Karnataka seizes Amazon medicines over missing drug licence

Karnataka's Food Safety and Drug Administration Department has seized medicines worth Rs 4,02,352 from two storage facilities linked to Amazon Seller Services Pvt Ltd. The department alleges the premises held drugs without the required licence.

Officials seized stock worth Rs 2,45,352 from a facility in Thattanahalli, Anekal taluk. A second seizure, worth Rs 1,57,000, was made at a facility in the aerospace park area of Devanahalli. Assistant Drugs Controller Manohar led the action in Bengaluru Urban, while Drugs Inspector Vibha led the action in Bengaluru Rural. Inspectors found no documents authorising the storage of medicines at either location.

Amazon told MediaNama it is reviewing the observations from the inspection and will take necessary steps. "We always extend our full cooperation to such inspections by various regulatory agencies," a company spokesperson said.

The alleged licensing breach

Storing medicines for wholesale distribution in India requires a licence under the Drugs and Cosmetics Rules, 1945. The specific licences are Form 20B for most drugs, or Form 21B for Schedule C and C(1) drugs like injectables and biologicals. These licences attach to specific premises.

Stocking a drug without the required licence is an offence under Section 27(b)(ii) of the Drugs and Cosmetics Act, 1940. It carries a minimum three-year prison term, extendable to five years, and a fine of at least one lakh rupees or three times the value of the confiscated drugs, whichever is higher. Section 22 gives an inspector the power to seize stock, which was exercised in this case.

The core legal question

The case hinges on a provision that prohibits not only selling, but also stocking a drug without a licence. This attaches the licence requirement to physical custody. An e-commerce marketplace's typical defences-that it is an intermediary, never owned the goods, and only listed them-answer who sold the drug. They do not obviously answer who was holding it.

The nature of the two facilities is unclear, which changes the legal analysis. Amazon runs fulfilment centres holding third-party seller inventory, grocery warehouses, and a network of dark stores for quick commerce. If the stock belonged to third-party sellers in a fulfilment centre, the question is whether an entity storing drugs it does not own needs its own licence. If the stock was for Amazon's own rapid-delivery operation, the question aligns more closely with recent state actions against quick-commerce warehouses over food safety.

Amazon's response and controls

In its statement to MediaNama, Amazon called the locations "our facilities in Bengaluru" and described controls covering what enters "our fulfillment centers." It did not distance itself from the premises or specify their exact function.

The company outlined its controls. "At Amazon, we have strong systems and controls designed to prevent products that do not meet applicable regulatory requirements from being listed on amazon.in or entering our fulfillment centers," the spokesperson said. These controls screen products, but the Karnataka department's allegation is not about product standards. It is that the premises themselves lacked authorisation to hold medicines. A product screening control does not detect a licensing gap in the building.

Amazon did not answer specific questions from MediaNama. It did not say what the two facilities are, whether the medicines belonged to third-party sellers or an Amazon entity, whether it holds the required drug licences for the premises, whether it has received a show-cause notice, or what its legal position is on the storage question.

The regulatory context and precedent

India's foreign direct investment policy for e-commerce, through Press Note 2 of 2018, allows marketplace entities like Amazon to provide "logistics, warehousing, fulfilment" services to sellers. This arrangement keeps the platform out of ownership but puts it into custody of the goods. The law against stocking drugs without a licence is drafted around that custody.

This reading has not been tested in court. A related case, IndiaMART Intermesh v CDSCO, saw the Delhi High Court in April 2026 grant a conditional stay on the prosecution of the marketplace over drug listings. The platform argued it was a marketplace, not a seller, and claimed safe harbour as an intermediary. The protection granted was a notice-and-takedown system for listings, which does not directly apply to physical medicines on a shelf.

Sectoral regulators have increasingly targeted physical custody. The Bureau of Indian Standards conducted search and seizure operations at Amazon and Flipkart warehouses in March 2025, seizing non-compliant toys, blenders, cables, and water bottles.

Enforcement operates in a vacuum, as draft rules for online medicine sales published in 2018 have still not been formally notified. Regulators are applying a 1940 statute written for brick-and-mortar chemists' shops to modern logistics networks. MediaNama has written to the Karnataka department seeking details on the inspection dates, the exact quantity and value seized, the specific licence found absent, the premises' recorded occupier, and whether any show-cause notice has been issued.