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Issues:
1. Interpretation of import clearance under a specific license. 2. Classification of imported item as Drug or Drug Intermediate. 3. Relevance of pharmacopeial standards in determining import eligibility. 4. Application of the definition of "drug" under the Drugs and Cosmetics Act, 1940. 5. Comparison of conflicting judgments regarding the classification of imported items. Analysis: 1. The appeal challenged the Order-in-Appeal confirming the confiscation of "polyvinyl Pyrrolidone" but allowing a fine option. The appellants imported Luviskol K 30 claiming clearance under a specific license for Drug/Drug Intermediates. The manufacturer's literature indicated non-pharmaceutical usage, leading to objections and a show cause notice for under-invoicing. The adjudicating authority ruled against the appellants, upheld by the Collector of Customs (Appeals). 2. The appellant argued that the imported item met pharmacopeial standards, making it a Drug under the Drugs and Cosmetics Act, 1940. Referring to legal precedents, the appellant contended that the item was importable as a Drug or Drug Intermediate. The respondent supported the original order, citing a Bombay High Court judgment on the same item. 3. The Tribunal considered the appellant's possession of a license for Drug/Drug Intermediates and the nature of the imported "Polyvinyl Pyrrolidone PVP." While valuation was not contested, the key issue was whether the item could be classified as a Drug or Drug Intermediate based on its pharmacopeial identity. 4. The definition of "drug" under Section 3(b) of the Drugs and Cosmetics Act, 1940 was pivotal. The appellant argued that the item's presence in the US and British Pharmacopeias, along with the Act's definition, made it importable under the license. The Tribunal analyzed the Act's broad definition encompassing items without medicinal properties. 5. The Tribunal reviewed the Bombay High Court's judgment in Glaxo Laboratories, emphasizing the distinction between medicinal properties and pharmacopeial identities. Contrasting views in subsequent judgments were evaluated, ultimately siding with the interpretation that aligned with the Drugs and Cosmetics Act. The Tribunal concluded that the imported item, a pharmaceutical-grade polyvinyl pyrrolidone, fell within the definition of a Drug, allowing its import under the license. In conclusion, the Tribunal allowed the appeal, setting aside the original order and permitting the import of the item under the presented license. The decision highlighted the significance of the Drugs and Cosmetics Act's definition in determining the eligibility of imported items classified as Drugs or Drug Intermediates.
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