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M/s. Parenteral Drugs India Ltd. Versus CCE & ST, Indore

2015 (11) TMI 1246 - CESTAT NEW DELHI

Waiver of pre deposit - Whether the products, in question, Tinidazole Intravenous Infusion (Tinipidi), Metroidazole Sodium Chloride Injection, Metronidazole Injection with Dextrose, Ciprofloxacin Injection with Dextrose,Ciprofloxacin Injection with Sodium Chloride, and Mannitol Injection, all of which contain antibiotics in saline or glucose medium and other medicaments and are meant for Intravenous infusion are covered for duty exemption by the entry no.56 of the notification no.3/2001-CE dated .....

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be construed strictly and this was one of the observations in the Apex Court’s judgement dated 31.03.2009 while remanding the matter to the Tribunal. Thus, it cannot be said that the appellant have prima facie case in their favour.

The undue hardship is determined on the basis as to whether the assessee has prima facie case in his favour and if so, to what extent. The Revenue s interest have to be safeguarded keeping in view the factors which are in favour of the Revenue. At this sta .....

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case stands decided by the Tribunal against the Appellant in its judgement in case of Ives Drugs (India) Ltd. , Venus Remedies Ltd. & Ors. (2010 (10) TMI 649 - CESTAT, NEW DELHI) and this judgement has been upheld by Hon’ble Punjab & Haryana High Courts, this is not a case for total unconditional waiver from the requirement of pre-deposit and the Appellant have to be put to certain conditions of pre-deposit to safeguard the interests of the Revenue. - Partial stay granted. - E/Stay/53395/2014 i .....

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about the following products:- (a) Tinidazole Intravenous Infusion (Tinipidi), (b) Metroidazole Sodium Chloride Injection, (c) Metronidazole Injection with Dextrose, (d) Ciprofloxacin Injection with Dextrose, (e) Ciprofloxacin Injection with Sodium Chloride, and (f) Mannitol Injection. All the above medicaments are injected through intravenous infusion. 1.2 Notification No.6/2000-CE dated 1.3.2000, as amended by notification no.36/2000-CE dated 4.5.2000 (Sl.No.47A) provided full duty exemption .....

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r duty exemption under notification no.3/2001-CE dated 1.3.2001 (Sl.No.56). 1.4. Initially, three show cause notices had been issued for denying the exemption in respect of the above products and recovery of duty. The details of these show cause notices are as under:- (1) Show cause notice dated 7.6.2001 for demand of duty of ₹ 74,92,015/- for the period from 4.5.2000 to 31.3.2001 (2) Show cause notice dated 23.04.2000 for demand of duty amounting to ₹ 97,68,855/- for the period from .....

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is Tribunal. The Tribunal vide Final Order No.733/2004-WZB/C-II dated 27.02.2004 decided the appeal filed by the appellant along with appeals of other drug manufacturers and allowed the same. 1.6. The Revenue challenged the Tribunals order dated 27.02.2004 before the Apex Court. The Apex court remanded the matter to the Tribunal for de novo adjudication with certain directions. In this regard, para 6, 7, 8, and 9 in the case of CCE, Indore Vs. Parenteral Drugs (I) Ltd. reported in 2009 (236) El .....

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nately, despite detailed analysis of the notification in question by the Commissioner, the Tribunal has not examined this aspect and, therefore, the matter needs to be remitted to the Tribunal to give its finding as to what is the effect of the 2001-2002 Budget which restricts the definition of IV Fluids in terms of the above three qualifications. 7. There is one more aspect which the Tribunal is required to consider. In the labels of the respondent-Company, there is a warning stating that IV .....

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a Schedule-H drug. We do wish to express any opinion on this point. Suffice it to state that on the above two questions/issues, the matter needs to be remitted to the Tribunal for consideration in accordance with law. 8. We may add that exemption notifications have to be read strictly. We may also add that the burden is on the assessee to prove that the item falls within the four corners of the exemption notification. 9. Before concluding, we may state that if on the second issue, regarding Sch .....

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.759-767/2010-EX dated 28.04.2010 reported in 2011 (264) ELT 73 (Tribunal-Delhi). Here, it may also be mentioned that all the appeals which had earlier been decided by the Tribunal vide Final Order No.27.02.2004 including the appeal filed by the present appellant were against the orders of the Commissioner, Central Excise, Indore. The Tribunal vide its Final order dated 29.10.2010 which was in respect of the appeals filed by M/s.Ives Drugs (India) Pvt. Ltd. and others, held that the assessees wo .....

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ed by the appellant was, however, decided by Bombay Bench of the Tribunal. The Tribunal vide order no.A/335/2009-CE dated 16.12.2009 remanded the matter to the Commissioner for de novo adjudication. Pursuant to the remand order by the Supreme Court, the appellant had filed an affidavit on 7.11.2009 of one Dr. Vivek Sullere, a doctor by profession, along with application for admitting the affidavit as evidence in this case and in that affidavit, Dr. Sullere has opined that the products, in questi .....

