In Brief
This case concerns the validity of notifications fixing drug price norms under the Drugs (Prices Control) Order 1995. Cipla and other manufacturers challenged notifications prescribing norms for conversion cost, packing charges, and process loss, arguing they were issued without application of mind and mechanically re-notified annually. The Supreme Court held that expert committee reports recommending these norms receive limited judicial scrutiny. Since the Central Government considered available materials despite industry non-cooperation in providing data, the notifications were valid. The Court held that annual norm prescription, while normally expected, is discretionary depending on circumstances. Retail prices can be fixed using the statutory formula even without annual norm re-prescription or norms for packing material costs, as the industry could use actual costs. Appeals by the Union were allowed and High Court decisions quashing the notifications were set aside.
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