CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL NEW DELHI.

PRINCIPAL BENCH, COURT NO. I EXCISE APPEAL NO. 50578 OF 2017 [Arising out of the Order-in-Original No. 56-57/COMMJR/DDN/2016 dated 29/12/2016 passed by Commissioner, Customs, Central Excise & Service Tax, Dehradun.]

M/s Shahnaz Ayurvedics (Dehradoon), ……Appellant Vikas Nagar, Dehradun, (Uttarakhand).

Versus Commissioner, Central Excise ….Respondent Commissionerate, Dehradun, E-Block, Nehru Colony Dehradun, Uttarakhand.

AND EXCISE APPEAL NO. 51016 OF 2025 [Arising out of the Order-in-Appeal No. DDN/EXCUS/000/APPL/147/2024- 25 dated 30/01/2025 passed by Commissioner, Customs, Central Excise &

Service Tax, Dehradun.]

M/s Shahnaz Ayurvedics (Dehradoon), ……Appellant Vikas Nagar, Dehradun, (Uttarakhand).

Versus Commissioner, Central Excise ….Respondent Commissionerate, Dehradun, E-Block, Nehru Colony Dehradun, Uttarakhand.

APPEARANCE:

Shri Vivek Kohli, Senior Advocate and Shri Ashwani Sharma, Advocates for the appellant.

Shri Din Dayal Mangal, Authorized Representative for the Department CORAM:

HON’BLE JUSTICE MR. DILIP GUPTA, PRESIDENT HON’BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)

FINAL ORDER NO. 50346-50347/2026 DATE OF HEARING : 17.12.2025 DATE OF DECISION: 13.03.2026 P.V. SUBBA RAO M/s Shahnaz Ayurvedics¹ filed these two appeals to assail the following orders passed by the Commissioner and Commissioner (Appeals).

2. The short question to be answered in both these appeals is whether the following 18 goods manufactured by the appellant are Patent and Proprietary Ayurvedic² preparations as asserted by the appellant or cosmetics as held in the impugned orders.

(i) Shabase (ii) Shanaz Forever Root Marrow Base (iii) Shanaz Forever Vegetable Exfoliating Dermabrasive powder (iv) Shanaz Forever Thermal Mini Face Lift (v) Shagrain (vi) Shapeel (vii) Sharose (viii) Shalmond (ix) Shawhite (x) Shamoon (xi) Shaface Plus (xii) Shatreat Plus (xiii) Flower Power Shatreat (xiv) Vegpeel (xv) Flower Power Vegpeel (xvi) Shacomplex (xvii) Shamarrow (xviii) Shapack Mix

1. appellant

2. P&P

3. Consequently, the questions to be answered are whether the demand of duty and penalty can be sustained or not.

Submissions on behalf of the appellant

4. Learned counsel for the appellant made the following submissions:

(i) The department wrongly classified the goods which are ayurvedic medicaments (classifiable under Chapter 30) as cosmetics and soap under chapter 33 &34 of the Central Excise Tariff.

(ii) The controversy had initially arisen in 1987 with respect to the appellant‟s manufacturing unit in Delhi and an SCN dated 7.3.1988 was issued which was decided by the Additional Commissioner by order-in- original dated 29.8.1989 in favour of the appellant. He had also allowed the exemption available to P&P Ayurvedic medicines.

(iii) Later, on 28.2.1994, the exemption available to P&P Ayurvedic medicines was withdrawn and therefore, the appellant had filed a classification list under Rule 173B of the erstwhile Central Excise Rules, 1944 for its units in Delhi and NOIDA classifying them as P&P medicines (during the relevant time, a manufacturer had to file classification lists giving the products which he intended to manufacture and their classification to the Assistant Commissioner for approval). The classification lists were approved by the Assistant Commissioner, Delhi on 29.9.1994 and Assistant Commissioner, NOIDA on 2.12.1994.

(iv) Thereafter, the classification dispute was again raised by the Department in 1996 and the appellant filed a Writ Petition in Allahabad High Court and by order dated 29.1.2004 the High Court decided the matter in favour of the appellant which order was subsequently upheld by the Supreme Court.

(v) These appeals pertain to the appellants‟ unit in Dehradun which was started on 1.6.2004 and the appellant was registered on 17.6.2004 with the central excise department for manufacture of P&P medicines and cosmetics. For the first ten years, there was no dispute because all goods manufactured by the uni