TMI Blog1997 (11) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... 988 and confirmed the demand of duty of Rs. 18,30,444.00 on menthol I.P. under Rule 9(2) of the Central Excise Rules, 1944. The Collector vide impugned order also held that the appellants have contravened the provisions of Rules 52A, 173B, 173C, 173F and 173Q of the Central Excise Rules, 1944 and also imposed a penalty of Rs. 2.0 lac on the appellants. 2. The appellants are engaged in the manufacture of menthols that is menthol ordinary grade and menthol pharmacopoeial grade. Menthol pharmacopoeial grade is bulk drug. Notification No. 31/88-C.E., dated 1-3-1988 exempts bulk drugs specified under the Table to the Notification from the whole of excise duty leviable thereon and prescribed 5% excise duty on the other bulk drugs. The Notifica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Control) Order, 1987. He submitted that the Notification provides that the expression `bulk drug shall have the same meaning assigned to in the Drug (Price Control) Order, 1987. He submits that as per the definition in the Drug (Price Control) Order, 1987, the `bulk drug means any substance including pharmaceutical, chemical, biological or plant product or medicinal gas conforming to pharmacopoeial or other standards accepted under the Drugs and Cosmetics Act, 1940 (23 of 1940), which is used as such, or as an ingredient in any formulation. He submits that the Revenue has wrongly relied upon the expression `formulation as defined under Drug (Price Control) Order, 1987. He submits that the objection of the Revenue is that the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in any formulation as prescribed under the Drug (Price Control) Order, 1987. He therefore, prays that the appeal be dismissed. 6. Heard both sides. In this case, the appellants cleared the menthol I.P. availing the benefit of Notification No. 31/88-C.E., dated 1-3-1988. The Notification No. 31/88-C.E., dated 1-3-1988 provides as under : In exercise of the powers conferred by sub-rule (1) of Rule 8 of the Central Excise Rules, 1944, the Central Government hereby exempts goods of the description specified in column (2) of the Table hereto annexed and falling under Chapter 28, 29 or 30 as the case may be, of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), from so much of the duty of excise leviable thereon under the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed out of, or containing one or more bulk drugs or drugs with or without the use of any pharmaceutical aids, or internal or external use for........." 8. The definition of `Bulk Drug provided under the Drugs (Prices Control) Order, 1987 means any substance provided under the definition, which is used as such, or as an ingredient in any formulation and the `Formulation means a medicine processed out of, or containing one or more bulk drugs or drugs with or without use of any pharmaceutical aids, for internal or external use for, or in the diagnosis, treatment, mitigation or prevention of disease in human beings or animals. In the present case, the appellants are not disputing the fact that they are clearing the menthol I.P. to the manu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s per the definition, the `bulk drug means any substance mentioned in the definition which is used as such, or as an ingredient in any formulation and `Formulation means a medicine processed out of, or containing one or more bulk drugs. In the present case admittedly the menthol I.P. cleared by the appellants is not being used as such, or as an ingredient in any of the formulation mentioned under the Drugs (Prices Control) Order, 1987. Therefore, the facts of the present case are different from the cases relied upon by the appellants. 10. In view of the facts as discussed above, we find that menthol I.P. cleared by the appellants is not used as such, or as an ingredient in any of the formulation as provided under the Drugs (Prices Con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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