GUFIC LABORATORIES Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners are the manufacturers of patent and proprietary medicines falling under Tariff Item 14-E. The petitioners intended to manufacture "Analgin Injections" and on December 16, 1975 got the label approved as being a pharmacopoeial product. The classification list was also approved on December 22, 1975 under Tariff Item 68. The petitioners manufacture "Analgin Injection" as per the pharmacopoeia U.S.S.R. of the packing 5 ml. and submitted classification list under Tariff Item 68 on December 27, 1976 and the same was approved on the next day.

(2.) The Superintendent of Central Excise issued show cause notice dated June 3, 1977 and the petitioners were asked to show cause why a short levy of Rs. 4446.33 should not be recovered from them in respect of the clearance of Analgin Injection of 53465 units of 2 ml. and 30 ml. valued at Rs. 40268.64 cleared from their factory during the period May 1976 to January 1977. The petitioners sent their reply on June 10, 1977, inter alia, claiming that the Analgin Injections were manufactured as per the pharmacopoeia of U.S.S.R. and the product is described at Serial No. 57 on page 81 of the U.S.S.R. pharmacopoeia. The Assistant Collector, by his order dated June 28, 1977, held that the demand notice issued was correct and the claim of the petitioners that the Analgin Injection falls in monograph 57 of U.S.S.R. Pharmacopoeia is not correct. The petitioners carried an appeal before the Appellate Collector of Central Excise and the appeal was allowed by order dated June 16, 1978. The Appellate Collector held Entry 57 in U. S. S. R. Pharmacopoeia spells 'Analgin' as a powder but also gives the minimum and maximum dosages for various injections, viz. intravenous and intramuscular. The appellate authority also held that the Commissioner of Food and Drugs Administration of Maharashtra State has recognised "Analgin Injection" as submitted by the petitioners to form a Pharmacopoeial product. The Government of India served a show cause notice for reviewing the order of the Appellate Collector, on the petitioners, in exercise of the powers under Section 36(2) of the Central Excises and Salt Act, 1944 and by order dated July 30, 1979, it was held that the petitioners are liable to pay duty under Tariff Item 14-E as Analgin Injections do not fall under Monograph 57 of the U.S.S.R. pharmacopoeia. The order of the Government is under challenge in this petition field under Article 226 of the Constitution of India.

(3.) Entry 14E and the relevant portion of explanation I thereto is as follows :