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TMI Blog2025 (2) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... nder list 3 and 4 of the Customs Notification vide Order in Original No. V(30)15/CE/ADJ/81/2007/296 dated 14.01.2016. The pharmaceutical substances are prepared as hydrochlorides so that they may be quickly released in the gastrointestinal tract which body usually absorbs within 15-30 minutes; therefore, exemption granted to various formulations under the notifications also includes their salts, esters, and not including of Hydrochlorides under Notification will make the Notification redundant and this aspect has also been indicated in the various Pharmacoepia - the denial of exemption to the appellant amount to discrimination because the other manufacturer who are manufacturing the identical goods are availing the exemption which has been sought to be denied to the appellant which is not permitted in law. Principles of unjust enrichment - HELD THAT:- The appellant has procured the bulk drug on payment of duty which was borne by them and has not been passed on to any customer and in order to establish this fact, the appellant has produced the copies of balance sheet, wherein it has been recorded that the amount of duty paid on bulk drug as "Receivable" under Current Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsequently applied for refund of duty paid on these inputs. 2.2 The adjudicating authority rejected the refund claim vide passing Order-in-Original dated 31.03.2011 on the ground that Hydrochloride of Gemcitabine and Doxorubicin were not specified under list 3 and 4 of the Customs Notification and therefore, exemption under the Notification was not available to the appellant as the bulk drugs were not used for manufacture of Gemcitabine and Doxorubicin and rather used for manufacture of the Hydrochloride of said drugs. Further, it was held that the appellant has passed the duty component claimed as refund to the customers and hence failed the test of unjust enrichment. Aggrieved by the said order, the appellant filed the appeal before the Commissioner (Appeals) who rejected the appeal. Hence, the present appeal. 3. Heard both the parties and perused the record. 4.1 Ld. Counsel for the appellant submits that the impugned order is not sustainable in law as the same has been passed without properly appreciating the facts and the law. She further submits that the exemption benefit under the Notification has been denied to the appellant solely on the basis that the bulk drugs are use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arifies that exemption under the Customs Notification under SI. 80(A) and SI. 80(B) is available to not only drugs or medicines specified in list 3 but also their salts & esters which makes it evident that the legislature always had the intention to provide the benefit of exemption to the salts and esters of the drugs or medicines specified under List 3 of the Customs Notification. 4.5 She further submits that exemption granted to various formulations under the Notifications also include their salts and esters and the same is also certified by the Dr. Surinder Tyagi, Chief Scientific Officer of the Dabur Research Foundation, wherein, it has been clarified that use of Hydrochloride salts is only because of the low solubility of the Doxurubicin & Gemcitabine. In this regard, she further relied upon the following decision: Rhone Poulenc (India) Ltd. Versus Collector Of Customs 1992 (60) E.L.T. 259 (Tribunal) [Maintained in Supreme Court in 1996 (87) ELT A205 (Supreme Court) 4.6 She further submits that Doxorubicin and Gemcitabine are the live saving anti-cancer drugs. Due to the low solubility/absorption of these drugs, these drugs are formulated for injection solution by using hy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iod where, the appellant has recorded the amount of excise duty paid on bulk drugs as "Receivable" under Current Asset and not included the same in the cost of the injections manufactured by the appellant. The appellant has also produced a chart elaborating on the cost vis-à-vis pricing of the final product of the appellant and all the elements gone into pricing and the same was certified by Chartered Accountant which is produced in record. 4.10 She further submits that the invoices issued prior to the relevant period and during the relevant Period clearly shows that the MRP of the products remained same despite the payment of duty on bulk drug which shows that the duty element has been borne by the appellant only. She also relied upon the following decisions, wherein it has been held that the Department cannot disregard the evidences products by the assessee for passing the test of unjust enrichment without producing contrary evidence: M/S Tejas Network Ltd. Versus Commissioner, Customs (Appeals), Bangalore 2023 (7) TMI 778-CESTAT Bangalore M/S. Indian Oil Corporation Ltd Versus C.C.E. -Service Tax-Vadodara-I 2019 (370) E.L.Τ. 487 (Tri. - Ahmd.) Commr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as held in the cases cited (Supra). We also find that Hydrochlorides are nothing but salts resulting or regarded as resulting from the reaction of Hydrochloric acid with an organic base. We also note that the pharmaceutical substances are prepared as hydrochlorides so that they may be quickly released in the gastrointestinal tract which body usually absorbs within 15-30 minutes; therefore, exemption granted to various formulations under the notifications also includes their salts, esters, and not including of Hydrochlorides under Notification will make the Notification redundant and this aspect has also been indicated in the various Pharmacoepia cited (Supra). We also note that denial of exemption to the appellant amount to discrimination because the other manufacturer who are manufacturing the identical goods are availing the exemption which has been sought to be denied to the appellant which is not permitted in law. 8. As regards the unjust enrichment, we find that the appellant has procured the bulk drug on payment of duty which was borne by them and has not been passed on to any customer and in order to establish this fact, the appellant has produced the copies of balance shee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue has not even considered the Cost Accountant certificate leave alone countering the same with valid reasons. Cost Accountant has issued the certificate after going through the accounts of the appellants and after satisfying himself about the truthfulness of the same. A certificate given by a professional cannot be dis-regarded unless it is proved to be blatantly wrong and contrary to the facts and evidence available on the hand. Thus, the certificate given by the Cost Accountant has an evidentiary value and cannot be rejected in a half-handed manner. We find that there is merit in the argument of the appellants that the impugned order has not given any specific findings regarding the correctness and genuineness of the Cost Accountant Certificate; it is trite in law that the Cost Accountant Certificate is one of the sufficient conditions to substantiate that the incidence of duty has not been passed on to the customers; the onus to disprove the Cost Accountant Certificate is with the Department and the same has not been discharged. The impugned order having been issued despite the evidence in the form of the certificate and without giving reasons as to why the same has not bee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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