2004 (6) TMI 507 - AT - Central Excise

Summary

Issues: Classification of product 'shower to shower prickly heat powder' as medicament under chapter heading 30.03 vs. cosmetic and toilet preparation under chapter heading 33.04 of CETA.

In this case, the appellant contended that the product, containing pharmacopoeial ingredients like Boric Acid, Salicylic Acid, and Zinc Oxide, is used for preventing the disease 'prickly heat.' They argued that the ingredients act medicinally, with Salicylic Acid as a keratolytic agent, Boric Acid as a bacteriostatic or fungicide, and Zinc Oxide as an astringent. However, both adjudicating authorities classified the product as a cosmetic and toilet preparation under chapter heading 33.04 of CETA, rejecting the appellant's claim for classification under chapter heading 30.03. The appellant's prayer was denied based on this classification.

The Senior Counsel pointed out a relevant judgment by the Hon'ble Apex Court in a similar case involving Johnson & Johnson's 'prickly heat powder.' The Apex Court had accepted that the item contained medicinal ingredients such as salicylic acid, boric acid, and zinc oxide, classifying it as a medicament under Chapter Heading 30.03. The Senior Counsel argued that the ingredients in the present product were the same, with a higher medicinal percentage than Johnson & Johnson's product. Therefore, the Senior Counsel contended that the appeal should be allowed based on the Apex Court's judgment, providing consequential relief.

The Revenue's representative acknowledged the applicability of the Apex Court's judgment to the case but reiterated the Commissioner (Appeals)'s findings. Upon careful consideration and comparing the ingredients and functions of Johnson & Johnson's product with the disputed product, the Tribunal found them to be the same. The Tribunal noted that the Apex Court had accepted Johnson & Johnson's product as a medicament due to its medicinal ingredients and common parlance understanding. Relying on the Apex Court's judgment, the Tribunal set aside the impugned order and allowed the appeal, granting any consequential relief due.

Therefore, the Tribunal ruled in favor of the appellant, classifying the product 'shower to shower prickly heat powder' as a medicament under Chapter Heading 30.03 based on the ingredients and common understanding, in line with the Apex Court's precedent.