1. In this application under Section 8 of the West Bengal Taxation Tribunal Act, 1987, the petitioner has challenged the order of assessment dated June 22, 1998 for the period fourth quarters ending March 31, 1997 passed by the respondent No. 1, Assistant Commissioner of Commercial Taxes, Corporate Division and order dated November 14, 2000 in Appeal Case No. A-401/AN/1999-2000 passed by the respondent No.2, Deputy Commissioner of Commercial Taxes, Corporate Division, imposing sales tax at 15 per cent on "Hajmola Candy" treating the said item as falling under entry No. 46 of Schedule IV of the West Bengal Sales Tax Act, 1994 (in short, "the 1994 Act").
2. The ease of the petitioner, in brief, is that Hajmola Candy is an ayurvedic medicine. The petitioner manufactures Hajmola Candy after obtaining drug licence from the Drug Licensing Authority, Lucknow, and it is manufactured in accordance with the formula given in the authenticated ayurvedic text book "Bhav Prakash" and is certified by the Director, Ayurvedic and Unani Directorate, Lucknow, U. P. Hence, Hajmola Candy is to be treated as a drug and, therefore, sales tax is to be imposed at five per cent in terms of entry No. 24 of Schedule IV of the 1994 Act.
3. The respondent, in the affidavit-in-opposition, has disputed the contention of the petitioner that Hajmola Candy is an ayurvedic preparation which improves digestion as there is no clinical evidence or proof in this regard. According to the respondents, it is a sweet and sour and tasty confectionery item liked by young and old and it does not come within the meaning of drugs and medicines described in entry No. 24 under the 1994 Act. Children are very much fond of Hajmola Candy and unlike medicinal doses, they take it at any numbers at a time. It is also available in grocery, pan shop, public transport and from hawkers unlike medicines and in common trade parlance, it is understood as lozenge and not as medicine. In the affidavit-in-reply, the petitioner rebutted the arguments of the respondents and reiterated that in common trade parlance, Hajmola Candy is treated as a digestive and not a lozenge or confectionary.
4. The point for determination is whether Hajmola Candy is an ayurvedic medicine as specified in item No. 24 or lozenge in entry No. 46 in Schedule IV of the 1994 Act.
5. The basic contention of the petitioner-company is that Hajmola Candy is a patent and proprietary medicine in relation to ayurvedic system of medicine containing ingredients mentioned in the formula described in an authoritative ayurvedic text book and, therefore, satisfies Section 3(h) of the Drugs and Cosmetics Act, 1940. The list of ingredients has been furnished at annexure "C" (page 23) of the application and the respondents have not questioned the correctness of the statement in this regard. Dr. Paul, learned Senior Counsel for the petitioner, has cited a decision of the Madhya Pradesh High Court reported in Panama Chemical Works v. Union of India , wherein it has been stated that "Swad" is an ayurvedic medicine and following the judgment, Special Bench of the CEGAT, New Delhi, held in a judgment reported in Dabur India Ltd. v. Collector of Central Excise , that Hajmola Candy is an ayurvedic medicine under Chapter 30 of the Central Excise Tariff Act. In the said case, it was held by the Tribunal that since the ingredients of "Swad" and "Hajmola" are one and the same, Hajmola should also be regarded as an ayurvedic medicine. He also reported another decision of the CEGAT, New Delhi, reported in Commissioner of Central Excise, Chandigarh v. Dabur India Ltd. [2002] 50 RLT 767, wherein the Tribunal held that Hajmola tablets are ayurvedic medicaments under Chapter 30 of the Central Excise Tariff Act. According to Dr. Paul, the expressions "medicines and medicaments" are interchangeable. Dr. Paul also assailed the order dated November 14, 2000 of the respondent No. 2, Deputy Commissioner of Commercial Taxes, Corporate Division, wherein the respondent No. 2 had relied on the decision of this Tribunal in the case Prabhunath Sharma v.Commissioner of Commercial Taxes reported in [2000] 120 STC 241. But this Tribunal's decision that "Banphool Oil" is not an ayurvedic medicine does not hold good since the Supreme Court in the case of Commissioner of Central Excise, Calcutta v. Sharma Chemical Works , held that Banphool Oil is an ayurvedic medicine and not a perfumed hair oil. According to Dr. Paul, in terms of the ratio laid down by the Supreme Court, the onus or burden to show that a product is within a particular tariff item is always on the revenue and mere fact that a product is sold across the counters and not under a doctor's prescription does not by itself lead to the conclusion that it is not a medicament. In respect of Hajmola Candy too, Dr. Paul argues that merely because Hajmola Candy is sold across the counters and not under the doctor's prescription, it cannot be concluded that it is not an ayurvedic medicine and Hajmola Candy is also registered with the Drug Controller and is being manufactured under drug licence. Dr. Paul also argued that in the case of Himtaj Oil, too, the Supreme Court adopted the reasonings given in the case of "Banphool Oil" and held that "Himtaj Oil" is an ayurvedic medicine. Dr. Paul also referred to another decision of the Supreme Court reported in Meghdoot Gramodyog Sewa Sansthan v. Commissioner of Central Excise, Lucknow [2004] 174 ELT 14, wherein the Supreme Court following the ratio laid down in the case of Banphool Oil and Himtaj Oil held that six products manufactured by the appellant therein are classifiable as ayurvedic medicaments and/or medicines.
