The Kerala branch of the Indian Medical Association (IMA) will soon start statewide agitation against the Kerala government move to bring registration of hospital pharmacies under the sales tax rules.

As per the Department of Commercial Taxes directive, being issued to the registered 4000 odd clinics and hospitals in the state, it is mandatory to have sales tax registration certificate for selling drugs with turnover exceeding Rs 2 lakhs per annum. Further, the hospitals will have to maintain relevant registers of the drug transaction at the hospital pharmacies and should file details with department on a periodic basis, and submit the taxes to the government as per the ST rules applicable to the trade of drugs from time to time.

The doctors' community fears the move would cause unnecessary harassment of doctors by the sales tax department officials, besides causing additional burden on clinics and hospitals for maintaining the records. Further, this will cause harassment of most of the practicing doctors by the officials, since most of them dispense drugs in their private practices and clinics.

Jose M Malana, general secretary of Kerala IMA told Pharmabiz that the move would be gross violation of the rights of medical practitioners. "No other state has implemented such a rule. Doctors do not run pharmacies and sell drugs. We only dispense drugs to patients. It is a question of infringing our professional integrity and equating doctors with a drug retailer."

"As per Clause 5 of the Schedule K of the Drugs and Cosmetics Act, doctors are allowed to dispense medicines to patients. Our repeated representations to the state finance minister, commercial taxes commissioner and the appellate authority on this matter has not yielded much results. Therefore, IMA is forming an action committee to fight against this injustice. We will soon chalk out strategies of action which includes demonstrations and other ways of protest," he added.

He said the IMA office bearers had met the state chief minister this week, and he suggested a meeting of IMA office bearers with the concerned department officials and ministers to solve the issue. "If this move also fails, we will soon start agitation," said Jose M Malana.

It may be noted that in a related case, the doctors were engaged in a prolonged legal battle against the state drug controller's decision to mandate license for hospital pharmacies. The doctors had moved Supreme Court in 1999, when the state high court judgment favored the DC's move. However, the Supreme Court allowed a stay for implementing the decision and had directed the petitioners to resubmit the case in the lower court.

Sources said out of the 4000 odd hospitals in the state, ST registration has been taken by at least 100 odd corporate and big hospitals having large-scale pharmacies. Traders and the drug control department say the hospitals pharmacies in Kerala account for at least 25-30 per cent of the Rs 700 crore odd drug trade in the state.