Section 309 I.P.C. -- Retention or Deletion Desirable?

(P. Rajan, Advocate, Thalassery)

 

Ongoing discussions at executive and legislative levels are suggestive of the fact that steps are afoot to decriminalise offence of attempt to commit suicide, resultantly to delete section 309 I.P.C., as attempt to commit suicide is not violative of Article 14 or 21 of the Constitution which guarantees life and liberty of the people. It is no gainsaying that section 309 I.P.C. is the only section in the Penal Code which speaks of attempt as penal and not the completion; failure leads to prosecution besides ignominy and succeeds in the attempt, the person is above law. The Ministry of Home affairs is in the process of effacing the relevant section as the Minister in charge of the Portfolio declared recently that more than half of the statutes in the country and few union territories favoured removal of Section 309 I.P.C. - the Law commission by its report also recommended such a step.

 

As early in 1994, Supreme Court had observed that attempt to commit suicide cannot be considered as an offence done with requisite mens rea and even ruled that right to life as envisaged in the constitution means existence with dignity free from distress and miseries. The judgment further observed that all fundamental rights though have positive connotations, negative implications also cannot be ignored. Freedom to do something also means impliedly freedom of avoiding something which is not to the liking of a person. The court also held life means life sans disabilities; termination of one’s life has no baneful effect on society and cannot be termed as unconstitutional. (AIR 1994 SC 1844). The Law Commission report nearly four decades back also recommended deletion of this provision as the same is ultra vires of the Constitution and Constitutional rights have their positive and negative aspects, thus one’s desire to die cannot be termed as unnatural. Relating to this recommendation a bill was introduced in the Rajya Sabha then but lapsed due to dissolution of both the houses. Personality trait compel persons to react differently when placed in identical situations and some would feel he is the master of his fate.

 

Subsequently by a larger bench’s ruling Supreme Court overruled the judgment of 1994 and held that right to die is not a fundamental right and attempt to end one’s life is penal - invites punishment though the sentence is comparatively lighter. The five judge Bench lead by Justice J.S. Varma held that evaluation of criminal prompensity needs consideration and even complex reasons like economy, sadness, frustration etc., are no reason to extinguish one’s life and the relevant provision must be retained in the statute and attempt to commit suicide is immoral with adverse sociological effects (AIR 1996 SC 1257).

 

If the ongoing deliberations and discussions are any indication, it is likely to delete Section 309 I.P.C. from the Indian Penal Code which is the prerogative of the executive and legislature. It is true that men cannot be improved by injuries and one’s agony is not equal to corporal punishment and suicide knows no barrier of race, age, or region. There are suicide prone individuals and persons resort to different methods to end their lives. Terminally ill person having no duties to perform to himself or to others decides to relieve himself from the agony of living, feeling that he is a burden to others; his failed attempt also invites penal action. Wise counselling than harsh punishment rarely be a solace and reason to rethink by few. Instead of removing the provision of law from the statute even for the sake of suffering individuals modified provision is needed. Separate bill to make euthanasia permissible did not gain acceptance though circumstances are humane to avoid miserable existence even causing untold agony to the relatives. In a heterogenous society reason to end one’s life becomes multiple resorting to different methods and even on ‘genuine’ reasons. Pranksters scaleing heights declaring self destruction self- styled reformers declaring fast unto death causing even law and order problem deserve penal action under section 309 I.P.C. To humanise an act which is opposed to law effacing section 309 I.P.C. is not the remedy as the Supreme Court ruling also had held that section 309 is valid and is not offending article 14 and 21 of the Constitution. It is not dearth of law or plenty of it leads to crime rates variation but varying factors affecting the society pave way for commissions and omissions and number of enactments is no answer to alleviate crimes. By retaining section 309 I.P.C., courts reformative measures succinct orders considering the nature and circumstances led to the crime are needed and even a verbose provision by amending the present one will be more desirable instead of total erasure

 

We learn from history that man can never learn anything from history.

George Bernad Shaw

Short-circuiting Legislative Democracy

(By Kaleeswaram Raj, Advocate,)

 

 

 Crony capitalism could take legal forms as well by imposing itself  on institutions of Government.  For worse, it could result in a ‘law’ in the form of an executive order, without deliberations in the Parliament.  For still worse, such an executive order could even undo the virtues of a radical legislation duly promulgated.

 

This is what precisely happened in the ordinance issued on 29.12.2014 to amend the Land Acquisition Act, 2013 by excluding five new categories of projects from the ambit of prior consent of affected families and Social Impact Assessment (SIA), which are conditions precedent for land acquisition, as per the Statute. News report appeared on 9.1.2015 say that grove of concerned citizens including  Rajinder Sachar, Shanti Bhushan and Medha Patkar requested the President to “rethink and reject” the ordinance. In all probabilities, this would remain a wishful thinking.   According to the Finance Minister Arun Jaitley,  by way of the ordinance, the Government “have tried to achieve a balance” between  Government’s interest and public concern.

 

Legality of the ordinance

On the question of ‘balance of interest’, Justice Frankfurter famously said that “striking balance between the competing interests” cannot be “an exercise in absolute”.  In Excel Wear v. Union of India (1978) the Supreme Court held that State action cannot result in “the annihilation of the person affected by the restraint”.

 

The ordinance has the effect of annihilating the individual - the most significant minority in a democracy.  It also annihilates the very soul of the parent statute namely, the Land Acquisition, Rehabilitation and Resettlement Act 2013 (Act of 2013). The ordinance is more than an amendment. It is closer to repeal of the statute. 

