Exemption for listed bulk drugs applies where the notification incorporates the customs list and makes no distinction from formulations.

Bulk drugs specifically named in List 3 of Notification No. 21/2002-Customs were treated as covered by Sl. No. 47A of Notification No. 4/2006-C.E., because the exemption for drugs or medicines incorporated that list and did not distinguish between bulk drugs and formulations. The same issue had already been decided in favour of the assessee by the same Bench, and the present matter was found identical on facts and law. On that basis, the exemption was accepted and the demand and penalty were held not to survive.

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Issues: Whether the bulk drugs manufactured and cleared by the assessee were eligible for exemption under Sl. No. 47A of Notification No. 4/2006-C.E. dated 01.03.2006 by reason of their inclusion in List 3 of Notification No. 21/2002-Customs dated 01.03.2002.

Analysis: Sl. No. 47 of Notification No. 4/2006-C.E. covered goods falling under Chapters 28, 29, 30 or 38, and its clause (A) exempted drugs or medicines, including salts and esters and diagnostic test kits, specified in List 3 or List 4 of Notification No. 21/2002-Customs. The goods cleared by the assessee were specifically named in List 3, and the entry did not draw any distinction between bulk drugs and formulations. The same issue had already been decided in favour of the assessee in an earlier decision of the same Bench, and the present case was held to be identical on facts and law.

Conclusion: The bulk drugs were held to be covered by Sl. No. 47A of Notification No. 4/2006-C.E. and eligible for exemption; the demand and penalty could not survive.

Final Conclusion: The assessee's appeal was allowed and the revenue's appeal was rejected, resulting in acceptance of the assessee's exemption claim under the notification.

Ratio Decidendi: Where a notification grants exemption to drugs or medicines specified in an incorporated list, a bulk drug specifically named in that list cannot be excluded merely because it is used in the manufacture of formulations.

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