JUDGMENT

KURIAN, J.

1. ‘Care or cure’, is the clue for the resolution of the lis arising in these cases. If the product by name ‘Moisturex’ is held to be a medicament for cure, the decision goes in favour of the assessee and if the product is held to be one for care of the skin, the decision benefits the Central Excise. The Tribunal has held in favour of the assessee and, thus, the Central Excise is in appeals.

2. The Central Excise Tariff Act, 1985 (hereinafter referred to as ‘CETA’) under Chapter 30 of the Schedule (2) deals with pharmaceutical products for the purposes of tariff. At the relevant time, if a product is held to be medicament, then, the rate of duty was 15% and, if not, 70%. Heading 30.03 deals with the medicaments including veterinary medicaments. The same reads as follows:

“Heading Sub-headi Description of goods Rate of

No. ng No. duty

(1) (2) (3) (4)

30.03 Medicaments (including

3003.10 veterinary medicaments) 15%

-Patent or proprietary

medicaments, other than

those medicaments which are

exclusively Ayurvedic,

Unani, Siddha, Homoeopathic

or Bio-chemic.”

3. ‘Medicaments’ is defined under Note 2(i) under Chapter 30 which reads as follows:

“2. For the purposes of heading No. 30.03:

(i) ‘Medicaments’ means goods (other than foods or beverages such as dietetic, diabetic or fortified foods, tonic beverages) not falling within heading No.30.02 or 30.04 which are either:-

(a) products comprising two or more constituents which have been mixed or compounded together for therapeutic or prophylactic uses; or

(b) unmixed products suitable for such uses put up in measured doses or in packings for retail sale or for use in hospitals.”

(Emphasis supplied)

4. ‘Patent or proprietary medicaments’ is defined under Note 2(ii) which reads as under:

“2(ii) ‘Patent or proprietary medicaments’ means any drug or medicinal preparation, in whatever form, for use in the internal or external treatment of, or for the prevention of ailments in human beings or animals, which bears either on itself or on its container or both, a name which is not specified in a monograph, in a Pharmacopoeia, Formulary or other publications, namely:-

(a) The Indian Pharmacopoeia;

(b) The International Pharmacopoeia;

(c) The National Formulary of India;

(d) The British Pharmacopoeia;

(e) The British Pharmaceutical Codex;

(f) The British Veterinary Codex;

(g) The United States Pharmacopoeia;

(h) The National Formulary of the U.S.A.;

(i) The Dental Formulary of the U.S.A.; and

(j) The State Pharmacopoeia of the U.S.S.R.;

or which is a brand name, that is, a name or a registered trade mark under the Trade and Merchandise Marks Act, 1958 (43 of 1958), or any other mark such as a symbol, monogram, label, signature or invented words or any writing which is used in relation to that medicine for the purpose of indicating or so as to indicate a connection in the course of trade between the medicine and some person, having the right either as proprietor or otherwise to use the name or mark with or without any indication of the identity of that person.”

5. The Chapter Note has explained Heading No.30.03 as under:

“This heading covers medicinal preparations for use in the internal or external treatment or prevention of human or animal ailments. These preparations are obtained by mixing together two or more substances. However, of put up in measures doses or in forms or packings for retail sale, they fall in heading 30.04.

The heading includes :

(1) Mixed medicinal preparations such as those listed in an official pharmacopoeia, proprietary medicines, etc., including those in the form of gargles, eye drops, ointments, liniments, injections, counter-irritant and other preparations not falling in heading 30.02, 30.05 or 30.06.”

Entry 33.04 dealing with cosmetics reads as follows:

“Heading Sub-headi Description of goods Rate of

No. ng No. duty

(1) (2) (3) (4)

33.04 3304.00 Beauty or mak