SANDOZ PRIVATE LIMITED Vs. COMMISSIONER, C. EXCISE

JUDGEMENT

(1.) APPELLANT is engaged in the manufacture of different bulk drugs and formulations falling under different sub headings of Chapter 29 and 30 of Central Excise Tariff Act, 1985. The appellant inter -alia, manufacture Rifampicin, Isoniazid, Pyrazinamide and Ethambutol. They imported/ purchased locally finished formulations such as Dapsone and Clofazimine (Lamprene) in the form of capsules and tablets respectively, without payment of CVD under Notification No. 04/2006 -CE dated 01.3.2006. The appellants sell Rifampicin individually as Rimactane (brand name) which in combination with other medicines namely Isoniazid and R. Pyrimethamine and R. Ethambutol. Rifampicin sold in combination with Isoniazid is called Rimactazid 2FDC and when it is sold in combination with Isoniazid, Pyrazinamide and Ethambutol, it is called as Rimstar 4 FDC. Clofazamine was also sold individually as "Lamprene".

(2.) THE dispute in this case pertains to following formulations cleared by them in Multy Drug Therapy (MDT) combi pack, as follows:

(4.) FURTHER , the Commissioner also held that the products in question namely MB Adult, MB Child, PB Adult, PB Child, Lamprene, Rimactane, Rimstar and Remecatzid did not merit classification under CHS No. 30049057 or 30049058. He also held that process of packing two or more formulations in blister packs does not amount to manufacture and therefore, cenvat credit of duty paid on gelatin caps and packing materials and printed carton etc. is not admissible. In view of the fact that process does not amount to manufacture and goods were totally exempted under Notification No. 04/2006 -CE dated 01.3.2006, he held that appellants were not eligible to export the goods under bond and therefore appellants are liable to pay 10% of value as duty since they had availed cenvat credit on the inputs. Further, he also held that appellants were not eligible to clear the goods to UN Organisations under Notification No. 108/95 -CE since the goods were unconditionally exempted. Therefore, he held that the appellants were required to maintain separate accounts since the exclusion provided in terms of Rule 6(6) of the Cenvat Credit Rules, 2004 from the provisions of Sub-rule 1 to 4 of Rule 6 have no application in respect of the appellants.