Drug exemption under notification cannot be denied by adding an actual end-use or marketing requirement not stated in the text.

Goods established as pharmacopoeial grade, non-proprietary drugs were held eligible for exemption under Notification No. 55/75-C.E. because the notification did not require proof that they were marketed as drugs or actually used as drugs. The end-use condition was treated as relevant only for drug intermediates that may also function as chemicals in allied industries, not for goods already classified as drugs. An additional marketing or end-use requirement therefore could not be read into the notification to deny relief, and the assessee was entitled to exemption and consequential refund relief.

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Issues: Whether goods admittedly classifiable as drugs were entitled to exemption under Notification No. 55/75-C.E. without any additional condition of proof that they were marketed or actually used as drugs.

Analysis: The goods were found to be pharmacopoeial grade and non-proprietary, and therefore drugs. The exemption notification was held to contain no requirement that such drugs must be shown to have been marketed as drugs or that the importer must establish actual end-use. The condition relating to end-use was treated as relevant only in the case of drug intermediates, which may also serve as chemicals in allied industries, and not for goods already established as drugs. The additional condition imposed in the appellate order was therefore beyond the scope of the notification.

Conclusion: The goods were covered by Notification No. 55/75-C.E., and no end-use or marketing condition could be imposed for denial of the exemption; the relief was thus in favour of the assessee.

Final Conclusion: The assessee was held entitled to consequential refund relief, and the departmental appeals failed.

Ratio Decidendi: Where imported goods are found to be drugs, exemption under the relevant notification cannot be denied by adding a condition of actual marketing or end-use unless the notification itself expressly requires it.

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