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TMI Blog2016 (4) TMI 600X X X X Extracts X X X X X X X X Extracts X X X X ..... iscation of goods was thus not justified. It is made clear that this bench has not gone into the time barred aspect of the demands because on merits, the case has been decided in favour of the assessee. - Appeal No.EA-228/11 - Order No.FO/75213/2016 - Dated:- 29-2-2016 - DR. D.M. MISRA, MEMBER(JUDICIAL) AND SHRI H.K.THAKUR, MEMBER(TECHNICAL) For the Petitioner : Shri Lakshmi Kumaran, Advocate Shri Ravi Raghavan, Advocate For the Respondent : Shri S.C.Jana, Spl.Counsel ORDER PER SHRI H.K.THAKUR. This appeal has been filed by the appellant against Order-in-Original No.01-15/COMMISSIONER/CE/KOL-VII/ADJN/2010-11 dated 31.12.2010 passed by Commissioner of Central Excise, Kolkata-VII as Adjudicating authority. Under this Order-in-Original dated 31.12.2010 Adjudicating authority has decided the classification of appellant s product Chyawanprash Awaleha with Ashtawarg and Chyawanprash Awaleha Special under Central Excise Tariff heading (CETH) 2107.91 or 2107.90 or 2108.90 or 2108.99 of the Schedule to Central Excise Tariff Act, 1985 (CETA 85) as per the CETH prevailing from time to time during the period of 15 show cause notices decided. Adjudicating aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority should not have considered acted as a superior authority to say that goods manufactured by appellant are not Ayurvedic medicines. Learned Advocate relied upon Bhubaneswar Collectorate Instruction No.33-GL-30-94 date 20.04.1994 to argue that a drug licence issued under Drugs Cosmetics Act can be used to determine whether a particular product is prepared as per specific standard text books or not. That elsewhere in the country the same products manufactured by the appellant and others have been classified under CETH 30.03 and no appeal is filed by the Revenue against such orders. That this argument was taken before the Adjudicating authority as per para 2.3.8 of the Order-in-Original but no findings are given by Adjudicating authority on this aspect. That no penalty can be imposed upon the appellant as they are of the firm belief that goods manufactured by them are classifiable under CETH 30.03. That demands beyond one year is time barred. Learned Advocate also relied upon the following case laws and citations in support of his argument:- (i) Baidyanath Ayurved Bhavan Pvt.Ltd. vs. CCE- [2006 (203) ELT 294(Tri)] (ii) CCE Chennai-IV vs. Hindustan Lever Ltd.- [2015 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t has established that Ayurvedic Book Bhava Prakash finds a mention in the list of Ayurvedic books under the first schedule to the Drugs Cosmetics Act, 1940, but it is not established whether the substitute ingredients are in reality mentioned in the said Ayurvedic book as ingredients for the manufacture of Chyawanprash Awaleha and Chyawanprash Ashtawarg. (vi) That for the period, for which appellant could not produce the properly renewed Drug Control licence, the impugned products may be classified as food supplements, as the ingredients contained in the products during the period, other than 01.01.1998 to 31.12.1989, may not be as per the Authoritative Ayurvedic texts. 4. Heard both sides and perused the case records including the written submissions filed by either sides. The issue involved in the present proceeding is whether two products of Dabur Chyawanprash (Awaleha Special Awaleha with Ashtawarg) should be classified as Ayurvedic medicaments under CETH 30.03, as claimed by the appellant, or the same should be classified under CETH 21.07/21.08 as decided by the Adjudicating authority. It is the case of the Revenue/Adjudicating authority that the products are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are most useful plant part used medicinally in various diseases and is one of the most popular common and highly reputed drugs of indigenous medicine and that the fruits are well known and domestically used commonly as edible, dietic and home remedy esteemed for its high medicinal potential with preventive, restorative and curative utility. It is an admitted fact that Amla is used alongwith all other Ayurvedic ingredients in making Chyawanprash as specified in the Authoritative Ayurvedic texts. All the ingredients used/contained in Chyawanprash, whether from Charak Samhita or Rosa