Per Justice K.K. Usha : The above appeals arise out of an order in original No. MP (Demand-49/2000) 21/2000 dated 31.10.2000 passed by the Commissioner of Central Excise, Allahabad.

2. The issue referred for consideration by the Larger Bench [vide referred order dt. 29.5.2001 reported in 2001 (45) RLT 16 (CEGAT-Del.)] is whether 'Himtaj Tel' manufactured by M/s. Himtaj Ayurvedic Udyog Kendra, the appellant, is to be classified under sub-heading 3003.30 of the Central Excise Tariff Act, 1985 as Ayurvedic medicine or under sub-heading 3305.10 as perfumed hair oil.

3. Under the impugned order 'Himtaj Tel' was classified as perfumed hair oil falling under Chapter Heading 3305.10. Pursuant thereto the duty and penalty were imposed on the appellant. In classifying 'Himtaj Tel' as above, the Commissioner relied on a decision of the Delhi Bench of this Tribunal dated 28.9.99 reported in CCE, Allahabad vs. Himtaj Ayurvedic Kendra 2000 (125) ELT 765 (Tribunal). In the meanwhile the East Zonal Bench of this Tribunal had taken a different view in its Final Order No. 848/CAL/2000 dated 9.6.2000 [refer 2000 (41) RLT 443 (CEGAT)] classifying identical goods under Chapter sub-heading 3003.30 as Ayurvedic medicine. It was in the light of the conflicting views expressed by two Benches that the issue is referred for consideration of a Larger Bench.

4. It is alleged that the appellant had commenced manufacture of 'Himtaj Tel' in April 1987. The appellant has a licence issued under the provisions of Drugs & Cosmetics Act, 1940 to manufacture for sale Ayurvedic (including siddha and unani) drugs. One of the Ayurvedic medicines manufactured by the appellant on the basis of the above mentioned licence is 'Himtaj Tel'. Appellant would further contend that the ingredients based on which the oil was manufactured are duly mentioned in the Authoritative Ayurvedic Text Book, namely, Bhav Prakash mentioned in the First Schedule to Drugs & Cosmetics Act, 1940.

5. Chapter 30 of the Excise Tariff Act covers pharmaceutical products. Heading 30.03 refers to medicaments (including veterinary medicaments). Sub-heading 3003.30 refers to medicaments, including those used in Ayurvedic, Unani, Siddha, Homoeopathic or Bio-Chemic Systems. The goods coming under sub-heading 3003.30 attracted nil rate of duty under exemption Notification No. 32/89-CE dated 1.3.89 and later under Notification No. 9/93-CE dated 28.2.93. Subsequently, by Notification No. 75/94-CE dated 29.3.94 a differentiation was made in the matter of exemption among (1) 'Medicaments' (including veterinary medicaments) used in Ayurvedic, Unani, Siddha, homoeopathic or bio-chemic systems manufactured exclusively in accordance with the formulae described in the Authoritative Books specified in the First Schedule to the Drugs & Cosmetics Act, 1944 (23 of 1940) or Homoeopathic pharmacopoeia of India, United States of America, United Kingdom. or the German Homoeopathic Pharmacopoeia, as the case may be and sold under the name as specified in such books or pharmacopoeia, (2) Medicaments (including veterinary medicaments) used in bio-chemic system and not bearing a brand name and (3) 'others'. For the first and second categories nil rate of duty was prescribed whereas for the third category 10% duty was prescribed. The appellant would contend that a distinction is thus made between Ayurvedic medicaments manufactured exclusively in accordance with the formulae described in Ayurvedic books and sold under the name specified in that book which are termed as 'classical Ayurvedic medicines' and those manufactured based on ingredients mentioned in the text books but not manufactured in accordance with the formulae mentioned in the book termed as 'proprietary Ayurvedic medicines coming under the heading 'others'. Both continued under the common sub-heading 3003.30 for classification. it is the case of the appellant that its product would certainly come under the definition of the term 'medicaments' under Chapter Note 2