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Calcutta HC sets aside Center’s decision for strategic sale of Bengal Chemicals

Calcutta HC sets aside Center’s decision for strategic sale of Bengal Chemicals

Kolkata: The Calcutta High Court has set aside the Centres decision to go for strategic sale of century-old Bengal Chemicals and Pharmaceuticals Ltd (BCPL), noting that a PSU is better equipped to provide affordable healthcare to people.

The court, while passing the order, observed that BCPL’s production is not limited to generic drugs as it manufactures snake anti-venom and cosmetics among other products.
Quashing the Centre’s decision on BCPL, Justice Debangshu Basak said that existence of a pharmaceutical company in the public sector will add to the availability of medicines at affordable rates to the citizens rather than subtract it.

Noting that “availability of medicines at affordable rates is one of the pillars on which a robust healthcare facility is founded”, the judge said, “The citizens must have access to affordable healthcare.

“Affordable healthcare would necessarily bring within its wake availability of affordable medicines. A public sector undertaking manufacturing generic medicine would, therefore, be better placed and equipped to provide such a service,” Justice Basak said in the order yesterday.

The court said the decision of the central government, based on the recommendations of NITI Aayog to consider BCPL as falling under the non-priority sector, could not be sustained.

The petitioner, Bengal Chemical Sramik Karmachari Union, had challenged the decision of strategic sale of BCPL taken by the Centre.

The union’s counsel Bikash Bhattacharya told the court that health being a priority sector, the central government was misplaced while treating the pharmaceutical industry as not a priority sector.

He submitted that a parliamentary standing committee report of the current Lok Sabha had noted that the company had made stellar performance in the last few years and recommended that it be supported when it was on the path of regaining its past glory.

Additional Solicitor General Kaushik Chanda submitted on behalf of the central government that it has taken a policy decision in not doing business in sectors which did not come within the priority sector.

Manufacturing of pharmaceutical products did not come within the priority sector, Chanda stated in the court.

He submitted that with regard to the revival of BCPL, the Union chemical and fertilizer ministry’s pharmaceuticals department was of the view that although BCPL achieved net profit in the last few years, its net worth continued to remain negative.

Therefore, the Cabinet had decided not to close down the company but put it up for strategic sale, he said.

BCPL, the first chemical factory in the country, was founded by eminent scientist and entrepreneur Acharya Prafulla Chandra Roy in 1901 and at present has four factories in the country — two in Kolkata and one each in Mumbai and Kanpur.

After a sterling performance till the early 1950s, the company went downhill and started making losses from mid- 1950s.

The company was taken over by the Government of India in 1977.

Bengal Chemical doubled its sales turnover to Rs 88 crore in 2015-16, compared to Rs 45 crore in 2014-15, according to information made available by the company.

Source: PTI
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