9911796707
TMI Blog2003 (5) TMI 496X X X X Extracts X X X X X X X X Extracts X X X X ..... three revisions filed by M/s. Dey's Medical Stores (Mfg.) Ltd., the question of law involved is as to whether Keo Karpin brand antiseptic cream and massage oil fall under the category of medicines or they are cosmetics. 4.. The contention of the applicants is that they are medicines while on the other hand and department's version is that they are cosmetics and are taxable as such. 5.. The relevant notifications are No. ST-2-5784/X-10(1)-80U.P. Act 15/48-Order-81 and No. ST-2-5785/X-10(1)-80-U.P. Act 15/ 48-order-81, both dated September 7, 1981, issued under the U.P. Trade Tax Act (hereinafter to be referred as "the Act"). Entry No. 5 of Notification No. ST-2-5784/X with regard to cosmetics reads as under: "All kinds of cosmetics and toilet preparations for beautification or care of the face, skin, hair, nails, eyes or brows, but not including soaps, safety razor blades, hair combs, tooth pastes, tooth powders and other dentifrices, tooth brushes and kumkum." Entry No. 29 of Notification No. ST-2-5785/X, dated September 7, 1981, relates to medicines, which is as follows: "Medicines and pharmaceutical preparations including insecticides and pesticides." 6. The learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficial Gazette." 8.. Rule 76 of the Rules framed under the Drugs and Cosmetics Act, 1940 deals with the procedure for licences of drugs or medicines, which are issued under Schedule C or C(I) and X, and form 27-A is the form in which a licence for manufacture of a drug is applied, while for cosmetic, rule 138-A prescribes the procedure and form 32 is the form in which a licence for a cosmetic is issued. 9.. Apart from the above fact, it is also necessary to examine the ingredients of each commodity in order to decide whether they would be a medicine or a cosmetic. The compositions as per the specifications given in the certification by the Drugs Controller, as well on the phial of each of the said commodities are as given below: Keo Karpin Hair Vitaliser: Bottle of 100 ml. and 300 ml. Each 100 ml. contains: Keratin Hydrolysate (5%) ... 5.0 ml. d-Panthenol. ... 50.0 mg. Biotin ... 5.0 mg. Nicotinic Acid I.P. ... 200.0 mg. Resorsinol I.P. ... 50.0 mg. Hailkyl HBU-150 ... 500.0 mg. (Underylenic derivative) Povidone U.G.P. ... 1.0 gm. Absolute alcohol ... 25.0% v/v. Glycerin I.P. ... 10.0 ml. Purified water I.P. to 100 ml. Keo Karpin Massage Oil: Bottle of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I find force in the arguments of the learned counsel for the applicant. 12.. So far as vitaliser is concerned, it was argued that it is to prevent untimely fall of hair, and to remove dandruff, which is an ailment. In this regard the learned counsel for the applicant has also filed the opinion of Dr. Gopal Mukharjee, Head of the Department of S.T.D., Calcutta National Medical College and Hospital, and others that vitaliser is for premature fall of hair and dandruff, which is a disease and as such vitaliser is used to prevent this disease. The following is the extract from it: "Vitaliser is a formulated product for uses in excessive fall of hair and in dandruff. The formulation is a quite rational one containing keratin, hydrolysate, biotin, panthenol, nicotinic acid, resorcinol and hialkyl HBU 150. Keratin is the protein which forms the essential constituent of hair. The hydrolysate form helps optimum utilisation of this substance. This along with co-factor biotin help prevent fall of hair. In a controlled study local application of biotin in persons with excessive hair fall 89 per cent showed good response and some visible hair growth. Pathenol is an important co-enzyme and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial or executive, all over India. It has been held by the honourable Supreme Court in the case of Union of India v. Kamlakshi Finance Corporation Ltd. reported in (1992) Supp 1 SCC 648 that: "The order of the Appellate Collector is binding on the Assistant Collectors working within his jurisdiction and the order of the Tribunal is binding upon the Assistant Collectors and the Appellate Collectors who function under the jurisdiction of the Tribunal. The principles of judicial discipline require that the orders of the higher appellate authorities should be followed unreservedly by the