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of <h1>Court classifies products as medicaments or cosmetics under Chapters 30 and 33</h1> <h3>PUMA AYURVEDIC HERBAL (P) LTD. Versus COMMISSIONER OF C. EX., NAGPUR</h3> PUMA AYURVEDIC HERBAL (P) LTD. Versus COMMISSIONER OF C. EX., NAGPUR - 2006 (196) E.L.T. 3 (SC), [2006] 145 STC 200 (SC), 2006 AIR 1561, 2006 (3) SCC 266 Issues Involved:1. Classification of products as medicaments or cosmetics under the Central Excise Tariff Act, 1985.2. Application of the twin test for determining product classification.3. Evaluation of evidence and burden of proof regarding product classification.4. Relevance of authoritative opinions and previous judgments in classification disputes.Detailed Analysis:1. Classification of Products:The core issue was whether the products manufactured by the appellant should be classified as medicaments under Chapter 30 or as cosmetics under Chapter 33 of the Central Excise Tariff Act, 1985. The classification impacts the rate of excise duty, with medicaments attracting nil duty and cosmetics attracting a higher duty.2. Application of the Twin Test:The judgment emphasized the twin test for classification:- Common Parlance Test: Whether the product is commonly understood as a medicament. If a product is used specifically for treating ailments and not for regular use, it is considered a medicament.- Ayurvedic Ingredients Test: Whether the ingredients are mentioned in authoritative Ayurvedic texts.The court noted that both tests are recognized by the Central Board of Excise and Customs and should be applied to determine the classification.3. Evaluation of Evidence and Burden of Proof:The appellant provided substantial evidence, including Ayurvedic texts, certificates from doctors, and opinions from Ayurvedic practitioners, to support the classification of their products as medicaments. The Collector (Appeals) relied on an opinion from the Directorate of Ayurveda, Maharashtra, which confirmed that the ingredients used in the products were described in Ayurvedic texts and were meant for treating skin diseases. The court highlighted that the burden of proving the correct classification lies with the revenue, which failed to provide any evidence to rebut the appellant's claims.4. Relevance of Authoritative Opinions and Previous Judgments:The court referenced several previous judgments where products with Ayurvedic ingredients were classified as medicaments. For instance:- C.C.E. v. Sharma Chemical Works: The burden of proof lies with the revenue to show that a product is not a medicament.- C.C.E. v. Pandit D. P. Sharma: Emphasized the common parlance test for classification.- Naturalle Health Product (P) Ltd. v. C.C.E.: Followed the twin test for classification.- Amrutanjan v. C.C.E.: Held that products with medicinal ingredients, even in small quantities, should be classified as medicaments.- BPL Pharmaceuticals v. C.C.E.: Classified a medicated shampoo as a medicament based on its therapeutic use.- Muller & Phipps (India) Ltd. v. C.C.E.: Classified Johnson Prickly Heat Powder as a medicament.- Dabur (India) Ltd. v. C.C.E.: Classified products with Ayurvedic ingredients as medicaments.Conclusion:The court concluded that most of the appellant's products should be classified as medicaments under Chapter 30, except for Puma Herbal Massage Oil, Puma Herbal Massage Oil for Women, and Puma Scalp Tonic Powder, which were classified as cosmetics under Chapter 33. The appeals were allowed for the products classified as medicaments, and the matter was remanded to the Assistant Collector for quantification of duty for the products classified as cosmetics. The appeals in Civil Appeals No. 1414-1416/2004 were dismissed.Products Classified as Medicaments:- Puma Neem Facial Pack (Neemal)- Puma Anti-Pimple Herbal Powder (Pimplex)- Puma Herbal Facial Pack (Herbaucare)- Puma Herbal remedy for Facial Blemishes- Puma Hair Tonic Powder (Sukeshi)- Puma Anti-Dandruff Oil (Dandika)- Puma Shishu Rakshan Tel- Puma Neem TulsiProducts Classified as Cosmetics:- Puma Herbal Massage Oil- Puma Herbal Massage Oil for Women- Puma Scalp Tonic Powder (Scalpton)
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