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2008 (8) TMI 629 - AT - Central ExciseExemption to Drugs/medicines as per Sl. No. 47 of N/N. 4/2006-C.E. - Manufacture of Bulk Drugs - Nevirapine and Stavudine - Exemption denied on the ground that since the item comes under Sl. No. 47(B), the appellants should have followed certain conditions - HELD THAT:- The items manufactured by the assessee specifically fall under Sl. No. 117/118 of List 3 of Notification No. 21/2002-Cus., dated 1-3-2002. Although, the appellants cleared the items to be drugs, there is specific entry in the above stated Sl. No. of List 3 of Notification No. 21/2002-Cus., dated 1-3-2002. In view of this entry, the assessees are eligible for the benefit of the Notification. The items are bulk drugs and they are required to be granted the benefit of Notification. The issue is also covered in the case of M/s. Burroughs Wellcome (I) Ltd. v. CCE [2007 (6) TMI 354 - CESTAT, MUMBAI] and Cipla Ltd. v. CC [2007 (8) TMI 131 - CESTAT, CHENNAI] - it is found that the clearance made by them availing the Notification had been intimated to the Department in form ER-1 filed by the appellants from time to time. The appellants had cleared the items to Cipla Ltd. by availing nil rate of duty in terms of the Notification No. 4/2006-C.E. Cipla had used “Stavudine and Nevirapine” in the manufacture of medicines and had accounted for the quantity of both the items received by it from the appellants at nil rate of duty, in the records maintained by them, and used the same in the manufacture of formulations/medicines specified in Sl. No. 47A of the Notification No. 4/2006-C.E. It is further seen that Nevirapine is specifically mentioned in List-3 of the Notification No. 21/2002-Cus., hence, it is a drug covered under Sl. No. 47(A) of Notification No. 4/2006-C.E. It is also seen that all drugs or medicines including their salts and esters and diagnostic test kits which are specified in List-3 of List-4 of the Notification No. 21/2002-Cus., are exempted, when they are manufactured in India. Thus, both the items find a specific entry in Sl. No. 117 and 118 respectively of List-3 of Notification No. 21/2002-Cus., Therefore, the term “drug” has to be considered to include bulk drug and formulation as per Drugs (Prices Control) Order, 1995 and hence, both the items being bulk drugs are entitled for the benefit of the Notification. The impugned orders are not correct and legal and hence, they are set aside by allowing these appeals - appeal allowed.
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