Madras High Court: The present writ petition was filed under Article 22 of the Constitution praying for issuance of a Writ of Mandamus directing Respondents 1 and 2 to permit the petitioner to clear all goods covered by bill of entry dated 19-2-2025. A Single Judge Bench of Senthilkumar Ramamoorthy, J., examined the classification of the imported products as ayurvedic drugs and noted that while the statute regulated ayurvedic drugs, the existing licensing forms and procedures were tailored for allopathic medicines and not suitable for ayurvedic products. Therefore, the Court opined that it was necessary for the rule-making authority to amend existing rules and develop proper standards and forms applicable to the import of Ayurvedic drugs.
The Court held that the Ayurvedic products imported by the petitioner must conform to the standards applicable to similar products manufactured in India and to ensure this, the consignment must be tested by a laboratory accredited by Central Drugs Standard Control Organization (‘CDSCO’), under the supervision of Respondent 5-State Licensing Authority (IM). The Court directed the customs authorities to permit the release of goods upon satisfactory test report.
Background
The petitioner was an authorized importer and distributor of Axe medicated oil products in India and imported these goods from a Singapore-based company. The petitioner had received notices from Respondent 5, alleging violations under Section 33EEA of the Drugs and Cosmetics Act, 1940 (‘1940 Act’) and Rule 154 of the Drugs and Cosmetics Rules, 1945 (‘1945 Rules’). In response, the petitioner requested Respondent 1-Additional Commissioner of Customs to release the goods but was informed that the matter had been transferred to Respondent 4-Drug Controller General of India. The petitioner then filed the present writ petitions seeking directions from the Court to the respondents to allow clearance of the goods and other related reliefs.
Analysis, Law, and Decision on Import of Ayurvedic Drugs
The Court held that ayurvedic drugs fall within the ambit of the 1940 Act, based on the definitions of drug and ayurvedic, siddha or unani drug under Sections 3(a) and 3(b). The Court stated that Parliament’s intention to regulate Ayurvedic drugs was evident from Part XVI of the 1945 Rules. While Rule 23 of the 1945 Rules mandated an import license for drugs, no specific exclusion was made for Ayurvedic drugs. However, the forms prescribed under Rules 23 and 24 of 1945 Rules were not appropriate for Ayurvedic drugs, as they were tailored for allopathic medicines.
The Court opined that there was a strong public interest element, specifically public health element, in relation to the import of drugs and the drug involved in the present case was Axe Medicated Oil and, in that context, the public health threat might not be significant. Therefore, it was necessary for the rule-making authority to amend existing rules and develop proper standards and forms applicable to the import of Ayurvedic drugs. Alternatively, Parliament might choose to amend the law to prohibit such imports, if it finds it appropriate as a matter of policy.
The Court stated that the Ayurvedic products imported by the petitioner must conform to the standards applicable to similar products manufactured in India. To ensure this, the consignment in question was to be tested by a laboratory accredited by CDSCO, under the supervision of Respondent 5. The Court further stated that the petitioner was required to bear the costs of such testing.
Respondent 5, upon receiving a satisfactory test report, shall certify that the manufacturing process complied with the process in India. The same shall be forwarded to Respondents 1 and 2, who on receipt, shall permit the release of the goods. The Court accordingly disposed of the petitions on the said terms without imposing any costs.
[Axeon Mktg. India v. Commr. of Customs, 2025 SCC OnLine Mad 3245, decided on 26-6-2025]
Advocates who appeared in this case:
For the Petitioner: Hari Radhakrishnan, Advocate
For the Respondents: Revathi Manivannan for R 1 & R 2, Arl Sundaresan, assisted by V. Chandrasekaran, SPC for R 3, R 4 & R 6 and M. Sneha, Spl. Counsel for R 5.
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