SOL PHARMACEUTICALS LTD. Vs. CCE

JUDGEMENT

(1.) PURSUANT to the Hon'ble Supreme Court's order in Civil Appeal No. 4359/2000, we have to settle a classification dispute in this case. The appellants were engaged in the manufacture of "P or P Medicaments" during the material period. These goods were classified under SH 3003.20 and cleared for home consumption at 'Nil' rate of duty during the said period. However, the same goods cleared for export (under Bond) during the same period were claimed to be classifiable under SH 3003.10 attracting duty @ 15% ad valorem and Modvat credit was availed in respect of the duty -paid inputs used in the manufacture of the export goods. The Modvat credit so availed on duty -paid inputs used in final products cleared for export from 7.10.94 to 15.2.95 amounted to Rs. 36,04,926/ -. The Commissioner disallowed this credit to the assessee under Rule 571 of the Central Excise Rules, 1944 and imposed on them a penalty of Rs. 15 lakhs under Rule 173Q(1)(bb) of the said Rules, after holding the export goods to be classifiable under SH 3003.20 chargeable to 'Nil' rate of duty. Hence the present appeal.

(2.) THERE is no representation for the appellants despite notice, nor any request of theirs for adjournment. In the circumstances, we are constrained to dispose of this appeal after examining the records and hearing SDR.

(3.) IT appears from the records that the assessee claimed classification of the goods under SH 3003.10 by affixing on the paper cartons used for clearing the export goods, what was claimed to be their brand -name. The same goods were cleared for home consumption in plastic boxes with no brand -name affixed thereon. For example, "AMPICILLIN CAPSULES B.P. 500 mg." Packed in blisters (each containing 10 capsules) were cleared for export in cartons (each carton carrying 10 blisters) with alphabets "SOL" stylishly printed thereon. The printed matter is reproduced below: When the medicine was cleared for home consumption, the above alphabets (with the black bands and stripes therewith) were not printed or otherwise depicted on the plastic containers. According to the appellants, "SOL" was their brand -name and, therefore, the medicine which was cleared in containers with the brand -name printed/affixed thereon was different from the medicine without the brand -name cleared for home consumption. According to them, the medicament cleared under the brand -name could be classified only under SH 3003.10 in terms of Chapter Note 2 (ii) of Chapter 30 of the CETA Schedule. According to the Revenue, represented before us by ld. SDR, "SOL" was not a brand -name but only a 'house -mark' of the appellant -company. In her bid to establish that "SOL" was only a house -mark and not product -mark (brand -name), ld. SDR relied on the Supreme Court's judgment in Astra Pharmaceutical (P) Ltd v. Collector and the Tribunal's decision in Wockhardt Ltd. v. Collector 2000 (124) ELT 386 (T). It was also argued that, even if it be assumed that "SOL" was a brand -name belonging to the appellants, they would not get the benefit of Chapter Note 2 (ii), inasmuch as it was not shown that the capsules or the blisters containing them were also bearing the brand -name.