In re Huvepharma Sea (Pune) Private Limited (CAAR Mumbai)
Facts and Background
M/s Huvepharma Sea (Pune) Pvt. Ltd. (IEC No. AACCH3097H) filed an application in Form CAAR-1 for advance ruling before the Secretary, Customs Authority for Advance Ruling (CAAR), Mumbai. The application, along with its enclosures, was received on 08.06.2026 under Section 28H(1) of the Customs Act, 1962.
The Applicant sought clarification on whether Integrated Goods and Services Tax (IGST) is leviable at 5% on the import of the bulk drugs Clopidol (VET) and Amprolium 100% (VET) under Serial No. 226 of Schedule I to Notification No. 9/2025-Integrated Tax (Rate) dated 17.09.2025.
The Applicant stated that it is engaged in the manufacture and supply of animal health and nutrition products, including antibiotics. The two products are described as high-purity Active Pharmaceutical Ingredients (APIs) intended exclusively for veterinary use, particularly for prevention and treatment of coccidiosis in poultry.
The Applicant submitted that Clopidol is a pyridinol derivative used as a coccidiostat, while Amprolium is used against coccidial parasites. The Applicant also referred to regulatory and pharmaceutical documentation, including import licences and registration certificates under Forms 10 and 41 under the Drugs Rules, 1945, the Indian Pharmacopoeia 2022, veterinary certifications, product packaging and recognition by CDSCO.
The relevant entry relied upon by the Applicant, Serial No. 226 of Schedule I to Notification No. 9/2025-Integrated Tax (Rate), covers “All Drugs and medicines including their salts and esters and diagnostic test kits; formulations manufactured from bulk drugs”, falling under Chapter 30 or any other Chapter, other than those specified at nil rate under Serial No. 113 of Notification No. 10/2025-Integrated Tax (Rate) dated 17.09.2025. Notification No. 9/2025 – Integrated Tax (Rate)
Applicant’s Submissions
The Applicant submitted that the products are veterinary-grade APIs with established therapeutic applications and are used exclusively for prevention and treatment of coccidiosis.
According to the Applicant, the products possess medicinal characteristics and are recognised as veterinary drugs through the applicable regulatory framework. The Applicant referred to Section 3(b) of the Drugs and Cosmetics Act, 1940, the Drugs Rules, 1945, pharmacopoeial standards, CDSCO recognition and veterinary certifications.
The Applicant further submitted that although the products are classifiable under Chapter 29, they are specifically covered by Serial No. 226 of Schedule I to Notification No. 9/2025-Integrated Tax (Rate), whereas Serial No. 36 of Schedule II covers Chapter 29 – all organic chemicals other than gibberellic acid at 18%.
The Applicant argued that Serial No. 36 is a general entry based on tariff classification, whereas Serial No. 226 is a specific description-based entry covering drugs and medicines. It relied on the principle that a specific entry prevails over a general entry.
The Applicant also relied upon Commissioner of Customs (Import), Mumbai v. Dilip Kumar & Company, 2018 (361) E.L.T 577 (S.C.), submitting that Notification No. 09/2025-Integrated Tax (Rate) is a rate/taxing notification rather than an exemption notification and that ambiguity in a taxing provision should be interpreted in favour of the taxpayer.
Reliance was also placed on Sunisung India Electronics Put. Lid. v. Princij2yl Commissioner of Customs 12025 (7) 7IVI1 229 .- CESTAT New Delhi’, as cited in the supplied material, for the submission that a rate notification is to be strictly construed and ambiguity is to be interpreted in favour of the taxpayer and against the Revenue.
Court/Authority’s Analysis and Findings
The ruling observed that Serial No. 226 specifically covers “All drugs and medicines” and is not confined to a particular tariff Chapter. It treated the entry as description-based rather than Chapter-based.
The ruling further observed that where goods are covered by both a general and a specific entry, the specific entry prevails over the general entry. Accordingly, APIs, though classifiable under Chapters 28 or 29 for tariff purposes, were considered appropriately covered under Serial No. 226 when they satisfy the description of drugs.
The ruling also observed that Notification No. 09/2025-Integrated Tax (Rate) is an IGST rate slab notification and not an exemption or concessional duty notification. It considered the Applicant’s reliance on Commissioner of Customs (Import), Mumbai v. Dilip Kumar & Company, 2018 (361) E.L.T 577 (S.C.) and applied the stated distinction between a taxing notification and an exemption notification.
Under Section 3(b) of the Drugs and Cosmetics Act, 1940, the ruling observed that the definition of “drug” is wide and inclusive and covers substances intended for use as components of a drug. It stated that APIs/bulk drugs, being pharmaceutical substances used as such or as ingredients in formulations, fall within that definition.
The ruling further observed that Serial No. 226 is broad and description-based, covering “All drugs and medicines” and extending to goods falling under “Chapter 30 or any Chapter”. It found that the evidence on record established that Clopidol (VET) and Amprolium 100% (VET) satisfy the conditions prescribed for the applicable rate, possess medicinal properties, are duly licensed as drugs under the applicable law and are not covered by the nil rate of IGST under Notification No. 10/2025-Integrated Tax (Rate). Notification No. 10/2025 – Integrated Tax (Rate)
Final Decision
The ruling concluded that Clopidol (VET) and Amprolium 100% (VET) qualify as “All Drugs” under Serial No. 226 of Schedule I to Notification No. 9/2025-Integrated Tax (Rate) dated 17.09.2025, provided that they are not specified against Serial No. 113 of Notification No. 10/2025-Integrated Tax (Rate) dated 17.09.2025.
Accordingly, the products were held eligible for the 5% IGST rate under Serial No. 226, subject to the stated condition.
The ruling records: “I rule accordingly.”
Cases Discussed
- Commissioner of Customs (Import), Mumbai v. Dilip Kumar & Company, 2018 (361) E.L.T 577 (S.C.)
- Sunisung India Electronics Put. Lid. v. Princij2yl Commissioner of Customs, 2025 (7) 7IVI1 229 .- CESTAT New Delhi