 

By way of the present ordinance the Government has negated the principles of legislative democracy.  The manner in which the Central Government has diluted a radical legislation is quite unfortunate. The winter session of Parliament began on November 24 and ended on December 23.  The Government did not choose to place a Bill for amendment of the enactment. It ingeniously avoided the debate for the reasons best known to it. There was no discussion within or outside the legislature.  The abrupt issuance of the ordinance is definitely vulnerable to challenge in a properly constituted proceeding before the Supreme Court.

 

The ordinance has the effect of sabotaging judgments of the Supreme Court on ordinance power on the one hand, and land rights on the other.  It is this patent illegality that makes the ordinance fragile.

 

 Under Article 123 of the Constitution, for promulgating an ordinance during recess of Parliament, the President should be satisfied about the need for an ‘immediate action’ which cannot even wait for regular legislative exercise.  In R.C.Cooper (1970) the Supreme Court has clearly said that the President’s power to promulgate an ordinance is strictly conditioned and could be exercised only when immediate action is warranted in a given exigency. Therefore, an ordinance issued to avoid legislative deliberations is untenable on the face of it.  By virtue of the 38th Constitutional Amendment Act (1975), Article 123(4) was incorporated in the Constitution by which President’s satisfaction in the matter of ordinance was held to be unquestionable. However, this amendment was repealed in 1979 leaving open possibility for judicial review.  In A.K.Roy (1981) also the Supreme Court held that ordinance power is not beyond the scope of judicial review.  The Court explained that in cases where a genuine challenge was made out, judicial review is possible, though it may not be available in “every casual or passive challenge”. In the landmark decision in D. S. Wadhwa (1986), the Supreme Court held that ‘the power to promulgate an ordinance is essentially a power to be used to meet an extraordinary situation and it cannot be allowed to be ‘perverted to serve political ends.’ "

 

The impact of the present amendment would be drastic.  The five categories indicated in the executive order unfairly strengthen the State as against the helpless individual. With the promulgation of the ordinance, no SIA or prior consent of effected families is required when the acquisition pertains to activities related to defence, rural infrastructure , housing projects, industrial corridors and social infrastructure project with a public private partnership (PPP)content if the “formal ownership” vests with the Government.  Thus the exceptions outweigh the statute and practically nullify the very object of the beneficial legislation.  Even the categories referred in the ordinance are so broad and could be subjected to elastic interpretation, so that anything done by the Government or private persons under the label of PPP would be brought within the ambit of ordinance.

 

Background  of  the  enactment

The 2013 Act was an instance of legislative radicalism that reflected State’s gesture towards the people’s movements from Narmada to Singur.  The unilateral invocation of State power had a political impact. The growing dissatisfaction among the adivasis in the context of land rights even led to the growth of terrorism under the label of Maoism.

 

The adverse impact of the erstwhile Land Acquisition Act was highlighted by the Supreme Court on several occasions. In Dev Sharan v. State of U.P. (2011), the Supreme Court held that the concept of public purpose in land acquisition has to be viewed from an angle which is consistent with the concept of welfare State.  In Bondu Ramaswamy (2010) the Supreme Court held that acquisition cannot and should not be a matter of routine.  The court indicated that there is a requirement of more rigorous judicial scrutiny in the matter of land acquisition and town planning.  Even earlier, the Supreme Court through Justice Bhagwati expressed a constitutional hope in the celebrated decision in Kharjan Jalasa Yojana (1986) by holding  that “the person dispossessed should not be without roof over his head  even for a single day”.

 

In view of the 44th Amendment to the Constitution which deleted Article 19(1)(f), right to property is no longer a fundamental right. Though it was done to control the claims by litigative landlords, the impact of such deletion in the context of developmental activities as against the marginalized could not be forseen.  The direct result was that the state-centric provisions related to unilateral land acquisition as contained in the colonial statute of 1894 were invoked more rigorously against the citizens in the guise of ‘public purpose’ and ‘emergency’.   The scope for challenge on the ground of violation of the right to property  which was available at least in theory, was taken away.  Very often the Governments misused the ‘public purpose’ clause for the purpose of initial acquisition, as a camouflage.  There are instances where the acquired land was subsequently leased out to private entrepreneurs.  This was the social context that motivated the Supreme Court in Indore Vikas Pradhikaran (2007) to say that the deprivation of property would lead to infringement of human rights though not fundamental rights. Such judgments contain an indirect and silent dissent to the manner in which Article 19(1)(f) was erased.   Many of the modern constitutions often recognise right to property as a fundamental right which is judicially enforceable.   Section 26 of the South African Constitution dealing with housing right, is an illustrative instance. Viewed so, with all the limitations, the Act of 2013 reflected an egalitarian statism.

 

Negation  of  democracy

The ordinance has however, dealt with the legislation in a casual and mechanical manner by overlooking the socio-political and historical back ground of the enactment.  A cardinal feature of the 2013 Act is that it gives due weightage to public opinion.  The SIA indicated in Section 4 is a participative process that accommodates public opinion, expert views and the victims’ objection.  Section 5 of the Act makes public hearing mandatory “wherever a social impact assessment is required to be prepared”.  Section 6 tells about the publication of the study report which also is mandatory.  An appraisal of the report by the expert group is stipulated in Section 7.Section 15 of the Act reflects better level as democratic participation by ensuring hearing of objections related to (a) the area and suitability of land proposed to be acquired; (b) justification offered for public purpose, (c) the findings of the SIA report.  On rehabilitation scheme also public hearing is contemplated vide Section 16(5).  Section 41 contains special provisions for Scheduled Castes and Scheduled Tribes.  Rehabilitation and settlement is institutionally guaranteed vide Section 43 to 57 of the Act. Thus, despite the provisions for executive prerogative to dispense with SIA in certain exceptional situations, by and large, a participative role for the effected persons is legally ensured.  This makes the process of acquisition inherently democratic and dialogic.  This characteristic feature is smashed by an executive excessiveness that negated all traits of deliberative democracy. The ordinance has a clear dictatorial tone. It emerged out of sinister secrecy.

