1985 (7) TMI 353 - AT - Central Excise

Summary

Issues: Classification of 'Marylon Medicated Shampoo' under Tariff Items 14E (patent or proprietary medicine) or 14F(ii)(c) (toilet preparation)

Detailed Analysis:

1. Background: M/s. Stamac Products classified their product 'Marylon Medicated Shampoo' under Tariff Item 14E as a patent or proprietary medicine. The Assistant Collector, Appellate Collector, and Govt. of India classified it under T.C. 14F(ii)(c) as a toilet preparation, leading to an appeal before the Appellate Tribunal CEGAT New Delhi.

2. Appellants' Argument: The appellants argued that the ingredients of the product are pharmacopoeal drugs, approved by the Director of Drugs Control, and manufactured under a drug license. They contended that the product is a medicinal preparation, not a shampoo, and should be classified as a patent or proprietary medicine under Item 14E (CET).

3. Department's Argument: The Department argued that the product is marketed and used as a shampoo, as indicated on the carton and pamphlet. They emphasized that the common usage and perception of the product as a shampoo should determine its classification under Tariff Item 14F(ii)(c) as a toilet preparation.

4. Tribunal's Analysis: The Tribunal considered the technical and commercial aspects of the product. They noted that while the product may have medicinal properties, it is primarily used and known as a shampoo in common parlance and trade. The Tribunal cited the principle that items should be construed based on common commercial understanding rather than technical definitions.

5. Precedent and Decision: The Tribunal referenced the decision in the case of Abbot Laboratories Pvt. Ltd. and distinguished between a medicated shampoo and a product like 'Selsum' recommended solely for medical purposes. They concluded that 'Marylon Medicated Shampoo' falls under the category of shampoo under Tariff Item 14F(ii)(c) and dismissed the appeal, affirming the classification as a toilet preparation.

6. Conclusion: The Tribunal upheld the classification of 'Marylon Medicated Shampoo' as a shampoo under Tariff Item 14F(ii)(c) based on its common usage and understanding in the market, despite its medicinal properties and approval under the Drugs & Cosmetics Act.