Customs, Excise and Gold Tribunal - Bangalore
Smithkline Beecham Pharmaceuticals ... vs The Commissioner Of Central Excise, ... on 1 November, 2001
Equivalent citations: 2002(79)ECC287, 2002(139)ELT77(TRI-BANG)
JUDGMENT
G.A. Brahma Deva
1. The issue relates to animal feed supplement in both the cases. Appeal No. E/2474/97 is filed by the party whereas appeal No. E/716/2000 is filed by the department. Since the issue is common in both the cases, they are being disposed off by this common order.
2. Arguing for the assessee Sh. Parameshwaran submitted that the issue relates to classification of animal feed supplements, consisting of one or more vitamins mixed together with dilutants and used in small quantum by addition to the main feed to get desired performance of live stocks or to enhance their performance classifiable as animal feed under Heading 23.02 of Central Excise Tariff Act 1985 as it was held by Supreme Court in the case of Tetragon Chemie Pvt Ltd reported in 2001 (132) ELT 525. He said that the view taken by the Tribunal was upheld by the Supreme Court. He also referred to the subsequent decision of the Tribunal in the case of Li Taka Pharamaceuticals reported in 2000 (121) ELT 203 in support of his claim.
3. On the other hand Smt. Radha Arun appearing for the revenue submitted that the decision referred to by the counsel is not applicable to the facts of this case as it is not vitamins but medicament being gadded. In support of her contention she referred to the decision of the Supreme Court in the case of Eskayef Ltd v. Collector of Central Excise reported in 1990 (49) ELT 649 (SC). She also drew our attention to para 13 & 14 of the above order, which is as follows:
"13. Shri Venugopal has laid stress on the word "used" in Explanation I in item 14E and has submitted that Neftin Tablets are manufactured for use as medicine whereas Neftin 50 and Neftin 200 are manufactured for use as animal feed supplement and are not manufactured for use as medicine. Shri Venugopal has invited our attention our attention to the decision of this court in Annapurna Carbon Industries Co. v. State of Andhra Pradesh (1976 (3) S.C.R. 561). In that case the question for consideration was whether Cinema Arc Carbons were taxable to sales tax under the entry relating to cinematographic equipment and parts and accessories 'required for use therewith'. This Court held that the main use of the arc carbon was proved to be that of production of powerful light used in projectors in cinemas and the fact that they can also be used for search lights, signalling, stage lighting or where powerful lighting for photography or other purposes may be required, could not detract from the classification to which the carbon are belong, which is determined by their ordinary or commonly known purpose or user and hence their sale was subject to sales tax under the said entry. Here we find that Neftin-50 and Neftin-200 contain Furazolidone which is administered for prevention and treatment of ailments viz., Coccidiosis and Histomoniasis in poultry. Merely because Neftin-50 and Neftin-200 can also be used for improving egg production and increase in growth rate of broilers would not in anyway detract from the fact that the said products are medicines for use in the treatment and prevention of ailments in poultry. Once it is found that Neftin-50 and Neftin-200 are medicines for use for treatment and prevention of ailments in poultry they have to be regarded as medicines chargeable to excise duty under Item No. 14E and the question patent and proprietary whether the said products fall in the residuary entry at Item 68 does not arise.
14. The exemption from payment of central excise duty which has been granted notification dated November 1, 1982, as amended by notification dated February 15, 1984, is confined in its application to goods specified in the Schedule annexed to the said notification which fall under Item 68. The said notification does not grant exemption in respect of a product falling in any other entry of the excise tariff. It cannot be construed as transferring a product from an entry other than Item 68 to Item 68. The insertion of animal feed supplement in the Schedule to the Notification dated November 1, 1982 by the Notification dated February 15, 1984 would not means that a product which was liable to payment of central excise duty under Item 14E prior to such insertion would cease to be so liable and would become exempt from such payment of duty by virtue of this notification. It is not disputed that prior to the notification dated February 15, 1984, the appellant was paying central excise duty on Neftin-50 and Neftin-200 as patent and proprietary medicines falling under Item 14E. In the absence of any notification granting exemption in respect of products falling under Item 14E, Neftin-50 and Neftin-200 which are patent and proprietary medicines falling under Tariff Item 14E and which do not fall under the residuary entry at Item 68, cannot be claimed to be exempt from Central excise duty as animal feed supplement under notification dated November 1, 1982, as amended by notification dated February, 15, 1984."
4. Sh. Parameswaran replied that decision in the case of 'Eskayef' referred to by the department was with reference to old tariff. He said that item in question is concerned with the new tariff and the very issue with reference to the new tariff has been dealt with by the Tribunal in the case of Tetragon (Supra) which was upheld by Supreme Court and further the Tribunal has taken similar view in the case of Le Taka Pharmaceuticals (Supra). In those cases, it was clearly held that animal feed supplement is to be classifiable as animal feed under Heading 2302.00 of Central Excise Tariff Act, 1985. In view of the settled position, he requested that the item in question is appropriately be classified under 2302.00.
5. We have carefully considered the matter. On going through the submissions made by both sides with reference to those cases, we are of the view that this matter requires to be examined in detail with reference to factual position and in light of the decision referred to above. We find that there is no direct decision of the Supreme Court with reference to medicament. The decision referred to by the counsel are with reference to animal feed supplement consisting of vitamins. In view of the factual discrepancies, we are remanding the matter to the concerned adjudicating authority to examine the issue afresh and to pass an appropriate order in the light of observations made by the Apex Court in the cases referred to above on providing an opportunity to the party. Thus these two appeals are allowed by way of remand.
(Pronounced and dictated in open court.)