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2017 (6) TMI 657 - HC - VAT and Sales TaxInterpretation of statute - entry 28A, particularly after its amendment with effect from 01.08.2009 - classification of goods - Whether on the facts and in the circumstances of the case, the Tribunal has rightly held that, products sold by the opponent company are drugs and medicines and are not cosmetics and toilet preparations including tooth paste, tooth powder, hair oil, face and body lotion, cream and soaps are therefore, exclusion clause (b) of entry no. 28(A)(i) of the Gujarat Value Added Tax Act, 2003 will not apply and on the same basis, the products sold by the opponent fall under the entry no. 28(A)(i) of the Gujarat Value Added Tax Act, 2003? Held that: - prior to its amendment, entry 28A(i) referred only to drugs, medicines and vaccines including bulk drugs. This entry does not have any further elaboration nor it has any exclusion clause. With effect from 01.08.2009, while maintaining the original main description of the items covered under the entry, the legislature introduced an exclusion clause which had two subclauses. We are concerned with subclause (b) which pertains to cosmetics and toilet preparations including tooth paste, tooth powder, hair oil, face and body lotions, creams and soaps. When a product is manufactured from medicinal drugs, be it Ayurvedic or homeopathic, is used under medical advice for specific disease, merely because it may have an element of improving appearance of the human beings, would not mean that the same is not a drug or a medicine, but a cosmetic. The Tribunal therefore correctly held that the products in question were drugs and medicines and not cosmetics or toilet preparations. If that be so, the consequential effect of the items being included in entry 28A(i) becomes simple. The exclusion clause cannot be applied by simply holding that the product in question is a toothpaste or a tooth powder whether it is a cosmetic or toilet preparation or not. Appeal allowed - decided in favor of assessee.
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