GLINDIA LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The first petitioners company manufacture a diverse range of preparations including drugs and medical preparations, laboratory chemicals and nutritional food products for animals. Petitioners have their factory at Worli in Greater Bombay and at Thane. The petitioners manufacture inter alia products which are known by trade names Vitablend. WM Forte and Vimeral. These preparations contains Vitamins A, B & D and are intended to be used as supplements to either liquid or solid animal feeds. They are known in the trade as animal feed supplements. The petitioners have relied upon a certificate dated 25th February, 1974 from the Commissioner Food and Drug Administration to the effect that General Liquid Food Supplement is an animal feed supplement and is not a drug within the meaning of Drugs and Cosmetics Act, 1940. They have also annexed affidavits of stockists of animal food saying that these products are purchased for the purpose of supplementing animal and poultry feed. They are not sold as medicines.

(2.) The Petitioners started manufacturing these two products in the year 1966 in their factory at Thane. In November 1971, the Assistant Collector passed an order stating that these products were animal feed and did not fall under Tariff Item 14E for the purpose of excise duty.

(3.) As from 1st March 1975, Tariff Item 68 was introduced in the Central Excise Tariff which is a residuary item. Under an exemption notification of the same date bearing No. 55/75, certain goods failing under Tariff Item 68 were exempted from payment of excise duty. One of the items so exempted was "animal feed including compound livestock feed". The Petitioners were given the benefit of this exemption notification and no excise duty was charged on these two products. In 1978 however, the petitioners shifted their factory to Worli. Thereupon, a fresh classification list was filed in respect of these two products. The respondents thereupon claimed that these two products fell under Tariff Item 14(E). The petitioner filed a petition being Writ Petition No. 1426 of 1986 challenging this classification. Thereafter, it was agreed between the parties that the petitioners would be given a hearing before orders are passed and the petitioners paid excise duty on these two products under protest under Tariff item 68 on clearances made after 1978.