TMI Blog2016 (1) TMI 1230X X X X Extracts X X X X X X X X Extracts X X X X ..... dismissed and claim of petitioner rejected in relation to these two products. Savlon - Held that: - The Apex court in the case of IPCA Health Products & Pvt. Ltd. v. CCE [2014 (6) TMI 861 - BOMBAY HIGH COURT] was considering a case of Hexiperp, Hexiscrub (Surgiscrub) and Hexiaque, which also contain Chloral Hex dine Gluconate Solution BP, which is also available in “Savlon” and held it to be a medicine. Imposition of penalty - Held that: - The Apex court as well as this court have in identical cases held that when there is an issue of classification and issue being debatable, the penalty is not leviable/imposable/sustainable - The judgment in the case of Sree Krishna Electricals v. State of Tamil Nadu & Another [2009 (4) TMI 428 - SUPREME COURT OF INDIA] so also judgment of this court in the case of CTO v. Bambino Agro Industries Ltd. [2015 (9) TMI 1504 - RAJASTHAN HIGH COURT] are sufficient to refer for non imposition of penalty. Petition dismissed - decided partly in favor of assessee and partly in favor of revenue. - S.B. Sales Tax Revision / Reference No. 3, 4, 2, 5 / 2013, S.B.Sales Tax Revision / Reference No. 229, 230, 236, 237 / 2012, S.B.Sales Tax Revision / Ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tax Board held insofar as Savlon , is concerned that it is a drug and the Revenue has also challenged deletion of penalty u/s 61. 5. The Assessing Officer, during a survey, taking into consideration the products after analysing the medicinal value and in particular test of common parlance, held that the three products named above, cannot be said to fall as drugs and a residuary rate is applicable and accordingly charged differential rate and held that the rate of 12.5% being the general rate or residuary rate, is required to be applied, accordingly charged differential rate on the sales recorded. The AO also levied interest u/s 55 and also imposed penalty u/s 61 of the Act holding that the assessee concealed the particulars and furnished inaccurate particulars by paying a lower rate of tax. 6. The matter was assailed before the Dy. Commissioner (Appeals), who was also not satisfied with the contention raised by assessee and upheld the order of AO. On a further appeal, the Tax Board, taking into consideration the material placed on record, insofar as the product Savlon is concerned, held that it has medicinal value as held in the case of Reckitt Benckiser (India) Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing reached insofar as Savlon is concerend, the Tax Board has rightly held it to be a drug and taken into consideration the antiseptic value which it has to protect against germs in cuts, abrasions, minor burns and other infective skin conditions and the same is just like Dettol , and supported the order of Tax Board in this regard. 11. Learned counsel also relied on Naturalle Health Products (P) Ltd. v. Collector of Central Excise, Hyderabad (2004) 9 SCC 136, Commissioner of Central Excise, Calcutta v. Sharma Chemical Works (2003) 5 SCC 60, Puma Ayurvedic Herbal (P) Ltd. v. Commissioner, Central Excise, Nagpur (2006) 3 SCC 266, Dabur India Limited v. Commissioner of Central Excise, Jamshedpur (2005) 4 SCC 9, Ponds India Ltd. (Merged with H.L. Ltd.) v. Commissioner of Trade Tax, Lucknow (2008) 8 SCC 369, Union of India Anr v. Vicco Laboratories (2007) 13 SCC 270, Commissioner of Central Excise, Nagpur v. Vicco Laboratories 2005 (179) E.L.T. 17 (S.C.), ICPA Health Products (P) Ltd. v. Commissioner of Central Excise, Vadodara (2004) 4 SCC 481, Commissioner of Central Excise v. Hindustan Lever Ltd. (2015) 10 SCC 742, Commissioner of Central Excise, Mumbai IV v. Ciens Laborator ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... placed on the findings reached under Excise Act as they are entirely different provisions. Learned counsel also contended that various courts have held that even if some ingredients of medicinal value or use are there, it cannot be said to be a medicine and even the common parlance test does not justify that these products can be said to be drugs/medicines. 15. Learned counsel also justified imposition of penalty u/s 61 as it is a clear cut case of evasion of tax and on the material found during the course of survey it can clearly and safely be said that the assessee is paying tax at lower rate, and contended that the penalty was rightly imposed by the AO and upheld by the DC(A) and wrongly deleted by Tax Board, which is required to be upheld. 16. I have considered the arguments advanced by the learned counsel for the parties and have perused the material on record and have gone through the judgments. 17. In my view the findings reached by the Tax Board is just and proper and is not required to be interfered with as the Tax Board has gone into the issue elaborately after taking into consideration the ingredients in all the three items. Insofar as Shower to Shower and Li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is required to be rejected and accordingly the petitions insofar as the assessee is concerned, is required to be dismissed. 20. Insofar as the issue raised by the Revenue about Savlon is concerned, I do agree with the finding reached by the Tax Board that it is entirely a different product and it has medicinal value for it is used when there is some cut or injury on the skin and the same is used as an antiseptic. A product which is used mainly for curing or treating ailments or diseases and contains curative ingredients, is required to be branded as a medicament. 20.1 The Apex court in the case of Commissioner of Central Excise v. Sharma Chemical Works (supra), which was related to Banphool Oil , after taking into consideration the tests laid down, held that the mere fact that a product is sold across the counters and not under a doctor's prescription, does not by itself lead to the conclusion that it is not a medicament. Generally the percentage of dosage of the medicament will be such as can be absorbed by the human body. The main criteria for determining classification is normally the use it is put to by the customers who use it, and taking into consideration the us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to treat inanimate objects and materials though it may also be applied to agents used to treat the skin and other body membranes and cavities (externally). Dettol contains some chemicals which are antiseptic but does not loose its character as a Disinfectant for the said reason or that it can be used to treat skin and other body membranes and cavities... 20.3 The Apex court in the case of IPCA Health Products Pvt. Ltd. v. CCE (supra) was considering a case of Hexiperp, Hexiscrub (Surgiscrub) and Hexiaque, which also contain Chloral Hex dine Gluconate Solution BP, which is also available in Savlon and held it to be a medicine. 20.4 Taking into consideration the aforesaid, the finding reached by the Tax Board, in my view, is just and proper and is not required to be interfered with. 21. Insofar as the penalty is concerned, which has been raised by the Revenue, in my view the finding reached by the Tax Board is just and proper and is not required to be interfered with. Admittedly, it is a case where an issue of classification of entries is there and the issue becomes debatable once the assessee claims that it is a drug/medicine and Revenue may dispute to be falling in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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