Holding

The products are patent and proprietary medicines chargeable to excise duty under Item 14‑E; the exemption under the notification for Item 68 does not apply.

Summary

The appellant, ESKA YEF Ltd., manufactured Bifuran Supplement, Neftin‑50 and Neftin‑200 and claimed they were exempt from central excise duty as "animal feed supplements" under Item 68 of the Central Excise Tariff, relying on a 1984 notification. The Revenue argued that the products contained furazolidone, a veterinary drug used to prevent and treat coccidiosis, and therefore fell within Item 14‑E as patent or proprietary medicines, making them chargeable to excise duty. The Court held that Item 68 is a residuary entry and cannot be invoked when a product is clearly covered by a specific entry such as Item 14‑E. Since furazolidone is a drug used for treatment/prevention of animal ailments, the three products are medicines and must be taxed under Item 14‑E; the exemption under the notification applies only to goods classified under Item 68. The Court also rejected the appellant’s claim of discrimination under Article 14, noting that any disparity arose from differing interpretations by separate excise authorities, not intentional bias. Consequently, the appeal was dismissed.

Issues considered

Whether Bifuran Supplement, Neftin‑50 and Neftin‑200 are patent or proprietary medicines chargeable under Item 14‑E of the Central Excise Tariff.
Whether the exemption under the 1984 notification for "animal feed supplements" under Item 68 applies to the said products.
Whether the appellant is entitled to relief on the ground of discrimination under Article 14 of the Constitution.

Legislation cited

Subjects

central excisetariff classificationpatent or proprietary medicinesItem 14-EItem 68animal feed supplementexemption notificationArticle 14 equalityfurazolidonecoccidiosis

Judgment

ESKA YEF LIMITED
A
v.
COLLECTOR OF CENTRAL EXCISE

SEPTEMBER 14, 1990

B [N.M. KASLIWAL AND S.C. AGRAWAL, JJ.]

Central Excises and Salt Act, 1944: First Schedule Item 14E-
Bifuran Supplement, Neftin-50 and Neftin-200--Whether chargeable to
excise duty as patent or proprietary medicines.

Item 14-E of the First Schedule to the Central Excises and Salt
c Act, 1944 at the relevant time dealt with patent or proprietary
medicines not containing alcohol, opium, Indian hemp or other narcotic
drugs or narcotics. Explanation I thereto defined 'patent or proprietary
medicines' to mean any drug or medicinal preparation, in whatever
form, for use in the internal or external treatment of, or for the preven-
D tion of ailments In human beings or animals. Item 68 dealt with all other
goods, not elsewhere specified but excluding alcohol, opium, Indian
hemp and other narcotic drugs and narcotics.

The Central Government by a notification dated February 28,
1982 exempted certain goods falling under Item 68 from the levy of
E central excise duty. Entry at S. No. IO in the schedule annexed thereto
read "animal feed Including compound livestock feed". The said notifi-
cation was superseded by notification dated November I, 1982 which
also provided the same exemption. This notification was again amended
by notification dated February 15, 1984. Entry at S. No. IO in the
schedule thereto read "animal feed including compound livestock feed,
F animal feed supplement and animal feed concentrates".

A question arose as to whether Bifuran Supplement, Neftin-50
and Neftin-200 manufactured by the appellant were chargeable to
excise duty as patent or proprietary medicines under Item 14-E or could
be classified as "animal feed supplement" under Item 68 and exempted
G from payment of excise duty. The Assistant Collector of Central Excise
held that the said formulations were classifiable under Tariff Item 14-E.
His order was, however, set aside by the Collector of Central Excise
(Appeals) who held that the said products were animal feed supple-
ments which merited classification only under the erstwhile Tariff Item
68 and not under Tariff Item 14-E. On appeal by the Department, the
H Tribunal held that the aforesaid three products manufactured by the

442
ESKA YEF v. C.C.E. 443

appellant were patent and proprietary medicines as defined in Tariff
A
Item 14-E inasmuch as they have therapeutic and preventive use in
respect of the specific ailments in animals, that if the products satisfied
the requirements of Tariff Item 14-E there was no question of consider-
ing their classification under Tariff Item 68 which was a residuary item.

