The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that Sensur Rubefacient and Herbyl Skin Ointment is classifiable as ayurveda medicaments when active ingredient are ayurvedic.
The question before the Tribunal is that whether the product manufactured by Lyka Labs Limited ,the appellant in the name of Sensur Rubefacient and Herbyl Skin Ointment are ayurvedic medicament classifiable under 3003.30 or P&P medicament (other than medicament) classifiable under 3003.39 to the first schedule to the Central Excise Tariff 1985.
Shri Shailesh P. Sheth, Counsel appearing on behalf of the appellant submitted that the product is manufactured out of Ayurvedic ingredients which are specified in Ayurveda Grantha. The product is sold as Ayurvedic medicine. The Drug Authority has given license to these medicines as Ayurvedic medicine that the goods are marketed as Ayurvedic medicine, therefore, the product is clearly an Ayurvedic medicine and the appellant have correctly classified the goods.
It was submitted that merely because some of the ingredients which are other than active ingredients like preservatives, excipients, binding agent carriers or vehicle or fillers etc., even not prescribed in Ayurvedic text would not render the product P or P medicament (other than Ayurvedic medicament) classifiable under said heading 3003.10. Shri R.K. Agarwal, Superintendent (AR) appearing on behalf of the revenue reiterated the findings of the impugned order.
The two member bench comprising of Ramesh Nair (Judicial Member) and Raju (Technical member) viewed that “to classify medicament as Ayurvedic medicament, the following criteria to be satisfied.
1.The medicament should be manufactured out of Ayurvedic ingredient specified in Ayurvedic Grantha or Ayurveda authoritative books.
2.The medicament is sold as ayurvedic medicine in the trade parlance etc.
In the present case some of the ingredients such as Boric acid, Lanoline Anhydrous, White Soft Paraffin, Essence of Jasmine, Salicyclic Acid, and Bees wax have been used were claimed by the department as other than ayurvedic ingredients.”
The appellant claimed that firstly these are not active ingredients, whereas the same are in the nature of preservatives, excipients, binding agent, career or vehicle or filler etc., therefore, even though these product are other than ayurvedic ingredients, if the active ingredient are ayurvedic still the medicament is classifiable as ayurvedic medicament.
It was important to examine whether they are active or non-active and whether they are also covered under Ayurvedic authoritative books. The CESTAT set aside the impugned order and remanded the matter to the adjudicating authority for passing a fresh order.
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