, Advocates

For the Respondent:

Mr S.V.Raju, ASG with Mr Sanjay Lao, Standing Counsel (Crl), Ms Kamna Vohra, ASC with Ms Sairica Raju, Mr A Venkatesh, Mr Guntur Pramod Kumar, Ms Zeal Shah, Mr Shaurya R Rai, Ms Aarushi Singh and Mr Anshuman Singh, Advocates for the State.

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