1994 (1) TMI 86 - SC - Central Excise

Whether the respondent s product, Handyplast , is a patent or proprietary medicine within the meaning of T.I. 14E of the First Schedule to the Central Excise Act as it obtained at the relevant time/ Held that - Even though we are not satisfied with the reasoning of the High Court, we are of the opinion that no interference is called for in the particular facts and circumstances of the case. The relevant facts relating to the dispute concerned herein have been stated in the opening paragraphs of the Judgment of the High Court, which establish that the proviso to Section 11A may not be attracted to this case. The High Court has traced the course of this litigation and the inordinate delays in deciding the matter. The Respondent has been paying duty all the while under T.I. 68 till the Central Excise Tariff Act, 1985 came into force. The difference of duty is very small. Having regard to all the above facts, we do not think this is a fit case for interfering under Article 136 of the Constitution. Appeal dismissed.

Summary

Issues:
Interpretation of Tariff Item 14E of the Central Excise Act to determine if the product "Handyplast" qualifies as a patent or proprietary medicine.

Analysis:
The appeal before the Supreme Court involved a dispute over whether the product "Handyplast" manufactured by the respondent company qualifies as a 'patent or proprietary medicine' under Tariff Item 14E of the Central Excise Act. The product in question is a surgical dressing containing a pad medicated with nitrofurozone. Both parties agreed that the product description aligned with the criteria of a medicinal preparation for external treatment or prevention of ailments. The respondent argued that the product merely protected wounds from infection, aiding the body's natural healing process without possessing curative properties. Conversely, the Revenue contended that the inclusion of nitrofurozone indicated a curative intent. The High Court ruled in favor of the respondent, citing the low concentration of nitrofurozone and its use for antiseptic purposes. However, the Supreme Court found the High Court's reasoning flawed, noting the absence of a specific quantity requirement for drugs in dressing pads. Despite disagreeing with the High Court's analysis, the Supreme Court declined to interfere due to the insignificant duty difference, long litigation history, and lack of grounds for constitutional intervention.

In conclusion, the Supreme Court dismissed the appeal, upholding the High Court's decision regarding the classification of "Handyplast" as a non-curative surgical dressing rather than a medicinal preparation. The judgment emphasized the specific facts and circumstances of the case, the historical duty payments by the respondent, and the lack of substantial grounds for constitutional intervention. The dismissal of the appeal was made without imposing any costs on either party.