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TMI Blog2023 (8) TMI 179X X X X Extracts X X X X X X X X Extracts X X X X ..... hat dismissed the application preferred by the appellant seeking clarification on the rate of tax of the commodities Clohex, Clohex Plus and Senquel-AD Mouthwashes. 2. The appellant is engaged in manufacturing and trading pharmaceutical products, Clohex, Clohex Plus and Senquel-AD, which are being used as medicaments, with Mouthwash having prophylactic and therapeutic effects. The appellant contends that under the Central Excise Tariff Act, all the above products have been assigned HSN Code 3003.3900, treating them as medicaments. The appellant was accordingly submitting returns under the KVAT Act, treating them as medicaments and paying tax at 4% and later 5%. Earlier, under the Kerala General Sales Tax Act also, they were treated as medi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sh and that sensitivity cannot be treated as a specific disease condition and any person can use this product for desensitising as advertised on the label. The authority found that though the product is not used to treat any specific disease condition, it has some prophylactic or therapeutic use for general dental hygiene. It is the contention of the learned counsel that various literature relating to the medicinal effect of the composition of both Potassium Nitrate and Sodium Fluoride in equal proportion were submitted, and they were not properly considered. It is also the submission that Senquel-AD is also manufactured under a similar drug licence given to Clohex and Clohex Plus. According to the learned counsel, dental caries, in general ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Collector of Central Excise Vadodara [1995 (77) E.L.T. 485 (SC)] and Commissioner of Central Excise, Mumbai IV and another v. CIENS Laboratories, Mumbai and another [(2013) 14 SCC 133] to argue that the conclusion arrived by the clarificatory authority is clearly wrong. The learned counsel also cited the decision in ICPA Health Products (P) Ltd. v. Commissioner of Central Excise, Vadodara, reported in [(2004) 4 SCC 481] and argues that if a product comprises of two or more constituents that have been mixed together for therapeutic or prophylactic uses, then it would be a medicament. According to the learned counsel, since the product in question has both therapeutic properties and prophylactic uses, they are to be treated as medicament fall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Customs Tariff Act, 1975, which in turn is aligned with HSN, each product is required to be considered in the context of HSN code and the judgments based thereon. It is also his argument that for a product to be called a medicament, it effectively has to be a disease-curing or disease-preventing item, and the same is not satisfied in the instant case. It is his further submission that, essentially this product is being marketed as a mouthwash which is a crucial factor. It is his further argument that Senquel-AD cannot be treated at par with Clohex and Clohex Plus and prayed for sustaining the clarificatory order. 7. At the outset, we note that Supreme Court in Heinz India Limited v. The State of Kerala [JT 2023 (5) SC 155], after a survey ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5) Mixing medical ingredients with other products or preservatives does not alter its character as a medicament [Amrutanjan Ltd. v. Collector Central Excise [1996 (9) SCC 413]] 6) That a licence under the Drugs Act is necessary is not a determinative or decisive factor always. 8. Likewise, in Puma Ayurvedic Herbal Private Ltd. v. Collector of Central Excise [2006 (2) SCR 1120], the product considered, namely 'Nycil Powder' has all the qualities and ingredients of a medicine, and since the same is basically a talcum powder, which has preventive and curative power, the same was required to be brought under the special entry rather than general entry. 9. On a reading of the principles emerging from the above decisions, it can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be excluded. The product in the instant case normally should have come under Chapter 30 but for the specific exclusion under Note to Chapter 30. We also find that if a product is registered as a medicament by the Drugs Controller, that would be a strong factor to consider it as having curative or prophylactic value as a medicament. Thus, we find that no single test can be employed to classify a product but a combination of different tests. Whether the product is one carrying predominantly pharmaceutical value has also to be considered, notwithstanding the Note to Chapter 30. In this context, the judgment of the Supreme Court in Commissioner of Customs, Central Excise and Service Tax, Hyderabad v. Ashwani Homeo Pharmacy [JT 2023 (6) SC 324] ..... X X X X Extracts X X X X X X X X Extracts X X X X
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