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Oxygen concentrators black marketing case: Supreme Court issues notice on plea seeking release of seized material

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The Supreme Court on Tuesday issued notice in a plea by Matrix Cellular (International) Services Private Limited challenging the Delhi High Court judgment dismissing its appeal to release oxygen concentrators seized by Delhi Police amid the Covid pandemic.

The three-judge bench of Justices R.F. Nariman, K.M. Joseph and B.R. Gavai while issuing notice heard Senior Advocate Mukul Rohatgi appearing on behalf of Matrix Cellular. He said the High Court has not considered the plea regarding the release of seizure of Rs 3.5 crore worth of medical equipment. It was further stated by him that there was no law that fixed the price of oxygen concentrators at the time of FIR.

It was further stated that the FIR was lodged on May 5, 2021 and then there was no bar on selling them at higher prices. He added that the company had brought the items from abroad and all kinds of taxes were paid by them before selling.

He further iterated that if there is no price fixation then there is no matter of black marketing and hoarding. The senior advocate requested the bench to allow a short notice period so that the medical equipment seized can be released soon. He also stated that the High Court’s order was merely a reflection of the situation and sentiments involved due to the loss of human life during the second wave.     

In the same case, earlier this year, the accused and owner of Khan Chacha restaurant Navneet Kalra, and directors of Matrix were granted bail. They were arrested under Section 3/7 of the Essential Commodities Act, under Section 3 of the Epidemic Diseases Act and Section 420/188/ 120B/34 IPC was registered at police station Lodhi Colony.

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It was noted by the High Court that during the course of investigation, at the instance of accused persons, 387 oxygen concentrators; 112 boxes containing KN-95 marks, 95 Oximeter were recovered from Matrix Cellular International Services Private Limited and sold at higher prices at the profit of Rs. 40,000/- to 42,000/- per piece.

The arguments before the High Court were that despite the FIR being registered on 05.05.2021, the entire seized material was sent to the Deputy Commissioner and not to a local Magistrate hence they have no remedy under Section 451 or 457 Cr P C to move an appropriate application before learned Magistrate and since the seizure is illegal, the remedy is only to file a Writ under Article 226 of the Constitution.

It was further observed that seized items were found under suspicious circumstances where individuals were in alleged violation of the Covid-19 lockdown measures imposed at that time, and accordingly, police was authorized to seize the oxygen concentrators lying at the spot. The registration of the FIR was not mandatory for search and seizure under Section 102 CrPC.

It was further observed the actions of the accused was in violation of an Office Memorandum, Ministry of Chemicals and Fertilizers dated 29th June which had directed the sellers not to increase prices of oxygen concentrators by more than 10% of the maximum retail price in a year of the Drugs Pricing Control Order, 2013. All manufacturers/importers were directed to ensure compliance of the provisions of DPCO failing which action may be initiated for violation of provisions of DPCO read with the EC Act.

Also Read: Delhi High Court stays NCSC summons to Centre, RML Hospital authorities

The facts also show the alleged were engaged in selling untested oxygen concentrators to people desperate for these devices that too at exorbitant prices through false representations, especially, when the State and the whole country saw an unprecedented surge of covid-19 infections and severe lack of oxygen cylinders and/or concentrators.

It was also observed by the High Court that the relief sought qua release of seized oxygen concentrators is in conflict with the orders passed by the Hon’ble Division Bench in Venkateshwar Hospital case and also Bram Health Care Private Limited case wherein it is directed whenever any drugs etc. used in treatment of Covid-19 are seized by the authorities or Delhi Police, they shall, without any delay inform the District Magistrate, who shall take the necessary steps to ascertain genuineness of the drugs etc. and pass orders for release of the same before the items seized are rendered unusable.

The High Court at last observed that the investigation is at initial stage and the reliefs sought cannot be granted by the High Court, except the concentrators so seized be put an identification mark(s) and its coloured photographs be kept for future reference, by the respondent. 

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