TMI Blog2021 (1) TMI 564X X X X Extracts X X X X X X X X Extracts X X X X ..... defines a drug as all medicines for internal or external use of human beings or animals and all substances intended to be used for or in the diagnosis, treatment, mitigation or prevention of any disease or disorder in human being, or animals , including specified preparations. Thus, Sr. No. 180 of Schedule-I of Not. No. 01/2017-Ct (Rate) dated 28.06.2017, as amended, only such medicine and drugs are covered, which can be used for or in diagnosis, treatment, mitigation or prevention of any disease or disorder in human beings - further, the term 'drugs' as per DRUGS (PRICES CONTROL) ORDER, 1979 makes it clear that bulk drugs are raw material /ingredient of pharmaceutical and they are the Active Pharmaceutical Ingredients (i.e. API) of the medicine. In other words, it is the substance responsible for the product being a medicine. The bulk drug would inevitably remain the same as it is the identity of the medicine. When the bulk drug is absent, the product is no longer a medicine and when it is changed, it is a new medicine. Bulk dugs is not defined in GST, therefore, in common parlance we can say that Bulk drugs is basically an Active Pharmaceutical Ingredients (API) me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -01 discharging the fee of ₹ 5,000/- each under the CGST Act and the GGST Act. 2. M/s. Altis Finechem Pvt. Ltd. an applicant is engaged in the manufacture and supply of pharmaceutical products viz. Bulk Drugs and intermediates viz. Alpha-Ketoanalogue Isoleucine Calcium Salt, Alpha-Ketoanalogue Valine Calcium Salt, Alpha-Ketoanalogue Leucine Calcium Salt, Alpha-Ketoanalogue Methionine Calcium Salt, Alpha-Ketoanalogue phenylalanine Calcium Salt. 3. The applicant submitted that they supply their above product @18% but their customer stated that their product attract 5%. They requested to determine the tax liability of their product falling under HSN 2919. 4. Accordingly, applicant sought Advance Ruling on the following question : 1. Classification of goods and determination of tax liability of product under HSN 2919 of following goods : Calcium-3-methyl-2oxo-valerate (Alpha-Ketoanalogue Isoleucine Calcium Salt), Calcium-3-methyl-2oxobutyrate (Alpha-Ketoanalogue Valine Calcium Salt), Calcium-4-methyl-2oxo-valerate (Alpha-Ketoanalogue Leucine Calcium Salt), Calcium-DL-2-hydroxy-4(methylthio) butyrate (Alpha-Ketoanalogue Methionine Calcium Salt, Calcium ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ff Item Description of goods 180 30 or any chapter Drugs or medicines including their salts and eaters and diagnostic test kit, specified in List I appended to this Schedule 11. As per the above entry, Drugs or medicines including their salts and esters specified in List I appended to this Schedule are eligible for GST @5%. In CGST Act 2017, the terms Medicine or Drugs have not been defined. We consider the definition Drugs given in Drugs and Cosmetics Act, 1940 (Central Act 23 of 1940). Section 3(b) of the Drugs and Cosmetics Act, 1940 (Central Act 23 of 1940) defines a drug in the following terms: (i) All medicines for internal or external use of human beings or animals and all substances intended to be used for or in the diagnosis, treatment, mitigation or prevention of any disease or disorder in human beings, or animals, including preparations applied on human body for the purpose of repelling insects like mosquitoes; Clause (i) of Section 3(b) defines a drug as all medicines for internal or external use of human beings or animals and all substances intended to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... natural, ordinary or popular sense and phrases and sentences should be construed according to their grammatical meaning, unless that leads to some absurdity or unless there is something in the context, or in the object of the statute to suggest the contrary. Where a word has a secondary meaning, the assessment is whether the natural, ordinary or popular meaning flows from the context in which the word has been employed. 14. The word medicine is defined in Black s Law Dictionary thus: Medicine - the science and art dealing with the prevention, cure and alleviation of diseases; in a narrower sense that part of science and art of restoring and preserving health which is the province of the physician as distinguished from the surgeon and obstetrician. 14.1 Collins Dictionary for Advanced Learners defines medicine thus: Medicine is the treatment of illness and injuries by doctors and nurses; is a substance that you drink or swallow to cure an illness. 14.2 Cambridge Dictionary defines medicine as: A drug that is used to treat illness or injury; the science dealing with the preserving of health and with preventing and treating disease or injury. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal rate of GST is applicable only to the medicine or drugs, which are ready for administering in the human being or person. In the instant case, the applicant supplies bulk drug to their customers and hence the said bulk drug becomes raw material to the said customers. The applicant contention is that their bulk drug i.e. Alpha-Ketoanalogue Isoleucine Calcium Salt, Alpha-Ketoanalogue Valine Calcium Salt, Alpha-Ketoanalogue Leucine Calcium Salt, Alpha-Ketoanalogue Methionine Calcium Salt, Alpha-Ketoanalogue phenylalanine Calcium Salt is covered under the entry No. 180 of Not. No. 01/2017-CT (Rate) dated 28.06.2017 and eligible for concessional rate of GST. In the said entry No. 180 of said Notification word Bulk Drugs would have been included, had the intention of the Government been to extend the benefit of concessional rate to the bulk drugs/raw material. Therefore 5% GST is not applicable to the bulk drug Alpha-Ketoanalogue Isoleucine Calcium Salt, Alpha-Ketoanalogue Valine Calcium Salt, Alpha-Ketoanalogue Leucine Calcium Salt, Alpha-Ketoanalogue Methionine Calcium Salt, Alpha-Ketoanalogue phenylalanine Calcium Salt, in terms of List I to Entry No. 180 of Schedule I to the No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ff item , sub-heading heading and Chapter shall mean respectively a tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). (iv) The rules for the interpretation of the First Schedule to the Customs Tariff Act, 1975 (51of 1975), including the Section and Chapter Notes and the General Explanatory Notes of the First Schedule shall, so far as may be, apply to the interpretation of this notification 21. The relevant entry No. 40 of Notification No. 01/2017-Ct (Rate) dated 28.06.2017 is read as under : SCHEDULE III - 9% S.No. Chapter/Heading/Sub-heading/Tariff item Description of Goods (1) (2) (3) 40. 29 All organic chemicals other than giberellic acid 21.1 In view of the entry No. 40 of Notification No. 01/2017-Ct (Rate) dated 28.06.2017 the goods viz. bulk drugs and intermediate i.e. Alpha-Ketoanalogue Isoleucine Calcium Salt, Alpha-Ketoanalogue Valine Calcium Salt, Alpha-Ketoanalogue Leucine C ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