In this appeal under s. 35-L of the Act it was stated on behalf of the B
appellant that since the use of Bifuran Supplement was to promote
growth rate, weight-gains and feed conversion efficiency in growers and
broilers by keeping coccidiosis away during growing period, it could be
regarded as a preventive medicine falling under Tariff Item 14-E. How-
ever, in respect of Neftin-50 and Neftin-200 it was urged that these were
manufactured for use as animal feed supplement and not for use as
medicines and, therefore, they should haw been classified as animal c
feed supplement under Tariff Item 68 and exempted from payment of
excise duty under notification dat.ed February 15, 1984. It was further
contended that the appellant had been subjected to arbitrary and
hostile discrimination as similar products of other manufacturers were
being exempted from payment of excise duty under the said notifica- D
tion. For the respondent it was contended that Neftin-50 contains
Furazolidone 5% w/w and Neftin-200 contains Furazolidone 20% w/w,
that Furazolidone is used as an aid in the prevention of coccidiosis as
well as for treatment of cocddiosis, that Furazolidone is a patent drug
and in England it is sold to the public on the prescription of a registered
practitioner only that the finding that these two products were patent 'E
and proprietary medicines falling under Tariff Item 14-E was essen-
tially a finding of fact based on the materials placed before the excise
authorities and the said finding was not normally open to challenge in
appeal, that the other manufacturers whose products were exempted
were located at different places and were assessable to excise duty by
different authorities, and that the relevant notifications have been F
wrongly applied to those manufacturers by the concerned authorities.

Dismissing the appeal, the Court,

HELD: I. Item 68 of the Excise Tariff was a residuary entry
· which dealt with all other goods not elsewhere specified. A product G
which is found to be covered by the other items of the Schedule of the
Excise Tariff would be outside the ambit of Item 68. [260F]

Dunlop India Ltd. v. Union of India & Ors., [1976] 2 S.C.R. 98
and Collector of Central Excise, Kanpur v. Krishna Carbon I'aper Co.,
[1989] I S.C.C. 150, referred to. H
444 SUPREME COURT REPORTS [ 1990) Supp. I S.C.R.

2. What is required for purposes of Item 14-E is that the product
A
must be a preparation for use in the treatment or prevention of ailments
in human beings or animals. Furazolidone is an antibacterial, antifun-
gal and antiprotozoal compound. It is used for prevention and treatment
of coccidiosis as well as histomoniasis in poultry. In England it.is a
veterinary drug and it can be sold or supplied to the public on a
B practitioner's prescription only. Furazolidone is thus a drug or medici-
nal preparation used for treatment and prevention of ailments in
poultry. Since Neftin-50 and Neftin-200 contain only Furazolidone, the
said products are also drugs or medicinal preparations for use in the
treatment and prevention of ailments in poultry. They have, therefore,
to be regarded as patent and proprietary medicines chargeable to excise
duty under Item No. 14-E. [262E-G]
c
Annapurna Carbon Industries Co. v. State of A.P., [1976] 3 SCR
561, referred to.

3. The exemption under notification dated November 1, 1982, as
D amended by notification dated February 15, 1984 was confined in its
application to specified goods which fell under Item 68. The said notifi-
cation did not grant exemption in respect of a product falling in any
other entry of the excise tariff. It could not be construed as transferring
a product from an entry other than Item 68 to Item 68. The insertion of
'animal feed supplement' in Entry No. 10 in the schedule to the notifica-
E tion dated November 1, 1982 by the notification dated February 15,
1984, would not mean that a product which was liable to payment of
excise duty under Item 14-E prior to such insertion would cease to be so
liable and would become exempt from such payment of duty by virtue of
that notification. Prior to the notification dated February 15, 1984, the
appellant was paying excise du!y on Neftin-50 and Neftin-200 as patent
F and proprietary medicines falllng under Item 14-E. In the absence of
any notification granting exemption in respect of products falling under
Item 14-E, Neftin-50 and Neftin-200 could not be claimed to be exempt
~( from Central Excise duty as animal feed supplement. [263F-H; 264A-B I

.
1!