 

Had there been a proper people oriented perception, the Centre would have found that even the 2013 legislation was opposed for not being ‘sufficiently revolutionary’.  The Act was criticised for giving an inclusive definition for the phrase ‘public purpose’, which is elastic and vulnerable to arbitrariness.  Anything with a ‘public utility factor’ could be brought within the purview of the definition, going by the text of Section 3(za) read with Section 2(1) of the Act.   Even Section 105 of the Act suffered the vices of permitting exclusion of certain acquisitions under specified enactments.  Thus the basic concern, even against the Act as it stood, was that many  developmental activities remained outside the ambit of the enactment and therefore the ‘victims’ were no longer always in the comfort zone.  It is a paradox that the new Government did not even find it necessary to debate on the issue while reducing the comfort zone practically to zero level. 

 

The ordinance does violence to the socialist preamble to the constitution.    More than that, it shows the majoritarian audacity to overturn a welfare legislation. It makes the citizen unsafe and his freedom uncertain.  It therefore calls for new and organic methods of struggle.    In the words of Albert Camus, “the only way to deal with an unfree world is to become so absolutely free that your very existence is an act of rebellion.”

Compulsory Licensing : Balancing Pills and Patents Through
A Legislative Framework

 

(By Dr. Raju Narayana Swamy, I.A.S., Secretary to Government of Kerala, 

Chairman, K.B.P.S. & Homi Bhabha Fellow)

 

Introduction

A license, in the context of a patent, stands for a contract by which the licensor (patentee) authorizes the licensee to exercise defined rights over the patent. The effect is to give to the licensee a right to do what he/she would otherwise be prohibited from doing. A license may be voluntary or compulsory.

 

Compulsory licensing has been defined to be a governmental grant to someone to produce a patented product without having the patent- holder’s consent (W.T.O., Compulsory licensing of pharmaceuticals and TRIPS ( March 17, 2013) , http:// www.wto.org/english/tratop-e/tripse-e/ public - health-faq-e.htm). It is a balance between the needs of technology consumers and producers- between a governmental grant and preservation of patent holder rights (Sara M. Ford: "Compulsory Licensing Provisions under the TRIPS Agreement: Balancing Pills and Patents).

 

Under a compulsory licence, the licensee is per force required to offer his intellectual property for a predetermined royalty or for a royalty to be decided by the authority on a case to case basis. The provisions for grant of compulsory license are aimed at making best use of the patented invention - not to restrict the rights of the patentee, but to stop abuse and misuse and to safeguard the interests of the public.

 

Provisions in the Paris Convention and TRIPS Agreement

Compulsory licensing dates from the Paris Convention (where in each member country has the right to provide for grant of compulsory licenses to prevent abuses resulting from the exclusive rights conferred by the patent). Article 5A(4) of this Convention provides for fulfillment of specific requirements before the request for grant of compulsory licenses on the ground of failure to work/insufficient working can be made. But Article 31 of the TRIPS Agreement is the cardinal provision in this regard. The following are the guidelines that member nations must respect prior to implementing compulsory licenses: -

 

1.   Article 31(b):- Conditions the granting of compulsory licenses on an initial attempt to obtain authorization by the patent holder through commercial terms and failure to obtain an agreement within a reasonable amount of time. But situations of national emergency or extreme urgency permit waivers.

 

2.   Article 31(c) :- Limits use of compulsory licensing to the purpose for which it was authorized initially.

 

3.   Articles 31(d) and 31(e) :- Compulsory license will not be exclusive and will not be assignable.

 

4.   Article 31(f): - Use of the license shall be predominantly for domestic market use.

 

5.   Article 31(g) : - Authorizes use of compulsory licenses only during the time that circumstances for its creation still exist. Competent authority shall have the power to review continuation of compulsory licenses.

 

6.   Article 31(h) :- Proper payment to patent holder, based on economic value of compulsory licensing scheme.

 

7.   Article 31(i) :- Decision to authorize compulsory licenses is subject to judicial review.

 

8.   Article 31 (k) :- Special consideration should be given in cases where patent holder is engaged in anti-competitive acts.

 

It is noteworthy in this regard that the term “ compulsory licensing” does not appear in the TRIPS agreement and that instead the phrase “ other use without authorization of the right holder “ appears in the title of Article 31. It must also be pointed out that although the agreement refers to some of the possible grounds ( such as emergency and anti-competitive practices) for issuing compulsory licenses, it leaves members full freedom to stipulate other grounds- non-working of patents, public interest and public health, to name a few. The conditions set forth include a case - by- case determination of compulsory license applications.

 

In the context of public health, the following articles are also noteworthy:-

 

a)  Article 8 : Members may adopt measures to protect public health

 

b)  Article 27: Invention needed to protect public health may be excluded from patentability

 

Read together, these provisions lead to the cardinal observation that countries may grant compulsory licensing for protecting public health.

