Bulk drug exemption for Cimetidine upheld where pharmacopoeial standards were met despite later Indian Pharmacopoeia inclusion.

Cimetidine imported for countervailing duty purposes was treated as a bulk drug conforming to pharmacopoeial standards and therefore eligible for exemption under Notification No. 234/82-C.E. The notification covered bulk drugs and medicines, and its explanation extended to chemicals or biological products conforming to pharmacopoeial standards and used for diagnosis, treatment, mitigation or prevention of disease. Recognition in accepted pharmacopoeial reference works and use as a single-ingredient formulation supported eligibility. Inclusion in the Indian Pharmacopoeia only from 1-1-1985 was not enough to deny the exemption, because the notification was not limited to Indian Pharmacopoeial standards.

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Issues: Whether Cimetidine imported for levy of countervailing duty qualified as a bulk drug conforming to pharmacopoeial standards and was therefore eligible for exemption under Notification No. 234/82-C.E.

Analysis: The notification exempted bulk drugs medicines not elsewhere specified, and its explanation treated as bulk drugs those chemicals or biological plant products conforming to pharmacopoeial standards and used for diagnosis, treatment, mitigation or prevention of diseases. Cimetidine was shown to be included in recognised pharmacopoeial reference works and described as a drug used in the treatment of gastric and duodenal ulcer and related conditions. The fact that it was included in the Indian Pharmacopoeia only from 1-1-1985 was held insufficient to deny exemption, because the notification did not confine eligibility to Indian Pharmacopoeial standards. The material also showed use of Cimetidine as a single-ingredient formulation.

Conclusion: Cimetidine was held to be a bulk drug conforming to pharmacopoeial standards and was entitled to exemption for countervailing duty purposes under Notification No. 234/82-C.E., in favour of the assessee.

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