6. Learned State Representative filed a written submission and has argued that it is a well-settled principle of law that words and phrases used in the entries of taxing statute are not to be understood in their scientific and technical meaning but had to be understood by their popular meaning, i.e., meaning attached to them by those dealing in and using the products. He cited number of decisions of the apex court reported in Commissioner of Sales Tax v. Jaswant Singh Charan SinghState of West Bengal v. Washi Ahmed [1977] 39 STC 378, Indo International Industries v. Commissioner of Sales Tax, Uttar Pradesh [1981] 47 STC 359, Filterco v. Commissioner of Sales Tax, Madhya Pradesh [1986] 61 STC 318 , Collector of Central Excise, Kanpur v. Krishna Carbon Paper Co.Plasmac Machine Manufacturing Co. Pvt. Ltd. v. Collector of Central Excise, Bombay [1992] 84 STC 107 and Parle Biscuits (P) Ltd. v. State of Bihar [2005] 139 STC 204, in support of his contention. He submits that 1994 Act has not defined the term "Drugs and Medicines". Entry 24 of Schedule IV at the relevant point of time was as under: 24(i) Drugs and medicines except those specified elsewhere in this Schedule or in any other Schedule.
7. According to the learned State Representative, the specific mention of "Surgical dressings" in entry 24 is a strong pointer to the legislative intent to use the expression "drugs and medicines" in the common parlance. If the expression was used to mean drugs and medicaments in the sense of Drugs and Cosmetics Act or in the sense in which entries under the Central Excise Tariff Act are made then it would include "surgical dressings" automatically and there is no necessity to include it specifically. The statute has not defined the term "drugs and medicines" and, therefore, whether Hajmola Candy falls within the expression "drugs and medicines" will not depend upon the fact whether doctors, pharmacists, ayurvedic experts treat them as ayurvedic medicine but whether people purchasing and selling the same treat it as drugs and medicines. He also mentioned that in a magazine called "Drug Today" where all types of medical formulation available in India are included and are used extensively by the doctors, pharmacists, etc., Hajmola Candy has not been included there. In reply, the petitioner-company also submitted a written submission and reiterated the arguments made verbally.
8. It appears that the learned Senior Counsel for the petitioner-company has based all his arguments on the decisions of CEGAT and the apex court and other courts regarding classification of a product as a medicine under the Central Excise Tariff Act. In the Central Excise Tariff Act under Chapter 30, it has been mentioned that the products manufactured exclusively in accordance with the formulae described in the authoritative text book specified in the Drugs and Cosmetics Act, 1940 arc to be regarded as medicaments/medicines. In the West Bengal Sales Tax Act, entry 24 only mentioned drugs and medicines except those specified elsewhere in this Schedule or in any other Schedule. There is no mention that products manufactured in accordance with the formulae described in the authoritative text books specified in the Drugs and Cosmetics Act are to be treated as drugs and medicines. Hence, in absence of any definition of any "drugs and medicines" under the 1994 Act, a product is to be regarded as a drug or a medicine as understood in the common parlance. In a case reported in Dabur India Ltd. v. Commissioner of Central Excise , the Supreme Court has held that in classifying a product, the scientific and technical meaning is not to be resorted to. The product must be classifiable according to the popular meaning attached to it by those using the product. In the said case, the appellant-company had shown that all the ingredients in the product are those which are mentioned in ayurvedic text books. In addition, the appellant had also shown that they had a drug controller's licence for the product and they also produced the clinching evidence by way of prescriptions of ayurvedic doctors, who have prescribed these for treatment. But in the said case, the revenue failed to produce any evidence that in common parlance, the product is not understood as a medicament. In the instant case, the petitioner-company has shown that all the ingredients in the product are those which are mentioned in an authoritative ayurvedic text book and they manufacture the product under a drug controller's licence. But the petitioner-company has not produced any evidence whether the said product is prescribed by any ayurvedic doctor. On the contrary, the revenue has mentioned that this product is sold across the counters and not under the doctor's prescription and the Revenue authorities have also mentioned that it is a sweet and sour and tasty confectionary item liked by young and old. The petitioner-company has not denied the said contention of the Revenue. It is true that mere fact that a product is sold across the counters and not under a doctor's prescription does not by itself lead to the conclusion that it is not a medicament but facts and circumstances made out in the pleadings of the parties are factors to be considered in applying such a principle. Here in the instant case, against the affidavit of the respondents about the nature of Hajmola Candy, which is taken by the young and old as a confectionary without any doctor's prescription, it was incumbent on the petitioner-company to produce evidence that Hajmola Candy is prescribed by the ayurvedic doctors for patients suffering from some particular disease and such failure on the part of the petitioner-company goes to show that in popular parlance, it is not acknowledged as a medicine but as a confectionary.
9. In view of the above, the petition is dismissed without any order as to costs.
10. The judgment is ready and delivered in open court and kept in separate sheets along with the records of this case.
11. The prayer for stay is made by the learned advocate for the petitioner which prayer is opposed vehemently by the learned State Representative. Considered. We find that no order of stay is required.
The prayer is, as such, rejected.