TMI Blog2019 (3) TMI 1407X X X X Extracts X X X X X X X X Extracts X X X X ..... and scope of Medicaments and, more specifically, of HSN 3004 need, therefore, to be ascertained from judicial observations in this regard - In HSN 3004 the emphasis is on therapeutic or prophylactic uses. Even if a product is manufactured using ingredients and according to the formula prescribed in the Pharmacopeia, it should not be classified as a medicament under heading 3004 unless it is meant for therapeutic or prophylactic uses. Its curative or preventive value must be substantial, and the product must be manufactured primarily to control or cure a disease, and the consumers use it primarily for treatment, mitigation, cure or prevention of specific disease or disorder. The emphasis clearly, therefore, lies in the user s perception of a particular product. If the user consumes the product primarily for cure from or treatment or mitigation of or for prevention of a disease or disorder, it should be treated as a medicament classifiable under HSN 3004. The products are being offered as food supplements and sometimes with specific declaration that they are not meant for use as medicine for treatment of any disease. Note 1(a) of Chapter 30 excludes food supplements from Chapter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ruling Regulations, 2018. 1. Admissibility of the Application 1.1 The Applicant is stated to be a manufacturer of pharmaceuticals, APIs and other medicaments. He seeks a ruling on classification of fifteen products. Advance ruling is admissible on classification of any goods or services or both under section 97(2)(a) of the GST Act. 1.2 The Applicant declares that the issue raised in the application is not pending nor decided in any proceedings under any provisions of the GST Act. The officer concerned from the revenue has raised no objection to the admissibility of the Application. 1.3 However, the West Bengal Appellate Authority for Advance Ruling (hereinafter the WBAAAR), while disposing the appeal against the ruling pronounced by this Authority in the matter of Akansha Hair Skin Care Herbal Unit Pvt Ltd (Appeal Case No. 2/WBAAAR/Appeal/2018 dated 01/08/2018) = 2018 (8) TMI 772 - APPELLATE AUTHORITY FOR ADVANCE RULING, WEST BENGAL , cautioned this Authority against accepting a single application for classifiaction of multiple products, where such products cannot be clubbed together into a single category. 1.4 The Applicant argues that section 97(2)(a) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Applicant s reference to the above judgments of the apex court is not, therefore, relevant in the present context. While passing a judgment, decree or ruling, the court may touch upon different issues that are not the subject matter of the dispute or decision thereon. An instruction to this Authority, given in course of discussing the appeal case, is one such point. 1.7 While issuing an instruction to the subordinate court a power inherent to the authority of a higher court, the ld WBAAAR is not bound to discuss the relevant statutory provisions etc. Of course, the instruction must not be illegal. The instruction of the ld WBAAAR to limit the ruling to a single category of goods or services or both while disposing an application on classification, does not deny the applicant his right to seek an advance ruling on multiple products. It does not, therefore, violate section 97(2)(a). This Authority is, therefore, bound to follow the instruction. 1.8 The table below contains information about the composition and category of the products as provided in the Application. The Serial numbers of this table are the same as that of Table I of the Application. Sl.N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supplement Lactobacillus rhamnosus 0.25 billion cells Excipients q.s. 9 Biogut Dry Syrup Each 5 ml contais probiotics 1.25 bilion cells strains Health supplement 10 Enterobiotic Dry Syrup Lyophilizes saccaromyces Boulardii 2.5 billion cells Health Supplement. This product is not intended to diagnose, cure or prevent any disease. 11 Gutclausy Dry Syrup Each 5 ml contains Bacillus clausii 2 billion cells Health Supplement. This product is not intended to diagnose, cure or prevent any disease. 12 Evaday Capsule Evening primrose oil, Isoflavonoids, Vitamin E Acetate, Vitamin C, Vitamin B6, Cynocobalamide, Niacinamide, Folic acid, Dibasic Calcium Phosphate,Magnesium sulphate, Zinc Sulphate Monohydrate, biotin Dietary Supplement Not for medicinal use 13 Zink Ascorbate (Dry syrup) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat whether the products are meant for therapeutic or prophylactic use needs to be ascertained from experts in the field of medicine and also from the Drucg Control Authority. He also points out that the invoices attached (Exhibit B) show that some of the products are classified under HSN 2106. 4. Observations Findings of the Authority 4.1 The question to be answered is whether the products listed in the above table and labeled as dietary / health supplements are to be classified as medicaments under HSN 3004. Classification under any other HSN needs to be considered only if the above products are not medicaments. 4.2 Classification refers to determination of the nature and character of the goods being supplied. The purpose of the exercise is to ascertain the applicability of any entry of the notifications issued under the GST Act, specifying the rate of tax or exemption from payment of tax [Rate of tax on supply of goods is specified under Notification No. 1/2017CT (Rate) dated 28/06/2017 of the Centre and Notification No. 1125-FT dated 28/06/2017 of the State, as amended from time to time, and hereinafter collectively called the Rate Notification]. Explanation to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re a disease, and the consumers use it primarily for treatment, mitigation, cure or prevention of specific disease or disorder. The emphasis clearly, therefore, lies in the user s perception of a particular product. If the user consumes the product primarily for cure from or treatment or mitigation of or for prevention of a disease or disorder, it should be treated as a medicament classifiable under HSN 3004. 4.5 The Applicant has furnished various documents for facilitating the common parlance test. They include photocopies of prescriptions indicating that several products are being prescribed by the medical practitioners, invoices issued by the pharmacies, and data analysis showing how many medical practitioners recommend the Applicant s products for treating specific ailments. Finally, the Applicant has submitted the labels containing a description and use of the products and physical samples. 4.6 Pharmacies keep various FMCG products and medical practitioners often prescribe health drinks and food supplements for aiding recovery from ailments. They do not provide objective and conclusive evidence about the therapeutic or prophylactic value of what the Applicant is offerin ..... 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