 

Doha Declaration

Special mention should also be made here of the Doha Declaration (declaration on TRIPS Agreement and Public Health) adopted at the Fourth W.T.O. Ministerial Conference held in Doha, Qatar in 2001 that represents a step forward mainly for developing countries by providing access to medicine and health care by simplifying the compulsory license clause and by removing possible legal battles and consequences (Lalitha N., Doha Declaration and Compulsory Licensing for Access to Medicine, 2009, Paper downloaded from http:// ideas. repec.org/p/ess/wpaper/id 2216.html). The Doha Declaration provides for a liberal and wider use of compulsory licensing of pharmaceuticals. Paragraph 5 of the Doha Debate restates Article 31 of TRIPS and in relation to Article 31, simplifies and clarifies it and provides that a Member State has a right to grant compulsory licenses, to determine grounds for it, determine what constitutes national emergency and define its licensing regime (Licensing of Pharmaceutical Patents in Developing Countries: Central European University, March 2013, Iljazovic Jasmila, LLM Short Thesis). Needless to say, compulsory licensing represents an important tool for developing countries in accessing medicines at lower prices by circumventing patent regulations and stimulating competition through which prices of medicines significantly decrease (Alberto do Amaral Junior, Compulsory Licensing and Access to Medicines in Developing Countries, 1-18, 2, ( 2005) ( March 22, 2013) ).

 

The Brazil, Thailand and Canadian Experience

Examples are galore from different countries across the globe as to compulsory licences granted for pharma products. For instance, Brazil and Thailand have been in news for declaration of national emergency and subsequent issuance of compulsory licenses . In 2006, there was an avalanche of compulsory licenses for pharmaceutical patents in Thailand. This sudden movement was due to the continuing increase in the number of patients suffering from cancer and heart diseases in 2003 as well as the sudden rise of HIV patients (Suwan-in, Nattapong, Compulsory License, a Long Debate on TRIPS Agreement Interpretation : Discovering the Truth of Thailand’s Imposition on Pharmaceutical Patents, Asian Journal of W.T.O. & International Health Law and Policy, Vol 7, No.1, 225-261,228 ( March 2012 ). The first compulsory license was for Efavirenz intended to treat patients with HIV. This was followed by two more compulsory licences: one for HIV drug named Kaletra and other for a drug called Plavix used to treat heart disease. In the case of Brazil, on the 4th of May 2007, President Luiz Inacio Lula da Silva issued a compulsory license to produce a low cost generic version of the antiretroviral medicine Efavirenz used in HIV treatment.

 

It also needs to be mentioned here that Canada is the first country to grant compulsory license for export to a developing/least developed country using the provisions of para 6 of the Doha Declaration. The patented drug in this case was Tri Avir. This drug is a triple combination AIDS therapy drug and is manufactured in Canada by Apotex Inc under the name Apo Triavir. It can now be exported to Rwanda under the compulsory license for export.

 

The following table provides a bird’s eye view of the situation.

Country                          Drug

Brazil                               Efavirenz

Cameroon                      Lamivudine, Nevirapine

Canada                           Oseltamivir

Ecudor                            Lopinavir/Ritonavir

Ghana                            Generic HIV & AIDS medicines

Indonesia                       Lamivudine, Nevirapine

Israel                              Hepatitis B Vaccine

Italy                                Imipenem/cilastatine, Sumatripan succinate

Malaysia                         Didlanosine, Zidovudine

Mozambique                  Lamivudine, Stavudine, Nevirapine

Thailand                         Lopinavir/Ritonavir, Clopidrogel, Eriotinib,                                             

Zambia                           Letrozole, Docetaxel  Lamivudine, Stavudine, Nevirapine

 

 

(Ref : Understanding Compulsory Licences in India- Part 2 of a 2 - Part Series / BRIC Wall)

 

The Indian Context

The pharmaceutical industry is vital to the health of a country’s population. The Indian pharmaceutical industry is one of India’s most successful industries. More than the economic contribution in terms of output, employment and exports, it provides drugs at affordable prices to the people. There are mainly two types of companies in pharmaceutical sector. On the one hand are Originator Companies which are active in R & D, manufacturing, marketing and supply of innovative medicines (Communication from the European Commission, Executive Summary of the Pharmaceutical Sector InquiryReportavailableathttp://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/communication-en.pdf ( July 30, 2010)). On the other hand are Generic Companies which are manufacturers of bio-equivalent drugs of patented drugs. The generic companies use research data developed by originator companies and produce these drugs on patent expiry of original drugs.

 

For a long time, Indian Patent Act did not contain any patent protection for pharmaceuticals.In fact, those were the golden days of Indian generics as patents were recognized neither in food nor in health - the areas considered vital to human life. Historically India’s weak patent laws allowed Indian manufacturers to make inexpensive copies for existing pharmaceuticals . With not even a single pharmaceutical patent valid in the country, the Indian companies focused on expertise in reverse engineering and supplied medicines at reasonable prices not just in the county, but in other parts of the world such as Africa and South America as well. A classic example in the regard is Cipla which is famous for its antiviral drugs. These drugs succeeded in making a frontal assault on the citadels of the spread of many epidemics.

 

In 2005, India due to the necessity to be TRIPS compliant, amended its legal framework and introduced patent protection for pharmaceuticals. After Section 92, Section 92 A was added enabling exportation of patented drugs. India’s compulsory licensing regime now allows a local drug maker to manufacture a generic version of a life- saving patented drug that is not freely available in the market without the consent of the patent owner.

 

Legal Provisions in India

Though compulsory licensing of patents in India can be traced back to Act V of 1888, it was not until the new Indian Patents Act was brought into force in 1970 that significant changes came. The provisions relating to grant of compulsory licenses are contained in Chapter XVI of the Patents Act 1970. Section 82 to 94 in this Chapter provide details of :-

 

a. general principles applicable to working of patented inventions

b.  ground for compulsory licenses

c. matters to be taken into account by the Controller while considering applications for compulsory licenses

d. procedures for dealing with such applications

e.  general purpose of granting of these licenses and their terms and conditions .

