1996 (10) TMI 240

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....ay of recovery in cash or through debit in PLA in terms of Rule 57-I of the Central Excise Rules and imposing a penalty of Rs. 25 Lakhs thereupon. 2. The brief facts of the case are that the appellants are manufacturers of various pharmaceutical products and they had entered into agreements with the customers namely M/s. J. R. Sharma Overseas Ltd. and Agnall Traders. As per the agreement Paracetamol B.P. and Analgin B.P. were to be manufactured by the appellants and sold to these two customers above mentioned, which in turn exported the goods to foreign buyers. At the time of clearance of these two products for export excise duty was paid by the appellants @ 10% under sub-heading 3003.10 of the CETA, 1985 as Patent or Proprietary me....

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.... which indicated that Paracetamol B.P. and Analgin B.P. were bearing the mark of the buyer and bearing the Logo of the buyer and it is only after this material was considered that the classification lists filed during the relevant period were finally approved by the department and this classification list in turn was based upon the appellant's understanding of the law as it stood during the relevant period. [The Tribunal in the case of Astra Pharmaceuticals reported in 1987 (32) E.L.T. 720 had held that the distinctiveness in regard even to the name of manufacturer was also sufficient for the purpose of considering such medicine as a Patent or Proprietary medicine, relying in turn on the judgment of the Hon. Allahabad High Court in the case....

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....l. From the narration set out above it cannot be said that the appellants suppressed or concealed or mis-declared any material facts relating to the product so as to attribute any suppression or mis-declaration with intent to evade payment of duty. Not only did the classification list filed by them enclose therewith the sample of the product and the label and the cartons, the classification lists were approved only after this material was placed before the department and so the department, if it felt that the classification of the products as Patent or Proprietary medicines was not correct, was entitled in law to revise this classification and issue a demand within a period of six months backwards. The legal position as expounded by the jud....