What Are the Penalties for Importing Medical Devices Without CDSCO Registration?

Importing a medical device into India without a valid CDSCO registration is a criminal offence under Section 13 of the Drugs and Cosmetics Act, 1940. Penalties include imprisonment up to three years, fines and seizure of goods. These consequences fall on the Indian importer and through the AIR mechanism, on the foreign manufacturer's designated representative in India.

What are the penalties for importing without CDSCO registration?

The Drugs and Cosmetics Act, 1940 is the foundational statute governing the import, manufacture, distribution and sale of drugs and medical devices in India. The Central Drugs Standard Control Organisation (CDSCO) headed by the Drugs Controller General of India (DCGI) under the Director General of Health Services, Ministry of Health and Family Welfare is the enforcement authority alongside Customs.

Section 13 of the Act governing violations, prohibits the import of any drug or device in contravention of the Act's provisions and prescribes criminal penalties for non-compliance. Import of an unregistered device is an objective violation irrespective of intent to defraud or knowledge. A consignment imported in good faith, relying on a supplier's incorrect assurance or in honest misunderstanding of class requirements is not insulated from prosecution under the act.

The Medical Devices Rules (MDR), 2017 established the registration framework that makes Section 13 enforceable for medical devices. MDR 2017 extended the registration requirement to all medical devices covering the vast majority of devices imported for commercial sale. The penalty regime exists alongside Customs Act enforcement. Customs and CDSCO coordinate on port-level enforcement.

Implications for businesses

For foreign medical device manufacturers, the penalty exposure in India is concentrated in the Authorised Indian Representative. For Class C and Class D devices, AIR is the legally registered Indian company or LLP appointed under MDR 2017 that accepts regulatory responsibility for the manufacturer's compliance in India. Where the manufacturer's registration has lapsed, was never obtained or is based on inaccurate information, the AIR faces enforcement consequences in India.

A foreign manufacturer whose Indian registration is cancelled following an enforcement action cannot simply re-register and restart. Government procurement programmes in India typically require clean CDSCO registration status, and a company with an enforcement record faces disqualification from government tenders for extended periods.

The Indian importer is the named licence holder under Form MD-14. A prosecution under Section 13 names the importer and directors and responsible officers can be individually named in proceedings. The Act provides for corporate criminal liability for individual officers presumed to be responsible for corporate acts unless they can demonstrate they had no knowledge and exercised due diligence to rebut the presumption.

How CDSCO penalty enforcement works

When customs authorities detect a medical device shipment without valid CDSCO registration it is detained at the port. The customs officer issues a show cause notice to the importer. If the importer is not able to show a valid registration, the shipment remains detained while the outcome is determined. During the detention period, demurrage charged by the shipping line and ground rent charged by the port or terminal operator accrue daily from the moment the container is held.

The non-compliance risk at the importer side can be absolved through re-export that requires coordination with the shipping line, customs clearance for outbound cargo and additional handling costs or by obtaining a special permission from CDSCO to conditionally release unregistered goods. Under the Customs Act, the outcome is confiscation where the importer cannot demonstrate a legitimate path to resolution.

Section 27 of the Act addresses devices that are not of standard quality or that are misbranded or adulterated. This provision carries fines up to Rs 5 lakh or imprisonment applicable where imported goods that passed customs examination are subsequently found non-conforming in post-market checks. Section 27 is invoked by state drug authorities as well as CDSCO and applies at the import, distribution and sale level.

Legality and risks

Section 13 of the Drugs and Cosmetics Act, 1940 provides imprisonment up to three years and a fine for import in contravention of the Act. Section 27 of the Act provides fines up to Rs 5 lakh or imprisonment for sale of substandard, misbranded or non-standard devices. Both provisions carry individual liability for directors and officers of corporate entities. The Medical Devices Rules, 2017 provide for suspension and cancellation of registrations by CDSCO as an enforcement measure independent of criminal prosecution.

A suspended or cancelled registration affects the legality of all stock already imported under that registration and in circulation in India. The importer faces recall obligations including logistics, customer relationship management, replacement of goods and potential liability to end users for goods already distributed in addition to the enforcement action at the port.

The CDSCO approved device list is a public register. Any party can verify whether a device is registered in minutes.

Word of counsel

Importers should not rely on a pending CDSCO application to release a detained shipment. CDSCO's registration process is a substantive review that takes months with no emergency-lane treatment for importers whose shipments are detained. The cost of compliance, front-loaded before the first shipment, is less than the cost of enforcement, re-export proceedings back-loaded after the shipment arrives.

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