 

Section 84 (1) of the Act allows any interested person to apply any interested person to apply for grant of compulsory license to the Controller on the grounds that

a. The reasonable requirements of the public have not been satisfied or

b.  Patented invention is not available at a reasonable affordable price or

c. The patented invention is not worked in India.

 

It is noteworthy that non-working of a patent in India forms one of the grounds for obtaining a compulsory license. Hence the concept of patent troll (companies that purchase low value patents which they then use in nuisance law suits) which is so prevalent in the US and has recently been in the limelight notably in the Blackberry case (NTP v. RIM) may not be an option in India in view of this “ working of the patent in India” requirement. To be more precise, an equivalent situation in our country would have brought in a regime of compulsory licensing either by an application by RIM to the Controller or by the Government.

 

An application for compulsory licence must be made to the Controller of Patents in the prescribed form. An application on any on the aforesaid three grounds cannot be made until a period of 3 years has elapsed from the date of sealing of the patent. The applicant must set out.

 

i.   nature of his interest

ii.  facts upon which he alleges grounds for the licence to be granted

iii. terms and conditions on which licence is acceptable to him

The Controller is required to take into account a number of factors vide Section 84

 

(6) including

 

(i) the nature of the invention

 

(ii) measures taken by the patentee to make full use of the invention

 

(iii)   applicant’s ability to work the invention to the public advantage and to undertake the risk in providing capital

 

(iv)  whether the applicant has made any effort to obtain the licence from the patentee on reasonable terms and whether such efforts were successful within a reasonable time.

 

The patentee, on his part, has an opportunity to present his case and prove that the conditions that justify the grant of a compulsory licence do not exist.

 

Section 89 specifies the general purposes of granting compulsory license under Section 84as

 

 (i) that the patented inventions are worked on a commercial scale in the territory of India without undue delay and to the fullest extent that is reasonably practicable

(ii) that the interests of any person for the time being working or developing an invention in the territory of India under the protection of a patent are not unfairly prejudiced.

 

The terms and conditions for grant of compulsory license are laid out in Section 90.

 

In the following circumstances, reasonable requirement of the public would be deemed not to have been satisfied : (Section 84 (7) )

 

a.   If by reason of the refusal of the patentee to grant a license on reasonable terms-

 

(i)  an existing trade or industry or the development thereof or the establishment of any new trade or industry in India is prejudiced or

 

(ii) the demand for the patented article has not been met to an adequate extent or on reasonable terms or

 

(iii)  a market for export of the patented article manufactured in India is not being supplied or developed or

 

(iv)  the establishment or development of commercial activities in India is prejudiced or

 

b.   if by reason of conditions imposed by the patentee upon the grant of licence under the patent or upon the purchase, hire or use of the patented article or process, the manufacture, use or sale of materials not protected by the patent or the establishment or development of any trade or industry in India is prejudiced or

 

c.   if the patentee imposes a condition upon the grant of licenses under the patent to provide exclusive grant back, prevention to challenges to the validity of patent or coercive package licensing or

 

d.   if the patented invention is not being worked in the territory of India on a commercial scale to an adequate extent or is not being so worked to the fullest extent that is reasonably practicable or

 

e.   if the working of the patented invention in the territory of India on a commercial scale is being prevented or hindered by the importation from abroad of the patented Article by

 

(i) the patentee or persons claiming under him or

 

(ii) persons directly or indirectly purchasing from him or

 

(iii)            other persons against whom the patentee is not taking or has not taken proceedings for infringement.

 

The Act also provides for grant of compulsory license on notification by the Central Government in cases of

a.   a circumstance of national emergency or

b.   a circumstance of extreme urgency or

c.   a case of public non- commercial use.

The circumstances include “ public health crisis relating to AIDS, HIV, TB, Malaria or other epidemics.” ( Section 92 (3)).

 

Moreover grant of compulsory licence to manufacture and export patented pharmaceutical products to any country having insufficient or no manufacturing capacity by an Indian manufacturer is possible either through the importing country granting compulsory license to the Indian manufacturer or through allowance of importation of the patented pharmaceutical products from India by notification. Thus para 6 of the Doha declaration is reflected in the Act.

 

But the only Doha styled application for compulsory license under the Indian law was the one moved by Natco in respect of Roche’s Tarceva and Pfizer’s Sutent for export of the generic version of these patented drugs to Nepal. However, this application was later withdrawn due to various reasons including lack of adequate authorization from the authorities of Nepal government.

 

It must be mentioned here that compulsory licenses granted as a result of national emergency, extreme urgency or public noncommercial use are published by Central Government in the official gazette. Once these are published, the Controller will grant compulsory license to any interested person who applies for such a license. Such a grant cannot be challenged by the patentee either through an opposition proceeding or in court. But the Controller is required to notify the patentee of the grant of the compulsory license.

 

Natco v. Bayer

In 2012, India granted compulsory license to manufacture and sell generic version of cancer drug produced by German pharmaceutical company Bayer due to the claim that Nexavar drug is of public interest and Bayer is imposing unaffordable prices on Nexavar, On the 4th of  March, 2013, the I.P.A.B. ( Intellectual Property Appellate Board) dismissed the appeal filed by Bayer and confirmed the compulsory license given to Natco for producing Nexavar. This marked a moment that comes rarely in pharma patent history - when we stepped out from the old to the new.

