"Nycil Medicated Powder" Classified as Medicine under Schedule C Entry 13

The High Court determined that "Nycil Medicated Powder" is considered a "medicine" falling under entry 13 of Schedule C. It was established that the powder's composition and intended medicinal use align with the definition of a medicine, distinguishing it from a mere toilet article. As a result, the Commissioner of Sales Tax was directed to cover the costs of the reference to the assessee-firm, and the reference was resolved in favor of this classification.

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Issues Involved:
1. Whether "Nycil Medicated Powder" is a "toilet article" within the meaning of entry 21A of Schedule E.
2. Whether "Nycil Medicated Powder" is a "medicine" within the meaning of entry 13 of Schedule C.
3. Whether "Nycil Medicated Powder" falls under the residuary entry 22 of Schedule E of the Bombay Sales Tax Act, 1959.

Detailed Analysis:

1. Whether "Nycil Medicated Powder" is a "toilet article" within the meaning of entry 21A of Schedule E:

The Tribunal and the Deputy Commissioner of Sales Tax initially determined that Nycil powder was a toilet article. The Tribunal observed that Nycil powder "can be used and is presumably used for the purpose of grooming a person by beautifying his appearance." However, the High Court disagreed with this assumption. The court emphasized that the essential and true character of Nycil powder, based on its composition and advertised use, was for medicinal purposes, specifically to cure or prevent skin ailments. The court noted that the article is not styled or advertised as a toilet powder and is primarily made of medicinal articles. Therefore, the High Court concluded that Nycil powder is not a toilet article within the meaning of entry 21A of Schedule E.

2. Whether "Nycil Medicated Powder" is a "medicine" within the meaning of entry 13 of Schedule C:

The High Court referred to dictionary definitions and common parlance to interpret the term "medicine." The court noted that "medicine" means a remedial agent used in treating disease or relieving sickness. The court found that Nycil powder, with its composition of medicinal substances like chlorphenesin, zinc oxide, and boric acid, and its recommended use for treating skin ailments, fits within this definition. The court emphasized that the overall composition and property of Nycil powder, along with its advertised use, make it a medicine. The court also noted that Nycil powder is treated as a drug under the Indian Drugs Control Act and is assessed as a medicine under the Central Excise Act. Therefore, the High Court concluded that Nycil powder is "medicine" within the meaning of entry 13 of Schedule C.

3. Whether "Nycil Medicated Powder" falls under the residuary entry 22 of Schedule E of the Bombay Sales Tax Act, 1959:

Given the conclusion that Nycil powder is a medicine under entry 13 of Schedule C, the question of whether it falls under the residuary entry 22 of Schedule E does not arise.

Conclusion:

The High Court answered the question by concluding that Nycil Medicated Powder is "medicine" covered by entry 13 of Schedule C to the Act. The opponent-Commissioner of Sales Tax was ordered to pay the costs of the reference to the assessee-firm and bear his own. The reference was answered accordingly.

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