11
4. It was not tbe case of the appellant that the same authority had
passed orders discriminating between the appellant and other produc-
G
!l ers of similar products. Nor it is said that there has been intentional and
systematic discrimination in favour of the producers other than the
appellant. The discrimination complained of arose on account of orders
passed by different excise authorities acting quasi-judicially. Merely
because on account of difference in the interpretation of the relevant
H notifications by the excise authorities in other regions other manufac-
ESKAYEF v. C.C.E. [AGRAWAL, J.l, 445

turers of similar products in those regions were enjoying exemption
A
from payment of such duty the same exemption could not be extended to
it. The appellant could not obtain so.ch an exemption in disregard of the
law by invoking the right to equality before the law and equal protection of
the laws guaranteed under Article 14 of the Constitution. [264G-H; 265A-B]

Narain Dass v. The Improvement Trust, Amritsar, & Anr., AIR B
1972 S.C. 865, referred to.

Cumberland Coal Co. v. Board of Revision, 76 Law Edn. 147;
Iowa-Des Moines National Bank v. E.R. Bennett, 76 Law Edn. 265;
Vishnudas Hindumal v. State of Madhya Pradesh & Ors., [1981] 3
S.C.R. 234 and Ramnath Verma v. State of Rajasthan, [1963] 2 s.C.R.
152, distinguished. C

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4457
of 1989.

Appealunder Section 35-L(b) of the Central Excise and Salt D
Act, 1944 from the Order No. 285/89-C dated the 29th June, 1989 of
the Customs, Excise and Gold (Control), Appellate Tribunal, New
Delhi in Appeal No. E/2489/87-C.

K.K. Venugopal, D. Shroff, Ravinder Narain, Raj Darak, P.K.
Ram and D.N. Mishra for the Appellant. E

Kapil Sibal, Additional Solicitor General, P. Parmeshwaran and
Ms. Indu Malhotra for the Respondent.

The Judgment of the Court was delivered by
F
S.C. AGRAWAL, J. This appeal involves the question whether
the products, Bifuran Supplement, Neftin-50 and Neftin-200, manu-
factured by the appellant, are chargeable to excise duty as 'patent or
proprietary medicines' under Item 14-E of the First Schedule to the
Central Excise and Salt Act, 1944, (hereinafter referred to as the
'Excis ~ Tariff') or the said products are exempted from excise duty G
under notification No. 6/84 dated February 15, 1984, as animal feed
supplement. At the relevant time Item 14-E of the Excise Tariff was as
under:

"14-E Patent or proprietary medicines not contam1~
alcohol, opium, Indian Hemp or other narcotic drugs or H
A
446 SUPREME COURT REPORTS [1990] Supp. l S.C.R.

other narcotics other than those medicines which are exclu-
sively Ayurvedic, Unani, Sidha or Homeopathic.
•
. ,,

Explanation !-'Patent or Proprietary Medicines' means
any drug or medicinal preparation, in whatever fonn, for
use in the internal or external treatment of, or for the pre-
B vention of ailments in human beings or animals which bears
either or itself or on its container or both, a name which is
not specified in a monograph in a pharmacopoeia, formu-
lacy or other publications notified in this behalf by the
Central Government in the Official Gazette, or which is a
brand name, that is, a name or a registered trade mark
under the Trade. and Merchandise Marks Act, 1958 (43 of
c 1958), or any other mark such as a symbol, monogram,
label, signature or invented words or any writing which is
used in relation to that medicine for the purpose of indicat-
ing or so as to indicate a connection in the course of trade
between the medicine and some person, having the right
D either as a proprietor or otherwise to use the name or mark
with or without any indication of the identity of that
person.

Explanation 11-'Alcohol', 'Opium', 'Indian Hemp',
'Narcotic Drugs' and 'Narcotics' have the meanings respec-
E tively assigned to them in Section 2 of the Medicinal and
Toilet Preparations (Excise Duties) Act, 1955."

Item 68 of the Excise Tariff was in the nature of a residuary
provision and it read as under: ·· · ·

F "All other goods, not elsewhere specified but excluding:

(a) alcohol, all sorts, including alcoholic liquors for human
consumption;

(b) opium, Indian Hemp and other narcotic drugs and
G narcotics; and

(c) dutiable goods as defined in Section 2(c) of the Medici-
nal and Toilet Preparations (Excise Duties) Act, 1955 (16 of
1955).

