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REPORTABLE

IN THE SUPREME COUR OF INDIA CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. 660 OF 2007

Union of India & Another  …Appellants

Versus

Sanjeev V. Deshpande …Respondent

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)

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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)

J U D G M E N T

Chelameswar, J.

1. 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:-

“Our attention has been invited by the learned counsel to two decisions of  this Court; namely, a decision of 3-Judge Bench in Collector of Customs,  New Delhi vs. Ahmadalieva Nodira (2004) 3 SCC 549 and subsequent  decision of 2-Judge Bench in State of Uttaranchal vs. Rajesh Kuamr Gupta  (2007) 1 SCC 355.

Reference  was  also  made  of  Section  80  of  the  Narcotic  Drugs  and  Psychotropic Substances Act, 1985 which reads as under:

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“80.  Application of the Drugs and Cosmetics Act, 1940 not  barred.   –  The  provisions  of  this  Act  or  the  rules  made  thereunder shall be in addition to, and not in derogation of,  the Drugs and Cosmetics Act, 1940 (23 of 1940) or the rules  made thereunder.

In our opinion, in view of the fact that the effect of Section 80 requires to  be considered, we grant leave and direct the Registry to place the papers  before the Hon’ble  the  Chief  Justice  for  placing  the  matter  before  a   3-Judge Bench.

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.  

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Aggrieved by such orders, either the State or the accused  

preferred these appeals.

6. Section 371 of the Act stipulates that all  the offences  

punishable  under  the Act  shall  be cognizable.    It  further  

stipulates that:—  

(1) persons  accused  of  an  offence  under  

Section 19, 24, 27A or persons accused of  

offences involved in “commercial quantity”2  

shall  not  be  released  on  bail,  unless  the  

public prosecutor is given an opportunity to  

oppose the application for bail; and

1 Section 37 - Offences to be cognizable and non-bailable.-(1) Notwithstanding anything contained in the  Code of Criminal Procedure, 1973 (2 of 1974)  

(a) every offence punishable under this Act shall be cognizable; (b) no person accused of an offence punishable for offences under  section 19 or section  

24 or section 27 A and also for offences involving commercial quantity shall be released on bail or  on his own bond unless   

(i) the Public Prosecutor has been given an opportunity to oppose  the application for  such release, and  

(ii) where the Public Prosecutor opposes the application, the court is satisfied  that there  are reasonable grounds for believing that he is not guilty of such  offence and that he is not  likely to commit any offence while on bail.  

(2) The limitations on granting of bail specified in clause (b) of sub-section (1) are in addition to  the limitations under the Code of Criminal Procedure, 1973 (2 of 1974) or any other law for the time being  in force, on granting of bail.]

2 Section 2(viia):  “ Commercial quantity”, in relation to narcotic drugs and psychotropic substances, means  any quantity grater than the quantity specified by the Central Government by notification in the Official   Gazette.

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(2) more  importantly  that  unless  “the  Court  is  

satisfied  that  there  are  reasonable  grounds  

for believing” that the accused is not guilty of  

such an offence.   Further, the Court is also  

required to be satisfied that such a person is  

not  likely  to  commit  any  offence  while  on  

bail.

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  

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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:-

““narcotic  drug”  means  coca  leaf,  cannabis  (hemp),  opium,  poppy  straw and includes all manufactured goods;”

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.

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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  

3 Section 8. Prohibition of certain operations. -No person shall –  (a) cultivate any coca plant or gather any portion of coca plant; or  (b) cultivate the opium poppy or any cannabis plant; or  (c) produce, manufacture,  possess, sell, purchase,  transport, warehouse,  use, consume,  

import inter-State, export inter-State, import into India, export from India or tranship any narcotic   drug or psychotropic substance,  except for medical or scientific purposes and in the manner and to the extent provided by the  

provisions of this Act or the rules or orders made thereunder and in a case where any such provision,  imposes any requirement by way of licence, permit or authorization also  in accordance with the terms and  conditions of such licence, permit or authorization:  

Provided that, and subject to the other provisions of this Act and the rules made thereunder, the   prohibition against  the cultivation of the cannabis  plant  for the production of  ganja or the production,  possession, use, consumption, purchase, sale, transport, warehousing, import inter-State and export inter- State of  ganja for any purpose other than  medical and scientific purpose shall take effect only from the  date which the Central Government may, by notification in the Official Gazette, specify in this behalf:  

