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TMI Blog2004 (6) TMI 122X X X X Extracts X X X X X X X X Extracts X X X X ..... rity. After 1994, the appellants submitted classification declaration and paid central excise duty accordingly without any objection from the Central Excise Department. 4.M/s. Prem appellants in E/487/03 filed a classification declaration under Rule 173B with effect from 4-5-2000 claiming exemption under Notification No. 6/2000 as amended by Notification No. 36/2000, dated 4-5-2000 for IV Fluids. In respect of the following IV Fluids the appellants claimed exemption : (i) Mannitol Inj. (ii) Metronidazol Inj. (iii) Ciprafloxacin Inj. 5.Appellants were asked by the Central Excise Department to reverse total amount of Cenvat credit on the inputs used in the manufacture of finished goods covered under the said notification. Accordingly, the appellants debited an amount of Rs. 1,87,808. Therefore, according to the appellants the Department had accepted the view that the impugned products are exempted under Notification 36/2000, dated 4-5-2000. Thereafter, by the DG, Central Excise Intelligence a show cause notice dated 28-5-2001 was issued proposing to dem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Rule 173Q. Appellant submitted detailed reply denying the allegation and contending that the goods are covered under the scope of IV Fluids exempted under notification. Ultimately the Commissioner of Central Excise, Indore passed an order dated 31-10-2002 rejecting the contention taken by the appellant. 8.Under notification 6/2000, dated 1-3-2000 as amended by 36/2000, dated 4-5-2000 exemption from duty had been granted in respect of certain goods included in the list appended thereto. Item 47A was shown as Intravenous fluids coming under Chapter Heading 30 of the Schedule to Central Excise Tariff Act, 1985. Under subsequent notification, namely, 3/2001, dated 1-3-2001 similar exemption was being granted against Item No. 56 where it was shown "Intravenous fluids, which are used for sugar, electrolyte or fluid replenishment" coming under Chapter 30. Commissioner has taken the view in both the cases that IV Fluids for the purpose of exemption under Notification 6/2000 would be only those IV Fluids which are used for sugar electrolyte or fluid replenishment. The Commissioner comes to the above conclusion on the basis of the description of Intravenous Fluids in Notification 3/2001, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... independent notification. Notification 6/2000 was rescinded on 1-3-2001 by Notification 10/2001 itself. Therefore, the description of IV Fluid given under Entry 56 in Notification 3/2001 cannot be applied for interpreting the meaning of IV Fluids under Entry 47A of Notification 6/2000. Description under Entry 56 cannot be treated as clarification of Entry under 47A. 11.Another issue considered by the Bench was whether the goods declared as IV fluids by Albert David and Ahlcon would conform to the specifications of IV fluids in terms of technical literature. The Revenue had contended that the products in question were meant for intravenous infusion for medicinal purposes and were not merely intended to be used as fluid replenishment in human body. It was also contended that the products were IV fluids containing added substances. On this ground also the products were sought to be excluded from the category of Intravenous Fluids coming under Entry No. 47A. The Bench took the view that the contention of the Revenue cannot be sustained. Reliance was placed on technical literature such as Pharmacopoeia, encyclopedia etc. It was observed that all the literature on the subject invariab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n grounds, for this stand, are enumerated as under :- (a) No additives or preservatives could be added in IV fluids, whereas the drugs contained in the disputed entities were in the nature of additives. (b) IV fluids perform function of restoring sugar, fluid and electrolyte balance in the body. The drugs contained in them, on the other hand, were for treatment of specific ailments, having antamoebic or/and antibiotic properties, among others. (c) In the 2001-2002 Budget, an explanation, was inserted in Notification 36/2000, clarifying that only such IV fluids which were used for sugar, electrolyte or fluid replenishment, were exempt from duty and not other IV fluids. (In actual fact, this was not a clarificatory explanation, but an entirely new dispensation, vide Notification 3/2001, dated 1-3-2001. (d) The additives in question, if cleared in tablet/syrup form, were eligible to duty @ 16% ad valorem, under S.H. 3003.20. It would be anomalous, therefore, to hold that, if they were cleared as 'injections', as in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the drug. The Bench took the view that it is not permitted to add the word 'exclusive or alone' to a Notification, as proposed by the Revenue. 16.We are in respectful agreement with the view taken in the above decisions of this Tribunal in the matter of interpretation of the notifications granting exemption to IV fluids. Now coming to the facts of the present cases we find that in appeal by Prem Pharmaceuticals following are the details of clearances of IV fluids made without payment of duty during the period 4-5-2000 to 31-3-2001 :- S. No. Description of the product Qty. Cleared (Boxes/cartons) Clearance value (Rs.) 1. 10% Mannitol Inj. I.P. 300 ml 255 101139.18 2. 20% Mannitol Inj. I.P. 300 ml 6148 3936935.38 3. 20% Mannitol Inj. I.P. 100 ml 7705 3984002.20 4. Ciprofloxacin 100 ml 6232 1726360.63 5. Metronidazole 100 ml IP 10276 2229811.53 6. Premogyl 100 ml 383 73850.13 7. C.Flox 100 ml 619 161166.38 8. Premezol 500 ml 2990 731323.64 9. ACD Solution A 75 ml IP 566 138305.63 10. ACD S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he peritoneal cavity is gravitated moderately slowly a hypertonic solution (20 per cent dextrose solution with 6 G. sodium chloride per litre added). The liquid is retained by clipping the tube for two hours and then allowing it to flow out. The process is continued for up to forty-eight hours. Thus the peritoneum acts as a dialysing membrane". The above would show how the Dextrose solution is used in peritoneal dialysis. In the same book kidney dialysis process is explained as below :- "The principle of the artificial kidney is that of dialysis across a membrane which is permeable to crystalloids and not to colloids, with the patient's blood on one side of the membrane and a saline bath on the other; excessive crystalloids will leave the blood and enter the bath, which is constantly flowing." The above would show that these items are not pushed through veins and cannot be treated as IV fluids. 18. So also in the case of irrigation fluids we are not able to accept the contention of the appellant that they are to be treated as IV fluids. Irrigation fluid is used only at specific area and not pushed through veins. In the result, we hold that the appellant is not entitled to any e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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