 

The compulsory license was granted to Natco under Section 84 of the Patents Act. Nexavar, priced at ` 2,80,000/- per month was not available to the public at a reasonable cost. Neither was it available to all patients who need the drug. Natco will now manufacture and sell the drug at ` 8800/- per month and will also pay a royalty of 6% of its sales to Bayer.

 

It is noteworthy in this regard that the IPAB modified the royalty rate payable by Natco and increased it by 1% to 7%. To be true to facts, the IPAB approached the dispute from a public health perspective in the context of the right to life under Article 21 of the Constitution of India and flagged the major issues based on the three pronged test laid out in Section 84 (1) of the Act. The reading on the wall is crystal clear “Work your patents to keep generic- savvy persons at bay.” To put it a bit differently, for Indian domestic companies, the decision will open flood gates to market copy cat drugs under compulsory licenses. It will no doubt encourage other manufacturers to apply for compulsory licenses. In fact, researchers point out that India is using TRIPS and Doha flexibilities as much as possible and serving as an excellent example to other countries on how to benefit from compulsory licensing ( Licensing of Pharmaceutical Patents in Developing Countries: Iljazovic Jasmila, LLM Short Thesis, Central European University, March 2013 ).

 

The country has come a long way from the 2006 days wherein even in an extreme situation of bird flu, it reframed from granting compulsory license and placed an order for Tarniflu with Roche, the original manufacturer of the drug.

 

Roche v. Cipla (High Court of Delhi)

Special mention should also be made of the case Roche v. Cipla. The case pertains to an action brought by La Roche against Cipla in the High Court of Delhi. The Court while refusing La Roche’s plea for an interim injection, laid emphasis on the harms such an injunction can do to the public dependant on such essential medicines. Cipla while justifying its plan to launch the affordable version of Tarceva in the domestic market promised that it would sell the generic version at `1600 per tablet, 1/3rd of its original market value. In this case, the Court largely based its order on the balance of convenience rather than statutory patent law. It was laid down by the Delhi High Court that “Courts while deciding applications seeking interim injunction, involving claims for infringement of patents especially when life saving drugs are involved have to strike a balance between the imponderables such as the likelihood of injury to unknown parties and the potentialities of risk of denial of remedies.” (http://www.indialawjournal.com/volume2/issue-1, 2007)

     

Since 2012, compulsory licenses have been granted or are in the process of being granted or are in the process of being granted in India for several pharmaceutical products as shown below.

                          

Drug                  Company                 Indication                                Relevant provision of law

 

Nexavar            Bayer                  Hepatocellular caranoma              Article 84                                                                 

Herceptin         Genentech           Breast cancer                               Article 92

Ixempra            BMS                    Breast cancer                               Article 92

Sprycel             BMS                    Leukemia                                     Article 92

(Ref : Understanding Compulsory Licensing in India - Part 2 of a 2 - part series/ BRIC Wall)

 

 

It is noteworthy that India’s Patent Act provides for a broad compulsory licensing regime that it is by no means limited to pharma products, but encompasses products from any technology.

 

To summarize, India is no exception to the access versus profit debate. In recent times, however, India’s pro- access stance has developed new teeth. In a spate of patent cases, the judiciary has made it clear that public interest is of prime importance and India will not tolerate the exploitation of its masses by drug giants looking to reap benefits (Natco Pharma Ltd.V Bayer Corporation and Compulsory Licensing Regime in India, Mansi Sood). The need of the hour is to fine tune this regime so as to herald the beginning of a new chapter - balancing pills and patents through the frame work of compulsory licensing.

 

 

BIBLIOGRAPHY

 

1. Alan M. Fisch, Compulsory Licensing of Pharmaceutical Patents: An Unreasonable Solution to an Unfortunate Problem”, 34 JURIMETRICS J. 295, 295-315 (1994).

 

2.          Alan O. Skyes,TRIPS, Pharmaceutical, Developing Countries, and the Doha "Solution”", Chicago Law & Economics, Olin Working paper No. 140, 1-31
(February 2002).

 

3.         Alsegard Erik, Global pharmaceutical patents after the Doha Declaration -What lies in the future, Volume 1, Issue 1, SCRIPT-ed., (March 2004).

 

4.         Carlos M. Correa, “Implication of the Doha Declaration on the TRIPS Agreement and Public Health.” Health Economics and Drugs: Essential drugs and Medicines Policy Series No. 12, 2002.

      5.         Danzon PM, Towse A, Differential Pricing for Pharmaceuticals: reconciling access R&D and Patents, Int J Health Care Finance Econ, 2003 Sep (3) 183-205.

 

6.         DiMasi, J., H. Grabowski and J. Vernon, R&D costs and returns by therapeutic category”, Drug Information Journal 38(3):211-23; (2004).

 

7.         F. M. Scherer and Jayashree Watal, Post Trips Options for Access to Patented Medicines in Developing Nation, J Int Economic Law5(4):913-939,915(2002).

 

8.         Ho, M. Cynthia, Compulsory licensing under TRIPS: An Introduction, Loyola University Chicago School of Law, Paper No. 2011 -030, 124-156, (2011).

 

9.         J.P. Moatti, B. Coriat, Y. Souteyrand, B. Barnett, J. Dumoulin, and Y.A. Flori, Economics of AIDS and Access to HIV/AIDS Care in Developing Countries, Issues and Challenges, Editions de l’ANRS,Paris, (2003).

 

10.      James Love Packard, Recent examples of the use of compulsory licenses on patents,       Knowledge Ecology International, KEI Research Note 2007:2, (March 8, 2007).

 

11.      Jean O. Lanjouw, The introduction of pharmaceutical product patents in India: Heartless exploitation of the poor and suffering, NBER Working Paper No. 6366,
1-52, (January 1998).

