Per Moheb Ali M. :

These applications for condonation of delay along with stay applications are filed by the Revenue.

2. Delay condoned.

3. After hearing both sides for some time, it is considered possible to decide the appeals themselves. Accordingly we grant the stay and take up the appeals.

4. Briefly the issue involved in all these appeals pertains to classification of 'Kesini Hair Oil' manufactured by the Respondents M/s. Kerala Ayurveda Pharmacy Ltd. The Commissioner (Appeals) held that the product is classifiable under Chapter Sub heading 3003.39 as proprietary Ayurvedic medicine. The Revenue contends that the product is a preparation for hair classifiable under 3305.99 of the schedule to CETA, 1985. In the impugned order the Commissioner observed that when the ingredients used in the product is from authoritative texts on Ayurveda and understood in common parlance as an Ayurvedic medicine it is sufficient to call it an Ayurvedic medicine.

5. Heard both sides.

6. Atthe outset, we observe that the Commissioner's observation that because the ingredients used in the product are mentioned in the authoritative texts on Ayurveda, the product should be classified as an Ayurvedic medicine and not as a product under Chapter 33.05 (Preparation for hair) is unacceptable. While such authoritative texts may be useful to determine whether a particular product is an Ayurvedic medicine or an Alopathic medicine, they cannot be made the basis for determining classification of goods in the rival entries chapter 30 and chapter 33.

7. Secondly it is nobody's case that the product is not a preparation for hair. The only contention of the Respondents supported by the Commissioner in the impugned order is that the product has therapeutic values and therefore should be classified under Chapter 30 of the schedule to CETA.

8. On the question of classification of product in the rival entries, Chapter 30 and 33, the Supreme Court in the case of Alpine Industries Vs. Collector of Central Excise, 2003 (54) RLT 369 (SC)=2004 (152) ELT 16 (SC) laid down the principles of classification after going through the Pharmaceutical and Medical literature produced before it in respect of a product namely, 'Lip Salve'. They are -

(a) The certificate issued by the user (In that case the Army authorities) and the chemical ingredients of the product are not decisive on the question of classification of the product for levy of excise duty.

(b) Commercial parlance has to be applied.

(c) The mere fact that the product has some curative effect is not enough to classify the product as a medicament.

(d) Rules of interpretation and chapter notes are the guides to determine classification of a product.

(e) Preparation of Chapter 33 even if they have therapeutic value are excluded from Chapter 30 (Note 1 (d) to Chapter 30).

(f) Medicaments are defined in Note 2 (1) to mean 'goods' which are either products comprising two or more constituents which have been mixed or compounded together for therapeutic or prophylactic; and

(g) Preparations which have a subsidiary curative or prophylactic value clearly fall under entry 33.03 to 33.07 as per Note No. 2 under Chapter 33.

9. Relying upon the Apex Court's decision the Tribunal in the case of Arya Vaidya Pharmacy (CBE) Ltd. Vs. CCE, Cochin, 2004 (65) RLT 262 (CESTAT-Ban.)=2004 (172) ELT 338 held that 'Kesini' a powder which is a preparation for hair falls under Chapter 33 and not under 30 as claimed by the appellants in that case.

10. The Respondent's claim that its product is not a preparation for hair because it is applied to the scalp not to hair, is untenable. One has to apply this product on one's hair before it reaches the scalp. Further, we observe that these kinds of products like soaps, creams, hair oils do claim to have therapeutic value. Even the tooth pastes claim^ the same. It is difficult to classify these products under Chapter 30 as medicaments on that score. The fact that the Respondents have a drug licence to manufacture th