PANACEA BIOTEC LTD. Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) M/s. Panacea Biotec Ltd. have filed this appeal being aggrived with the Adjudication Order No. 5/2002, dated 20 -5 -2002 passed by Commissioner of Customs demanding customs duty, imposing penalty and confiscating the goods imported by them.

(2.) Shri V. Lakshmi Kumaran, learned Advocate, submitted that no Appellants manufacture P or P medicaments; that they also get the goods manufactured from other manufacturers of P or P medicaments on loan licence basis which is permitted under the provisions of Drugs and Cosmetics Act and is prevalent on large scale in pharmaceutical industry; that they imported two consignments of bulk drugs for the manufacture of life saving drugs and availed exemption from payment of duty under Notification No. 23/98 -Cus., dated 2 -6 -98 (Serial No. 46B); that the said Notification exempts duty if the imported goods are used in the manufacture of life saving drugs or medicaments specified in List 2 subject to the condition that they follow the procedure set out in the Customs (Import of goods at Concessional of Rate Duty for Manufacture of Excisable Goods) Rules, 1996; that in terms of Rule 3 of the said Rules, they got a certificate of Registration from the Assistant Commissioner of Central Excise on 14 -7 -98 and executed at bond; intimated the fact of receipt of the goods in the factory to the Superintendent of Central Excise concerned on 31 -7 -88; that as the Appellants did not have enough production capacity in their factory, they obtained loan licence on M/s. GMP Pharmaceuticals (P) Ltd. and M/s. Omega Laboratories Ltd. and were getting part of the products manufactured by them on loan basis; that in terms of Rule 57F (3) of the Central Excise Rules, they intimated to the Assistant Commissioner in letter dated 31 -7 -98 their intention to remove the imported raw material on payment of duty equivalent to the credit availed for manufacture of excisable goods on loan licence basis; that the life saving medicaments, so manufactured, were cleared on payment of Central Excise duty.

(3.) He mentioned that the Commissioner, under the impugned order has confirmed the demand of duty, etc., on the ground that the intended purpose is confined only to the manufacturing taking place within the factory of the Appellants which has been registered under Rule 3 of the said Rules of 1996 and the imported goods did not go into the manufacturing by them in their factory.