H Explanation-For the purpose of this Item, goods which

ii
ESKAYEF v. C.C.E. [AGRAWAL, J.l 447

are referred to in any preceding Item in this Schedule for A
the purpose of excluding such goods from the· description
·of goods in that Item (whether such exclusion is by means
of an Explanation to such Item or by words of exclusion in
the description itself or in any other manner) shall be
deemed to be goods not specified in that Item."
B
In exercise of the powers conferred by sub-rule (1) of rule 8 of
the Central Excise Rules, 1944, the Central Government issued notifi-
cation dated February 28, 1982 whereby the goods of the descriptions
specified in the Schedule annexed to the said notification and falling
under Item 68 of the Excise Tariff were exempted from the levy of
central excise duty. Entry at S. No. 10 in the Schedule annexed to the C
said notificatio.n was:

"Animal feed including compound live stock feed."

The said notification dated February 28, 1982 was superseded by
notification dated November. 1, 1982, which also exempted from levy D
of central excise duty goods of the description specified in the
Schedule annexed to the said notification falling under Item 68 of the
Excise Tariff. Entry at S. No. 10 in the Schedule annexed to the said
notification was in the same terms as in the previous notification dated
February 28, 1982. The notification dated November 1, 1982 was
amended by notification dated February 15, 1984 whereby entry at E
S. No. 10 in the Schedule annexed to the notification dated November
1, 1982 was substituted by the following entry:

"Animal feed including compound live stock feed. animal
feed supplements and animal feed concentrates."
F
By the aforesaid notification dated February 15, 1984, the following
explanation was also inserted:

"Explanation II-For the purposes of this notification. the
expression-
G
(i) "animal Med supplements" means an ingredient or
co!nbination of ingredients, added to the basic feed mix or
parts thereof. to fulfil a specific need, usually used in micro

- quantities and requiring careful handling and mixing;

(ii) "animal feed concentrates" means a feed intended to H
448 SUPREME COURT REPORTS [ 1990] Supp. 1 S.C.R.

be diluted with other feed ingredients to produce complete
A
food of optimum nutrient balance."

The appellant carries on business as manufacturer of phar-
1maceuticals. Among the products manufactured by it are Bifuran Sup-
plement, Neftin-50 and Neftin-200. Prior to the notification dated
ll February 15, 1984 the appellant was ~lassifying the products men-
tioned allove under Item 14E and was paying central excise duty on
that basis. After the notification dated February 15, 1984 the appellant
filed a classification list effective from March I, 1984 whereby the
above mentioned products were classified as 'animal feed supple-
ments' under Item 68 and exemption was claimed under notification •
dated February 15, 1984. The said classification list submitted by the
c appellant was approved by the Assistant Collector of Central Excise
on June 4, 1984. Subsequently the Assistant Collector realised that the
said classification had been wrongly approved and he gave a show
cause notice dated January 31, 1985 to the appellant wherein it was
stated that the above mentioned products classified by the appellant to
D be "animal feed supplement" do not appear to fulfil the conditions
enumerated in the notification dated February 15, 1984 and the appel-
lant was required to show cause why the exemption granted to the said
products should not be withdrawn. The appellant submitted a reply
dated March 29, 1985 to the said show cause notice. After considering
the said reply Assistant Collector passed an order dated August 21,
E 1985 whereby it was held that the exemption granted to the above
memioned products of the appellant has to be withdrawn with effect
from March l, 19S4 as the condiiions set out in the Notification No.
6/84 da(ed February 15, 1984 had not been fulfilled and the duty
involved on the clearance of the said formulations had to be paid and
further clearance could be effected under the revised classification list
F by including these items in Tariff Item 14E. The· said order was set
aside, on appeal, by the Collector of Central Excise (Appeals) by his
order dated December 12, 1985 and the matter was remanded to the
Assistant Collector to decide the classification in de-novo proceedings
after recording evidence to establish that the product has definite
therapeutic or preventive value for disease in animals. Thereafter the
G Assistant Collector initiated de-novo proceedings. The appellant sub-
mitted written submissions and filed documents. After giving a
personal hearing to the representation of the appellant the Assistant

