Patient-specific medicinal mixtures are not manufacture for tax purposes unless the notification clearly says otherwise.

A medicinal mixture prepared in a medical practitioner's dispensary under a patient-specific prescription, for treatment of that patient alone, is not manufacture of medicines or pharmaceutical preparations for taxing purposes unless the notification clearly says so. The Court reasoned that such a preparation is not a commercial commodity passing in trade, and the practitioner cannot be treated as a manufacturer merely because different drugs are mixed for therapeutic use. On that construction, the exemption notification was not displaced by the manufacture exception, and the turnover from such preparations was not taxable.

---

---

Issues: Whether the preparation of medicines on prescriptions in a medical practitioner's dispensary amounted to manufacture of medicines and pharmaceutical preparations within the meaning of the notification, so as to make the turnover taxable.

Analysis: The notification exempted turnover in respect of medicines and pharmaceutical preparations, but excepted sales by an importer of goods brought from outside Uttar Pradesh and sales by a manufacturer of goods manufactured in the State. The Court held that where, according to a medical practitioner's prescription, different drugs are mixed in a dispensary specially for the treatment of a particular patient, the resulting mixture is not a commercial commodity passing from hand to hand in trade and the practitioner cannot be treated as a manufacturer. In a taxing provision, such a construction could not be adopted in the absence of clearer language.

Conclusion: The preparation of such medicinal mixtures did not amount to manufacture, and the respondent was not liable to tax on that turnover.

Ratio Decidendi: A medicinal mixture prepared by or under the direction of a medical practitioner exclusively for treatment of a patient, and not as a commercial commodity, is not manufacture within a taxing notification unless the language clearly so provides.

---