TaxTMI 
TaxTMI 
2016 (4) TMI 600
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....onfirmed a total demand of Rs. 12,31,65,919/-, along with interest, and also imposed equivalent penalty under Rule 173Q(1) of the erstwhile Central Excise Rules, 1944. In addition 25 kg. of the impugned goods, valued at Rs. 1826.88 were also confiscated and allowed redemption on paying Rs. 2,142/- as redemption fine. 2. Shri Lakshmi Kumaran (Advocate) and Shri Ravi Raghavan (Advocate) appeared on behalf of the appellant. It was argued by Shri Lakshmi Kumaran that appellant is manufacturing Chyawanprash Awaleha with Ashtawarg and Chyawanprash Awaleha Special as per the ingredients specified in the authoritative Ayurveda Texts, read with the permissible substitutes also allowed by the authoritative Texts. That these impugned products are correctly classifiable under CETH 30.03 as an Ayurvedic Medicine and not as food supplement/tonic under CETH 21.07/21.08 done by the Adjudicating authority because as per Chapter Note 1(a) of the Chapter 21 of CETA, 1985 products of Chapter 30 are not covered under Chapter 21. 2.1 That as per The Ayurvedic Formulary of India Part-I Chyawanprash is made up of 48 ingredients. That appellants product also contains the same ingredients but sometimes al....
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....le Ltd. vs. CCE, Mumbai-II- [2002 (146) ELT 418 (Tri-Mumbai)] (Affirmed by Supreme Court) (iv) CCE, Calcutta vs. Sharma Chemical Works - [2003 (154) ELT 328(SC)] (v) Naturalle Health Products (P) Ltd. vs. CCE, Hyderabad- [2003 (158) ELT 257(SC)] (vi) Puma Ayurvedic Herbal (P) Ltd. vs. CCE, Nagpur- [2006 (196) ELT 3(SC)] (vii) CCE, Delhi vs. Ishaan Research Lab (P) Ltd.- [2008 (230) ELT 7(SC)] (viii)BCI No.33-GL-30-94 dt.20.04.1994 Issued by Bhubaneswar Commissionerate (ix) Extracts of Authoritative Texts - The Ayurvedic Formulary of India (First Edition), Dravyaguna Vijnava & Agnivesa's Caraka Samhita 3. Shri S.C. Jana (Special Counsel) appearing on behalf of the Revenue argued as follows:- (i) That all the ingredients used in appellants two products are not Ayurvedic in as much as the three ingredients Bridhi Coarge Powder, Kshir Kokoli Coarge Powder and Mahameda Coarse Powder are admittedly not mentioned in the list of ingredients for Chyawanprash. That the substitute ingredients used in the products are not acceptable to hold the products as Ayurvedic medicaments as "Bhava Prakash" is not specified in the first Schedule to the Drugs & Cosme....
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....ealth tonic and also that the Drug Control Authorities licence is not valid for the certain periods of demand. It is observed form the wrappers used on the impugned products that the same describe, interalia, the product as Ayurvedic Medicine. Drug Control licence No.AL-529-M is indicated on the wrappers and dosage to be taken is also specified on the wrapper. Besides there is following description given on the packs:- "Dabur Chyawanprash is prepared strictly to a centuries old ayurvedic recipe from 49 totally natural and fresh ingredients, including amla, the richest source of Vitamin-C. It works on your immune system, your body's vital internal defence mechanism. Protecting you against everyday infections particularly coughs & colds, reducing stress related symptoms and adding to your general well-being. Because Dabur Chyawanprash is totally natural with no artificial flavouring, it is safe and completely free from side effects. It is especially good from growing children". 4.1 Though the above details given on the product does not say that the impugned products are food supplements or health tonic but Adjudicating authority in para -3.4(iv) to (ix) of the Order-in-Original da....
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....ed as a food supplement or health tonic in common parlance. Adjudicating authority has also held that substitutes used as per Bhava Prakash are not permissible in Ayurvedic Medicine. In this regard it is observed from legal Notice No.5 of the Ayurvedic Formulary of India (First Edition); published by Govt. of India, Ministry of Health and Family Planning, Department of Health; that use of substitute drugs (pratividhis dravyas) wherever the original drugs are not available; is permissible in Ayurvedic classics and practice. The substitutes used as per Bhavya Prakash were duly declared by the appellant before the Drug Control Authorities. After taking into consideration all the facts into consideration Drug Control Authorities granted/extended the licence of the appellant for manufacture of Ayurvedi medicine. The argument of the Revenue, that for the period where no extension of the Drug Control licence is available the products should be classified as food supplements/tonic is beyond reasoning. If a product is considered as an ayurvedic drug then it remains an ayurvedic drug for all periods when the ingredients used are the same. Revenue's apprehension that for some period of manufa....
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....perties the products manufactured by the appellant also acts as a tonic for general well being of human body. In the case of CCE, Calcutta vs. Sharma Chemical Works [2003(154) ELT 328 (SC)] Hon'ble Apex Court held as follows:- "12. We have heard the parties and considered the submissions made by them. We have also read the opinion of the majority Bench and the minority opinion of the Technical Member. It is a settled law that the onus or burden to show that a product fall within a particular Tariff Item is always on the revenue. Mere fact that a product is sold across the counters and not under a Doctors prescription, does not by itself lead to the conclusion that it is not a medicament. We are also in agreement with the submission of Mr.Lakshmikumaran that merely because the percentage of medicament in a product is less, does not ipso facto mean that the product is not a medicament. Generally the percentage or dosage of the medicament will be such as can be absorbed by the human body. The medicament would necessarily be covered by fillers/vehicles in order to make the product usable. It could not be denied that all the ingredients used in Banphool Oil are those which are set out....
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....learned Spl.Counsel of the revenue. 4.6. It has also been taken up by the appellant in the arguments and grounds of appeal that classifying their products under CETH 21.07/21.08 will be discriminating as similar Chyawanprash manufactured by Sri Baidyanath Ayurved Bhavan, Mayer India Ltd. etc. have been considered by the department as Ayurvedic medicaments. It is observed from the case records that appellant in paras - 2.3.8.1 and 2.3.8.1 of the Order-in-Original dated 31.12.2010 brought to the notice of Adjudicating authority that the same products in other units of the appellant at Baddi, Sahibabad and Rudrapur has been considered as Ayurvedic medicines. No findings have been given by the adjudicating authority to counter the claim of the appellant. It is also relevant to mention that Chyawanprash in the case of Baidyanath Ayurved Bhavan Pvt.Ltd. vs. CCE, Kolkata (supra) was also manufactured at Patna, Jhansi, Nagpur, Naini as Ayurvedic Medicament. From this case law also it is observed that Chyawanprash Special was being made under Drug Control Authority Licence as is the case with the present appellant. The dispute was only under CETH 3003.31 claimed by that appellant and CETH ....