TaxTMI 
TaxTMI 
2026 (3) TMI 744
X X X X Extracts X X X X
X X X X Extracts X X X X
....ort question to be answered in both these appeals is whether the following 18 goods manufactured by the appellant are Patent and Proprietary Ayurvedic [P&P] preparations as asserted by the appellant or cosmetics as held in the impugned orders. (i) Shabase (ii) Shanaz Forever Root Marrow Base (iii) Shanaz Forever Vegetable Exfoliating Dermabrasive powder (iv) Shanaz Forever Thermal Mini Face Lift (v) Shagrain (vi) Shapeel (vii) Sharose (viii) Shalmond (ix) Shawhite (x) Shamoon (xi) Shaface Plus (xii) Shatreat Plus (xiii) Flower Power Shatreat (xiv) Vegpeel (xv) Flower Power Vegpeel (xvi) Shacomplex (xvii) Shamarrow (xviii) Shapack Mix 3. Consequently, the questions to be answered are whether the demand of duty and penalty can be sustained or not. Submissions on behalf of the appellant 4. Learned counsel for the appellant made the following submissions: (i) The department wrongly classified the goods which are ayurvedic medicaments (classifiable under Chapter 30) as cosmetics and soap under chapter 33 &34 o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hich is impugned in Excise Appeal No. 51016 of 2025. (ix) All the disputed goods manufactured by the appellant were P&P Ayurvedic Medicines. The active ingredients of these goods are prescribed in Authoritative Ayurvedic Texts. Other than the active ingredients, these products only contain only permitted preservatives, stabilizers, excipients/base material & stabilizers like starch, lactose and filling agents like sodium lauryl sulphate, liquid paraffin, etc. (x) The primary function of these products is to cure a particular medical condition recognized as ailment/ disease in Ayurveda and also in Allopathy. The medicinal properties of the products are mentioned on their labels. (xi) The Commissioner rejected the technical study report submitted by the appellant but failed to bring any test report to establish that the products have no medicinal characteristics. (xii) Even in trade parlance, these were known as ayurvedic medicines. (xiii) Even if the classification is decided against the appellant, it is only a matter of difference of opinion regarding the classification of the goods and no penalty can be imposed on the appellant. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uted products all show that they are cosmetics with some ayurvedic ingredients; they were packed, marketed and priced as premium personal care or beauty products with no reference to diseases. (ix) In view of the above, the impugned order is correct and proper which may be upheld and the appeal may be dismissed. Findings 6. We have considered the submissions advanced by both sides and perused the records. 7. We have also carefully gone through the detailed table submitted by the learned counsel giving the active ingredients of each of the products in dispute, the specific properties of each active ingredient, the authoritative text in which the ingredient is mentioned and the text of the authoritative book. The table also indicates the manufacturing licence for each product obtained under the Indian System of Medicine(ISM). None of these have been disputed by the learned authorized representative of the Revenue. We, therefore, conclude that the products were manufactured from the ingredients mentioned in the table and were manufactured under a licence under the ISM. 8. The reasons given in the impugned order of the Commissioner of CGST, Dehradun to hold that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ve books of Ayurvedic, Siddha and Unani Tibb system of medicine, specified in the First Schedule; (h) "patent or proprietary medicine" means, - (i) in relation to Ayurvedic, Siddha or Unani Tibb systems of medicine all formulations containing only such ingredients mentioned in the formulae described in the authoritative books of Ayurvedic, Siddha or Unani Tibb systems of medicine specified in the First Schedule, but does not include a medicine which is administered by parenteral route and also a formulation included in the authoritative books as specified in clause (a); (ii) in relation to any other systems of medicine, a drug which is a remedy or prescription presented in a form ready for internal or external administration of human beings or animals and which is not included in the edition of the Indian Pharmacopoeia for the time being or any other Pharmacopoeia authorised in this behalf by the Central Government after consultation with the Drugs Technical Advisory Board constituted under section 5; 10. Since the products also contain excipients, the Commissioner reasoned that the goods do not qualify to be called Ayurvedic PP medicines. The case of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 33 of the Central Excise Tariff which is as under : "Note 2. Heading Nos. 33.03 to 33.07 apply, inter alia, to products, whether or not mixed (other than aqueous distillates and aqueous solutions of essential oils), suitable for use as goods of these headings and put up in packings with labels, literature or other indications that they are for use as cosmetics or toilet preparations or put up in a form clearly specialized to such use and includes products whether or not they contain subsidiary pharmaceutical or antiseptic constituents, or are held out as having subsidiary curative or prophylactic value." 24. On the basis of this Note it was argued that even if a product had some curative or prophylactic value, it will still be cosmetic. We cannot accept this argument. The learned counsel has overlooked the use of the word 'subsidiary' in the said note from which it follows that a subsidiary curative or prophylactic use will not convert a cosmetic into medicament. We have tried to illustrate this by giving the example of bald man treating his baldness by use of Ayurvedic product. The curative use of the product is primary in that example and not subsidiary. The su....