Minor Drug Law Violations Can Now Be Settled Without Trial: Health Ministry Issues Rules

The move aims to decongest the court system, offer regulatory relief for minor violations, and streamline compliance under India’s evolving drug and cosmetic regulation framework.

The move follows the draft rules published last year, where public feedback was invited. The Central Government has introduced these rules under the powers conferred by Section 32B and Section 33 of the Drugs and Cosmetics Act, 1940, after considering public objections and suggestions to the draft rules published earlier in July 2024.

"Objections and suggestions received from the public on the said draft rules have been considered by the Central Government."

Who Can Apply for Compounding?

The rules specify that any individual or company involved in the manufacturing, sale, import, or distribution of drugs, medical devices, or cosmetics can apply for compounding, either before or after prosecution begins.

"The applicant may, either before or after institution of prosecution, make an application to the compounding authority under section 32B of the Act in the Form along with such relevant informations and documents, to the compounding authority for compounding of the offence."

Designation of Compounding Authorities

The Central and State Governments will appoint officers, not below the rank of licensing authorities, to act as compounding authorities for handling such cases.

"The Central Government may, for the purposes of these rules, by notification in the Official Gazette, appoint any officer not below the rank of reporting authority under these rules, as compounding authorityy for the purpose of exercising powers and functions of the Central Government under these rules and for taking measures with respect to matters arises from these rules."

Similarly,

"The State Government may, for the purposes of these rules, by notification in the Official Gazette, appoint any officer not below the rank of licensing authority under the Act as compounding authority for the purpose of exercising such powers and functions of the State Government under these rules and for taking measures with respect to matters arisen from these rules."

Procedure to Compound an Offence

Once an application is filed, the compounding authority will call for a report from the concerned licensing authority or reporting officer, review the matter, and then either allow or reject the application based on findings.

"The compounding authority after taking into account the contents of the said application may, by order, either allow the application indicating the compounding amount and grant him immunity from prosecution in terms of rule 6 or reject such application: Provided that the application shall not be rejected unless an opportunity has been given to the applicant of being heard and the grounds of such rejection are mentioned in such order."

Payment of Compounding Amount

If the offence is compounded, the applicant is required to pay the compounding amount within 30 days of receiving the order.

"The applicant shall, within a period of thirty days from the date of receipt of order under sub-rule (3) allowing the compounding of offences, pay the compounding amount t, as ordered to be paid by the compounding authority and shall furnish the proof of such payment to the compounding authority: Provided that the compounding amount once paid shall not be refunded except in cases where the Court rejects grant of immunity from prosecution."

Conditions and Withdrawal of Immunity

Immunity from prosecution may be withdrawn if the applicant:

Fails to pay the compounding amount, or

Is found to have concealed material information or given false evidence.

"An immunity granted to a person under rule 6 shall stand withdrawn,if such person fails to pay any sum specified in the order of compounding passed by the Compounding authority, under sub-rule(3) of rule 5 within the time specified in such order or fails to comply with any other conditions subject to which the immunity was granted and thereupon the provisions of the Act shall apply as if no such immunity had been granted."

Further,

"An immunity granted to a person under sub-rule(1) above may, at anytime, be withdrawn by the Compounding authority, if satisfies that such person had, in the course of the compounding proceedings, concealed any particulars, material or had given false evidence, and thereupon such person may be tried for the offence with respect to which immunity has been granted or for any other offence that appears to have been committed by him in connection with the compounding proceedings and there upon the provisions of the Act, shall apply as if no such immunity had been granted."

To view the official Gazette, click on the link below: