2007 (4) TMI 568 - AT - Central Excise

Summary

Issues involved: Interpretation of Note 5 to Chapter 30 of the Schedule to the CETA, 1985 regarding labelling of medicaments amounting to manufacture and imposition of duty and penalty.

The judgment by the Appellate Tribunal CESTAT, Mumbai involved a case where the appellants imported medicaments and cleared them after labelling without payment of duty, leading to a show cause notice for recovery of duty and penalty. The Hon'ble Bombay High Court had previously decided a seizure case related to the matter, citing the judgment of the Apex Court in the case of CCE, Mumbai v. Johnson & Johnson, which influenced the present case. The Commissioner of Central Excise had confirmed the demand and imposed penalties on the assessees, prompting the appeal.

The Tribunal considered the precedent set by the case of Johnson & Johnson, where it was established that mere labelling or re-labelling of containers was not enough to trigger the provisions of Note 5 to Chapter 30. The Tribunal's decision was upheld by the Apex Court, emphasizing that re-packing from bulk to retail packs was also necessary to attract the said provision. In the current case, it was noted that there was no evidence of the appellants engaging in the re-packing process in addition to labelling. Therefore, following the Apex Court's decision, the Tribunal set aside the impugned order, allowing the appeal and disposing of the Revenue's cross-objection.