TaxTMI 
TaxTMI 
2007 (4) TMI 617
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....d with the classification of biotech products. 3. The said assessee was engaged in the manufacture of blood-grouping reagents and diagnostic and laboratory reagents. It had obtained registration on 10-9-99 for the manufacture and clearances of the following products : (1) Anti-A Mono Clonal (2) Anti-B Mono Clonal (3) Anti-Decoders Mono Clonal (4) Anti-Decoders Mono Clonal (5) Anti-Decoders 1g M Mono Clonal (6) Anti-Decoders 1g G Mono Clonal 4. The above six items are called Monoclonal Antibodies (for short, ''MABs'). They were classified by the assessee under Chapter sub-heading 3002.00 (Chapter Heading 30.02) of Central Excise Tariff Act (for short, 'CETA') whereas the Department classified the MABs under CSH 3005.90 (Chapter Heading 30.05) of CETA. The assessee classified MABs as "cultures of micro-organisms" whereas the Department classified the said MABs as "pharmaceutical products, not elsewhere specified or included". 5. The CEGAT (Tribunal), vide the impugned judgment, upheld the classification of MABs unde....
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.... xxx xxx 2. For the purposes of Heading No.30.02, the expression "modified immunological products" applies only to monoclonal antibodies (MABs), antibody fragments, antibody conjugates and antibody fragment conjugates." 10. We also quote herein below Chapter Heading 30.02 in entirety from the said HSN which reads as under : "30.02 - HUMAN BLOOD; ANIMAL BLOOD PREPARED FOR THERAPEUTIC, PROPHYLACTIC OR DIAGNOSTIC USES; ANTISERA AND OTHER BLOOD FRACTIONS AND MODIFIED IMMUNOLOGICAL PRODUCTS, WHETHER OR NOT OBTAINED BY MEANS OF BIOTECHNOLOGICAL PROCESSES; VACCINES, TOXINS, CULTURES OF MICRO-ORGANISMS (EXCLUDING YEASTS) AND SIMILAR PRODUCTS. 3002.10 - Antisera and other blood fractions and modified immunological products, whether or not obtained by means of biotechnological processes 3002.20 - Vaccines for human medicine 3002.30 - Vaccines for veterinary medicine 3002.90 - Other This heading covers : (A) Human blood (e.g., human blood in sealed ampoules). (B) Animal blood prepared for therapeutic, prophylactic or diagnostic uses Animal blood not prepared for such uses....
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....or ascites. (b) Antibody fragments - parts of an antibody protein obtained by means of specific enzymatic splitting. (c) Antibody and antibody fragment conjugates - enzymes (e.g., alkaline phosphatase, peroxidase or betagalactosidase) or dyes (fluorescin) covalently bound to the protein structure are used for straightforward detection reactions. (D) Vaccines, toxins, cultures of micro-organisms (excluding yeasts) and similar products. These products include : (1) Vaccines - preparations of microbial origin containing either viruses or bacteria suspended in saline solutions, oil (lipovaccines) or other media. These preparations have usually been treated to reduce their toxicity without destroying their immunising properties. The heading also covers mixtures (such as Diphtheria, Tetanus and Pertussis (DPT) vaccine) consisting of vaccines and toxoids. (2) Toxins (poisons secreted by bacteria), toxoids, crypto-toxins and anti-toxins, of microbial origin. (3) Cultures of micro-organisms (excluding yeasts). Th....
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.... catgut (processed collagen from the intestines of cattle, sheep or other animals); (b) natural fibres (cotton, silk, linen); (c) synthetic polymer fibres, such as polyamides (nylons), polyesters; (d) metals (stainless steel, tantalum, silver, bronze). The item also covers tissue adhesives such as those consisting of butyl cyanoacrylate and a dye; after application, the monomer polymerises and the product is therefore used in place of conventional suture materials for closing internal for closing internal or external wounds of the human body. The heading excludes non-sterile suture materials. These are classified according to their nature e.g. catgut (heading 42.06), silkworm put, textile yarns, etc. (Section XI), metal were (Chapter 71 or Section XV). (2) Sterile laminaria and sterile laminaria tents. This item is restricted to sterile laminaria and sterile laminaria tents (small lengths of algae, sometimes brown and with a rough grooved surface). They swell considerably on contact with moist substances and become smooth and flexible. They are therefo....
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....sp; xxx 5. to 8. xxx xxx xxx" 12. According to the assessee, MAB is produced by hybridoma technology in which hybrids (fused cells) are allowed to grow by multiplication in culture medium and in that process they secrete the antibodies. According to the assessee, these hybrids (fused cells) are micro-organisms and as they grow in culture medium, therefore, they are classifiable under CSH 3002.00 as "cultures of micro-organisms". In this connection, reliance is place on "Compendium of Transfusion of Medicine" by Dr. R.N. Makroo. In his book Dr. R.N. Makroo has stated that with advancement in biotechnology, hybridoma technology has made available a new source of reagents; that before the introduction ....
