WOCKHARDT PVT. LTD Vs. COLLECTOR OF C. EX.

JUDGEMENT

(1.) THE issue involved in this appeal filed by M/s. Wockhardt Ltd. is whether the medicine manufactured by them is a patent or proprietary medicine classifiable under sub -heading 3003.10 of the Schedule to the Central Excise Tariff Act or Tariff Item 14E of the erstwhile Central Excise Tariff.

(2.) SHRI C.S. Lodha, ld. Advocate, submitted that the Appellants are manufacturing, inter alia, Veterinary drugs namely, Albandazole suspension, Calcium Borogluconate Oxytetracycline. The Collector, Central Excise, under the impugned order, classified all the three medicines as Patent or Proprietary medicines, observing that in addition to the name and address of the manufacturer, the word "WOCKHARDT" had been printed on the label of the product in a conspicuous manner; that the said word was also embossed on the cap of the container of Oxytetracycline Injection in capital letters: that the printing and embossing the word "WOCKHARDT" connot the connection in course of trade between the medicine and the person having the right as proprietor or otherwise to use the name. He relied upon the decision of the Allahabad High Court in the case of Ramsey Pharma (P) Ltd. - 1983 (12) E.L.T. 78. The ld. Counsel further submitted that Albendazole is a generic name as is evident from American Drug Index and Martindale Extra Pharmacopoeia; that the Drugs Controller granted them licence for manufacture of Albendazole on the condition that preparation shall not be marketed under the brand name but only under generic name; that similarly other two impugned medicaments are also sold under generic name. He also mentioned that it was a legal requirement under the Drugs and Cosmetics Act and the Rules made thereunder to mention the name of the manufacturer on the label; that if a trade connection (sic.) would be established in all cases because as per the legal requirement name of the manufacturer is to be indicated boldly on the pack itself; that whether the name is indicated once in a conspicuous manner on the pack or whether it is also inscribed on the vial to prevent spurious drugs being passed on, would not make any difference in sofar as the interpretation of the Tariff entry is concerned. He relied on the decision of the Madras High Court in the case of Union of India v. Indo French Pharmaceutical Co. - 1983 (12) E.L.T. 725 in which the symbol which was a rectangle with a flame and the words "Indo French" was held not to indicate a connection in the course of trade between medicine and the manufacturer. The Madras High Court observed that there is absolutely nothing in the mark to indicate a connection in the course of trade between the medicine and the Respondent. The ld. Advocate added that there was no monogram printed by them on any label of the impugned products and in cases of their other medicines wherever the monogram was printed on the label, they were paying Central Excise duty. He finally relied upon the decision of the Supreme Court in the case of Astra Pharmaceuticals (P) Ltd. v. C.C.E., Chandigarh -1995 (75) E.L.T. 214 (S.C.) in which the Apex Court made a distinction between the house mark and trade name and held that "the identification of a medicine should not be equated with the product mark. Identification is compulsory under the Drug Rules. Technically, it is known as "House Mark". He further submitted that the Supreme Court approved the ratio laid down by the Madras High Court in Indo French Pharmaceutical Co. (supra), as correctly enunciating the scope of Explanation I to item 14E of the erstwhile Central Excise Tariff. The Apex Court distinguished the Allahabad High Court decision in Ramsey Pharma case, relied upon by the Collector in the impugned order.

(3.) SHRI C.S. Lodha also contended that the major part of the demand was hit by time limit as specified in Section 11A of the Central Excise Act as the show cause notice was dated 27 -7 -1990 and the period covered by for demanding the duty was 1 -7 -1985 to 31 -3 -1990. He mentioned that they had filed Classification list in respect of Albendazole suspension in May, 1983 claiming exemption under Notification No. 234/82; that in respect of Classification list filed on 1 -3 -1984, the department directed them to classify the product under item 14E; that, however, after going through the labels and communication from FDA, Maharashtra, the Assistant Collector approved the said Classification list; that thereafter Classification lists were filed from time to time which were approved and no appeal had been filed against any of the approvals of the Classification lists; that RT 12 Returns filed from time to time which had also been assessed; that similarly in respect of Oxytetracycline, they filed on 18 -1 -1989 a C.L. classifying it under sub -heading 3003.10 along with a copy of the label; that the Superintendent, Central Excise, after visiting the factory, raised the query about the picture of animal and use of the word "WOCKHARDT"; that they clarified that the animal picture was shown on the label of all veterinary products as per the requirement of the Drugs and Cosmetics Act and Rules [Rule 97(3)]; that name "WOCKHARDT" was used only to depict the name of the manufacturer; that after further correspondence, the Assistant Collector approved the Classification lists on 19 -6 -1989. Similarly in respect of Calcium Borogluconate the Appellants had filed C.L. on 1 -3 -1984 and subsequently from 1985 to 1988 which were duly approved. The ld. Counsel submitted that in these facts and circumstances, there could be no question of any suppression of facts, that all the objections contained in the show cause notice were known to the Department; that it is well settled that when a manufacturer has filed Classification list and samples are drawn, labels are scrutinised and CLs. are approved, there could be no question of alleging suppression of facts. He relied on the following decisions.