Tarangini or Siddha Yoga Samgocha or Sharangadhara Samhita or Bhava Prakash etc. are declared to the Drug Control Authorities, West Bengal, who renewed appellant s licence No.AL-529 M granted to the appellant. It is observed that this licence No. is indicated specifically on the Chyawanprash packs sold by the appellant. In para 3.65 of the Order-in-Original dated 31.12.2010 Adjudicating authority mentions that appellant have produced certificate from Vaidyas, dealers etc. that impugned products are used as Ayurvedic medicine. In the next para 3.66 to 3.68 Adjudicating authority discusses that though the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich is protecting humans against coughs, colds etc. and also adding to the general well being. It is observed from the case records that the main ingredient of any Chyawanprash is Amla (Awaleha) which acts both as a tonic as well as a medicine. Types of Chyawanprash manufactured by the appellant as well as those specified in the authentic Ayurvedic texts contain Amla which means the Chyawanprash specified in the Authentic Ayurvedic texts will also act as a tonic as well as a medicine. A view thus has to be taken whether a product having the effect of both a medicine and a tonic, will be classified as a product of chapter 21 or chapter 30.03 of the CETA, 1985. As per chapter note 1(a) of Chapter 21 of the CETA, 85 products of Chapter 30 are excluded from Chapter 21. 4.4 Further as per Chapter note 2(i)(a) of Chapter 30 of the CETA, 1985, a medicament means a product comprising of two or more constituents which have been mixed or compounded together for therapeutic or prophylectic uses. The Ayurvedic ingredients used by the appellant in the manufacture of Dabur Chyawanprash has therapeutic and prophylactic use as claimed on the wrappers of the products. This fact is supported by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment was still entertaining any doubts, they could have referred the matter to the Adviser, Ayurveda/Sub-Commissioner in the Office of Drug Controller, Director General of Health Services, New Delhi. This was not done. 4.5 In the above case the product Banphool Oil was consisting of 98% Till oil and 2% Ayurvedic ingredients like Amla, Chandan, Camphor etc. and Revenue was of the opinion that the product was classifiable under CETH 30.03. In this case law it is observed by the Hon ble Apex Court that the ingredients of Banphool Oil are those which are set out in Ayurvedic text books but the formula adopted may not be as per the text books and a medicament can also be under a patented or proprietary formula. It is also observed by Apex Court that in doubtful cases matter may be referred to the Drug Controller. In the present case the Drug Control authorities have granted a licence to the appellant for the manufacture of impugned products as Ayurvedic/siddha medicines. Appellant has not claimed the classification as exempted category of Ayurvedic medicament under CETH 3003.31 but has claimed the same as patent or proprietary medicament under CETH 3003.39 on payment of appropriate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufactured by the appellant or as per the Authoritative Ayurvedic texts, has both medicinal and health tonic capabilities and any Chyawanprash will also act as a health tonic in addition to working as an Ayurvedic medicine for cure/prevention. An interpretation that Chyawanprash, also having health tonic capabilities will be classifiable only under chapter 21 of CETH, will be an absurd interpretation when the same product manufactured by the same appellant elsewhere in the country, and similar Chyawanprash manufactured by the competitors of the appellant, is being classified as Ayurvedic medicament under CETH 30.03. It is now a well settled legal proposition that interpretation of a statute should be done in such a way to avoid absurdity. In view of the above appeal filed by the appellant is required to be allowed by holding that the impugned products are classifiable as Ayurvedic Medicaments under CETH 30.03. The confirmation of demands, imposition of penalties and confiscation of goods was thus not justified. It is made clear that this bench has not gone into the time barred aspect of the demands because on merits, the case has been decided in favour of the appellant. 5. Appea ..... 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