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.... According to the Department, HSN deals with human blood, animal blood prepared for diagnostic uses; antisera and other blood fractions and Modified Immunological Products (for short, 'MIP'), whether or not obtained by means of biotechnological process; vaccine, toxin, cultures of micro-organisms and similar products whereas Chapter Heading 30.02 of CETA does not deal with items like human blood and MIP which items are dealt with by HSN and, therefore, according to the Department, in the present case, one should not rely upon the Explanatory Note to HSN. 14. We find merit in the arguments advanced on behalf of the assessee. There is no dispute that MAB is a blood-grouping reagent. The question is : whether merely because MAB is a blood-grouping reagent, should it be classified under Chapter Heading 30.05 on account of Note No. 3(e) to Chapter 30 of CETA, even though MAB is a "culture of micro-organism" falling under CSH 3002.00 (Chapter Heading 30.02). It is well-settled that the width of the Heading under CETA cannot be expanded by reading Note 3(e) to Chapter 30. In our view, MAB is a "culture of micro-organism". It falls specifically under Chapter Heading 30.02 of CETA. MAB i....
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.... HSN, we have Chapter Heading 30.02 which refers to human blood; animal blood; "antisera and other blood fractions and MIP"; therefore, human blood is one item, animal blood is another item whereas "antisera, blood fraction and MIP" is the third item. Therefore, the third item forms one separate class. In that class we have MIP which includes MAB. Therefore, if one reads the third item as a separate class as "antisera and blood fractions" then abridgement of HSN entries by CETA cannot rule out MIP which includes MAB. Therefore, when HSN treats antisera, blood fractions and MIP including MAB as one class then there is no contradiction between Chapter Heading 30.02 of CETA and Chapter Heading 30.02 of HSN. Therefore, taking any view of the matter, HSN cannot be ruled out. 15. For the above reasons, we find merit in the civil appeal filed by the assessee (Civil Appeal No. 5322 of 2002) and, accordingly, we classify the above six items under Chapter Heading 30.02 of CETA. 16. Accordingly, the said civil appeal is answered in favour of the assessee and against the Department. C.A. Nos. 1953-1954/2003 - filed by the Department 17. The short question which needs to be decided ....
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....ccording to the Department, PTK is a refined antisera. As stated, antisera falls under Chapter Heading 30.02. In the circumstances, "antisera" is covered by Chapter Heading 30.02 and since it is covered by that Heading, Chapter Heading 38.22 will not apply. If one reads Chapter Heading 38.22, it becomes clear that there could be diagnostic or laboratory reagents which could fall under Chapter Heading 30.02 and also under Chapter Heading 38.22. However, if a diagnostic or laboratory reagent like antisera falls under Chapter Heading 30.02 then it stands excluded from Chapter Heading 38.22. 22. Before concluding we may record the statement made on behalf of M/s. J. Mitra & Co. Ltd. that they have closed down their business in producing the following two items, namely, Syphilis RPR (VDRL) and Salmonella Antigens. Hence, they do not seek to press the classification issue concerning the said two items. 23. Hence we answer C.A. Nos. 1953-54 of 2003, filed by the Department, in favour of the assessee and against the Department. 24. For the above reasons, the assessee succeeds on Item Nos. 1 to 9, mentioned at page No. 5 of the paper book in C.A. Nos. 1953-54/2003 and, therefore, t....
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....1. On this point we may state that the Adjudicating Authority had referred the matter for opinion to Dy. Chief Chemist who opined that the three items were "cultures of micro-organisms" and, therefore, they came under Chapter Heading 30.02 and not under Chapter Headmg 30.05. Apart from the question as to whether the Dy. Chief Chemist was or was not entitled to classify, the fact remains that the question as to whether the above produces are "diagnostic reagents" was not referred. 32. In this case we are concerned with classification of diagnostic reagent for vivo detection of T.B. mycobacteria. According to the Adjudicating Authority, these reagents are of mycobacterium origin but they are injected intradermally into the patient and, therefore, they are classifiable under Chapter Heading 30.05 (CSH 3005.90). According to the Department, the above three items are put up by the assessee for sale in measured doses and, therefore, they were classifiable under Chapter Heading 30.05. In this connection, reliance is placed on Chapter Note 3(d) to Chapter 30 which reads as under : "CHAPTER 30 PHARMACEUTICAL PRODUCTS Notes : l. to 2. xxx &nb....
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....ic reagents or whether they are in aid of diagnosis. 35. Now, coming to Item Nos. 1 to 15 of Annexure B, we quote herein below the said items which read as under : "ANNEXURE - 'B' Name of the products which will fall under chapter sub-heading 3822 Sr. No. Code No. Item Pkg. 1. 17401A Anti Sheep Hemolysin 5 ML 2. 19404 Chem. Control (Assayed) 5x3 ML 3. 19404A Chem. Control (Unassayed) 5x3 ML 4. 17405 Fraund's Adjuvant (Com) 10 ML 5. 17406 Guinea pig (Complement) 5x1 ML 6. 19408 Kahn VDRL + Va control 5 ML 7. 19409 Kahn VDRL - Va control 5 ML 8. 19444 Chem. Control Assayed Normal 5x3 ML 9. 19444A Chem. Control Assayed Abnormal 5x3 ML 10. 25907 R.A. Test (Latax Test) 10 T 11. 25907A R.A. Test (Latax Test) 20 T 12. 25934 C.R.P. (Latax Test) 20 T 13. 25947 ASO (Latax Test) 20 T 14. 25946B Austragen (Latax Test) 25 T 15. 25946C Austragen (Latax Test) 50 T" 36. According to the assessee, the above 15 items fall under Chapter Heading 30.02 as they are "blood fractions". This is not dispute....