9911796707
TMI Blog2013 (5) TMI 736X X X X Extracts X X X X X X X X Extracts X X X X ..... olling and Licensing Authority of Uttarakhand. The petitioner also claims to be registered under the Central Excise Act, 1944. The petitioner manufactures cough syrups of different brand names such as Xenocof-D, Instacodin, Codistar Cough Syrup, Wilecod Syrup. In all these cough syrups an essential ingredient is "Codeine Phosphate". Admittedly "Codeine Phosphate" is nothing but a derivative of "Opium" and can also be called "morphine". The petitioner is being charged excise duties on the aforesaid products, as according to the State authorities in Uttarakhand, the products being manufactured by the petitioner contain a narcotic or narcotic drugs in the form of "Codeine Phosphate" and hence that product is chargeable to excise duties under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unless the context otherwise requires, - (a)... (b)... (c) ... (d)... (e)... (f)... (g)... (h) "narcotic drug" or "narcotic" means a substance which is coca leaf, or coca derivative, or opium, or derivative of opium, or Indian hemp and shall include any other substance, capable of causing or producing in human beings dependence, tolerance and withdrawal syndromes and which the Central Government may, by notification in the Official Gazette, declare to be a narcotic drug or narcotic;] 5. In other words, a "narcotic drug" or a "narcotic" would mean coca leaf and its derivatives, opium or derivatives of opium, etc., which the Central Government may by notification declares to be a "narcotic drug" or "narcotic". 6. There is a notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cified in the schedule as being subject to the duties of excise levied under this Act;" 9. Consequently a schedule has been mentioned under the Act which prescribes the rates on particular preparations, which reads as under :- "THE SCHEDULE (See section 3) Item No. Description of dutiable goods Rate of duty 1. 2. 3. 1. Medicinal Preparation Allopathic Medicinal Preparations - (i) Medicinal preparations containing alcohol which are not capable of being consumed as ordinary alcohol beverages - (a) Patent of proprietary medicines. [Sixteen per cent. ad valorem ] (b) Others [Sixteen per cent. ad valorem ] (ii) Medicinal preparations contain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... milligrams and 0.25 % concentration respectively, as per the said notification of the Central Government. Consequently, it is not a narcotic or a narcotic drug and hence though it is contained in the cough syrups, yet since the doses are much less than the prescribed limit it is not a narcotic drug and hence not chargeable under the Act. 11. On behalf of the State, the learned Deputy Advocate General Mr. B.D. Kandpal had argued that excise duty is liable to be levied under the Act if the product contains a narcotic or narcotic drug and since admittedly Codeine Phosphate is a narcotic or narcotic drug, the products which are being manufactured and sold by the petitioner in the form of cough syrups is liable to be charged excise duty. 12. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any medicinal preparations containing Dextropropoxyphene base per dosage unit not more than 135 mg are excluded from being classified as narcotic drug or narcotic within the meaning of the said expression under Section 2 (h) of the said Act. Once the product of the petitioners discloses Dextropropoxyphene-HCL which in terms contains Dextropropoxyphene base to the extent of 70 mg, which fact has not been disputed by the respondents at any stage of the proceedings, even in the affidavit in reply filed by them, obviously such a product would stand exempted in terms of the said notification and would not be classifiable as narcotic drug or narcotic under the said Act. 14. It is also not in dispute that the excise duty at the rate of 20 % is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eine Phosphate was being used for preparation of cough syrups in the proportion of 9.5 mg per 5 ml, i.e. per dosage unit and the Court held that the preparation in question falls within the ambit of the exception as contained in the item at Serial No. 35 of the Notification issued by the Central Government. 15. In view of the above, writ petition succeeds and is hereby allowed. A mandamus is issued to respondent no. 2 i.e. the Commissioner (State Excise), State of Uttarakhand, Secretariat, Dehradun not to charge excise duty on the cough syrups being prepared and sold by the petitioner under the brand names of Xenocof-D, Instacodin, Codistar Cough Syrup, Wilecod Syrup if it contains Codeine Phosphate less than the prescribed limits. 16. Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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