Case Law Details
Commisssioner Of Customs, Central Excise And Service Tax Vs Ashwani Homeo Pharmacy (Supreme Court of India)
Supreme Court held that Aswini Homeo Arnica Hair Oil being manufactured and marked as Homeopathy medicine is classifiable under Chapter 30 of the First Schedule to the Central Excise Tariff Act and cannot be branded as a cosmetic.
Facts- The Adjudicating Authority held that the product in question, known as “Aswini Homeo Arnica Hair Oil”4 could not be classified as ‘medicament under Tariff Item 3003 90 14 or under any item stated in Chapter 30 of the First Schedule to the Central Excise Tariff Act, 19855-6; and that the product in question, being “Hair oil”, was required to be classified as ‘cosmetic’ under Tariff Item 3305 90 19. Accordingly, the Adjudicating Authority confirmed the demand to the tune of Rs.2,72,14,266/- on the respondent for the differential duty payable in terms of Section 11-A (10) of the Central Excise Act, 19447; ordered payment of interest on the said differential duty in terms of Section 11-AA of the Act of 1944; and imposed penalty in the sum of Rs.54,00,000/- under Rule 25 of the Central Excise Rules, 2002.
However, the appeal preferred by the respondent was allowed by the Tribunal by its impugned order dated 31.01.2018 and the aforesaid order dated 16.10.2015 passed by the Adjudicating Authority was set aside. The Tribunal held that the product in question, AHAHO, fell in the category of ‘medicament’ and hence was rightly classified under Chapter 30 of the First Schedule to the Act of 1985.
Conclusion- In common parlance, the product in question would be approached essentially for its claimed medicinal qualities and not as another hair oil. This aspect, in our view, is itself sufficient to reject the contentions of the appellant and the observations of the Adjudicating Authority. The Tribunal has rightly dealt with the matter in accordance with the law applicable to the facts of the present case.
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