2000 (11) TMI 155 - HC - Central Excise

Summary

Issues:
1. Entitlement to exemption of Excise duty for cough syrup "Kafbin" under Notification No. 32/89-C.E.
2. Disallowance of exemption claim by Assistant Collector based on the presence of Allopathic constituents in the Ayurvedic preparation.
3. Jurisdiction of the Single Judge to address the merit of the case without resorting to regular appeal remedy.
4. Interpretation of the circular issued by the Board of Taxes regarding exemption for Ayurvedic medicines containing preservatives.
5. Binding nature of the circular on sub-ordinate authorities and its impact on the present case.

Analysis:
1. The appeal challenged the order disallowing the exemption of Excise duty for the cough syrup "Kafbin" claimed to be an Ayurvedic medicine under Notification No. 32/89-C.E. The Single Judge allowed the writ petition, holding the petitioner entitled to the exemption and quashing the Assistant Collector's order. The judgment directed the appellant to permit the respondent to clear their consignment without any excise duty until the exemption is withdrawn or the constitution of "Kafbin" is changed.

2. The dispute arose due to the presence of Allopathic constituents in the Ayurvedic preparation, leading to the disallowance of the exemption claim by the Assistant Collector. Despite certificates stating the constituents were mere preservatives, the Assistant Collector held the preparation subject to duty. The Single Judge overruled this, stating that the Allopathic constituents did not affect the Ayurvedic nature of the preparation, leading to the exemption.

3. The appellant contested the jurisdiction of the Single Judge to address the case's merit without the regular appeal remedy. The judgment highlighted the importance of leaving such disputed questions to the Appellate Authority for adjudication. However, the matter was resolved by the Board's circular, clarifying the conditions for exemption for Ayurvedic medicines containing preservatives.

4. The circular issued by the Board outlined conditions for exemption, requiring a certificate from the appropriate authority confirming adherence to prescribed formulae and the absence of therapeutic value in additional ingredients. The judgment emphasized the binding nature of the circular on sub-ordinate authorities, citing a Supreme Court decision, and directed the petitioner to obtain the necessary certificate for exemption.

5. The judgment concluded by setting aside the impugned order and instructing the petitioner to follow the conditions outlined in the Board's circular to obtain relief in accordance with the law. The decision highlighted the binding nature of circulars on sub-ordinate authorities and allowed the appeal without costs.