1998 (3) TMI 483 - AT - Central Excise

Summary

Issues Involved:
1. Classification of pharmacopoeial medicaments.
2. Applicability of Chapter Note 3(g) to Chapter 30 of CETA, 1985.
3. Determination of whether the items in question constitute "First Aid boxes and kits."
4. Appropriate tariff heading for the products under CETA, 1985.

Issue-wise Detailed Analysis:

1. Classification of Pharmacopoeial Medicaments:
The appellants are engaged in manufacturing pharmacopoeial medicines, including Paracetamol Tablets IP, Mebendazole Tablets USP, Benzyl Benzoate application, Merbromin Solution NFI, Sulphacetamide Eye drops BP, and Tetracycline Eye Ointment IP. They filed a classification list declaring these products under sub-heading 3003.20, which was initially approved by the Assistant Collector of Central Excise.

2. Applicability of Chapter Note 3(g) to Chapter 30 of CETA, 1985:
The Collector of Central Excise directed a review for classifying the products under sub-heading 3005.90, citing Chapter Note 3(g) to Chapter 30, which pertains to "First Aid boxes and kits." The appellants argued that their products are pharmacopoeial medicaments and not first aid kits, thus falling under Heading 3003.20.

3. Determination of Whether the Items Constitute "First Aid Boxes and Kits":
The judgment examined definitions of "First Aid" and "First Aid Boxes and Kits" from various medical encyclopedias and dictionaries. It was determined that the appellants' products are used to treat specific ailments and require professional medical consultation, unlike typical first aid items used for immediate emergency treatment. The products were supplied under a government scheme for treating children in unhygienic conditions, not as first aid kits.

4. Appropriate Tariff Heading for the Products under CETA, 1985:
The judgment analyzed whether the products should be classified under Heading 3005.90 as "Pharmaceutical goods not elsewhere specified" or under Heading 3003.20 as "medicaments (other than patent or proprietary)." The majority opinion concluded that the products are pharmacopoeial medicaments and do not meet the criteria for "First Aid boxes and kits" under Note 3(g). Therefore, the correct classification is under Heading 3003.20, attracting nil rate of duty.

Separate Judgments:

Majority Opinion:
The majority, including Member (J) and Member (J), concluded that the products are pharmacopoeial medicaments and not first aid kits. They set aside the impugned order and allowed the appeal, confirming the classification under Heading 3003.20.

Dissenting Opinion:
The Vice President disagreed, arguing that the items, when packed together in a box, constitute a "medicine kit" and should be classified under Heading 3005.90 as "Pharmaceutical goods not elsewhere specified." He emphasized that the changing concept of first aid and the specific context of the government's scheme should influence the classification.

Final Decision:
The majority opinion prevailed, and the appeal was allowed with consequential relief, classifying the products under Heading 3003.20.