K.C. Mamgain, Member (T)

1. These are 05 (five) appeal filed by the Revenue. Since the issue involved in these appeals is common, they were taken together for hearing and are being disposed of by this common order.

2. The appeal No. E/1376-1378/2000 & E/136/2001 are filed by the Commissioner of Central Excise, Cochin against the Order-in-Appeal No. 63 to 65/2000-CE dated 25.07.2000 & 91/2001 dt. 2.3.2001 whereas the appeal No. E/239/2001 is filed by the Commissioner of Central Excise, Calicut against the Order-in-Appeal No. 148/2001-CE dated 30.03.2001 passed by the Commissioner of Customs & Central Excise (Appeals), Cochin.

3. Shri B.R. Jagadish, learned JDR appeared for the Appellants and Shri S.S. Radhakrishnan, Learned Advocate appeared for the Respondents.

4. The learned JDR pleaded that M/s. Arshik Herbal Remedies (India), Trivandrum are manufactures of "Anoop Herbal Hair Oil". On declaration filed by them, it was found that they classified their products under chapter Sub Heading 3003.30 of Central Excise Tariff Act, 1985 which deals with medicaments used in Ayurvedic system manufactured exclusively in accordance with the formula described in the authoritative books specified in the first section of the Drugs and Cosmetics Act, 1940 and sold under the name as specified in such books as medicament. The product manufactured by the Respondent is a hair oil and not a medicament hence the product has to be rightly classified under chapter Sub Heading 3305.90. It was pleaded that the "Anoop Herbal Hair Oil" is not known in common parlance as Ayurvedic medicine. Mention of some of the ingredients of the products in the Ayurvedic Text does not merit the product to be classified as an Ayurvedic Medicament. The "Anoop Herbal Hair Oil" is not only sold in Medical Shops but also in General Stores. Some of the ingredients of the product are not known as medicines in common parlance. Chapter Heading 3305 is for the preparations for use on hair, on the packing of the product, it is mentioned as Hair Oil. Hence it is correctly classifiable under Chapter Heading 3305.

5. In the case of Appeal No. E/239/2001, the learned JDR stated that "Santosh Hair Tone" is applied on the hair and scalp and the product is manufactured using Ayurvedic Herbs referred to in the Ayurvedic Textbooks with coconut oil as its base. It was pleaded that there is hardly any hair oil introduced in the market about which there is not claim for medicinal value. Even the users of ordinary coconut oil (Without any medication) perceive it as having therapeutic value and as a cure for premature hair fall. The product is not perceived as a medicine in popular parlance and the advertisement also focuses on dark and thick hair with fragrance and the mode of prescription and use of "Santosh Hair Tone" is not similar to that of a drug/medicine. It is available without any medical prescription. Therefore, it should be classified under Chapter 33 of the Central Excise Tariff Act, 1985.

6. The learned JDR relied on the decision of the Tribunal in the case of CCE, Chandigarh-I Vs. Dabur India Ltd. and Precise Laboratories Ltd. Vs. CCE, Meerut reported in 2003 (87) ECC 748 (Tri) and Supreme Court decision in the case of B.P.L. Pharmaceuticals Ltd. Vs. Collector of Central Excise, Vadodara reported in : 1995 (77) ELT 485 (SC). Relying on these decision, he stated that from the definition of the term "Medicament" as given in Note 2 to Chapter 30 of the Tariff, a product to be considered as "medicament" must have therapeutic or prophylactic uses. These uses should be the main use of the product. Mere fact that some ingredients contained in the product are mentioned in the authoritative text books on Ayurveda, would not make the product a "medicament".

7. Shri S.S. Radhakrishnan, learned Advocate on behalf of the Respondents pleaded that the impugned product "Anoop Herbal Hair Oil" contains herbal extracts, goats milk and buffalo milk in a coconut oil base. The label on the bottle declares the ingredients which are known to Ayurvedic System of therapeutic value. The label states that the product is to arrest hair fall and to tone up scalp and hair. It gives the method of application stating that 8 to 10 drops or quantity as required has to be applied uniformly on the entire scalp and hair with gentle massaging action. Once the desired result is obtained, "Anoop Herbal Hair Oil" may be used occasionally to maintain hair and scalp in goods condition. It is prepared as per Ayurvedic text Sahasrayogam and it contains the ingredients given in Ayurvedic Formulary of India. Medicament is defined in Note 2 (i) of Chapter 30. According to this definition, Medicaments are products "comprising to or more constituent, which are being mixed together for therapeutic or prophylactic use". The excessive hair fall causes premature baldness. It is a disease known as Indruplupta in Ayurveda and Alopeciareata in allopathic system. since the product is intended to cure the disease, it is a therapeutic product. The Drug Controller and Licensing Authority of Government of Kerala has specifically certified that "Anoop Herbal Hair Oil" is an Ayurvedic Patent and proprietary medicine. He relied on the following decisions -

(i) Sharma Chemical Works Vs. CCE, Cal-I - 2002 (150) ELT 1112 (Tri. - Kolkata), wherein it was held that "Ayurvedic Cool Banphool Oil" is an ayurvedic medicament.

