TaxTMI 
TaxTMI 
TaxTMI 
2007 (7) TMI 634
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....ry (excluding 'Agarbatties' 'Dhoop' and 'Loban') cosmetics, including took paste 'Manjan', Comb, brushes, perfumed hair oil, razor and other shaving articles but excluding razor blades. 5. The question as to whether a particular product is a drug or medicine or medicinal preparation or pharmaceutical preparation or a cosmetic has come up before the courts from time to time. Such cases have arisen under the different Acts and Taxing Statutes. 6. In the case of B.P.L. Pharmaceuticals Limited v. Collector of Central Excise Vadodara 104 STC 164, the issue before the Supreme Court was about the classification of the product marketed under the brand name "Selsun" under the Central Excise Tariff Act, 1985. According to the manufacturer B.P.L. Pharmaceutical Limited, the product "Selsun" was a medicine having anti-fungal and anti-seborrhoeic properties and was used as a detergent medium for the treatment of dandruff on the scalp, while according to the revenue, the said product was a cosmetic. The Supreme Court having regard to the preparation label, literature, character, common and commercial parlance understanding and the earlier decisions of the Centra....
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....sed for treatment of headache, eye problem, night blindness, reeling, head weak memory, hysteria, ammenesia, blood pressure, insomnia etc. The dosages required are also set out on the label. The product is registered with Drug Controller and is being manufactured under a drug licence. 9. Similarly, dealing with the question as to whether the product 'Himtaj Oil' is classifiable as Ayurvedic medicament or perfumed hair oil under the Central Excise Tariff Act, 1985, the Supreme Court referred to the case of Banphool Oil (cited supra) and held thus: 5. At this stage it must be mentioned that in this Civil Appeal the question of classification relates to "Himtaj Oil". On board along with this Appeal were a number of other Appeals which related to classification of "Bhanphool Oil". The arguments of learned Additional Solicitor General, Mr. Raju Ramachandran, in this Appeal were based upon the submissions made in respect of "Bhanphool oil". It was submitted that if the submissions regarding "Bhanphool oil" are accepted by this Court then on the same reasoning it would have to be held that "Himtaj oil" was not an Ayurvedic medicament. Reliance was also placed upon the authority ....
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.... of time. Thirdly, it was held that the Commissioner had found that the packing of the products would indicate that the products were cosmetics and not medicines or drugs since it depicted 'a lady with black flowing hair' and other similar images. 5. The decision of the Tribunal is unsustainable on the reasoning given. A product may be medicinal without having been prescribed by a Medical Practitioner. It was also not necessary for a person manufacturing medical products to claim classification under Tariff Heading 3303.03 without establishing that the products had in fact been tested on patients in controlled situations or that the outcome had not been tested for effectiveness. This would be particularly true in the cases where the products are claimed to be based on traditional ayurvedic formulae. 6. The appellant has drawn our attention to the composition of the six products and the uses in respect of each of these six products. This has not been doubted by the Tribunal nor indeed by the Departmental authority. The composition and the curative properties being admitted, it was not open either to the Department or the Tribunal to hold that the items were cosmetics merel....
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....ase of L.M. Rajappachetty and Brothers v. Commissioner of Commercial Taxes in Karnatka was seized with the question whether Herbs/roots/barks of trees could be regarded as medicinal and pharmaceutical preparations falling under Entry 41 of the Second Schedule to the Kamataka Sales Tax Act, 1976. The Division Bench of the Kamataka High Court held that an interpretation of any entry in a sales tax law should be given the same meaning which it has at common parlance and herbs/roots/barks at common parlance are drugs/medicine, but not medicinal preparations and, therefore, not covered by Entry 41 of the Schedule of the Karnataka Sales Tax Act. 15. The question as to whether 'Roshan Shital Tail' was a medicine or hair oil for the purposes of Uttar Pradesh Sales Tax Act, 1948 fell for consideration before the Single Judge of Allahabad High Court in the case of Commissioner of Sales Tax v. Raj and Co. (1986) 62 STC 76. The Single Judge held that at Entry 26(a) of notification referred to hair tonic as well. The preparation of the hair tonic may have several medicinal properties, yet the 'hair tonic' has been described by the notification as an item of 'cosmetics' ....
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....ot a "medicament". It is neither prescribed by any doctor nor obtainable from the chemist or pharmaceutical shops in the market. 17. In the case of Dabar India Limited v. Assistant Commissioner and Ors. (2007) 5 BST 190, the West Bengal Taxation Tribunal held that 'hajmola candy' was a confectionery as is understood in common parlance and not a medicine. 18. Having surveyed the aforesaid decisions, in our considered view, while deciding the question as to whether the product is a drug or medicine or medicament or pharmaceutical preparation or a cosmetic or a perfumery oil, the Court has to have regard to the nature of the article, the ingredients thereof, the uses to which they are ' put with specific reference to the extra information, as to how the goods are treated in the market as such, the literature and whether the manufacturer of the goods applied for a license under the Drugs and Cosmetics Act, 1940 as a drug or medicine and the same having been obtained, and then the goods are marketed as such. Surely, the preparation label, literature, character, common and commercial parlance understanding with the goods and the manufacture of the product after procuring ne....
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....l. Sandalwood Oil : q.s. Absolute Alcohol I.P. : 1% v/v. Osopropyl Myristate BPO : 0.05 ml. Neem Oil I.P. : 0.05 ml. Appropriate overages of vitamis added. 22. That both the aforesaid products namely, "Keo Karpin Hair Vitalizer" and "Keo Karpin Baby Oil" are manufactured as per the composition approved by the Directorate of Drugs Control has not been questioned. 23. In other words, the products 'Keo Karpin Hair Vitalizer' as well as 'Keo Karpin Baby Oil are being manufactured by the respondent No. 1 after obtaining requisite permission and license under the Drugs and Cosmetics Act, 1940 as a medicinal preparation and these goods are marketed by them as such. A look at the aforesaid composition would show that in 'Keo Karpin Hair Vitalizer', there is no element of hair oil and what it contains is the various medicines like keratin Hydrolysate, D-Panthenol IP, Biotin, resorcininl IP. 66 etc. Similarly, 'Keo Karpin Baby oil' has ingredients of medicines like isopropyl myristate etc. According to the respondent No. 1, Keo Karpin Hair Vitalizer' prevents untimely fall of hair and helps in removal of dandr....