Customs, Excise and Gold Tribunal - Mumbai
Roche Products Ltd. vs Commissioner Of Customs on 24 January, 1997
Equivalent citations: 1998(98)ELT641(TRI-MUMBAI)
ORDER G.N. Srinivasan, Member (J)
1. This is an Appeal dealing with the importability of material Lithium Metal. The question involved in this case is whether Lithium Metal is a drug intermediate or not.
2. It is the case of the appellant that they have imported this item under the heading OGL, they had imported one of the earlier instalments sometime on 9-11-1990, and subsequent instalment under the said contract when it was imported on 2-1-1991, the Customs authorities refused to allow the same stating that in view of the Public Notice No. 83/ITC-PD. 90-93, dated 6-11-1990 these items could not be imported without a valid licence.
3. The appellants is clearly waived the show cause notice and they duly attended the personal hearing. There they explained to the nature of the end product and the chemical process involved in the manufacture of end product at page 18 of the paper book. It has been explained about the end product Vitamin A Acetate. A (sic) has been manufactured in the impugned order at page 14. It has been explained as follows :
"The question to be determined is whether Lithium Metal can be considered as a drug intermediate required for the manufacture of Vitamin A Acetate. As per the flow-chart given by the importer, Vitamin A is manufactured from Lemon grass oil (Citral) via a series of chemical intermediate steps. Lithium is reacted with Ammonia to obtain Lithium Amide which in turn reacts with Acetylene to give Lithium acitylide. This Acitylide is reacted with Methyl Vinyl Ketone to obtain Lithium Pentolate which on further processing gives 3-Pentol. 3-Pentol is converted to Vitamin A by a series of steps. It has been confirmed by Dy. C.C. that Lithium Metal does not directly go in the manufacture of end product. Lithium Metal may participate in the process but is not forming part of the end product."
It is the contention of Shri Danesh that following judgment of the Tribunal by the Special Bench in the case of Trichem Laboratories, Bombay v. Collector of Customs, Bombay - 1984 (17) E.L.T. 185 (Tribunal) his case should be accepted.
4. Shri S.V. Singh the ld. JDR would contend that the drug intermediate has not been defined anywhere. However, he would invited my attention to two cases they are Dempo Engineering 'Works (P) Ltd. v. Collector of Central Excise & Customs, Bombay - 1984 (16) E.L.T. 358 that Special Bench decision in the case of Fairdeal Corporation (Pvt.) Ltd. Bombay v. Collector of Customs, Bombay - 1984 (16) E.L.T. 368 to show that "intermediate are organic chemical" which may be considered as chemical stepping stones between the parent substance and the final product. The distinction between an intermediate and an end-product is not always precise". He invited my attention to the Paragraph 12 of the said Judgment three various definitions contained in the Dictionary have been mentioned. He also invited my attention to the case of Indian Drugs & Pharmaceuticals Ltd. v. Collector of Customs - 1989 (44) E.L.T. 395 (Tribunal) where the Special Bench of the Tribunal has held that an intermediate is a substance that arises between the beginning and the end. It is a chemical stepping stone between the raw material and the final product. The impugned order we find has described as to how the imported material has been used. Order states that it did not form part of the end product. This one will come to the conclusion on the basis of the Dy. C.C. report which has not been given to the appellants. It is argued by the representative that the failure of natural justice inasmuch as Dy. C.C. report has not been given to him as this if shown to him, he could have liberty to retract it (sic).
5. In my view natural justice cannot be treated in a strait jacket. The finding of the lower authorities is based on the chemical process described by the appellant's themselves in page 18. The reference to Dy. C.C. does not militant against the processes mentioned by the appellants. In my view therefore, since Lithium Metal does not form part of the end product, even though it may have participated in the processes of manufacturer cannot be treated as drug intermediate. It is stated that the decision cited by the ld. DR in between the raw material stage and the end product, I am not convinced that the appellants have made out a case. No doubt it is true that earlier consignment was cleared by the Customs in my view no two wrongs can make a thing right. I therefore dismiss the appeal.