No release of seized oxygen concentrator; prima facie Matrix Cellular in violation of order to not increase price: Delhi High Court

The Delhi High Court on Thursday refused to direct the release of oxygen concentrator stock seized by Delhi Police from the office locations of Matrix Cellular (International) Services Ltd (Matrix Cellular (International) Services Ltd vs State)..A single-judge Bench of Justice Yogesh Khanna opined that such a direction could not be issued when the investigation was at an initial stage. .The Court also stated that there appeared to be no illegality committed by Delhi Police when it seized the oxygen concentrators in the present case at a time when the State was reeling under acute shortage and attendants of patients were running pillar to post for their purchase. ."Prima facie the act of the petitioner (Matrix) is in violation of an Office Memorandum, Ministry of Chemicals and Fertilizers, Government of India, of dated 29.06.2020 (supra) which had directed the petitioners and others like him, selling oxygen concentrators, to not increase prices of oxygen concentrators by more than 10% of the maximum retail price in a year of the Drugs Pricing Control Order, 2013," the Court stated. .The Court also noted that any direction to release the oxygen concentrator would also be contrary to the order passed by the Division Bench which directed that whenever any drugs, concentrators etc used in the treatment of COVID-19 were seized by the authorities or Delhi Police, the District Magistrate shall take necessary steps to ascertain the genuineness of the drugs etc. and pass orders for their release. .In its petition, Matrix Cellular had argued that all its products were seized by the Delhi Police on a "baseless and misconceived allegation" that the stock was as part of black-market operation and dispatched the same to an unknown location..Matrix Cellular contended that that there was no basis for the arbitrary, irresponsible and highly capricious conduct on part of the authorities in seizing oxygen concentrators which were unregulated. .After relying on the Drugs and Cosmetics Act, Essential Comodities Act, Epidemic Act and other relevant government notifications, the Court opined that devices used for treatment, sustaining life etc were governed by the provisions of Drug Price Control order of 2013 and that there was an order against the increase of more than 10% a year in MRP of the concentrators. ."Thus, to say that respondent acted arbitrarily, or their action has no legal backing is all wrong. The police official when got information about black marketing and hoarding of medical devices (concentrator) and of violation of the law / orders (supra) had acted and seized the material," the Court stated. .In its order, the Court observed that a conjoint reading of the FIR, invoices and receipts, along with the fact that the seized oxygen concentrators were allegedly sold at a huge profit margins, showed that Matrix Cellular "engaged in selling untested oxygen concentrators to people desperate for these devices and at an exorbitant prices through false representations"..The Court also said that the seized items were found under suspicious circumstances and the police was authorised to seize the oxygen concentrators lying at the spot, even without the registration of an FIR. ."Unlike Section 156 Cr P C, under Section 102 Cr P C the police is empowered to investigate cognizable cases and the police can seize any property without an FIR," the Court said. .It added that even if there were some irregularities in the procedure to seize, it shall not vitiate the seizure by itself. .A Delhi Court had granted bail to Matrix Cellular CEO Gaurav Khanna, Vice President Gaurav Suri and two others in the case registered against them after their stock of oxygen concentrator was seized by Delhi Police from locations in Lodhi Colony and Mehrauli..Senior Advocates Mohit Mathur, Trideep Pais with Advocates Samudra Sarangi, Shruti Raina, Srishti Khare, Abhilasha Khanna, Nishtha Aggarwal, Moha Paranjpe, Sumit Misra, Sanya Kumar appeared for Matrix Cellular. .Additional Solicitor General SV Raju wth Standing counsel Sanjay Lao and Additional Standing Counsel Kamna Vohra appeared for the State. They were assisted by Advocates Sairica Raju, A Venkatesh, Guntur Pramod Kumar, Zeal Shah, Shaurya R Rai, Aarushi Singh, Anshuman Singh. .[Read Order]