ALBERT DAVID LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The appellant seeks appropriate order restraining the respondents from giving effect to the order dated the 17th July 1962 by which the Assistant Collector Central Excise, Calcutta III Division found that the revised demand for Rs. 101299. 34 nP on account of duty for patent and proprietary medicines cleared during the period from March 1961 to May 1961 without payment of duty was in order. The validity and the legality of this demand were challenged by the appellant on various grounds before the original court. Before us Mr. Banerjee has confined his arguments to two points only. He contends firstly that some of the medicines in respect of which duty has been charged are mixtures of drugs recognised by one or more of the pharmacopoeias specified in section 3(d) of the Drugs Act, 1940 and the notification issued by the Central Government thereunder and as the drugs mentioned in those pharmacopoeias are exempt from payment of duty the mixtures of those drugs are also exempt from payment of duty. This point was not taken either in the correspondence or in the petition. The point was raised for the first time in course of the argument before the learned judge. There is no material on the record to show that any of the medicines in respect of which this revised demand of Rs. 101299.34 nP relates is a simple mixture of several drugs specified in the pharmacopoeias above mentioned. It may be mentioned that sometimes the pharmacopoeias, mention separately the drugs in their nascent form as also in their combinations. The learned judge has well pointed out that the British Pharmacopoeia of 1958 mentions the compound Codine Tablet separately as also its combining parts Acetylsalicylic Acid Pharmacetin and Codine Phosphate. The duty is chargeable in respect of patent and proprietary medicines as defined in clause (d) of section 3 of the Drugs Act, 1940 not containing alcohol. Section 3(b) (originally section 3(d) of the Drugs Act, 1940) defines the expression patent or proprietary medicine thus :

(2.) Drugs which are for the time being recognised by any of the named pharmacopoeias are excluded from the purview of the definition of patent or proprietary medicine. But a medicine may be a compound of several drugs recognised by a pharmacopoeia. Such a Compound if not separately recognized in any of the named pharmacopoeias is not excluded from the purview of the definition of patent or proprietary medicine. We think firstly that in the absence of proper averments in the petition this point ought not to have been raised by the learned Trial judge. Secondly, we think that on the materials on the record the appellants have not established that any of the medicines in respect of which the duty has been charged is not a patent or proprietary medicine as defined in section 3(b) of the Drugs Act, 1940.

(3.) Mr. Banerjee contended secondly that if and in so far as the Central Excises and Salt Act, 1944 as amended by the Finance Act, 1961 seeks to levy duty on mixtures or compounds not specifically recognized by the pharmacopoeias and at the same time exempts from duty the drugs so recognized the taxing statute is discriminatory and is violative of Article 14 of the Constitution. We are unable to accept this contention firstly, this point was not taken in the petition or even in the argument before the learned trial judge and ought not to be allowed to be raised at this stage. Secondly, on the materials before us we are not satisfied that the taxing statute is in any way violative of Article 14. It is for the appellant to show that the mixtures or compounds in respect of which the tax has been levied and the drugs in respect of which the duty is not levied stand on the same footing. There is neither pleading nor proof of this fact. The distinction between drugs which are recognised by the pharmacopoeias and the mixtures or compounds which are not so recognised is founded on intelligible differentia. It is not shown that the differentia has no rational relation to the object sought to be achieved either by the Drugs Act, 1940 or by the Central Excise and Salt Act, 1944. The second contention of Mr. Banerjee must therefore be rejected.