2016 (12) TMI 533 - AT - Central Excise

Classification of item - Brahmi Amla Oil - Ayur natural hair wash - Hairolin-H - Held that - it appears that the issue has come up before the Tribunal in the case of Gurukul Kangri Pharmacy vs. C.C.E., Meerut I 2005 (12) TMI 159 - CESTAT, NEW DELHI , where it was held that use of the oil for treatment of headache, eye problem, night blindness, week memory, hysteria, amnesia, blood pressure, insomnia etc. and the product being registered with Drug Controller and manufactured under Drug licence, has to be treated as ayurvedic medicine and the mere fact that the same is sold across the counter and not under the Doctor s prescription does not lead to the conclusion that the same is not medicament - By applying the doctrine of ejusdom - genesis, we are of the view appellant s claim for classification under 3003.30 is accepted. When it is so then to this effect, the impugned order is set aside and the appellant will get the relief accordingly Regarding the third item i.e. natural hair wash (Amla Shikakai Powder) - Held that - the identical issue has come up before the 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 - By following the ratio laid down by the Hon ble Supreme Court, we find no reason to interfere with the order passed by the lower authority pertaining to the second item namely, natural hair wash (Amla Shikakai Powder). The orders of the lower authorities are hereby sustained along with the reasons mentioned therein pertaining to the Natural Hair Wash Powder. Appeal disposed off - decided partly in favor of assessee.

Summary

Issues:
Classification of products - Brahmi Amla Hair Oil, Ayur natural hair wash, and Hairolin-H.

Analysis:

1. Classification of Brahmi Amla Hair Oil and Ayur natural hair wash:
- The Tribunal had remanded the matter back to the adjudicating authority for fresh adjudication on these two items. The Department argued that these were cosmetic items, while the appellant claimed that the Amla Hair oil should be classified under 3305.10 of the Tariff Schedule as an ayurvedic medicine. The Tribunal referred to precedents and held that if the product is manufactured in accordance with authoritative Ayurveda books and registered with the Drug Controller, it should be classified as ayurvedic medicine. Applying the doctrine of ejusdem generis, the Tribunal accepted the appellant's claim for classification under 3003.30 and set aside the impugned order accordingly.

2. Classification of Natural Hair Wash (Amla Shikakai Powder):
- The appellant relied on various case laws to support the classification of this product. However, the Tribunal found the nature of the product to be beyond its name and with distinguishable character. Referring to a Supreme Court case, the Tribunal emphasized that a product can be medicinal even without being prescribed by a Medical Practitioner. It was noted that traditional ayurvedic formulae products do not necessarily require testing on patients in controlled situations. Therefore, the Tribunal upheld the lower authorities' decision on the classification of Amla Shikakai Powder as a natural hair wash, sustaining the reasoning provided in their orders.

3. Regarding Hairolin-H:
- The adjudicating authority had taken up the issue of Hairolin-H suo motu, which was not mentioned in the remand order. The Tribunal held that when the direction is specific, the adjudicating authority should not investigate additional items on its own. Consequently, the duty issue related to Hairolin-H was deemed unsustainable in law and set aside.

In conclusion, the Tribunal partly allowed the appeal, setting aside the duty issue pertaining to Hairolin-H and accepting the classification claims of the appellant for Brahmi Amla Hair Oil and Ayur natural hair wash based on their ayurvedic medicinal nature. However, the classification of Natural Hair Wash (Amla Shikakai Powder) was upheld, in line with the lower authorities' decisions and the legal principles outlined by the Supreme Court.