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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 224 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  4 22.   Punishment  for  contravention  in  relation  to  psychotropic  substances .   -Whoever,  in  contravention  of  any  provision of  this  Act  or  any  rule or  order  made or  condition of  licence  granted   thereunder, manufactures, possesses, sells, purchases, transports, imports inter- State, exports inter-State, or  uses any psychotropic substance shall be punishable, -

(a) where the contravention involves small quantity, with rigorous imprisonment for a term  which may extend to six months, or with fine which may extend to ten thousand rupees or with  both;

(b) where the contravention involves quantity lesser than commercial  quantity but greater  than small quantity, with rigorous imprisonment for a term which may extend to ten years and   with fine which may extend to one lakh rupees;

(c) where the contravention involves commercial quantity, with rigorous imprisonment for a  term which shall not be less than ten years but which may extend to twenty years and shall also be  liable to fine which shall not be less than one lakh rupees but which may extend to two lakh  rupees:

Provided that the court may, for reasons to be recorded in the judgment, impose a fine exceeding  two lakh rupees.

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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  236 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  

5 Section 2 (xxiiia): “small quantity”, in relation to narcotic drugs and psychotropic substances, means any  quantity  lesser  than  the  quantity  specified  by  the  Central  Government  by  notification  in  the  Official  Gazette. 6 Section 23. Punishment for illegal import in to India, export from India or transshipment of narcotic drugs  and psychotropic substances.—Whoever, in contravention of any provision of this Act or any rule or order   made or condition of licence or permit granted or certificate or authorization issued thereunder, imports   into  India  or  exports  from  India  or  tranships  any  narcotic  drug  or  psychotropic  substance  shall  be  punishment,—

(a) where the contravention involves small quantity, with rigorous imprisonment for  a term which may extend to six months, or with fine, which may extend to ten thousand  rupees or with both;

(b) where the contravention involves quantity lesser than commercial quantity but  greater than small quantity, with rigorous imprisonment for a term which may extend to  ten years, and with fine; which may extend to one lakh rupees;

(c) where  the  contravention  involves  commercial  quantity,  with  rigorous  imprisonment for a term which shall not be less than ten years but which may extend to  twenty years and shall also be liable to fine which shall not be less than one lakh rupees   but which may extend to two lakh rupees:

Provided that the court may, for reasons to be recorded in the judgment, impose  a fine exceeding two lakh rupees.

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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)  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: 7 Section 35. Presumption of culpable mental state.-(1) In any prosecution for an offence under this Act  which requires a culpable mental state of the accused, the Court shall presume the existence of such mental   state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect  to the act charged as an offence in that prosecution.  

Explanation.-In this section "culpable mental state" includes intention, motive knowledge of a  fact and belief in, or reason to believe, a fact.  

(2) For the purpose of this section, a fact is said to be proved only when the court believes it to   exist beyond a reasonable doubt and not merely when its existence is established by a preponderance of  probability.

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“6. As  observed  by  this  Court  in  Union  of  India v.  Thamisharasi clause (b)  of  sub-section (1)  of  Section  37  imposes limitations on granting of bail in addition to those  provided under the Code. The two limitations are: (1) an  opportunity  to  the  Public  Prosecutor  to  oppose  the  bail  application, and (2) satisfaction of the court that there are  reasonable grounds for believing that the accused is not  guilty of such offence and that he is not likely to commit  any offence while on bail.

7. The limitations on granting of bail come in only when the  question of granting bail arises on merits. Apart from the  grant  of  opportunity  to  the  Public  Prosecutor,  the  other  twin conditions which really have relevance so far as the  present  accused-respondent  is  concerned,  are:  the  satisfaction of the court that there are reasonable grounds  for believing that the accused is not guilty of the alleged  offence and that  he is  not  likely  to  commit  any offence  while  on  bail.  The  conditions  are  cumulative  and  not  alternative.  The  satisfaction  contemplated  regarding  the  accused being not guilty has to be based on reasonable  grounds.  The  expression  “reasonable  grounds”  means  something more than prima facie grounds. It contemplates  substantial probable causes for believing that the accused  is not guilty of the alleged offence…”  

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  

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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 drugs8,  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  

8 2(xi): “manufactured drug” means— (a) all  coca  derivatives  medicinal  cannabis,  opium derivatives  and  poppy  straw  

concentrate; (b) any other narcotic substance or preparation which the Central Government may,  

having regard to the available information as to its nature or to a decision, if any, under  any  International  Convention,  by notification in  the Official  Gazette,  declare  to  be  a  manufactured drug;

but does not include any narcotic substance or preparation which the Central Government  may,   having regard to the available information as to its nature or to a decision, if any, under any International  Convention, by notification in the Official Gazette, declare not to be a manufactured drug.

