Central Excise availment of exemption in terms of Notification No. 31/88, dated 1-3-1988 in respect of "other bulk drugs" - Central Excise - 8/90-CX.3

Central Excise availment of exemption in terms of Notification No. 31/88, dated 1-3-1988 in respect of "other bulk drugs" Circular No. 8/90-CX.3 Dated 6-3-1989 [From F. No. 120/12/89-CX.3] Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Central Excise availment of exemption in terms of Notification No. 31/88, dated 1-3-1988 in respect of "other bulk drugs" A doubt has been expressed as to whether furnishing of proof of end use in respect of 'other bulk drugs' appearing at S. No. 2 of Notification No. 31/88 is required for the purpose of availing the exemption in terms of that Notification. 2. The matter has been examined. As per Notification No-31/88, 'bulk drugs' specified under First Schedule to Drugs (Price Control) Order, 1987 are totally exempt. All 'other bulk drugs' are chargeable to 5% ad valorem. In the explanation to the Notification, it is staled that the expression 'bulk drugs' shall have the same meaning assigned to it in the Drugs (Price Control) Order, 1987. As per Drugs (Price Control) Order, l987 'bulk drug' is defined as any substance including pharmaceutical, chemical, biological or plant product or medicinal gas conforming to pharmacopoeial or other standards accepted under the Drugs Cosmetics Act, 1940, which is used as such or as an ingredient in any formulations. Further, 'formulations' is defined as a medicine processed out of or containing one or more bulk drugs or drug. with or without the use of any pharmaceutical aids for internal or external use for, or in the diagnosis, treatment, mitigation or prevention of diseases in human beings or animals. On a strict interpretation of the Notification No. 31/88, dated 1-3-1988 read with the definitions of 'bulk drug' and 'formulation' as provided in Drugs (Price Control) Order, 1987, it becomes necessary for any manufacturer of 'other bulk drugs' specified against Sl.No. 2 of the Notification No.31/88, to prove that such bulk drugs are actually meant to be used as such or as ingredients in any drug formulations. Accordingly, it is clarified that for the purpose of availing exemption in terms of Notification No. 31/88 in respect of 'other bulk drugs' it would be necessary to insist upon and use certificates in order to satisfy that the bulk drugs have actually been put to the use as specified in Drugs (Price Control) Order, 1987.