Specific tariff heading prevails for lactose; medicament classification and exemption fail without proof of special therapeutic presentation.

Lactose specifically named in Heading 1702.10 of the Customs Tariff Act was held classifiable there, because the assessee did not prove that the imported goods were a special homoeopathic medicament qualifying under Heading 3004.90. The certificates relied on were treated as unsupported, and the packing did not show measured doses or retail presentation required for the medicament heading. As the goods were not classifiable as medicaments, the exemption under Notification No. 58/85-Cus. dated 17-03-1985, which depended on that classification, was also unavailable. The tariff classification and denial of concessional treatment were therefore upheld.

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Issues: (i) Whether the imported goods described as homoeopathic medicine (single) sugar of milk were classifiable under Heading 1702.10 of the Customs Tariff Act, 1975 or under Heading 3004.90 of the Customs Tariff Act, 1975; (ii) whether the benefit of Notification No. 58/85-Cus. dated 17-03-1985 was available to the goods.

Issue (i): Whether the imported goods described as homoeopathic medicine (single) sugar of milk were classifiable under Heading 1702.10 of the Customs Tariff Act, 1975 or under Heading 3004.90 of the Customs Tariff Act, 1975.

Analysis: The classification turned on the tariff description, the chapter notes and the HSN explanatory notes. Lactose was specifically mentioned in Heading 1702.10, and Chapter Note 1(b) to Chapter 17 expressly kept chemically pure sugars other than sucrose, lactose, maltose, glucose and fructose outside the exclusion. The material produced by the appellants did not establish that the imported lactose was of a special grade used only as a homoeopathic medicament. The certificates relied upon were treated as unsupported bald statements, while the technical literature also described lactose as an inert substance used as a vehicle and as an item used in pharmacy generally. The packing also did not satisfy the indicia required for Heading 3004.90, since the goods were not shown to be put up in measured doses or in retail packs with the requisite indications for therapeutic or prophylactic use. The HSN notes were treated as persuasive support for this conclusion.

Conclusion: The goods were correctly classifiable under Heading 1702.10 of the Customs Tariff Act, 1975 and not under Heading 3004.90.

Issue (ii): Whether the benefit of Notification No. 58/85-Cus. dated 17-03-1985 was available to the goods.

Analysis: The exemption claim depended on the goods being classifiable as medicaments under Heading 3004.90. Once the goods were held to fall under Heading 1702.10 as lactose, the notification granting concessional treatment to goods of the relevant medicament heading could not be invoked. The later notification was treated only as clarifying the position regarding lactose and not as the basis for classifying the goods.

Conclusion: The benefit of Notification No. 58/85-Cus. dated 17-03-1985 was not available.

Final Conclusion: The tariff classification upheld by the lower authority stood confirmed, the exemption claim failed, and the appeals did not succeed.

Ratio Decidendi: Where a tariff heading specifically includes the goods by name and the assessee fails to establish the special attributes required for a competing medicament heading, classification must follow the specific entry; exemption dependent on the displaced heading then cannot be granted.

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