-
Collector passed an order dated November 17/21, 1986 holding that
products Neftin-50, Neftin-200 and Bifuran Supplement manufactured
by the appellant are correctly classifiable under erstwhile Tariff Item
H 14E and that effective from February 8, 1986 the said products are
·1 - ESKAYEF v. C.C.E. [AGRAWAL, J.I 449

classifiable under sub-heading 3003.9. The said order was set aside by
A
the Collector of Centr.al Excise (Appeals) by his order dated May 28.
1987, who held that the said products are animal feed supplements and
these products merit classification only under the erstwhile Tariff Item
68 and not u,nder Tariff Item 14E. Aggrieved by the said order of the
Collector (Appeals) the Department filed an appeal before the
Customs, Excise & Gold Control Appellate Tribunal, which was B
allowed by order dated June 29, 1989. The tribunal held that the
aforesaid three products manufactured by the appellant are patent and
proprietary medicines as defined in Tariff Item 14E inasmuch as they
have therapeutic and preventive use in respect of the specific ailments
in animals. The tribunal was also of the view that if the products satisfy
the requirements of Tariff .Item 14E there was no question of consider-
ing their classification under Tariff Item 68, which is a residuary item. c
Aggrieved by ·the said order of the tribunal the appellant has filed this
appeal under Section 35L of the Central Excise and Salt Act, 1944.
During the course of arguments Shri K.K. Venugopal, the
learned counsel for the appellant fairly stated that according to the
D
printed pamphlet issued by the appellant the use of Bifuran Supple-
ment is to promote growth rate, weight-gains and feed conversion
efficiency in growers and broilers by keeping coccidiosis away during
growing period, and that the said product can be regarded as preven-
tive medicine falling under Tariff Item 14E and he has confined his
submissions in respect of the other two 'products, namely, Neftin-50
E
and Neftin-200.

Shri Venugopal has urged that Neftin'50 and Neftin-200 are
manufactured by the appellant for use as animal feed supplement and
not for use as medicine and therefore they should have been classified
as animal feed supplement under Tariff Item 68 and were exempted
F
from payment of central excise duty under notification dated February
15, 1984. Shri Venugopal has invited our attention to the printed
literature issued by the appellant for the sale of these products as well
as certain certificate issued with regard to the use of these products as
additive to poultry feed and their usefulness for that purpose. Shri
(
Yenugopal has pointed out that in the printed literature it has been
specifically mentioned: G

"For use in poultry feed only. Not for medicinal use."

Shri Venugopal a!So pointed out that as regards uses of Neftin-50
and Neftin-200 it is stated in the said printed literature: 1-1 .
450 SUPREME COURT REPORTS [1990] Supp. 1 S.C.R.

A "To improve egg produ;;tion, feed/egg ratio and hatchabi-
lity in layers; to increase weight-gains and growth rate in
broilers and growers."

The learned Additional Solicitor General, on the other hand, has
urged that both these products are patent and proprietary medicines
B
chargeable to central excise duty under Tariff Item 14E. In this con-
nection the learned Additional Solicitor General has pointed out that
Neftin-50 contains Furazolidone 5% W/W and Neftin-200 contains
Furazolidone 20% W/W. The submission of the learned Additional
Solicitor General is that Furazolidone is used as an aid in the preven-
tion of coccidiosis as well as for treatment of coccidiosis and that
c Furazolidone is a patent drug and in England it is sold to the public on
the prescription of a registered practitioner only. The learned Addi-
tional Solicitor General also urged that the finding that aforesaid two
products are patent and proprietary me\licines falling under Tariff
Item 14E is essentially a finding of fact based on the materials placed
before the excise authorities and the said finding is not normally open
D
to challenge in appeal before this Court. The submission of the learned
Additional Solicitor General is further that in the present case it can-
not be said that the aforesaid products manufactured by the appellants
can be regarded as animal feed supplement as defined in Explanation
II, inserted by notification dated February 15, 1984 in the notification
dated November 1, 1982.
E
Jn the instant case we are not required to consider the scope of
two competing entries of the Excise Tariff because Item 68 was a
residuary entry which dealt with all other goods not elsewhere
specified. A product which is found to be covered by the other items of
the Schedule of the Excise Tariff would be outside the ambit of Item
F 68. Therefore, the primary question to be considered is whether the
products in question, namely, Neftin-50 and Neftin-200, are patent
and proprietary medicines falling within Item 14E.

