9911796707
TMI Blog1993 (6) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... was imposed with effect from March 1, 1961. The medicines manufactured by the company are not advertised but it is customary that free supply of medicinal preparations and drugs is made to hospitals, nursing homes and medical practitioners to enable them to get familiarise with such preparations. The samples handed over to the hospitals and medical practitioners are free and the company does not recover any charges for the value thereof. 2. The Government of India, Ministry of Finance (Department of Revenue) published exemption notification dated April 1, 1977 in exercise of sub-rule (1) of Rule 8 of Central Excise Rules, 1944 exempting clinical samples issued by any manufacturer of patent or proprietary medicines falling under Tariff Ite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quired to be stated that the validity of the explanation was challenged before Gujarat High Court and by judgment reported in 1980 (6) E.L.T. 759 (Guj.) (Suhrid Geigy Ltd. v. Union of India and Another), the Division Bench of the Gujarat High Court held that clause (a) to the explanation is ultra vires under Article 14 and Rule 8 of Central Excise Rules and it has no nexus with the object which the notification seeks to serve. The appeal preferred by the department before the Supreme Court is pending final disposal. Shri Korde, learned counsel appearing on behalf of the petitioners, submitted that in the present case, even accepting the validity of the explanation, the department is in error in assuming that the benefit of exemption noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dominance of corporations having foreign interest in the pharmaceutical industry in India. To achieve this object, the exemption notification deprives the manufacturing company which holds share in the capital of any foreign company or the part of the capital of the manufacturer is held by a foreigner. It is not in dispute that the petitioner company which was incorporated on August 17, 1935 is purely an Indian company and none of the foreign company has any interest in its share capital. 5. Shri Deodhar, learned counsel appearing on behalf of the department, submitted that the petitioner company is not entitled to advantage of exemption notification because the petitioner company holds share in the capital of foreign company. It is not i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the custodian of enemy property of India under the provisions of Evacuee Property Act. The property of the holding vested in the custodian was only 3.09%. One Shri J.A. Parkar, residing at Singapore and a British national had expired and at the time of demise, was holder of 14 equity shares of value of Rs. 1,400/-. The legal heirs of Shri Parkar did not seek transfer of shares. Shri Deodhar submitted that as 3.09% of issued capital was held by custodian and 0.05% by Shri Parkar, a British national, it must be concluded that the part of the capital of petitioner company was held by a foreigner. We are unable to accede to the submission of the learned counsel. The vested interest in favour of custodian under the Evacuee Property Act was b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the exemption notification in the present proceedings. As regards the claim for refund made in prayer (f), it is not possible to pass order in favour of the petitioner company in the present proceedings as the claim has not been verified by the department. The Assistant Collector of Central Excise, Bombay, Division VII is directed to verify the claim for refund within a period of 12 weeks and then pay the amount of refund to the company forthwith. It is required to be made clear that as the samples were handed over free to the hospitals and medical practitioners the application of Section 11B of the Central Excise Act does not come into play. In case the department fails to make refund within a period of 12 weeks, then the department will ..... X X X X Extracts X X X X X X X X Extracts X X X X
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