1999 (2) TMI 195 - AT - Central Excise

Summary

Issues: Classification of the product "NATCAL" under the Central Excise Act.

Analysis:
1. The appeal challenges the classification of the product "NATCAL" as tablets or syrup of natural calcium under sub-heading 3001.00 of the Central Excise Act, overturning the original classification under Chapter 2.

2. The appellant argues that the product should be classified under Chapter or under 3003.20 as a medicament, not under 3003.10 as patent and proprietary medicines due to its composition not aligning with the monographs or official pharmacopoeia mentioned in Chapter 30 notes.

3. "NATCAL" is manufactured from Micro Crystalline Hydroxy Apatite complex, a bone powder of bovine animals, purchased from another manufacturer classified under Chapter 2 as an exempted product. The product, in tablet or liquid form, provides therapeutic or prophylactic dosage of natural calcium, involving various additives while maintaining the bone powder as the main ingredient.

4. The revenue sought classification under sub-Heading 3001.00, stating the product is not merely bone powder but a manufactured item with the powder as the main ingredient. The Collector (Appeals) classified it under 3001.00, leading to the current appeal.

5. The appellant contests the classification under 3001.00, arguing it applies to substances of animal origin in their normal form, not bone powder.

6. The respondent argues against Chapter 2 classification, citing the product's therapeutic and prophylactic usage for humans, manufactured under a license by the Drug Controller. The product, derived from animal substances, serves medicinal purposes for humans, justifying the classification under Heading 3001.00.

7. The Tribunal notes the complex manufacturing process converting bone powder into tablets or liquid suspension, adding chemicals for flavor and color, making it suitable for oral human consumption for therapeutic or prophylactic purposes. Despite being a medicinal preparation with a license from the Drug Controller, the product is excluded from Heading 30.01 per the Harmonised Commodity description and Coding System.

8. Consequently, the Tribunal rules that the product does not fall under Chapter 2 or sub-heading 3001.00, being a distinct medicament or medicinal preparation. The matter is remanded to the Assistant Commissioner for reevaluation considering the product's medicinal nature, allowing the appellant to present arguments for classification.

9. The appeal succeeds, leading to a remand for further classification review.