Jn this context we may refer to the decision of this Court in
Dunlop India Ltd. v. Union of India and Others, [1976] 2 SCR 98
G where the question was whether V.P. Latex manufactured by the
appellant in that case was raw rubber and classifiable under Item 39 or
it was classifiable under the residuary entry contained in Item 87. It
was found that V.P. Latex fell within Item 39 and in view of the said
finding it was held that it could not fall within the residuary entry of
Item 87. It was observed:
.H
ESKAYEF v. C.C.E. [AGRAWAL, J.] 451

"When an article has, by all standards, a reasonable claim A
to be classified under an enumerated item in the Tariff
Schedule, it will be against the very principle of classifica-
tion to deny it the parentage and consign it to an orphanage
of the residuary clause. The question of competition bet-
ween two rival classification will, however, stand on a diffe-
rent footing." (P. 113). B

Similarly in Collector of Central Excise, Kanpur v. Krishna
Carbon Paper Co., [1989] 1 S.C.C. 150 the question was whether
carbon paper was taxable under Item 17 or under the residuary entry
at Item 68. It was found that carbon paper was taxable as paper under
Item 17(2) and, therefore, it would not fall ih the residuary entry at C
Item 68.

As noticed earlier, Item .J4E refers t@ patent or proprietary
medicines. The expression 'patent or proprietary medicines' has been
defined in Explanation I in Item 14E to mean any drug or medicinal
preparation, in whatever form, for use iri the internal or external treat- D
ment of' or for the prevention of ailment in human beings or animals.
What is, therefore, required is that the product must be a preparation
for use in the treatment or prevention of ailm:ents in hurr1an beings or
animals. Neftin-50 contains Furazolidone 5% W/W and Neftin-200
contains Furazolidone 20% W/W. The Assistant Collector in his order
dated i7/21 November, 1986 has referred to the following authorities E
on the subject. ·-

(a) British Pharmacopoeia 1980, Vol. I, wherein with reference
to Furazolidone it has been stated:

"A yellow crystalline powder, odourless, to be protected F
from light. An antibacterial, antiftingal and antiprotozol."
(P-.205)

(b) British Pharmacopoeia Codex 197~ wherein it has been
stated:
G
"A bacteriacide which is observed only slightly from the
intestinal mucosa and has therefore been used in the treat-
ment of bacterial diarrhoea and gestro enteritis. It is also
active against, "Giardia lamblia."

"Furazolidone is- used in animals as an antibacterial agent H
452 SUPREME COURT REPORTS I 1990] Supp. I S.C.R.

and for the promotion and treatment of histomoniasis."
A
"For histomoniasis in poultry, the usual prophylectic
dosage is 100 ppm in the feed and the usual therapeutic
dosage is 400 ppm in the feed for 10 days." (P. 376)

B (c) Scientific Foundations of Veterinary Medicine, 1980 Edn.:

"Bloody or cecal coccidiosis is an acute hemorrhagic dis-
ease and is the most severe form of coccidiosis in chickens."

"Furazolidone is fed continuously at 0.0055% in the feed as
an aid in the prevention of coccidiosis caused by E. tenella,
c E. necatrix, and E. acervulina. Furazolidone can also be
used for the treatment of these same coccidia species when
fed at 0.011% for 5 to 7 days." (P. 193)

(d) Medicines and Poisons Guide, 2nd Edn. 1980, prepared by
D the Law Department of Pharmaceutical Society of Great Britain:

