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SUPREME COURT OF INDIA
R.M. SAHAI AND N.P. SINGH, JJ.
MAC Laboratories (Pvt.) Ltd., Appellant
Versus
The Collector of Central Excise, Bombay, Respondent.
Civil Appeal No.958 of 1985
Decided on 22-11-1994.
Central Excise Rules, 1944 - Claim of appellant - Payment of duty - Appellant is manufacturer of KVS of two different strengths grams contents- Suppositories are introduced in vagina by hand- Its wax-like material containing melts at temperature of vagina and melted medicine n gets absorbed into system through or mucous preparation lining vagina- administration of this medicine is not against any topical or local infection but is directed internal infection of vagina resulting from oral functional system- By absorption into system its effect is to remove vaginal infection- It is primarily used to cure vaginal discharge resulting from oral functioning of system- It like oral antibiotic- Tribunal further held that were three methods of administering drugs and medicines - one by putting it in mouth and swallowing it second by injecting either intra-muscularly or intravenously and third by local application on surface of body and its absorption- Tribunal did not agree with claim of appellant that any medicine which is not administered through mouth would be - Tribunal found administration of medicine refers to method that involved absorption into body fluids and system of drug by active effect- It further that even though Drug Control Authority had classified medicine or than was covered in Notification- However it rejected claim of appellant- But allowed appeal in part and confined demand notice to six months before date of notice – Held, Courts concerned primarily how Notification granting exemption should be construed and what was intention in using word in Notification- exemption claimed by appellant was refused as suppositories produced by appellant were for local absorption- It has been explained that ambit of word is very wide- Its use in Notification has been in still wider sense- use of word oral for and for injections in Notification is not without purpose administration of medicine may be sublingual that absorption of drugs by oral mucous membrane producing systemic effects or oral one of most popular routes of administering drugs in form tablets capsules mixture powder pills emulsions or rectal of local or topical that is administration of drug for systemic actions specially in vomiting unconsciousness and when intestinal absorption is to be avoided- Government even though was aware word decided to use word oral in Notification obviously so that re may not be any ambiguity Notification construction of which involved is an exemption notification- Therefore benefit of it is available to only those who fall under it- To that extent notification has construed strictly- That is medicine must be for oral use- But once it is found that a medicine falls in category of medicine benefit cannot be denied because it falls in category of those medicines which are applied locally- Topical or medicines used for local absorption appear to be included word - In definitions which have been extracted earlier do support claim of appellant that re are only two classifications of medicines- one which are known as that is which passed through an alimentary canal and or which extend to all or medicines which are not - subsequent classification of medicines used locally for convenience cannot take away from main and broader classification of it being - Appeal allowed
JUDGMENT
R.M. SAHAI, J.:- Whether Kemicetine Vaginal Suppositories (KVS), a patent and proprietary medicine which contained the antiniotic chloramphenicol (CAF) was chloramphenicol and its esters for oral and parenteral use within the meaning of the Notification No.116 / 69 - CE dated 3-5-1969 as amended by the Notification No.106 / 80 -CE dated 19-6-1980 issued in exercise of powers conferred by sub-rule (1) of Rule 8 of Central Excise Rules, 1944 was answered against the appellant by Customs, Excise and Gold (Control) Appellate Tribunal.
2. The appellant is a manufacturer of KVS of two different strengths viz. 0.25 grams and 0.50 grams of chloramphenicol antiniotic contents. These suppositories are introduced in the vagina by hand. Its wax-like material containing antiniotic chloramphenicol melts at the temperature of the vagina and the melted medicine then gets absorbed into the system through the epithelium or mucous preparation lining the vagina. The administration of this medicine is not against any topical or local infection but is directed at the internal infection of vagina resulting from the oral functional system. By absorption into the system its effect is to remove the vaginal infection. It is primarily used to cure vaginal discharge resulting from oral functioning of the system. It acts like oral antibiotic.
3. The appellant was being granted exemption on the suppositories by the department till five notices were issued on 11th June, 1980, 17th June, 1980, 9th October 1980, 24th January, 1981 and 8th May , 1981 raising demand for the period 1st September , 1979 to 31st May , 1980 1st January, 1979 to 31st August, 1979, 1st June, 1980 to 31st August, 1980, 1st September, 1980 to 31st December, 1980 and 1st January, 1981 to 30th April, 1981 respectively. The basis for the notices for short levy was that the medicine produced by the appellant was neither for oral nor parenteral use. In reply it was claimed that Kemicetine Vaginal Suppositories were treated by the Drug Control authorities as life saving drug. And the produce was classified by the department for concessional rate of duty at 2-1/2% ad valorem since it was specified at serial No. 14 of the Schedule. But after the drug became wholly exempt from duty the department erroneously has taken the view that the medicine which was in tablet form and was meant for parenteral use was not entitled to exemption since it was not administered through oral route. It was claimed that the word parenteral was very wide and it could not be confined to use of injections only. The appellant objected to notices so far they were for period beyond six months prior to the date of notice. The Assistant Collector did not find any merit in the objection raised by the appellant and confirmed all the five notices issued by the Superintendent, Central Excise, The order was maintained by the appellate authority. In further appeal to the Tribunal it was not disputed that the medicine manufactured by the appellant contained chloramphenicol. Nor there was any dispute that in terms of pharmacology parenteral is understood to refer to such medication as is applied in such a manner that it by-passes the alimentary canal which has its opening point in the mouth and ends in the anus. The dispute centered round whether use of suppositories through vagina was parenteral use. The Tribunal after examining affidavits filed on behalf of both the parties, the text books and various dictionaries and papers on this subject found that parenteral refers to introduction of a medicine by route other than alimentary canal. The Tribunal further held that there were three methods of administering drugs and medicines - one, by putting it in mouth and swallowing it; second, by injecting either intra-muscularly or intravenously; and third by local application on surface of the body and its absorption. The Tribunal did not agree with the claim of the appellant that any medicine which is not administered through mout
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