Custom, Excise & Service Tax Tribunal
C.C. (Import & General), New Delhi vs M/S. Kimia Biosciences (P) Ltd on 13 January, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
WEST BLOCK NO.2, R.K. PURAM, NEW DELHI 110 066
Date of Hearing 13.01.2016
For Approval & Signature :
Honble Honble Ashok Jindal, Member (Judicial)
Honble Mr. R.K. Singh, Member (Technical)
1.
Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2.
Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
Yes
3.
Whether Lordships wish to see the fair copy of the order?
Seen
4.
Whether order is to be circulated to the Department Authorities?
Yes
Appeal No. C/50144/2014-CU[DB]
[Arising out of Order-in-Appeal No.CC(A)/I&G/478/2013, dated 20.08.2013 passed by the C.C.(Appeals), New Delhi]
C.C. (Import & General), New Delhi Appellant
Vs.
M/s. Kimia Biosciences (P) Ltd. Respondent
Appearance
Mr. K. Poddar, DR - for the appellant
Mr. Piyush Kumar, Advocate - for the respondent
CORAM: Honble Mr. Ashok Jindal, Member (Judicial)
Honble Mr. R.K. Singh, Member (Technical)
Final Order No.50054/2016, dated 13.01.2016
Per Mr. Ashok Jindal :
Revenue is in appeal against the impugned order.
2. The brief facts of the case are that the respondent imported one consignment of Ursodeoxycholic Acid EP 6.0. The respondent classified the said goods under CTH 29420090 with benefit of duty exemption under Notification No.12/2012-Cus, dated 17.03.2012 at Sl. No.165. Respondent sought recall of the assessment claiming benefit of Notification No.12/2012-Cus at Sl. No.147(A) at Nil CVD and Notification No.12/2012-Cus at Sl. No.108(A) at Nil BCD. The adjudicating authority held that the goods being bulk drugs and not eligible for the benefit of Notification as Sl. No.147A and 108(A) and it was directed to the respondent to seek the benefit under Sl. No.147(B) and 108(B) respectively and to specific conditions mentioned therein, the respondent relied on the decision of the Tribunal in the case of Cipla Ltd. Vs. CC [2007 (218) ELT 547 (Tri.-Chennai)] and Burroughs Wellcome Vs. CCE, Mumbai [2007 (216) ELT 522 (Tri.-Mumbai)]. But the adjudicating authority did not agree with the same and denied the benefit of Notification hereinabove 147A/108A respectively. Aggrieved from the said order, respondent filed an appeal before the Commissioner (Appeals), who after examining the issue held that the respondent is entitled for the benefit of Notification No.12/2012-Cust at Sl. No.147A and 108A respectively. Aggrieved from the said order, Revenue is in appeal before us.
3. Ld. Departmental Representative submits that it is no doubt that the respondent has imported the bulk drugs and the same had classified as 147B and 108B under the said Notification and therefore the respondents are entitled for the benefit under Notification No.12/2012-Cus at Sl. No.147B and 108B respectively on satisfying the conditions mentioned therein. Therefore, the impugned order is to be set aside.
4. On the other hand, ld. Counsel for the respondent relied upon the impugned order and reiterated that the findings of the same and he also relied on the decisions of the Tribunal in the cases of Cipla Ltd. Vs. CC and Burroughs Wellcome Vs. CCE, Mumbai (supra).
5. Heard the parties and considered the submissions.
6. We have gone through the Notification No.12/2012-Cus, dated 17.03.2012. The relevant extracts are extracted herein below:-
S.
No.
Chapter or Heading or
Sub-heading or tariff item
Description of goods
Standard rate
Additional duty rate
Condition No.
(1)
(2)
(3)
(4)
(5)
(6)
147.
28, 29 or 30
(A) Drugs, medicines, diagnostic kits or equipment specified in List 3
(B) Bulk drugs used in the manufacture of drugs or medicines at (A)
5%
5%
-
-
-
5165. 29 (except 2905 43 00, 2905 44 00 and 2933 71 00) All goods 7.5%
-
-
List 3 (See S. No.147 of Table) (1) Allopurinol (2) ..