 

12       .Jelovac Izabela and Catalina Bordoy, Pricing and Welfare Implications of Parallel Imports in the Pharmaceutical Industry, International Journal of Health Care, Finance and Economics, 5, 5-21,(2005).

 

13.      John A. Harrelson, TRIPS, Pharmaceutical Patents, and the HIV/AIDS Crisis: Finding the Proper Balance between Intellectual Property Rights and Compassion, 7 Widener L. Symp. J. 175, 175-201 (2001).

 

14.      Swarup Kumar, “Compulsory Licensing Provision under TRIPS: A Study of
Roche v. Natco case in India vis-à-vis the Applicability of the Principle of Audi Alteram Partem”, SCRIPTed Vol 7, Issue 1, 135 –154 (2010).

 

15.      The Indian Patents Act, 1970, Chapter XVI. The original chapter was subsequently replaced by a more detailed version in the Patents (Amendment) Act, 2002.

 

16. Bayer Corporation v. Natco Pharma Ltd., Order No. 45/2013 (Intellectual Property Appellate Board, Chennai), available at http://www.ipab.tn.nic.in/045-2013.htm

Don't Say Goodbye

(By K. Ramakumar, Sr. Advocate, High Court of Kerala)

 

The biggest bane of the judiciary in the country now is the regression from the Rule Book. Our system is wedded to the Rule of Law, meaning thereby that the Law is supreme over everybody. “May you ever be so high, the Law shall be above you” is often quoted in various judgments. Nevertheless, ‘justice according to Law’ is slowly yielding place to ‘Law according to Justices’.

 

This unfortunate development has been adversely commented upon by no less a person than the former Chief Justice of the High Court of Kerala and currently a Judge of the Supreme Court. (2014 (4) KLT Journal 25).

 

“Firstly, an honest belief that the adjudication insofar is not consistent with the correct principles of law;”

 

“Willingness to exercise discretion for the mere asking is the culpability of the legal system”.

 

Quality these days is the biggest casualty. That the superior courts should be places of excellence is more often forgotten than remembered. The fall out ? There is no respect to legal provisions compulsorily required to be cited when presenting even an application for adjournment in a Court of Law. The Code of Criminal Procedure and the Code of Civil Procedure are gems of codes providing for every contingency to be called in aid in litigations. They contain one provision or other to support any application presented in Court.

 

Unfortunately, however, even petitions presented in High Courts not to speak of the large number of petitions presented every day in the Subordinate Courts do even care to indicate the provision of law underwhich they are presented. Dutifully the Registries, lamentably including of the High Court pass on these petitions to the Bench, where again fortunately no questions are asked how the petition is maintainable. In short, the farewell to legal provisions has become the order of the day contributing at every level to the weakening of a system which had stood the test of time for centuries. For instance the Code of Civil Procedure prescribes under Order 20 how the judgment is pronounced. Unfortunately the period of 15 days to pronounce judgment provided for under Rule 1 of Order 20 had been substituted by Act 22 of 2002 doing away with the limitation prescribed under the old Codewhich provided reasons to be recorded for not pronouncing it in time. See how conveniently our Subordinate Judges are making merry with the statutory serendipity, which is heightened when matters reach the High Court, an unquestionable institution.

 

Who observes these mandatory provisions these days? They are brazenly breached and judgments take months if not years to surface totally ignoring the deleterious effect it will have on an institution which still survives solely on peoples’ trust and the loss of credibility pointed out by those involved and connected with the institution like Sri Justice J. Chelameswar. The attitude of “I don’t care” continues notwithstanding the sempiternal sermonizing on speedy justice.

 

Regretfully the members of the Bar are equally blameworthy in this area of indifference. Many even do not care to check up whether motions moved by them before an august body like the High Court can be supported by any provision of law. The amount of casualness is alarming. Surprisingly, those who are enjoined to ensure that legal provisions are adhered to, do not care a heck as to what is happening. Orders are passed irrespective of the question whether applications are maintainable or not.

 

It is this that has contributed more than anything else to the lowering of the standards of the Bar and the Bench which has started eating into the vitals of thejudiciary. Add that to the inordinate delay undoubtedly avoidable by efficient and committed working, neither of which is sadly available these days. Curiously whoever attempts to stick to the old pattern are branded as cantankerous and fit only for a museum and facetiously condemned old fashioned, incapable of adopting newer and modern techniques in advocacy.

 

No wonder people are slowly losing faith in a system which even the Mahatma had acclaimed as the finest gift of the Britishers to the country. It is one of the largest in the whole world with an Apex Court becoming more powerful as each day passes. See what our former learned Chief Justice says:-

 

“A doubt based on a suspicion of the competence levels of the Judges of the High Court. If, really, the Supreme Court believes that the competence level of the High Court Judges is not up to the expected standard, then the remedy is surely not examining the correctness of each and every judgment of the High Court brought before the Supreme Court, but to improve the recruitment process of the Judges of the High Court and choose more competent people”.

 

The attitude towards the Apex Court is beautifully summarized by the eminent Judge Sri Justice J. Chelameswar:-

 

“But the very hope that the Supreme Court might interfere makes the unsuccessful parties before the High Court take a chance and approach the Supreme Court adding to the burden of the Supreme Court. This isbecause the Supreme Court sits in benches of two and three judges, and different courts obviously have different approaches to the same problem.”

