2017 (1) TMI 28

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.... and written submissions inter alia submits as under: i. The appellant did not pay duty on the subject itmes namely Nascopine B.P. and Papavarine S.R. as the same are derivatives of Opium and thus exempted from duty by virtue of Chapter note 9 of Chapter 29 of Central Excise Tariff. ii. Existing system of indirect taxation under the Constitution of India empowers only the State Governments to levy duty on opium and narcotics under entry no. 51 of List II of VII Schedule to the Constitution of India where it exempts the duty on these items by the Central Govt. by virtue of entry no.84 of List 1 of the 7th Schedule to the Constitution of India. 5. The Ld. AR for the Revenue reiterated the findings given in the impugned order. In addition the Ld. AR submits as under: i. The products Noscapine B.P. and Papavarine S.R. are non Narcotic products, therefore, are under Chapter Heading No. 2939.1900 of Central Excise Tariff, which attract Central Excise duty. ii. The products Noscapine B.P. and Papavarine S.R. are non-Narcotic products and are classifiable under Chapter Heading No. 2939.1900 of Central Excise Tariff Act, 1985 and as no exemption is available to them, the appellan....

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....drugs and narcotic are as per Section 2 of the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 (16 of 1955). Therefore, let us refer to Section 2 of the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 (16 of 1955). The relevant provisions of Section 2 of the said Act are reproduced below: Section 2 Definitions- In this Act, unless the context otherwise requires,- i. Opium means- (1) the capsules of the poppy (Papaver somniferum L), whether in their form original form or cut, crushed or powdered and whether or not juice has been extracted therefrom; (2) the spontaneously coagulated juice of such capsules which has not been submitted to any manipulations other than those necessary for packing and transport; and (3) any mixture, with or without neutral materials, of any of the above forms of opium, and includes any derivative of opium; (bb) derivative of opium means- i. medicinal opium, that is, opium which has undergone the processes necessary to adapt it for medicinal use; ii. prepared opium, that is any product of opium obtained by any series of operations designed to transform opium into an extract suitable for smoking, and the dross or othe....

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....wo items. Though the subject items may be belonging to the categories of alkaloid of opium and their derivatives yet they cannot be called derivative of opium a such as per the definition given in Section 2 (bb) of Medicinal and Toilet Preparations (Excise Duties) Act, 1955 (16 of 1955). Once these two items are found not containing alcohol, opium, Indian hemp or other narcotic drugs and narcotics as per Chapter note 9 to Chapter 29 of Central Excise Preparations Act, they cannot be excluded from the Chapter 29 of Central Excise Tariff; and appropriate classification for the subject items would be Chapter sub-heading, 2939.1900 as per the description given there. The description the said chapter heading is below: 2939 Vegetable Alkaloids, natural or reproduced by synthesis, and their salts, ethers, esters and other derivatives - Alkaloids of opium and their derivatives; salts thereof: 2939 1100 --Buprenorphine (INN), and salts thereof 2939 1900 --Other And the said subject items accordingly would be liable to duty of Central Excise. 9.3. The impugned order also discusses the issue in detail referring to Chapter note as well as to relevant definition (s) given in Medicinal....

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....nce the alkaloid is one of nature s useful antispasmodics, it soon found its way into the physician s arsenal, and serves in cases when it is necessary to cause relaxation of smooth muscle. Papaverine, in the form of its hydrochloride, is administered intravenously in treating pulmonary arterial embolism and orally or by injection in treating renal or biliary colic. It is not effective in abolishing neutrally excited spasms and has undesirable side-effects, such as causing prolonged fall in arterial blood pressure, when the intestinal tract is relaxed. This is due to lack of selectivity in relaxing smooth muscle. Despite such undesirable side-effects, nature does not produce enough papaverine to meet the demands of medical practice, and many syntheses have been devised for preparation of this alkaloid. Since this structure is relatively simple, which considerably simplify the preparation of papaverine. Synthetic papaverine has out-distanced the naturally occurring alkaloid in volume of production. From the above it is clear that the Noscapine B.P & Papavarine S.R were non pehnantherene (Antherium) alkaloid and they were non Narcotic products. Therefore, both the products are no....