PANAMA CHEMICAL WORKS Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE issue involved in this Appeal, filed by M/s. Panama Chemical Works, is whether the products namely, 'Panjon Cough Drops', Panjon Balm' and 'Panjon Rub', manufactured by them, are classifiable as Ayurvedic medicaments.

(2.) SHRI G.S. Agrawal, learned Advocate, mentioned that the products in question have been approved by the Food and Drugs Authorities of State of Madhya Pradesh as Ayurvedic Medicines; that the ingredients used by them in their different products are as under :

(3.) COUNTERING the arguments Ms. Charul Barnwal, learned Senior Departmental Representative, submitted that during the visit of the Appellants factory on 14 -3 -85, the Central Excise officer found that Methyl Salicylate I.P. (synthetic) and Eucalyptus Oil (IP) was used by them in the manufacture of impugned products; that Shri Naginchandra Kothari, partner in his statement has stated that they were using Eucalyptus Oil (IP) and Methyl Salicylate (I.P.) and Thymol synthetic in the manufacture of their ayurvedic medicines such as Panjon Cough Drops, Panjon Balm and Panjon Rub; that Shri Kripashankar Sharma, Chemist, has also admitted in his statement dated 14 -3 -85 that oil of wintergreen which is used in the manufacture of Panjon Balm was found to contain the words "Methyl Salicylate (I.P.) (synthetic), manufactured by Atta Laboratories Pvt. Ltd. Bombay". She, further, mentioned that the Controller, Foods and Drugs Administration, MP in his letter dated 25 -3 -85 has opinion that synthetic material can not be used in the manufacture of Ayurvedic medicine. She, therefore, contended that as the Appellants are using synthetic ingredients in the manufacture of impugned products the same can not be regarded as Ayurvedic medicaments; that extended period of limitation is invocable for the purpose of demanding duty beyond the period of six months as they had never disclosed to the Department that they were using synthetic material in the manufacture of impugned products. She relied upon the decision in the case of Commissioner of Central Excise Ahmedabad v. Srivallabh Glass Works Ltd. [2003 (153) E.L.T. 494 (S.C.)] wherein the Supreme Court has confirmed the demand of duty when approved classification list showed glass cleared and sold by the respondents was of a particular thickness whereas what was actually cleared and sold was glass of greater thickness. Learned Senior Departmental Representative also submitted that the decision of Supreme Court in the case of Naturalle Health Products is not applicable as the Appellants therein were using the ingredient contained in the products were from natural herbs. In reply the learned Advocate submitted that the Adjudicating Authority has gone beyond the scope of show cause notice by adding Menthol to the list of offending ingredients; that it is well settled that an order going beyond the show cause notice is bad in law. He relied upon the decision in the case of Jawahari Lal Vaid v. Additional Collector of Customs [1991 (52) E.L.T. 278 (Tribunal) = 1991 (32) ECR 571].