 

The heavy docket explosion therefore is self generated. The Supreme Court is not expected to examine every facet of human life in a vast country like India with more than 120 crore of people. Their power is enunciated through Articles 136 et al. Merry and ready resort to Article 142 has now become routine. The result is what Sri Justice J. Chelameswar laments:

 

‘It is a different matter that over a period of 60 years of the working of the Constitution, quite a few of the constitutional values have been forgotten in the various aspects of the working of the Constitution. Power has a natural tendency to expandand judicial power is not an exception to it.”

 

Let us therefore, go back to the good old days when law, legal provisions, Rule book etc., mattered and convert our courts back into Courts of law and not mere courts of justices.

General Rule — Non-transferability of Trust Properties — Exceptions to the Same — Known to Many but unknown to Some

(By N. Subramaniam, Advocate, High Court of Kerala, Ernakulam)

 

1. Section 63 of the Trust Act, 2 of 1882 reads as follows :-

 

63. Following trust property - into the hands of third persons— Where trust property comes into the hands of a third person inconsistently with the trust, the beneficiary may require him to admit formally, or may institute a suit for a declaration, that the property is comprised in the trust.

 

Into that into which it has been converted.— Where the trustee has disposed of trust property and the money or other property which he has received therefor can be traced in his hands, or the hands of his legal representative or legatee, the beneficiary has in respect thereof, rights as nearly as may be the same as his rights in respect of the original trust property.

 

2. However, Section 64 of the Act gives some exceptions. Section 64 of the Act reads as follows:-

 

64. Saving of rights of certain transferees.— Nothing in section 63 entitles the beneficiary to any rights in respect of property in the hands of-

 

a) a transferee in good faith for consideration without having notice of the trust, either when the purchase money was paid, or when the conveyance was executed, or

b) a transfer for consideration from such a transferee.

 

3. A judgment-creditor of the trustee attaching and purchasing trust property is not a transferee for consideration within the meaning of this section.

 

4. Nothing in section 63 applies to money, currency notes, and negotiable instruments in the hands of a bona fide holder to whom they have passed in circulation or shall be deemed to effect the Indian Contract Act IX of 1872, Section 108, or the liability of a person to whom a debt or charge is transferred.

 

5. For creating a trust, what is required is the unequivocal declaration of the intentions followed by dedication of the property. 1979 (5) All. LR 97 at 99 = 1978 (2) RCJ 470 (Dayalchand v. First Additional District Judge) specification purpose, dedication of property divestiture by donor necessary to create a trust. AIR 1939 Pat 45. (Mt. Satwant Kuer v. Ambika Prasad).

 

6. Section 64 is an exception to S. 63. AIR 1935 Mad. 181(Venkitaram Reddy v. Valli Ammal).

 

7. Now coming to S.64 of Trust Act, which saves the rights of transferees, the judicial principles laid down are given below.

 

These would show that bona fide transferees for valuable considerations and without notice of trust are protected under S.64 of Trust Act. Transferees should have taken the properties without notice, actual or constructive. 32 Chancery D. 560 Taylor v. Blaklock, 10Ch. 22 Health v. Creaklock, LR 7 Ch. App. 259 at 268Picher v. Rawlis, ILR 38 Mad.1064 = 33 Indian Cases 45 (Prasanna Venkitachalam v. Collector of Trichinapoly).

 

It would appear that the word used is “a transferee” and not a purchaser. It also further provides that transferee must act in good faith in the transaction without any notice of trust, either at the point of time when purchase money was paid or when the conveyance was executed. If transferee was intended to mean or be co-extensive with buyer or purchaser, then suitable word would have been used as has been used in S. 92 of the Act. The transferee, includes the purchaser as also other transferees of title of properties in transactions like mortgage, or exchange. Such transferee, to be entitled to protection, must act in good faith without notice of trust, either at the time when purchase money was paid which connotes a buyer for price paid or when conveyance was executed which connotes other transferees. AIR 1972 Cal. 88 at para 17 at page 94 (Jayanta Mohan v. Jagat Mohan). Beneficiary cannot follow trust property in hands of transferee in good faith for consideration without notice of trust. AIR 1933 Cal. 366 Chartered Bank of India, Australia and China v. Imperial Bank of India.

 

8.Now with regard to legal position of a subsequent transferee from a previous transferee.

 

a) If the first transferee is a transferee for valuable consideration without notice of any trust, then subsequent transferee also would be benefited under S.64 of Trust Act and his rights would remain untouched. 14 Ch.D. 432 (CA) Borowgh’s case.

b)First purchaser was a bona fide purchaser without notice and for valuable consideration. Such a purchaser having no notice of breach of trust by trustees, sells the trust property. In the sale deed there is mere mention about the number of trust deed.

 

9. Mere notice of trust instrument cannot be deemed to be notice of breach of trust. Court held that purchase being 12 years from date of original sale, subsequent purchaser is not liable to beneficiary’s (here temple idol) to follow trust property. AIR 1968 Mad 161 at 166 and 167 D.B. (Joseph Costa v. Stansilaus Costa). It would be advisable that, we need not initiate any proceeding or steps or file a suit. If a suit or other proceedings is initiated against us, then we can claim protection under S. 64 of Trust Act by making the necessary pleadings regarding bona fide purchaser without notice and for valuable consideration. See 2007(2) MLJ 937 Para 14 - Inbamathi v. Ramar) Decisions referred to Jayanta Mohan v. Jagat Mohan (AIR 1972 Cal. 88) and Sesh Mutt M. Shah v. Syed ABdul Rashid (ILR 1992 Kar. 273).

 

10. But a transferee who claims to be a bona fide purchaser for valuable consideration without notice has to complete specifically and clearly that he is a bona fide purchaser along with the necessary averments regarding bona fide purchase.