Reported By:| Edited By: DNA Web Team |Source: DNA Web Desk |Updated: Feb 23, 2022, 12:38 PM IST

The Supreme Court on Tuesday said that giving free gifts to doctors by pharmaceutical companies to promote the sale of drugs is 'expressly prohibited by law'. Along with this, the apex court dismissed the company's petition for deduction under the Income Tax Act in the name of encouraging doctors.

The Supreme Court termed it as 'a matter of great public importance and concern', the manipulation of prescriptions by pharmaceutical companies in return for their free gifts to doctors. 

Justice U U Lalit and Justice S Ravindra Bhat dismissed the appeal of M/s Apex Laboratories Pvt Ltd against the order of the High Court. Not only this, it also settled a clever legal case where exemption from tax deduction was sought for gifts given to doctors. These gifts ranged from gold coins, fridges and LCD TVs to financing international trips for holidays or attending medical conferences.

Read | Pharma firms ply doctors with gifts

The company had contended that though the acceptance of such gifts to medical workers is prohibited under the purview of the law, it has not been made an offence under any law, so the companies can avail tax benefits on account of the amount spent on these gifts.

The relevant laws and rules have been explained in the decisions written by Justice Bhat on behalf of the bench. The court said that giving gifts to doctors by pharmaceutical companies is prohibited under the purview of law and in such a situation tax benefit under section 37(a) of the Income Tax Act cannot be claimed. The top court said that by doing so, it would completely affect the public policy.

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