(83) Ursodeoxycholic Acid Central Excise Notification No.12/2012-CE dated 17.03.2012 Sl. No. Chapter or heading or sub-heading or tariff item of the First Schedule Description of excisable goods Rate Condition No. (1) (2) (3) (4) (5) 108 28, 29, 30 or 38 The following goods, namely, (A) Drugs or medicines including their salts and esters and diagnostic test kits, specified in List 3 or List 4 appended to the notification of the Government of India in the erstwhile Ministry of Finance (Department of Revenue), No. 12/2012-Customs, dated the 17th March, 2012) Nil
-
(B) Bulk drugs used in the manufacture of the drugs or medicines at (A) Nil
-
Whether the goods imported by the respondent covers under Sl. No.A or B as the bulk drugs has been examined by this Tribunal in the case of Cipla Ltd. Vs. CC (supra), wherein the Tribunal observed as under:-
4.?The substantive question to be considered in these appeals is whether the goods imported by the appellants can be considered to be drugs within the meaning of this term figuring at Sl. No. 80 (A) of the Customs Notification as well as at Sl. No. 47(A) of the Central Excise Notification. The lower appellate authority has held the goods to be bulk drugs under Part B of the description of goods against Sl. No. 80 of the Customs Notification in contradistinction with drugs mentioned in Part A. The authority, accordingly, denied the benefit of the Notification to the assessee on the ground of non-compliance with the relevant condition. According to the appellants, bulk drugs are also drugs and, where they find mention in list 3 appended to the Customs Notification, the benefit of Sl. No. 80 (A) of the Notification should be extended to them. In this connection, their counsel has referred to the definitions of drug, bulk drug and formulation given in the Drugs (Prices Control) Order, 1995. Ld. counsel has also submitted that a similar dispute in relation to Sl. No. 43 of Central Excise Notification No. 11/97 was considered by the West Zonal Bench (W/B) of the Tribunal in Order No. A/461 & 462/2007 dated 20-6-2007 [2007 (216) E.L.T. 522 (Tribunal)] in the case of Burroughs Wellcome (I) Ltd & Pfizer Ltd. v. Commissioner of Central Excise & Customs, Mumbai [Appeal Nos. E/1665/2000 & C/1156/2001] and it was held that, inasmuch as the goods in question were specifically mentioned in List 2 annexed to Sl. No. 43A of the Notification, the benefit of the said entry would be admissible to the assessees. The relevant portion of Notification No. 11/97-CE considered by WZB is reproduced below :-
Sr. No. Chapter Or heading No. or sub-heading No. Description of goods Standard Rate Additional duty Rate Condition No. 43 28,29,30 or 38 The Following goods, (A) The life saving drugs or medicines (including diagnostic test kits) specified in List 2.
Nil Nil
-
(B) Bulk drugs used in the manufacture of life saving drugs or medicines at (A) above. Nil
-
-
(C) Other life saving drugs or medicines Nil Nil 7 M/s. Burroughs Wellcome (I) Ltd. had imported Polymyxin B Sulphate and used the same along with some other ingredients in the manufacture of Neosporin. M/s. Pfizer Ltd. had imported Cefoperazone Sodium and used the same for manufacture of Cefoperazone Sodium Injections. The issue before the Tribunal was whether the above parties were eligible for the benefit of exemption from payment of CVD on the items imported by them, under Sl. No. 43 (A) of Notification No. 11/97-CE and under the corresponding entries of successor Notifications. It was not in dispute that the imported items figured in List 2 appended to Sl. No. 43 (A) of the above Notification. While the Revenue classified the goods as bulk drugs under Sl. No. 43(B), the assessees classified them as life saving drugs under Sl. No. 43 (A). The Tribunal accepted the assessees contention and held that the drugs imported by them were to be categorized under Sl. No. 43(A) inasmuch as they found mention in List 2. It was further held that, as Sl. No. 43 (A) was more beneficial than 43 (B), the assessee was not precluded from claiming such benefit at a later stage. It is settled law that, where two exemption Notifications are applicable to a given goods which is otherwise chargeable to duty, the assessee is entitled to avail the benefit of that Notification which is more beneficial vide Indian Oil Corporation Ltd. v. CCE - 1991 (53) 347 (Tribunal), CCE v. Indian Petrochemicals - 1997 (92) E.L.T. 13 (S.C.) and H.C.L. Ltd. v. CC - 2001 (130) E.L.T. 405 (S.C.). Applying the same principle, we hold the view that, if two entries in an Exemption Notification are applicable to a given goods, the assessee can legitimately claim under the more advantageous entry. Therefore, we are inclined to follow, with approval, the view taken by the co-ordinate Bench in the case of Burroughs Wellcome (I) Ltd. & Pfizer Ltd.
5.?In the instant case, admittedly, the bulk drugs imported by the appellants were specifically mentioned in List 3 appended to Sl. No. 80(A) of Customs Notification No. 21/02 and are liable to be considered as drugs mentioned at 80(A). It is beyond doubt that bulk drugs are also drugs. They are so defined under the Drugs (Prices Control) Order, 1995 also. The imported goods, which are specified in List 3, must fall within the coverage of drugs specified in List 3 and consequently the benefit of Sl. No. 80(A) would be admissible to them in relation to BCD. It would follow that, insofar as CVD is concerned, the benefit of Sl. No. 47(A) of the Central Excise Notification would be available to the goods. We have taken this view upon strict interpretation of the language used in the description of goods under the relevant entries of the Notification, in terms of the Apex Courts ruling in Gujarat State Fertilisers Co. v. CCE - 1997 (91) E.L.T. 3 (S.C.) and other cases cited by learned DR. In the result, all the appeals filed against the appellate Commissioners order on merits are bound to succeed.
7. As the issue involved is clearly covered by the decision of the Tribunal in the case of Cipla Ltd. Vs. CC (supra), we do not find any infirmity with the impugned order and the same is upheld and the appeal filed by the Revenue is dismissed.
(Ashok Jindal) Member (Judicial) (R.K. Singh) Member (Technical) SSK -2-