9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (8) TMI 308 - AAAR - GSTClassification of goods - Biogut Capsule - Zinc Ascorbate Syrup - Lactoin Drop - whether the products for which classification has been sought fall under the category of dietary/health supplement or they are drugs and medicines as claimed by the Appellant? - HELD THAT - The Appellant is a license holder under FSSAI and as per the Appellant's submission and observations of WBAAR, the products have stickers pasted on packaging proclaiming Health/Dietary Supplements , Health Drinks and Not for Medicinal Use . This is as per the Regulations set by FSSAI. It is noted that Food for Special Medical Purpose and Food for Special Dietary Use are intended to be used only under medical advice Regulations 3 8 . The general requirement Regulation 2(d)(ii) of the Regulations specifies that the articles of food sold in capsules, tablets, syrups, hard or soft or vegetarian, shall comply with the general monograph and quality requirements specified for them in Indian Pharmacopoeia and also, the quantity of nutrients added to the articles of food shall not exceed the recommended daily allowance as specified by the Indian Council of Medical Research and in cases such standards are not specified the standards laid down by international food standards body, namely, Codex Alimentarius Commission, shall apply. So being prescribed by medical practitioners for a limited period use or sold by pharmacists are not sufficient parameters for the products in question to be classified us medicaments as per HSN classification in the light of the current Regulations laid down by FSSAI, It is clear that products under the Drugs and Cosmetics Act, 1940, will not fall under those categories regulated by FSSAI and vice versa. These two categories, namely the products under the Drugs and Cosmetics Act. 1940, and these regulated by FSSAI are mutually exclusive. In fact the products in question are not eligible drug license under the Drugs and Cosmetics Act, 1940 as these are mainly prebiotic and probiotic supplements, oral rehydration formulate and tonic. The products in question are classifiable under HSN 2106, and taxable under Sl.No. 23 Schedule III or Notification 1/2017-C.T (Rate) dated 28-06-2017 under the Central (Goods and Services ax Act, and Notification No. 1125-FT dated 28-06-2017 under the West Bengal Goods and Services Tax Act, 2017, as amended vide Notification No. 41/2017 (Rate) dated 14-11-2017 under the Central Goods and Services Tax Act, 2017 and Notification No. 2019-FT dated 14-11-2017 under the West Bengal Goods and Services Tax Act, 2017. Appeal dismissed - decided against appellant.
Issues Involved:
1. Classification of 15 products manufactured by the Appellant. 2. Whether the products fall under the category of dietary/health supplements or drugs and medicines. 3. The validity of the ruling pronounced by the West Bengal Authority for Advance Ruling (WBAAR). Detailed Analysis: 1. Classification of 15 Products: The Appellant, Eskag Pharma Pvt. Ltd., sought an advance ruling on the classification of 15 products under the GST Act. The products include Biogut capsule, Folcovit capsule, Folcovit Distab, Myova/Myowin tablet, Candyflora Tablet, Carisma Tablet, Lactolite syrup, Lacolite Z Sachet, Biogut Dry Syrup, Enterobiotic Dry Syrup, Gutclausy Dry Syrup, Evaday Capsule, Zink Ascorbate (Dry syrup), Zink ascorbate (syrup), and Lactoin Drop. 2. WBAAR's Initial Ruling: The WBAAR classified 12 out of the 15 products under HSN 2106, taxable under Sl. No. 23 of Schedule III of Notification No. 1/2017-C.T. (Rate) dated 28-06-2017 under the Central Goods and Services Tax Act, 2017. The WBAAR refrained from classifying the remaining 3 products based on the precedent set by the West Bengal Appellate Authority for Advance Ruling (WBAAAR) in a previous case. 3. Grounds of Appeal by Appellant: The Appellant challenged the WBAAR's ruling on several grounds: - The WBAAR partially accepted the application, not classifying Biogut Capsule, Zinc Ascorbate Syrup, and Lactoin Drop. - The WBAAR relied solely on package details and ignored product usage. - The products are not fortified foods or health supplements. - The WBAAR misinterpreted the term "Medicament" based on a Supreme Court judgment. - The products should be classified under tariff item 3004 as "Medicaments" for therapeutic or prophylactic uses. 4. Appellant's Arguments: The Appellant argued that the products are prescribed by medical practitioners and used for a limited period, thus qualifying as medicaments. They submitted prescriptions, invoices, and certificates to support their claim. They contended that labels like "Not for Medicinal Use" are statutory requirements under FSSAI regulations and do not reflect the actual usage of the products. 5. Regulatory Framework: The Central Drugs Standard Control Organisation (CDSCO) and the Food Safety and Standards Authority of India (FSSAI) are the regulatory bodies involved. The CDSCO regulates drugs under the Drugs and Cosmetics Act, 1940, while the FSSAI oversees food safety. The Appellant admitted to not holding a drug license under the Drugs and Cosmetics Act, citing procedural difficulties and opting for an FSSAI license instead. 6. FSSAI Regulations: The FSSAI regulations cover various categories of functional food, including health supplements and food for special medical purposes. These regulations specify that such products should comply with standards set by the Indian Pharmacopoeia and international bodies like the Codex Alimentarius Commission. The Appellant's products, labeled as health supplements and dietary supplements, fall under these FSSAI regulations. 7. Conclusion: The Appellate Authority concluded that the products in question are not classified as medicaments under the HSN classification but as health supplements under HSN 2106. The products do not qualify for a drug license under the Drugs and Cosmetics Act, 1940, and are regulated by the FSSAI. The classification under Chapter 30 of the Customs Tariff Code excludes food and beverages like fortified food and supplements, even if they have therapeutic properties. Final Judgment: The appeal was dismissed, and the products were classified under HSN 2106, taxable under Sl. No. 23 of Schedule III of Notification No. 1/2017-C.T. (Rate) dated 28-06-2017. The ruling by the WBAAR was upheld, and the appeal was disposed of accordingly. Copies of the order were sent to both the Appellant and the Respondent for information.
|
