2017 (7) TMI 1201 - AT - Central Excise

Classification of goods - wash powder (Amla and Shikakai) - appellant claimed that this is a medical preparation but the Department considered it is a cosmetic. Held that - For the earlier period, in assessee s case, the issue came up before the Tribunal HERBAL HOUSE VERSUS C.C.C. EX & S. TAX, BHOPAL 2016 (12) TMI 533 - CESTAT NEW DELHI , where Hon ble Supreme Court in the case of Meghdoot Gramodyog Sewa Santhan vs. C.C.E.,Lucknow 2004 (10) TMI 93 - SUPREME COURT OF INDIA where the Hon ble Supreme Court observed that A product may be medicinal without having been prescribed by a Medical Practitioner. It was also not necessary for a person manufacturing medical products to claim classification under Tariff Heading 3303.031 without establishing that the product had in fact been tested on patients in controlled situations or that the outcome had not been tested for effectiveness. This would be particularly true in the cases where the products are claimed to be based on traditional ayurvedic formulae. Appeal dismissed - decided against appellant.

Summary

Issues: Classification of product as medical preparation or cosmetic, applicability of earlier Tribunal decision

The judgment revolves around the classification of a product, specifically wash powder (Amla and Shikakai), as either a medical preparation or a cosmetic. The appellant claimed it to be a medical preparation, while the Department considered it a cosmetic, leading to a duty demand. The disputed period in question was from April 2001 to February 2002.

The Tribunal considered the case based on the appellant's claim that the wash powder was a medical preparation. The appellant argued that the product should be classified as such, but the Department viewed it as a cosmetic, resulting in a duty demand. The Tribunal referred to an earlier case where a similar issue was presented before the Hon'ble Supreme Court. In that case, it was highlighted that a product could be medicinal even without being prescribed by a Medical Practitioner. The Tribunal found the reasoning in the earlier case to be sound and upheld the decision that the wash powder was a cosmetic, based on the evidence presented, including the packaging depicting cosmetic features.

The Tribunal, after hearing arguments from both sides, found no reason to interfere with the lower authority's order regarding the classification of the wash powder as a cosmetic. The Tribunal upheld the decision based on the earlier Tribunal order and the reasoning provided therein. Consequently, the appeal filed by the appellant was dismissed, affirming the classification of the wash powder as a cosmetic product.

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