Customs, Excise and Gold Tribunal - Tamil Nadu
M/S Natco Pharma Ltd. (Parenterals ... vs Commissioner Of Customs And Central ... on 28 August, 2001
ORDER
Shri Jeet Ram Kait
1. Appellants are the manufacture of the products viz. (i) stronic (ii) Vitamin B Complex (iii) Bovoplex (iv) Neuronat (v) Avitol and (vi) Hivit. These are admittedly vitamin based injections and the same were classifiable by them as P or P medicaments under Chapter No. 3003.10. They were issued six show-cause notices by the Assistant Commissioner of Central Excise, Hyderabad-III Division on the grounds that the listed injections manufactured by them are dietetic and as per Chapter Note 4(a) of Chapter 30 of the Central Excise Traiff Act, dietetic products are excluded from Chapter 30 and they are properly classifiable under sub-heading 29.36 attracting duty @ 20% ad valorum upto February, 1997 and @ 18% ad valorum from March, 1997. The claim of the party to classify these products under chapter heading 3003.10 to attract duty @ 15% ad valorum was therefore, proposed to be rejected and a consequential differential duty totally amounting to Rs.3,56,909/- was proposed to be recovered from them, in addition to the imposition of penalty of Rs.32,000/- imposed on them.
2. Appellants contested the issue of show cause notice before the AC and submitted that sub-heading 2936 covers only those formulations which consists of merely vitamin, provitamins and derivatives used primarily as vitamins. These sub-headings do not cover formulations which had apart from vitamins and certain other ingredients except drugs, minerals, proteins etc. and since all of their products contained these ingredients, they had therapeutic value and would accordingly be liable to be classified under heading 3003.10 as medicaments. They also made an alternative contention before the original authority that the said products are for treatment of animals only which is clearly indicated on the labels and would be administered on the advise from the Veterinary Medical Practitioners, which also signifies that it is a medicament and nothing else. The contention of the appellants has been rejected and the AC in his order had confirmed duty of Rs.3,56,909/- and imposed penalty of Rs.32,000/- under Rule 9(2) of Central Excise Rules, 1944 read with Section 11A.
3. The party preferred an appeal before the Commissioner (Appeals) who vide his order No. 261 to 263/2000 (H-III) CE dated 7.11.2000 held the order passed by the AC as sustainable and rejected the appeal of the appellants. The matter had also come earlier before this Bench in Appeal No.E/St/561/2000 & E/1166/2000 arising out of Order-in-Appeal No. 114/2000 dated 1.5.2000 and the Tribunal vide final order No. 107/2001 and stay order No. 46/2001 dated 5.1.2001 had remanded the case back to the original authority for de novo consideration. The findings of the Tribunal as contained in para-7 are extracted herein below:-
"7. We have carefully considered the submissions made by both sides. It is observed that the case of the appellants since very beginning is that the products manufactured by them are not only composition of vitamins alone but they also contain other ingredients which all cumulatively have therapeutic effect, but the same has not been discussed by the original authority in his order. The Commissioner (Appeals) has even paid less attention to the issue before him and he has merely followed the view taken by his predecessor and rejected the plea of the appellants without going into the merits of their case. Keeping in view that the appellants have already deposited 50% of the duty amount confirmed on them and further that the case laws cited before us by them, are, prima facie, in their favour, we are of the view that the appeal itself can be disposed of at this stage. Consequently, we grant them waiver of pre-deposit of the balance amount of duty and penalty confirmed on them. We set aside the orders passed by the lower authorities and remand the matter to the original authority for passing a de novo speaking order, taking into consideration the contentions raised by the appellants in their submissions and in the light of the decisions cited above. The original authority shall afford a reasonable opportunity to the appellants to state their case before taking a final view in the matter. Since the matter is pending since long, the original authority shall pass final order in the matter within a period of three months from the date of receipt of this order."
4. Heard Ld.Counsel Shri J. Shankarraman for the appellants who relies on the judgement of earlier decision of the Tribunal in the case of CCE Vs JUGGAT PHARMA LTD., reported in 1999 (114) ELT 707 (T). He also submits that on a remand order of this Bench, the AC vide his Order-in-Original No.6/2001 dated 10.7.2001 has dropped proceedings in their favour by classifying the product under chapter sub-heading 3003.10 of the CET Act, 1985 and he dropped further proceedings initiated in the show cause notice. He, therefore, seeks for a similar order in this case also.
5. Heard Ld.DR Shri Soundarrajan, who reiterates the departmental view.
6. We have heard both sides. We are of the considered opinion that appeals themselves can be taken for disposal at this stage itself. Consequently, we grant them waiver of pre-deposit of duty and penalty amounts by allowing their stay applications and appeals are taken up for final hearing of the same at this stage. We, therefore, set aside the order passed by the lower authorities and remand the matter to the original authority for passing a de novo speaking order, taking into consideration the contentions raised by the appellants in their submissions and in the light of the decision rendered by this Bench in the cited case (supra). The original authority shall afford a reasonable opportunity to the appellants to state their case before taking final view in the matter.
7. As regards their submission to take a final decision as contained in O-I-O No. 6/2001 dated 10.7.2001 cited by Ld.Counsel, it is for the appellants to make similar submissions before the lower adjudicating authority and the lower authority will take a decision in accordance with law. Ordered accordingly.
(Pronounced & dictated in open court)