TMI Blog1987 (9) TMI 174X X X X Extracts X X X X X X X X Extracts X X X X ..... present proceedings against the appellants are the outcome of a visit by Central Excise officers (Preventive) Patiala Division to the appellants factory on 23-1-1982. The appellants are engaged in the manufacture of medicines. On examining the labels used for Dextrose I.P. Central Excise authorities were, prima facie, of opinion that in view of the label used on the packing and container of the medicine the medicine would merit classification as patent and proprietary medicine under T.I. 14E. The appellants had not filed any declaration claiming exemption from licencing in terms of Notification No. 111/78, dated 9-5-1978 nor had obtained a licence for manufacture of such medicine. After usual investigation show cause notice was served on the appellants calling upon them why for breach of certain rules specified in the show cause notice penalty be not imposed against them and central excise duty amount Rs. 6,50,439/- for the period 1978-79 to 23-1-1982 be not realised from them. The appellants through their Counsel Shri A.K.S. Bedi filed reply dated 20-4-1982 to the show cause notice mainly contending that the proposed action was based on misconstruction and wrong interpretation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stic and sematical fashion on the labels would not fasten liability under the item on the appellants. The Revenue was all along aware of the manufacturing activity of the appellants and therefore shorter period of six months and not the longer period of five years would apply for demand of duty. 7. Elaborating his arguments Shri Chandrasekharan submitted that the definition of patent and proprietary medicine has three parts which should be read conjunctively and not disjunctively. It should be read harmoniously. Shri Chandrasekharan submitted that if a manufacturer manufactures a medicine finding place in the specified pharmacopoeia then he cannot be said to have the proprietary right over the medicine. It is only when he manufactures a medicine not specified in the pharmacopoeia that he could be said to possess such a right. Such was not the case in the case of the appellants as Dextrose finds place in pharmacopoeia. He submitted that while the process is patented, the product Dextrose is not patented under Indian Patents Act. He referred to Drugs Cosmetics Act 1940, Section 3H for the definition of Patent Proprietary medicine. Shri Chandrasekharan referred to dictionary mea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that in order to fasten liability under Explanation to the item, the right be it exclusive or non-exclusive, should be enforceable in a Court of Law. 11. Before dealing with the arguments advanced by the parties and the decisions relied on it would be useful to reproduce Explanation I to Tariff Item 14E which is a definition of Patent or Proprietary medicines for the purpose of Central Excise Tariff. Explanation I : Patent or Proprietary medicines means any drug or medicinal preparation, in whatever form, for use in the internal or external treatment of, or for the prevention of ailments in human beings or animals, which bears either on itself or on its container or both, a name which is not specified in a monograph in a Pharmacopoeia Formulary or other publications notified in this behalf by the Central Government in the Official Gazette, or which is a brand name, that is a name or a registered trade mark under the Trade and Merchandise Marks Act, 1958 (43 of 1958) or any other mark such as a symbol, monogram, label, signature or invented words or any writing which is used in relation to that medicine for the purpose of indicating or so as to indicate a connection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion is which of the two High Court decisions should be preferred. The decision of Ramsey Pharma Private Ltd. case 1983 E.L.T. 78 Allahabad is more to the point with the case in hand. In this decision the Hon ble High Court was concerned with a medicine whose name was, as in this case, contained in an Indian Pharmacopoeia. It had no brand name and the manufacturer had not got any trade mark registered under the Trade and Merchandise Act, 1958 in respect of the medicine. The issue was whether the labels on the bottles of the medicines and the cardboard cartons in which the bottles were packed bore any mark such as a symbol, monogram, invented words or writing indicating a connection in the course of trade between those medicines and the person having either as proprietor or otherwise the right to use such name or mark. The main discussion of this issue is to be found in paras 8 to 12 of the decision. In the decision no monogram was involved but calligraphic letters as in the present case as seen from the label produced were involved. The High Court also referred to requirement of Rule 88 of Drugs and Cosmetic Rules. After referring to the arguments advanced by the parties the High Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as in conformity with the Allahabad High Court decision though it did not in terms refer to the Allahabad High Court decision. Shri M. Chandrasekharan has no doubt assailed this decision on the ground that it had not noticed in terms the Allahabad High Court decision or the contrary Madras High Court decision. He also submitted that these decisions were taken in absence of the manufacturer without any arguments. The fact, however, remains that the decision is in conformity with the Allahabad High Court decision though it does not in terms refer to the same. Tribunal having once taken a view in conformity with Allahabad High Court decision, it would not be prudent for this Bench to reverse that view and follow Madras High Court decision in preference to Allahabad High Court decision. 17. Examined in the light of the Allabad High Court decision, the two calligraphic letters A P with name Astra written below inside a near square of one cm. would make the medicine a patent or proprietary medicine attracting Central Excise duty. We find accordingly. 18. As for Shri Chandrasekharan s plea that the show cause notice referred to monograph and not monogram , the substance of the alle ..... X X X X Extracts X X X X X X X X Extracts X X X X
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