2002 (12) TMI 397 - Commissioner - Central Excise

Issues Involved:
1. Classification of "Tampcol Herbal Hair Tonic" as a Siddha medicament or a cosmetic.
2. Validity of the Assistant Commissioner's order and subsequent appeals.
3. Consideration of therapeutic and prophylactic properties.
4. Relevance of drug licenses and authoritative texts on Siddha medicine.
5. Interpretation of CBEC Circulars and relevant case laws.

Detailed Analysis:

1. Classification of "Tampcol Herbal Hair Tonic" as a Siddha medicament or a cosmetic:
The appellant, M/s. Tamilnadu Medicinal Plant Farms and Herbal Medicine Corporation Ltd. (TAMPCOL), classified their product "Tampcol Herbal Hair Tonic" under Chapter heading 3003.39 as a medicament. The Assistant Collector initially classified it under sub-heading 3003.30 as a Siddha Medicament, citing its therapeutic properties and recognition by doctors, dealers, and users as a Siddha medicine. However, the department contested this classification, arguing that the product should be classified under heading 3305 as a cosmetic preparation for hair, attracting a higher duty.

2. Validity of the Assistant Commissioner's order and subsequent appeals:
The Commissioner (Appeals) set aside the initial classification and remanded the case for reconsideration, leading to a de novo adjudication by the Assistant Commissioner. The Assistant Commissioner, after considering various show cause notices and detailed submissions by the appellants, concluded that the product was perceived more as a cosmetic rather than a Siddha medicine, classifying it under Chapter 3305.10 as perfumed hair oil.

3. Consideration of therapeutic and prophylactic properties:
The appellants argued that the product had therapeutic and prophylactic properties, as detailed in authoritative Siddha texts and supported by certificates from doctors. They cited various case laws where products with medicinal properties, even if containing non-medicinal ingredients, were classified as medicaments. The Assistant Commissioner, however, was not convinced, stating that the product's properties were not exclusively therapeutic or prophylactic but also catered to hair care and beautification.

4. Relevance of drug licenses and authoritative texts on Siddha medicine:
The appellants presented a drug license and certificates from recognized authorities, including the Drug Controller and heads of Siddha departments, confirming the product as a Siddha medicament. They argued that these certifications should be binding on the department, as supported by various judicial precedents. The Assistant Commissioner acknowledged these certifications but emphasized the popular perception and advertising of the product as a hair care item.

5. Interpretation of CBEC Circulars and relevant case laws:
The CBEC Circulars 379/12/98-CX and 333/49/97-CX, along with various judicial decisions, were cited to argue that products with therapeutic claims and recognized as medicaments by authoritative texts should be classified under Chapter 30. The Tribunal's decisions in similar cases, such as "Himtaj Ayurvedic Udyog Kendra" and "Dabur India Ltd.," supported the classification of products with medicinal ingredients as medicaments, even if not manufactured strictly according to classical formulas.

Conclusion:
The appellate authority, after reviewing the facts, submissions, and relevant case laws, concluded that the "Tampcol Herbal Hair Tonic" is a Siddha medicament meriting classification under heading 3003.30 of the Central Excise Tariff Act, 1985. The order-in-original classifying the product under 3305.10 as a cosmetic was set aside, and the appeal was allowed with consequential relief as per law.

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