Karnataka HC Lets Drug Distributor Resume Business Except Allegedly Spurious Zavicefta Injection For Now, Quashing Licence Suspension Before Reply Period Expired

The petitioner, a licensed pharmaceutical distributor, received a show-cause notice dated 17 September 2026 alleging that it had dealt with “Zavicefta injection,” alleged to be spurious.

The notice was issued under Rule 66(1) of the Drugs and Cosmetics Rules, 1945.

The petitioner contended that, despite time being granted to respond, its licences were suspended the following day, 18 September 2026.

It challenged the suspension and sought restoration of its licences.

Rule 66(1) of the Drugs and Cosmetics Rules, 1945, authorises the licensing authority to suspend or cancel a licence, wholly or partly, for specified non-compliance, but only after giving the licensee an opportunity to show cause and recording reasons in writing.

Rule 66(2) provides an appeal to the State Government against an order of suspension or cancellation.

The Court’s reasoning also applies the principle that an opportunity to show cause must be meaningful before adverse action is taken.

The Court read Rule 66(1) as requiring an opportunity to show cause before suspension or cancellation.

Since the authority suspended the petitioner’s licences on 18 September, immediately after issuing the notice on 17 September, the Court held the suspension unsustainable.

It also noted that Rule 66(1) permits suspension in whole or in part, and directed that the authority consider that aspect when proceeding on the notice.

The suspension order dated 18 September 2026 was quashed.

The petitioner was permitted to reply to the show-cause notice by 29 October 2026, after which the authority was to provide a hearing and proceed in accordance with law.

Pending that consideration, the petitioner could carry on its licensed business but could not deal with “Zavicefta injection.”

The parties’ contentions on the merits were kept open.