Cipla Ltd has informed the BSE that the company has received notice from the NPPA (National Pharmaceutical Pricing Authority) asking it to pay an amount of Rs 76.75 crores on account of alleged overcharging in respect to three drugs for the period from July 2000 till July 2003. The amount is to be paid on or before December 26, 2003.
The company had challenged the inclusion of the drugs- Salbutamol, Theophylline, Ciprofloxacin and Norfloxacin within the ambit of price control. The petition filed by the company had been decided in favour of the company by Bombay High Court, which held that the said drugs were outside the ambit of price control. However, on appeal filed, the Supreme Court had remanded the matter to the Bombay High Court for further and more detailed examination in light of the principles laid down by the Supreme Court.
The Supreme Court had also permitted the government to recover 50 per cent of the amounts they claimed to have been e been overcharged. The government had sent notices to the company demanding an aggregate of Rs 1030.80 million in respect of the drugs which according to them is 50 per cent of the amount allegedly overcharged by the company till June 2000. The company had however not paid the same in view of the interim orders obtained by the company in different proceedings from the Karnataka High Court and the Allahabad High Court in respect of the above-mentioned drugs. The company has also obtained legal opinion that it is not liable to make any payment of the said amounts at this stage in view of the aforementioned orders.