Measured-doses test governs medicament classification; bulk liquid paraffin falls under petroleum oil heading, with exemption issue remanded.

Liquid paraffin (heavy) I.P. packed in bulk drums was held not to qualify as a medicament under Heading 30.03 because Chapter Note 2(i) requires an unmixed product to be actually put up in measured doses, or in retail or hospital packing; a bulk container holding an aggregate quantity of doses does not satisfy that test. The product was therefore classifiable under Heading 27.10 as a petroleum oil-based product. The claim for exemption under Notification No. 242/88-C.E. required fresh factual examination, so the exemption issue, along with limitation and penalty, was remanded for de novo adjudication.

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Issues: (i) Whether liquid paraffin (heavy) I.P. packed in bulk drums containing an equivalent quantity of adult doses was classifiable as a medicament under Heading 30.03 of the Central Excise Tariff Act, 1985 or under Heading 27.10. (ii) Whether the assessee's claim to the benefit of Notification No. 242/88-C.E. dated 17-8-1988 required de novo consideration, along with the connected questions of limitation and penalty.

Issue (i): Whether liquid paraffin (heavy) I.P. packed in bulk drums containing an equivalent quantity of adult doses was classifiable as a medicament under Heading 30.03 of the Central Excise Tariff Act, 1985 or under Heading 27.10.

Analysis: Chapter Note 2(i) of Chapter 30 contemplates an unmixed product only where it is put up in measured doses, or in packing for retail sale, or in packing for use in hospitals. The bulk drum in question was neither retail packing nor hospital packing. The expression "measured doses" requires doses that are already measured and put up as such, not a bulk quantity from which doses must be measured out at the time of repacking or use. A container holding a quantity equal to 6900 doses is therefore only a bulk quantity corresponding to doses, not a packing of measured doses. The product being a petroleum oil based product also fell within Heading 27.10.

Conclusion: The product was not classifiable under Heading 30.03 and was classifiable under Heading 27.10, against the assessee.

Issue (ii): Whether the assessee's claim to the benefit of Notification No. 242/88-C.E. dated 17-8-1988 required de novo consideration, along with the connected questions of limitation and penalty.

Analysis: The plea for exemption could be raised in resistance to the demand and had to be independently examined by the adjudicating authority. Since entitlement to the notification depended upon the nature of the inputs and related factual verification, the matter required readjudication. The questions of limitation and penalty were also left to be considered afresh in the same proceedings.

Conclusion: The exemption plea and the connected issues were remanded for fresh adjudication.

Final Conclusion: The classification appeal failed, while the demand proceedings were sent back for fresh decision on exemption, limitation, and penalty.

Ratio Decidendi: An unmixed product is a medicament under Chapter 30 only if it is actually put up in measured doses, retail packing, or hospital packing; a bulk container holding the aggregate quantity of doses does not satisfy that requirement.

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