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TMI Blog2010 (10) TMI 233X X X X Extracts X X X X X X X X Extracts X X X X ..... Naresh Sharma, Narendra Sharma, B.K. Pandey and Praveen Kumar, for the Appearing parties. [Order]. All these revisions both by the assessee dealers and the revenue are directed against the order of the Commercial Tax Tribunal Kanpur Bench-3 dated 29-12-2009. 2. The tribunal by the impugned order has classified Himani Boroplus Antiseptic Cream, Himani Gold Turmeric Cream and many other similar items as cosmetics whereas Himani Hair Oil and such other products as medicament and directed for levy of tax accordingly. 3. It may be worth noting that under the provisions of the U.P. Trade Tax Act items of medicament are taxable at a lower rate and cosmetics at a higher rate. It is for this reason the classification has acquired importance. 4. Learned counsel for the parties have advanced their submissions by taking Revision No. 99 of 2010 as the leading case. I, therefore, state in brief the facts of the aforesaid case only which may be sufficient for understanding the background leading to the passing of the impugned order in connection with all items involved. 5. In the above revision the tax liability of the assessee-dealer in respect of only two items, namely, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ience and art of mitigation, prevention, cure and alleviation of disease whereas medicine means anything applied for the cure or lessening of disease or pain whether single or compound (made up of more than one ingredient). Medicine as such is any substance liquid or solid that has the property of curing or mitigating disease or which is administered in a treatment of disease and it may be a combination of drugs in largely varying proportions. Anything related to medicine is medicinal and anything mixed with medicine is medicated. The process of such mixing of medicinal substances having the power to cure or to heal is medication. 12. The word cosmetic has been defined under Section 3(aaa) of the Drugs and Cosmetics Act, 1940 as under : Cosmetic means any article intended to be rubbed, poured, sprinkled or sprayed on, or introduced into, or otherwise applied to, the human body or any part thereof for cleansing, beautifying, promoting attractiveness, or altering the appearance, and includes any article intended for use as a component of cosmetic. 13. Its dictionary meaning is, substances used for improving beauty especially that of the complexion or for beautifying skin a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the following few illustrations. 19. Generally, a soap is used for cleansing and hygienic purposes only. It is commonly called a toilet soap but at times dermatologist may prescribe use of medicated soap for remedial or preventive purposes concerning skin related problems. Thus, a soap may, in a given case, be a medicament. Similarly, a toothpaste in common use may be recognised as a toilet product but when a special toothpaste with medicinal properties is prescribed by a dentist it is a medicament as distinguished from ordinary toilet toothpaste. In the same way, liquor is ordinarily used for intoxication but at times it may be used for medical purposes. A particular Ayurvedic product may be used for the treatment of baldness which is a hair related disease. The use of such Ayurvedic product may not only cure baldness to some extent but may enhance the general appearance of the person using it as with the cure of the disease hairs may grow. 20. In such cases and circumstances it becomes difficult to classify the product either strictly as medicament or cosmetics. In such a situation the primary role and the purpose of use of the product becomes the determining factor for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord that the revenue had done nothing to discharge the aforesaid burden. It had not adduced any evidence whatsoever to establish that the aforesaid products are of cosmetic nature and cannot be classified as medicaments. None of the affidavits or the other evidence adduced by the assessee-dealers were rebutted either by filing counter to any of the said affidavits or by adducing contra evidence. 28. Now in the above background, I proceed to examine the nature of the above products for the purposes of their classification on the anvil of the twin test i.e. common parlance test and the use of ingredients based upon authoritative Ayurvedic text books. 29. In order to determine whether a product is an item of cosmetic or a medicament a twin test as aforesaid had always found favour with the courts. The Apex Court approved the application of the twin test for the first time probably in the case of CCE v. Richardson Hindustan Ltd. (2004) 9 SCC 156 and held that the above two tests to be determinative for classifying the goods for taxation purposes. The above two twin tests, at the cost of repetition are (i) common parlance test i.e. to see and find out how the product in common par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hey were typed out on the same machine or were more or less identical in nature can not first of all be a relevant criteria to discard them in evidence when there veracity is not being disputed. Moreover, even if some of the aforesaid affidavits are ignored, sufficient other evidence in the form of other affidavits and certificates of the recognised authorities remain and there is no reason whatsoever to ignore them and to take a view that the products in question fail to qualify the twin test for classifying them as medicaments. 37. One of the affidavits of Dr. Hari Shanker Sharma who happen to be in medical profession for the last 45 years on the date of the affidavit i.e. 21-8-1996, clearly states that Himani Boroplus Antiseptic Cream is an Ayurvedic medicine which was prescribed by him to various patients suffering from skin diseases such as minor cuts, burns wounds, chopped skin, scratches etc. and the results were satisfactory and he is regularly prescribing it for cure of skin diseases. To the same effect he has also filed affidavit dated 14-10-1996 in respect of Himani Gold Turmeric Cream. The above affidavits and similar other affidavits of qualified medical practitione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equired to be mixed up with what is in trade parlance called fillers and vehicles in order to make the medicament useful. It was illustrated by an example of vicks vapourub which has been referred to above. Thus, it was held the fact that use of medicinal elements in a product was minimal does not detract it from being classified as a medicament. It was also held that in order to be a medicinal preparation or a medicament it is not necessary that the item must be sold under a doctor s prescription and it makes no difference if it is available across the counter in shops. 45. It is common knowledge that paraffin wax is a filler or a vehicle in which Ayurvedic contents are mixed for making a medicine. Therefore, non-mention of paraffin wax in any Ayurvedic text makes no difference and the tribunal manifestly erred in returning a finding that as paraffin wax is not an Ayurvedic material the product made by using it cannot be a medicament. 46. In Union of India and Others v. G.D. Pharmaceuticals Ltd. and Another (2001) 9 SCC 759 Boroline antiseptic cream containing boric acid and zink oxide was held to be a medicament. However, this authority of the Supreme Court has been disting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and the other subordinate taxing authorities committed a gross error in classifying them as cosmetics and in levying tax accordingly. 50. There are some revisions of the revenue clubbed with this bunch of revisions of the assessee-dealers. All the revisions of the revenue are beyond time. The delay is not much and its condonation is not being seriously opposed. Sufficient explanation for the delay in filing the revisions also exists. Therefore, I treat the revision to be within time. 51. Learned Standing Counsel in support of the revisions preferred by the revenue, all of which pertain to classification of Himani Navratan Oil contended that the tribunal has erred in treating the aforesaid product as an Ayurvedic medicine without applying the twin test and despite the fact that it contains 67% liquid paraffin. 52. The submission of learned Standing Counsel is totally misplaced and devoid of any substance. As earlier stated, the burden to prove the classification of any product is upon the revenue. The revenue in connection with Himani Navratan Oil has not produced any evidence to show that it is not an Ayurvedic medicine but an ordinary oil with no medicinal value. On th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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