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under  Section  8(c)  of  the  Act,  DEALING  IN  all  the  

psychotropic substances specified in Schedule-I of the Rules.  

Rule 64 -

“No person shall  manufacture, possess, transport,  import  inter-State, export inter-State, sell, purchase, consume or  use  any  of  the  psychotropic  substances  specified  in  Schedule-I.”

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-  

“No person shall  possess sell,  purchase, consume or use  any psychotropic substance except in accordance with the  Drugs and Cosmetics Rules, 1945”.  

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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-

“no person shall  possess any psychotropic  substance for  any of the purposes covered by the 1945 Rules,  unless  he  is  lawfully  authorized  to  possess  such  substance for any of the said purposes under  these rules.”

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:

“38. So given,  as  far  as psychotropic  substances is  the  present case are concerned, operations pertaining to them  are  permitted  because  Schedule  I  to  the  Rules  do  not  include them at all.  That these substances are included in  the schedule to the act is  not of any relevance because  

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one  has  to  see  everything  viz.,  the  Act,  the  Rules  and  Order  made  thereunder  together  and  in  a  harmonious  manner.  It is well settled that the psychotropic substance  is included in the Schedule to the Act but it is not included  in the Schedule I to the Rules, then operations covered by  Section 8 cannot be said to be contravening provisions of  the  Act  and,  therefore,  punishable.   That  is  how,  these  provisions have been interpreted by Delhi High Court and  earlier  by  Punjab  and Haryana High  Court.   Their  views  have my respectful concurrence.”    

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  

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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.   

“Section 8.  Prohibition of certain operations – No person  shall – xxx                   xxx           xxx                xxx

Except for medical or scientific purposes and in the manner  and to the extent provided by the provisions of this Act or the  rules or orders made thereunder and in a case where any such  provision,  imposes  any  requirement  by  way  of  licence,  permit or authorisation also in accordance with the terms and  conditions of such licence, permit or authorisation;”

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  

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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 99 and 1010 enable the Central  

and  the  State  Governments  respectively  to  make  rules  

permitting and regulating various aspects (contemplated  

9  Section 9. Power of Central Government to permit, control and regulate.—(1) Subject to the provisions of  section 8, the Central Government may, by rules—

(a) permit and regulate— (i) to (v) x x x x

(iv) the manufacture, possession, transport import inter-State, export inter- State, sale, purchase, consumption or use of psychotropic substances;

x x x x

10  Section 10. Power of State Government to permit, control and regulate.—(1) Subject to the provisions of  section 8, the State Government may, by rules—

(a) permit and regulate—

x x x x

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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;

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“19. It has not been brought to our notice that the 1985 Act provides  for the manner and extent of possession of the contraband. The rules  framed under Section 9 of the 1985 Act read with Section 76 thereof,  however,  provide for both the manner and the extent,  inter alia,  of  production, manufacture, possession, sale, purchase, transport, etc. of  the  contraband.  Chapter  VI of  the  1985 Rules  provides  for  import,  export  and  trans-shipment  of  narcotic  drugs  and  psychotropic  substances. Rule 53 contains general prohibition in terms whereof the  import and export out of India of the narcotic drugs and psychotropic  substances  specified  in  Schedule  I  appended  thereto  is  prohibited.  Such prohibition,  however,  is  subject  to the other provisions of the  said  Chapter.  Rule  63  to  which  our  attention  has  been  drawn  specifically  prohibits  import  and  export  of  consignments  through a  post  office  box  but  keeping  in  view  the  general  prohibition  contained in Rule 53 the same must be held to apply only to those  drugs  and  psychotropic  substances  which  are  mentioned  in  Schedule  I  of  the  Rules  and not  under the  1985 Act.  Similarly,  Chapter VII provides for psychotropic substances. Rule 64 provides  for general prohibition.  Rules 53 and 64, thus, contain a genus and  other provisions following the same under the said Chapter are species  thereof. This we say in view of the fact that whereas Rule 64 provides  for general prohibition in respect of sale, purchase, consumption or use  of  the  psychotropic  substances  specified  in  Schedule  I,  Rule  65  prohibits  manufacture  of  psychotropic  substances,  whereas  Rule  66  prohibits  possession,  etc.  of  psychotropic  substances  and  Rule  67  prohibits transport thereof. Rule 67-A provides for special provisions  for medical and scientific purposes.”

