In this case, the original patent could not be granted because India's laws did not recognize patents on drugs at the time. Now India has passed laws recognizing patentable drugs, the company wanted a patent, and claimed one for the existing drug, unpatented because of previous laws, slightly changed.
In this case, a patent would have been reasonable. But if allowed, it would be a precedent that would have been used for evergreening other drug patents in the future. So it was quite rightly disallowed.
There are more egregious examples of evergreening, for instance, where a party gains a patent on a drug, and, just before the drug's patent expires, a second patent is applied for covering an essential process or precursor for making the drug. This second patent works if they have been careful to make sure that information about the process or precursor has been kept as a trade secret, which means simply that everyone that has been informed about it has signed an NDA.