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TMI Blog1993 (10) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal No. E/1935/89-C (hereinafter called appeal No. 2) has been filed by the Revenue against the order-in-appeal dated 22-2-1989 passed by Collector (Appeals), Bombay setting aside the Order-in-Original dated 30-12-1987 passed by the Asstt. Collector of Central Excise, Bulsar classifying the said product 'Selsun' as a cosmetic, - as also done by the Additional Collector of Central Excise, Vadodara vide his order dated 21-12-1987. 3. The main issue involved in both these appeals is thus regarding the classification of the product 'Selenium Sulfide Lotion USP (SELSUN)" as a cosmetic under sub-heading 3305.90 as held by the Department, or under sub-heading No. 3003.19 as a medicine as contended by the appellants in Appeal No. 1 (E/610/88-C). 4. We have heard both sides and have considered their pleas both oral and written. Main pleas for classifying the said product as a medicine adduced on behalf of the appellants in appeal No. 1 are as follows : (a) that the product is described and has consistently, for a long period of time in the past, been prescribed and sold as Selsun Suspension and not as a Shampoo. (b) that the Trade literature is sent only to registe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tis, commonly known as "Dandruff". (b) That Selsun was being manufactured under a drug licence (No. 1/22/423/71CH III dated 20-9-1971) issued by the F.D.A. Maharashtra State, Bombay to the manufacturer. (c) That the Food and Drug Administration, Maharashtra State had issued a certificate dated 12-11-1976 certifying that Selsun is a "drug", within the meaning of Section 3(b) of the Drugs and Cosmetics Act, 1940. (d) That the brand name "Selsun" was derived from the name of the drug "Selenium Sulphide Suspension". (e) That the said drug had been included in the National Formulary (XIII Edition) published by American Pharmaceutical Association Washington D.C. as well as in the United States Pharmacopoeia 19th Edition. (f) That the U.S. Pharmacopoeia mentioned Selenium Sulfide lotion as a drug. The U.S. Pharmacopoeia has been a standard and authentic work for the last 154 years in the U.S.A. for the selection, naming and standardisation of drugs. The drug Selenium Sulfide figures in monograph 360 under the category of "Antiseborrheic". The said drug also features in preface to the National Formulary. The preface to the National Formulary indicates that the wor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cases of seborrheasice (dandruff), it has also been found useful in the treatment of Seborrheic dermatitis of the scalp and tinca versicular. The Board also relied on Harry's "Cosmeticolog (revised by J. Wilkinson) published by George Godwin Limited in which the following extracts appear :- "Dandruff Therapy XXXXX" one major difficulty with Selenium Compounds is that although they are effective they are not cosmetical attractive. Thus products containing Selenium oxide or Sulphide are invariably dark brown in colour and are not pleasant to use. Product containing Selenium are considered to be mere ethical products for use in severe cases of dandruff, rather than general toiletries, and should be used mainly under advice." (k) The Board also took note of the fact that Selsun was being marketed as a Patent or Proprietary medicine through Registered Pharmacist holding valid drug licence, whereas the other general shampoos can be sold by any dealer in the market. (l) The Board also referred to 2 pamphlets issued by Abbott Laboratories to advertise the product "Selsun" wherein the product has been recommended because; "Extensive studies show that Selsun is effective in up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. (q) Further, the Board also took note of the fact that the matter had been referred to the Drugs Controller (India) in the Directorate General of Health Services to intimate whether Selenium Sulfide present in Selsun in therapeutical and prophylactic quantities. The Drugs Controller (India) stated categorically on 27-3-1978 that Selenium Sulfide was present in Selsun in a therapeutically effective concentration. 6. The appellants have produced the following documents and "evidence" to establish "without doubt" that their product is a medicine. (a) Certificate issued by the Food and Drugs Administration, Maharashtra State along with an English translation thereof. (b) Other test and analysis certificates issued by Government and other authorities. (c) Drug Licence covering manufacture of Selsun. (d) U.S.P. Pharmacopoeia Official Monographs - Extracts from pages 721 and 958, covering Selsun lotion. (e) Extracts from "Martindale" "Goodman and Gilmen", "Merck Index" etc. (f) Trade literature in respect of other shampoos and also Selsun, in order to contrast them with Selsun. (g) Affidavits/letters and certificates of various doctors and medical prac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e decisions passed by the CEGAT, New Delhi in respect of BOROLINE, it is crystal clear that the product manufactured by M/s. B.P.L. Pharmaceuticals Pvt. Ltd., Vapi attracts Central Excise duty under Chapter 33." 