(emphasis supplied)

29. We are unable to agree with the conclusion (reached in  

Rajesh  Kumar  Gupta’s  case)  that  the  prohibition  

contained in Rule 6311 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  

11 63.  Prohibition of import and export of consignments through a post office box, etc.  – The import  or export of consignments of any narcotic drug or psychotropic substance through a post office box or  through a bank is prohibited.

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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 5312  12 53.  General prohibition – Subject to the other provisions of this Chapter, the import into and export out  of India of the narcotic drugs and psychotropic substances specified in Schedule I is prohibited.

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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 5413 authorizes the import of opium by Government  

opium factory.  The construction such as the one placed on  Provided that  nothing in  this  rule  shall  apply in  case  the  drug substance  in  imported into or   

exported out of India subject to an import certificate or export authorisation issued under the provision of   this Chapter and for the purpose mentioned in Chapter VIIA.

13 54.  Import of opium, etc. – The import of –     (i) opium, concentrate of poppy straw, and      (ii) morphine, codeine, thebaine, and their salts is prohibited save by the Government Opium  

Factory;

    Provided that nothing in this rule shall apply to import of morphine, codeine, thebaine and their   salts by manufacturers notified by the Government, for use in manufacture of products to be exported or to   imports of small quantities of morphine, codeine and thebaine and their salts not exceeding a total of 1  kilogram during a calendar year for analytical purposes by an importer, after following the procedure under  rule 55 and subject to such conditions as may be specified in the import certificate issued in Form No. 4A.

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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  6414 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.   

14  Rule 64.  General  Prohibition.—No person  shall  manufacture,  possess,  transport,  import  inter-State,  export inter-State, sell, purchase, consume or use any of the psychotropic substances specified in Schedule- I.

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32. Rule 66 prohibits any person from having in possession  

any psychotropic substance  even for any of the purposes  

authorized  under  the  1945  Rules  unless the  person  in  

possession  of  such  a  psychotropic  substance  is  lawfully  

authorized  to  possess  such  substance  for  any  of  the  

purposes mentioned under the 1985 Rules.  Persons who are  

authorized under the 1985 Rules, and the quantities of the  

material  such  persons  are  authorized  to  possess,  are  

specified under Rule 66(2).  They are-

(1) any research institution or a hospital or  

dispensary  maintained  or  supported  by  

Government etc. – Rule 66(2).

(2) individuals  where  such  possession  is  

needed for  personal  medical  use subject  of  

course to the limits and conditions specified –  

the two provisos to Rule 66(2).

33. Rule 66 reads as follows —

Rule  66.  Possession,  etc.,  of  psychotropic  substances.—(1)  No  person  shall possess any psychotropic substance for any of the purposes covered  by  the  1945  Rules,  unless  he  is  lawfully  authorized  to  possess  such  substance for any of the said purposes under these rules.

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(2) Notwithstanding  anything  contained  in  sub-rule  (1),  any  research institution or a hospital or dispensary maintained or supported by  Government or local body or by charity or voluntary subscription, which  is not authorized to possess any psychotropic substance under the 1945  Rules, or any person who is not so authorized under the 1945 Rules, may  possess a reasonable quantity of such substance as may be necessary for  their genuine scientific requirements, or both for such period as is deemed  necessary by the said research institution or, as the case may be, the said  hospital or dispensary or person:

Provided that where such psychotropic substance is in possession  of an individual for his personal medical use the quantity thereof shall not  exceed one hundred dosage units at a time:

Provided further than an individual  may possess the quantity  of  exceeding  one hundred dosage units  at  a  time  but  not  exceeding  three  hundred dosage units at a time for his personal long term medical use if  specifically prescribed by a Registered Medical Practitioner.

(3) The research institution, hospital and dispensary referred to  in sub-rule (2) shall maintain proper accounts and records in relation to the  purchase  and  consumption  of  the  psychotropic  substance  in  their  possession.

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  

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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 8015 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  

15 Section 80. Application of the Drugs and Cosmetics Act, 1940 not barred.—The provisions of this Act or  the rules made thereunder shall be in addition to, and not in derogation of, the Drugs and Cosmetics Act,  1940 (23 of 1940) or the rules made thereunder.

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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.

……………………….CJI.                                            (R.M. Lodha)

………………………….J.                                                           (J. Chelameswar)

……………………..….J.                              (A.K. Sikri) New Delhi; August 12, 2014

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