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novo adjudication proceedings, the Commissioner vide order-in-original dated 27.2.2014 held that the appellant would not be eligible for exemption during the period w.e.f. 1.3.2001 and accordingly, while confirming duty demand of ₹ 6,54,674/- for the period from 1.3.2001 to 31.3.2001 covered by show cause notice dated 7.6.2001, confirmed full duty demand covered by other two show cause notices dated 23.4.2002 and 27.2.2003. Accordingly, the Commissioner confirmed the duty demands of ₹ .....

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appellant, pleaded that the impugned order has been passed by ignoring the directions of the Tribunal in the remand order, that in the remand order, the Tribunal after specifically referring to the Affidavit dated 7.11.2009 of Dr. Vivek Sullere, which had been admitted as evidence, had directed the Commissioner to consider the same but the same has not been considered anywhere in the impugned order simply on the ground that the Department has obtained an independent opinion from Govindgram Saks .....

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echnology and Science, Indore, relied upon by the Department has been given to the assessee. Pointing out to the opinion of Dr.Vivek Sullere, he pleaded that the products, in question, even though containing anti-biotic or pharmaceutical products having therapeutic value, essentially remain Intravenous fluids and would be covered by the Entry Intravenous Fluids which are used for sugar, electrolyte or fluid replenishment. He pleaded that the impugned order is not sustainable and, therefore, th .....

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ded that in that order, the opinion of Dr. Vivek Sullere was not produced and though the opinion of other experts had been produced, the Tribunal observed that the same cannot be considered. 4. Shri Ranjan Khanna, ld. Departmental Representative vehemently opposed the stay application and the plea for remand of the matter and pleaded that this appeal along with appeals filed by the other appellants involving identical issue had earlier been decided by the Tribunal vide Final Order dated 27.02.20 .....

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ted in 2014 (300) ELT 33 (P&H) dismissed the appeal, that thus, the Tribunals order in case of Ives Drugs and Others (supra) stand affirmed by the Honble Punjab & Haryana High Court, that not only this, a ROM application was also filed in respect of the order passed by Delhi Bench of the Tribunal and the same was also dismissed, that the Tribunal in its Final Order dated 29.10.2010 after analyzing the Entry No.56 in the notification no.3/2001-CE has held that w.e.f. 1.3.2006, the exemp .....

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ur and that in accordance with Section 35 F of the Central Excise Act as interpreted by the Apex Court in the case of Benara Valves Ltd. Vs. CCE reported in 2006 (204) ELT 513 (SC), the necessary conditions to safeguard the interest of the Revenue have to be prescribed. 4.1 Shri Ranjan Khanna, ld. DR also pointed out to ground XV(d) of the Memorandum of Appeal where the appellant have themselves pointed out that the products, in question, contained medicaments which are required to be administer .....

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products, in question, Tinidazole Intravenous Infusion (Tinipidi), Metroidazole Sodium Chloride Injection, Metronidazole Injection with Dextrose, Ciprofloxacin Injection with Dextrose,Ciprofloxacin Injection with Sodium Chloride, and Mannitol Injection, all of which contain antibiotics in saline or glucose medium and other medicaments and are meant for Intravenous infusion are covered for duty exemption by the entry no.56 of the notification no.3/2001-CE dated 1.3.2001 which covered, Intravenous .....

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mentioned in para 1.1 above, which are not simply meant for replenishing sugar, electrolyte or other fluids but are also meant for administrating certain drugs also, would be covered by the Entry Intravenous Fluids which are used for sugar, electrolyte and fluid replenishments. On this point, the Tribunal in its jugement dated 29.10.2010 in case of Ives Drugs (India) Pvt. Ltd. Vs. CCE, Indore & M/s.Venus Remedies Ltd. & ors. (supra) had given a clear finding that such products would be .....

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ea that even after 1.3.2001, the Intravenous Fluids meant for administering medicines besides replenishments of sugar, electrolyte and other fluids are covered by the entry No.56 of exemption notification no.3/2001-CE is accepted, the expression which are used for sugar electrolyte and fluid replenishment in the Entry No.56 of notification no.3/2001-CE would become reluctant and it would amount to extending the benefit of exemption to any Intravenous fluids. Therefore, we are of the prima faci .....

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nding the matter to the Tribunal. Thus, it cannot be said that the appellant have prima facie case in their favour. 7. At this stage, for deciding the application for waiver from the requirement of pre-deposit under Section 35 F of the Central Excise Act, 1944, the Tribunal is required to take prima facie view on merits so as to assess the risk to the Revenue, as in terms of the Apex Courts judgements in cases of Benara Valves Ltd. (supra) and also in the case of Indu Nissar Oxo Chemicals Indus .....

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