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CCE, Chandigarh Versus M/s Pfizer Ltd.

2017 (12) TMI 374 - CESTAT CHANDIGARH

Classification of goods - TMQ (kind of bulk drugs) - appellants are claiming the classification of said product under sub heading 2302.00, the Department disputed the same and contended that it is correctly classifiable under heading 2941.30 - whether the product classifiable as Preparation of a kind used in animal feeding, including dog and cat food under CTH 2302 or as Tetracyclines and their derivates: Salts thereof under CTH 2941.30? - Held that: - Considering the manufacturing process and i .....

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s. Archana Wadhwa, Member (Judicial) And Mr. Devender Singh, Member (Technical) Sh. Atul Handa, AR for the Appellant Sh. Udit Jain, Advocate for the Respondent ORDER Per : Devender Singh The Revenue is in appeal against the impugned order. 2. The brief facts of the case are that the appellants are manufacturer of bulk drugs under Chapter 29 of Central Excise Tariff Act. Among other bulk drugs, they are also manufacturing a product called TMQ, as named by appellant themselves. The appellants are .....

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4.93 3/90-2/92 10,11,690.58/- 4. V(29)3/12/D/93/3455 23.04.93 11/92-12/92 1,12,529.28/- 5. V/17/PFIZER/CL/20/96 28.12.99 w.e.f. 11/99 Nil 6. CE-20/TMQ/PFz/R-1/Chd/99 26.5.2K 11/99-04/02 6,82,294/- The show cause notices at Sr. No. 1 & 2 and at Sr. No. 3 & 4 were initially confirmed by the adjudicating authority. vide O-I-O No. 1/AC/CL/93 dt. 06.01.1993 and 49-50/AC/D/93 dt. 07.06.1993 respectively holding the classification of TMQ under sub heading 2941.30. The OIO at Sr. No. 1 & 2 o .....

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eedings and cases at Sr. No. 5 & 6 which were fresh cases were adjudicated and demand of ₹ 20,33,890.96/- was confirmed vide O-I-O No. 204-209/DC/D/2001 dt. 28.02.2001. Similarly another demand of ₹ 14,04,768/- arising out of the following two show cause notices was confirmed and personal penalty of ₹ 1,00,000/- was imposed vide O-I-O No. 108-109/DC/D/2002 dt. 26.03.2002 by Deputy Commissioner, Central Excise Division, Chandigarh after holding the party s product TMQ classi .....

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tively. Aggrieved by the above orders of the Commissioner (A), the party again filed an appeal with CESTAT who vide Final Order No. 684-86/04-NB-CE and S/461-62/04 dt. 30.09.2004 remanded the case to the original adjudicating authority with the directions to pass a fresh order after allowing cross-examination of the Chemical Examiner. Pursuant to the above final order, the adjudicating authority arranged the cross-examination of the chemical examiner and the adjudication proceedings were finaliz .....

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s the name invented by the party themselves and it is quite difficult to ascertain whether it is Terramycin or Tetracycline or Oxytetracycline. The contention is that the appellant s own document of quality assurance profile mentions TMQ as Oxytetracycline Salt, it is clearly covered under heading 2941.30 being a salt of Oxytetracycline which, in turn, is a derivative of tetracycline. He also stated that the affidavit of Sh. H.P.S Chawla, Professor and Head, Department of Pharmaceutical Technolo .....

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t Singh who concluded that manufacturing process for all the products in appellant s factory was same. He also argued that the Ld. Commissioner (Appeals) has erred in the observing that test of the chemical examiner is vague and based on the assumptions and presumptions. He referred to the notes written by the chemical examiner indicating various tests conducted to arrive at the conclusion. He argued that the judgment of the Hon ble Tribunal in the case of Tetraon Chemie (P) Ltd. Vs. CCE, Bangal .....

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, Mumbai and who have declared the product TMQ as raw material/inputs for their final product TM100. 4. Ld. Advocate for the appellant reiterated the findings in the impugned order of the Ld. Commissioner (Appeals) and stated that the issue was squarely covered by the Larger Bench of this Tribunal in the case of Tetraon Chemie (P) Ltd. Vs. CCE, Bangalore (Bangalore). 5. Heard the parties and perused the records. 6. We find that the issue which requires to be determined is the classification of t .....

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with the following observations of the Ld. Commissioner (Appeals):- I also gone through the test report of the Chemical Examiner and the results of the cross-examination in the form of questionnaires and answers thereto. Besides vague and indefinite answers, the Chemical Examiner admitted that the test residue on ignition or loss on drying was not conducted. She could not answer in affirmative whether there was any inorganic substance in the product or not. Even the test report is vague in as m .....

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ce on the test report can be placed. 8. The Revenue s main ground is that in their own document TMQ has been called as Oxytetracycline Salt and therefore being a derivative of Tetracyclines, it should be classified under Heading 2941.30. It is also contended by the Revenue that TMQ is an intermediate product. In this context, it would be relevant to refer to the manufacturing process of TMQ, as given in the Order-in-Appeal reproduced below:- Further the contention of the Appellant are that they .....

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e with the appellants, this is an in-process material obtained while manufacturing bulk drug namely Oxytetracycline. This in process material is transferred for further use as pre-mix with other carriers and diluents to make animal feed supplement by the appellants known as TM 100. 9. In this background, we find force in the argument of the Ld. Commissioner (Appeals) that the TMQ, being in process material is used as an additive to namely feed supplement and hence classifying the same as antibio .....

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