subordinate authorities. The mere fact that the order of the appellate authority is not 'acceptable' to the department-in itself an objectionable phrase-and is the subject-matter of an appeal can furnish no ground for not following it unless its operation has been suspended by a competent court. If this healthy rule is not followed, the result will only be undue harassment to assessees and chaos in administration of tax laws." 15.. From a perusal of the record, it appears that the ruling of B.P.L. Pharmaceuticals Ltd. v. Collector of Central Excise [1997] 104 STC 164 (SC) was reported in the year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Commercial Tax, Madhya Pradesh v. Dawar Brothers reported in [1998] 111 STC 319; 1998 UPTC 1211, the M.P. High Court has held Vicco Vajradanti paste and powder and Vicco turmeric cream to be drugs. In the case of Commissioner of Sales Tax v. Murari Brothers reported in [1980] 46 STC 88, it has been held by the Lucknow Bench of this Court that Bhimseni kajal is a medicine. In the case of Rashtra Deep Laboratory v. Commissioner of Sales Tax reported in [1983] 53 STC 419 (All.), distilled water has been held to be a medicine. In this case it has been held that the concept of "medicine" is static. In the case of Commissioner of Sales Tax v. Balsara Hygiene Products Ltd., reported in 1986 UPTC 367, it has been held by this Court that 'Odomos' though is not a curative but a preventive medicine. In that case it was observed "Odomos" is used only as mosquitoes repellent. The purpose is to save the human skin from mosquitoes which results in several infectious diseases and mostly malaria fever, etc. It is true that it is not used as a medicine to cure some disease or to heal up some wound but it is certainly a preventive medicine which prevents the body from being infected by the bite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed to enhance or preserve beauty by application to the face, hair, hands, and other parts of the body. In Chamber's 20th Century Dictionary, cosmetic is defined 'as adjective purporting to improve beauty, especially that of the complexion, as noun a preparation for the purpose'. In Webster's International Dictionary, 'cosmetic' is defined as 'any external application intended to beautify and improve the complexion, skin or hair'. The word is derived from Greek word 'kosmetikos', meaning skilled in decorating and 'kosmos' meaning order or ornament. In Encyclopaedia Britannica 'cosmetics' means 'substance of diverse origin scientifically compounded and used to cleanse, to allay skin troubles, to cover up imperfections and to beautify'. The expression 'antiseptic' is defined in Dorland's Pocket Medical Dictionary, Twenty Second Edition, as 'preventing sepsis, a substance that inhibits the growth and development of micro-organisms but does not necessarily kill them'. 'Septic' means pertaining to sepsis, which word means 'the presence in the blood or other tissues of pathogenic microorganisms or their toxins; the condition associated with such presence'. 'Drug' according to Chamber's ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case. 22.. It may be pointed out that in the ruling of Balaji Agency, Gorakhpur v. Commissioner of Sales Tax 1994 UPTC 184 cited by the learned Standing Counsel, Himtaj oil, which is an hair oil and is also used as hair oil, but because it has some medicinal properties of healing some disease, has been held to be a medicine. There is also another aspect of the matter. In the case of Shakti Lace Factory v. Commissioner of Sales Tax, U.P. reported in [1984] 57 STC 261 (All.) [App.]; 1983 STJ 35, it has been observed by this Court that if a commodity falls under two notifications, then the notification which is beneficial to the assessee should be applied. In view of the above discussions and observations, I have no hesitation in holding that all the four commodities are medicines, and are covered by entry No. 29, i.e., medicines and pharmaceutical preparations, and are taxable as such. Another submissions of the learned counsel for the applicant was that interest at the rate of 15 per cent may also be allowed on the excess deposits by the applicant, as in some cases partial stay had been granted by this Court and in some cases full amount of tax had been deposited, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
