2019 (11) TMI 1328 - AAR - GST

Classification of goods - Protein Powder with Vitamins and Minerals - whether classifiable under HSN 3004 or not? - HELD THAT - All the goods being manufactured by the applicant which are mentioned (including the goods mentioned at Sr. No. 20 and 21) in the drug license issued to the applicant by the competent authority and have the labels as per the standards prescribed under the Drugs and Cosmetics Act, 1940 can be classified under HS code 3004.

Summary

Issues: Classification of goods under HSN codes 2106 and 3004

Classification under HSN codes 2106 and 3004:
The judgment revolves around the issue of the classification of goods under the HSN codes 2106 and 3004. The applicant, engaged in the manufacture and supply of Pharmaceutical formulations, had been classifying the goods under HSN 2106. However, the applicant contended that goods, specifically Protein Powder with Vitamins and Minerals, manufactured under a valid drug license should be classified under HSN 3004, as other manufacturers with similar conditions were doing so. The Authority carefully examined the applicant's submissions, the drug license, and the labels of the products. It was observed that the products manufactured by the applicant, including those at Sr. No. 20 and 21, met the standards prescribed under the Drugs and Cosmetics Act, 1940, and could be appropriately classified under HS code 3004. The judgment, therefore, ruled in favor of the applicant's classification under HSN code 3004 based on the evidence presented.

Personal Hearing and Admittance of Application:
The applicant was granted an opportunity for a personal hearing, which was attended by the authorized representative. The applicant reiterated the submissions made in the application during the hearing. After a detailed examination, the application was admitted as the questions raised fell under section 97(2)(d) of the CGST/HPGST Act, 2017. This procedural aspect highlights the fair opportunity provided to the applicant to present their case before the Authority and the adherence to the statutory provisions governing the admission of applications for advance rulings.

Detailed Analysis of Goods and Licensing Authority's Approval:
The judgment delves into the detailed analysis of the goods manufactured by the applicant and the approval granted by the licensing authority. The applicant held a valid license to manufacture drugs specified in Schedule C and Schedule C1 of the Drugs and Cosmetics Act, 1940. The list of approved products included Protein Powder with Vitamins and Minerals, among others. The labels of the products manufactured by the applicant were examined, which prominently displayed the Drug Manufacturing License number, ingredients, and usage instructions. The products were specifically mentioned in the Fixed Dose Category under Schedule C of the drugs and cosmetics Act. This thorough examination of the applicant's manufacturing setup and compliance with regulatory requirements formed a crucial part of the judgment's analysis leading to the classification decision under HSN code 3004.

Conclusion and Ruling:
After considering the arguments, evidence, and regulatory framework, the Authority concluded that the goods manufactured by the applicant, including Protein Powder with Vitamins and Minerals, could be appropriately classified under HS code 3004. The ruling provided clarity on the classification of pharmaceutical formulations manufactured under a valid drug license, aligning with the standards set forth in the Drugs and Cosmetics Act, 1940. The decision served to guide the applicant and similar manufacturers in correctly categorizing their products for regulatory and compliance purposes.