TaxTMI 
TaxTMI 
1991 (1) TMI 306
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion 129(4) of the Customs Act and has set aside the order-in-original passed by the Assistant Collector of Customs and Central Excise, Indore. The Assistant Collector of Central Excise, Indore had allowed eleven refund claims of the appellants in respect of excess duties paid on Gallic acid NF 99.5% purity on the ground that the Gallic acid NF of pharmaceutical grade falls under sub-heading (13) of Heading 29.01/45 of the Customs Tariff and attracts basic customs duty of 60% ad valorem and is exempted from C.V. duty vide Notification No. 234/82-C.E., dated 1-11-1982 as amended. 2A. The learned Collector in the impugned order has held that there is no indication that the goods have prophylactic or therapeutic value and are used solely and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....as held that the salts and esters of the Gallic acid i.e. therapeutic category Gallic acid having specific therapeutic or prophylactic properties only would go under sub-heading (13). He further held according to note 3 of Chapter 29 Gallic Acid NF would go under sub-heading (10) and only salts and esters thereof, would qualify for classification under sub-heading (13). He also held that it was Rule 3(a) and not Rule 3(c) of the Interpretative Rules which would apply to the facts of the case. 3. The appellants in these appeals have contended that the said finding of the Collector (Appeals) is erroneous and the conclusions are not sustainable. It is their contention that the goods being of NF grade (i.e. pharmacopoeial grade) would clearl....
X X X X Extracts X X X X
X X X X Extracts X X X X
....c Category (Veterinary) - The Veterinary staff has provided short descriptive phrases detailing the major veterinary applications. 5. On the basis of these explanatory notes, the appellants have submitted that the details pertaining to the goods have been collected independently by experts of those lines and the different uses given against their imported goods should not have in any way compelled the learned Collector to have rejected the authority of Merck Index. It is their contention that the Merck Index clearly shows that Gallic Acid itself has therapeutic use and value. In the Merck Index, under the monograph "Gallic Acid" and under sub-heading "Therapeutic category", it is mentioned "Astringent, styptic". Therefore, "Gallic Acid N....
X X X X Extracts X X X X
X X X X Extracts X X X X
....veloper, in tanning, in testing for free mineral acids, dihydrozyacetone and alkaloids. Therap Cat - Astringent, styptic Therap Cat (vet) - Has been used as intestinal astringent" 5. The reference to Gallic acid in Condensed Chemical Dictionary, 11th Edition at page 550 is also relied upon which is as under - "3,4, 5. Triphydroxbenzoic acid) CAS 149-91-7 C6 H7 (OH)3 C02 H. Properties - Colourless or slightly yellow crystalline needles or prisms, soluble in alcohol and glycerol sparingly soluble in water and ether; d 1,964 mp 222-2400. Derivation - Action of mold or solutions of tannin or by boiling the latter with strong acid or caustic soda. Use - Photography, Writing ink, dyeing, manufacture of phrogallol, tanning age....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ic acid should be used solely or predominantly as drug to qualify for classification and for benefit as claimed. As Gallic acid is not USP and not predominantly used as a drug, the appellants are not entitled for relief and the impugned order is sustainable. 10. We have carefully considered the submissions made by both the sides and perused the records. The learned Collector has proceeded on an erroneous presumption in this matter. A chemical may have several uses but that by itself will not get disqualified for classification or for the benefit under the notification. So long as the imported goods are pharmaceutical chemicals having prophylactic or therapeutic value and the material imported has been used solely or predominantly as drug....