(ii) The Supreme Court decision in the case of Hindustan Ferodo Ltd. - 1997 (9) ELT 16 (SC), wherein it was held that articles fall under a particular heading is to be established by the Revenue.

(iii) Supreme Court decision in the case of BPL Pharmaceuticals Ltd. - : 1995 (77) ELT 485 (SC)

(iv) M/s. Pee Gee Pharma - Tribunal (Chennai Bench) Final Order No. 248 & 249/2003 dated 05.03.2003, wherein it was observed that - "we are not able to countenance the plea of the Revenue that a product just because it is available in general stores and super market cannot be considered as a medicament inasmuch as there is not such statutory requirement that a medicament should be sold only in medical shop as prescribed by a medical practitioner."

(v) Naturalle Health Products (P) Ltd. - 2003 (128) ELT 257 (SC). Wherein it was held that "Patent Ayurvedic medicament could be one where all the ingredients find mention in the authoritative textbooks on Ayurveda,though formula for preparation of medicament not in accordance with the formula given in those text books."

The learned Counsel relied on the above decisions of the various authorities in the case of Santhosh Hair Tone also and pleaded that "Santhosh Hair Tone" is a remedy for premature grey hair and hair loss, dandruff, head aches and insomnia and the same is market on the packing.

8. We have carefully considered the submissions made by both sides. We find the Commissioner (Appeals) in case of both the Respondents have considered the points raised by the appellants. We find that consequent to the Board Circular No. 333/49/97 CX dated 10.9.97 giving guide lines for classifying a product under Ayurvedic medicament, the Commissioner of Central Excise were directed to re-examine the assessments of products claimed to the Ayurvedic medicaments under Chapter 30 so as to determine their correct classification under the Central Excise Tariff Act, 1985. On the basis of these guidelines in para 8of the Order-in-Appeal in respect of the "Anoop Herbal Hair Oil", the Commissioner (Appeals) has given the following findings -

"08. On an examination of this case also in the light of the above guidelines, it is seen that -

1. The product is manufactured under the Drug Licence in Form 25 specified for the manufacture of ayurvedic drug only.

2. The Drugs Controller, Kerala has certified that the product is an Ayurvedic medicine.

3. It is perceived in common parlance as a remedy for premature baldness/excessive hair loss in human beings and not used for dressing or grooming the hair.

4. The price of the product is very high (Rs. 125 for 50 ml) compared to other hair oils, used for grooming hair.

5. The nature of the product, as made out in the leaflet to the users clearly reflect that it is a medicine for arresting hair fall/premature baldness. The leaflet of the product clearly indicate the prescribed dose for specific conditions/disorders and that too for limited time.

6. It is not advertised as a cosmetic or toilet preparation.

7. The product is perceived by users as having substantial therapeutic value and the cosmetic value, if any, is incidental.

8. Like all Ayurvedic and other Indian medicine the product is generally available without any prescription."

He has also taken into consideration the decision of the Supreme Court in the case of B.P.L. Pharmaceuticals Ltd. (supra) where the general principles of classification of a product under Chapter 30 or 33 are contained in Paragraphs 28, 31 & 34. He has correctly applied the principals as laid down by the Supreme Court and arrived at the conclusion that "Anoop Herbal Hair Oil" is appropriately classifiable under Chapter 30 as medicament and not under Chapter 33 as preparation for use on the hair.

9. Similarly, in the case of "Santhosh Hair Tone" manufactured by the second Respondents, the Commissioner (Appeals) has given his finding in Paragraph 5.8 of the impugned order which reads as under -

"05.08 The examination of the correctness of the classification of the product under CH. 30 in the light of parameters prescribed in Boards Circular F. No. 333/49/97 dated 10-9-97 1997 (93) ELT T-14 reveal that (i) It is perceived by users as a remedy for premature hair fall, (ii) the nature of the product as made out in the pamphlet to the users clearly indicate it as a medicine, (iii) it is not advertised asa cosmetic toilet preparation, (iv) Like all other Ayurvedic medicines, the product is generally sold without any prescription, (v) It is considered by users as having substantial therapeutic value and the cosmetic value is incidental. Hence, the reexamination of the classification as per the Boards orders also does not justify any change in the classification in CH. 30 to CH. 33 especially w.r.t. CH Note 1 (d) under CH. 30."

10. We find that the Commissioner (Appeals) has correctly decided the classification of "Anoop Herbal Oil" as well as "Santhosh Hair Tone". Both these products are mainly used as medicament for treating hair fall, dandruff, premature baldness and these are not used for dressing or grooming of the hair. The main use of these products is therapeutic and prophylatic and not as cosmetic or toilet requisite. Therefore, following ratio of the decision of the Supreme Court in the case of BPL Pharmaceuticals Ltd. (Supra), we find that the Commissioner (Appeals) has correctly classified the product sin question under Chapter 30 of the Central Excise Tariff Act, 1985. We do not find any merit in the appeals filed by the Revenue. In the result, these 05 (five) appeals are rejected.