 "Blow to Cipla; company loses court battle in drug-overcharging case")
Pharma major Cipla today lost a case related to alleged overcharging in certain drugs as per the provisions of Drug ( Price Control) Order, 1995. As per the
company's latest annual report, it had received notices of demand aggregating to Rs 1768.51 crore.
"Supreme Court has today decided in favour of Union of India in a appeal filed against Cipla and others arising out of the judgement of the Allahabad High Court," said the company in a statement to the stock exchanges.
The other petitions filed in the Bombay High Court on completely separate sets of ground relating to the alleged overcharged amounts are pending and are still subject to the interim stay granted by the Supreme Court in July 2016, said the statement.
The other petitions filed in the Bombay High Court on completely separate sets of ground relating to the alleged overcharged amounts are pending and are still subject to the interim stay granted by the Supreme Court in July 2016, said the statement.
In July 2016, the Supreme Court transferred back the writ petitions to Hon’ble Bombay High Court along with directions that 50% of the alleged “overcharged” amount mentioned in its earlier Order dated 1st August 2003 should be deposited by the petitioners in the Bombay petitions, within 6 weeks. Accordingly, the company deposited a sum of Rs 175.07 crore before the deadline.
"The Company has been legally advised that on the merits of the cases that there is very little likelihood of these demands crystallising. Hence no provision is considered necessary in respect of notices of demand received by the Company up to date aggregating to Rs 1768.51 crore," said the company in its latest annual report.
Now with this verdict it is still not clear how the liability for the company changes. Query sent to the company is yet to result in any response. The company stock was down by 2 per cent to Rs 583 on Bombay Stock Exchange at 3.15 pm.