9. The Asstt. Collector of Central Excise, Bulsar in his order dated 30-12-1987 regarding the classification of the said product has also classified it as a cosmetic for the following reasons extracted from his order dated 30-12-1987. "As per the arguments put forth by the party at the time of personal hearing I also referred the technical/chemical literature of the product and as per the information on the container of the product the seleniun sulfide USP is 2.5% which is very small proportion looking to the following other ingredients. Surfactant Inert stabilizer and water 17.0% 5.2% 75.3% and thus as a whole selenium sulphide has got very subsidiary curative or prophylactic value as to other ingredients have in proportion of 97.5% will have the substantial effect. It is also further revealed from the Cosmetics-Science and Technology edited by Edward Sagarin at page 647. The most recently developed preparation of this type is the detergent suspension ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ative and prophylactic value and that other 97.5% will have a substantial effect; (ii) The product 'Selenium Sulphide Suspension' was mentioned in National Formulary XII Edition/USP; (iii) It was used for treatment of dandruff (seborrheic dermatitis); (iv) By reading the note No. 2 of Chapter 33 and note 1(d) of Chapter 30 the product was classifiable as a medicine; 11. At the outset it may be pointed out that the classification of the subject goods as a medicine under the old tariff (T.I. 14E) will not be conclusive of classification of the said goods under the new tariff (3305.90) since the earlier tariff heading covered, inter alia, "Preparation for the care of the hair ...... including shampoos whether or not containing soap or organic surface active agents" and the corresponding heading of the new tariff reads "Preparation for use on the hair" including shampoos whether or not containing surface active agent. Further, the new tariff incorporates the rules of interpretation which were not there under the old tariff. 12. The main pleas on behalf of the appellants for classifying their product as a medicine are that it is a preparation for the treatment of da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essary if it were not to be used as a cosmetic. Further, as seen from the Order-in-Original passed by Asstt. Collector of Central Excise, Bulsar which has been set aside by the Collector (Appeals) and which is the subject matter of Appeal No. E/1985/89-C - page 5 of Cosmetics Science and Technology edited by Edward Sagarin mentions - "Undoubtedly many products conform to the definitions of both Drugs and Cosmetics under the Act, such as complex acne remedies, hormone preparations, anti-perspirants and many other preparations which can logically be called both Drugs and Cosmetics. (emphasis supplied.) 17. In this situation vide Rule 3(a) of interpretative rules, "The heading which provides the most specific description shall be preferred to heading providing a more general description". Here Chapter 30 covers pharmaceutical products and sub-heading 30.19 claimed by the appellants covers P. & P. Medicines other than those which are excluded and those which are specified under other sub-heading. As against this, sub-heading 3305.90 covers preparations for the use on the hair including shampoos. The said heading is more specific than the general headings 'Pharmaceuticals product ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore, have only subsidiary effect and the rest 97.5% will have a substantial effect; but he has not dealt with the other points made by the learned Adjudicating Authority dealt with referred to at paras 16 to 19 above, namely, that the Book of Science and Technology edited by Edward Sagarin says that there are many products which conform to the definitions of both drugs and cosmetics, and further that in view of Rule 3(a) and 3(c) of interpretative rules, the classification under Chapter 33 which occurs later and provides a more specific description will prevail over the earlier Chapter 30 which is of a more general nature. 24. Much emphasis has been laid on the fact that the product 'Selsun' is manufactured under a drug licence given by FDA authorities and that it is classified as a drug by the State Govt. Now, different enactments will have different considerations/tariffs, for classifying various products and a classification under each enactment has to be determined according to the provisions of the particular tariff. Secondly, it is seen that the product selsun is manufactured by the Principals of the present appellants under the provision of 'Drugs and Cosmetics Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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