P.K. Kapoor, Member (T)

1. This is an appeal against the order passed by the Collector of Central Excise (Appeals), Bombay. Briefly stated the facts of the case are that the appellants filed classification list No. Nil/90-91 dated 1-4-1990 in which they claimed classification of "Calamine I.P. and Calamine B.P." under Heading 3005.90 as pharmaceutical products. They claimed that the Calamine was a mixture of Zinc Carbonate or Zinc Oxide with Iron Oxide and was specified in Indian and British Pharmacopoeia. They also claimed that it was being supplied only in bulk in 50 kgs. packings for the manufacture of preparations for the care of skin. On the grounds that Note 5 of Chapter 33 provides that Heading 33.04 applies inter alia to skin foods, skin tonics and other preparations for the beautification or protection of the skin and in terms of the notes on page 436 of the HSN medicinal preparations even if listed in the official pharmacopoeia do not necessarily fall under Chapter 30 the Assistant Collector held that 'Calamine I.P. and Calamine B.P.' manufactured by the appellants were classifiable under Heading 33.04. Being aggrieved by the order passed by the Assistant Collector the appellants preferred an appeal before the Collector (Appeals) on the ground that Calamine having 'Ferric Oxide' content of only 1% was composed almost entirely of either 'Zinc Oxide' or 'Zinc Carbonate' and therefore, in terms of Interpretative Rule 3(b) it was either classifiable under Heading 28.17 or 28.36 depending upon the nature of the predominant component of the mixture or in the alternative being a pharmacopeial product and in bulk packings of 50 kgs. it was classifiable under Heading 3005.90. However, while rejecting the appellants' contention in the impugned order the Collector (Appeals) confirmed the Assistant Collector's findings that 'Calamine IP and BP' were classifiable under Heading 3304.00.

2. On behalf of the appellants the learned advocate Shri K.V. Naik appeared before us. He stated that 'Calamine I.P.' is, Zinc Oxide 98% mixed with 1% Ferric Oxide and Calamine B.P. is Zinc Carbonate 99% with 1% Ferric Oxide. He added that even though sold under the names of Calamine I.P. and Calamine B.P. these products were essentially Zinc Oxide and Zinc Carbonate respectively since addition of 1% Ferric Oxide in each case is only to impart colour. He contended that under these circumstances there was no force in the Collector's argument that Calamine I.P. and Calamine B.P. were not classifiable under Chapter 28 which in terms of Note 1(a) to Chapter 28 applies only to separate chemically defined compounds. He stated that addition of 1% Ferric Oxide to duty paid Zinc Oxide classifiable under sub-heading 2817.10 and Zinc Carbonate falling under sub-heading 2836.90 procured from the market does not constitute manufacture and in terms of Interpretative Rules 3(a) and 3(b) Calamine I.P. and Calamine B.P. would also be classifiable under sub-heading 2817.10 and 2836.90 respectively. He contended that Calamine was being cleared in bulk with quantities of 50 kgs. packed in bags bearing only details such as Calamine I.P. or Calamine B.P., batch no., weight, manufacturing date and drug licence number. He stated that the packages do not bear the details regarding the qualities of the material or the method of use. He argued that under these circumstances the item was classifiable under sub-heading 33.04 which covers only those cosmetics and toilet preparations which are ready for use. He stated that in the event of his claim that Calamine I.P. and Calamine B.P. are classifiable as bulk drugs under sub-headings 2817.10 and 2836.90 respectively, is not found acceptable then alternatively he would like to submit that the items would be appropriately classifiable under sub-heading 3003.10 and 3005.90 respectively since in accordance with both Indian and British Pharmacopoeia Calamine is recognised as having therapeutic value and appellants were manufacturi