"Furazolidone is a prescription only veterinary drug and by
virtue o: an entry in the medicines order (prescription only)
may be sold or supplied to the public only on a practition-
er's prescription." (P. 59)
E
These observations indicate that Furazolidone is an antibacte-
rial, antifungar and antiprotozol compound and it is used for preven-
tion and treatment of coccidiosis as well as histomoniasis in poultry.
From this material it also appears that in England Furazolidone is a
prescription only veterinary drug and it can be sold or supplied to the
F public on a practitioner's prescription only. Furazolidone is thus a drug
or medicinal preparation used for treatment and prevention of ail-
ments in poultry and since Neftin-50 and Neftin-200 contain only
Furazolidone, the said products are also drugs or medicinal prepara-
tions for use in the treatment and prevention of ailments in poultry. In
this context it would be relevant to mention that apart from Neftin-50
G and Neftin-200 the appellant also manufactures Neftin Tablets. The
appellant has not disputed that Neftin Tablets manufactured by it are
drugs or medicines falling within the ambit of Item 14E and it pays
central excise duty on the same. ·

Shri Venugopal has laid stress on the word "used" in Explana-
H tion I in Item 14 and has submitted that Neftin Tablets are manufactured
ESKAYEF v. C.C.E. [AGRAWAL, J.J 453

for use as medicine whereas Neftin-50 and Neftin-200 are manufac-
A
tured for use as animal feed supplement and are not manufactured for
use as medicine. Shri Venugopal has invited our attention to the deci-
sion of this Court in Annapurna Carbon Industries Co. v. State of
Andhra Pradesh, [1976] 3 S.C.R. 561. In that case the question for
consideration was whether Cinema Arc Carbons were taxable to sales
tax under the entry relating to cinematographic equipment and parts B
and accessories 'required for use therewith'. This Court held that the
main use of the arc carbon was proved to be that of production of
powerful light-used in projectors in cinemas and the fact that they can
also be used for search lights, signalling, stage lighting or where
powerful lighting for photography or other purposes may be required,
could not detract from the classification to which the carbon arc
belong, which is detennined by their ordinary or commonly known c
purpose or user· and hence their sale was subject to sales tax under the
said entry. Here we find that Neftin-50 and Neftin-200 contain
Furazolidone which is administered for prevention and treatment of
ailments viz., Coccidiosis and Histomoniasis in poultry. Merely
because Neftin-50 and Neftin-200 can also be used for improving egg D
production and .increase in growth rate of broilers would not in any
way detract from the fact that the said products are 1nedicines for use
in the treatment and prevention of ailments in poultry. Once it is
found that Neftin-50 and Neftin-200 are medicines for use for treat-
ment and prevention of ailments in poultry they have to be regarded as
patent and proprietary medicines chargeable to excise duty under !_tern E
No. 14E and the question whether the said products fall in the residuary
entry at Item 68 does not arise.

The exemption from payment of central excise duty which has
been granted under notification dated November 1, 1982, as amended
by notification dated February 15, 1984, is confined in its application p
to goods specified in the Schedule annexed to the said notification
which fall ·under Item 68. The said notification does not grant exemp-
tion in respect of a product falling in any other entry of the excise
tariff. It cannot be construed as transferring a product from an entry
other than Hem 68 to Hem 68. The insertion of animal feed supple-
ment in the Schedule to the Notification dated November 1, 1982, by G
the Notification dated February 15, 1984, would not mean that a pro-
duct which was liable to payment of central excise duty under Item 14E
prior to such insertion would cease to be so liable and y:ould become
exempt from such .payment of duty by virtue of this notification. It is
not disputed that prior to the notification dated February 15, 1984, the
appellant was paying central excise duty on Neftin-50 and Neftin-200 H
454 SUPREME COURT REPORTS [ 1990] Supp. 1 S.C.R.

as patent and proprietary medicines falling under Item 14E. In the
A absence of any notification granting exemption in respect of products
falling under Item 14E. Neftin-50 and Neftin-200, which are patent
and proprietary medicines falling under Tariff Item l4E and which do
not fall under the residuary entry at Item 68, cannot be claimed to be
exempt from central excise duty as animal feed supplement under
B notification dated November 1, 1982, as amended by notification
dated February 15, 1984.

Shri Venugopal has contended that the appellant has been sub-
jected to arbitrary and hostile discrimination inasmuch as similar pro-
ducts of other manufacturers which contain the same percentage of
c Furazolidone as Neftin-50 and Neftin-200 are being exempted from
payment of central excise duty under notification dated November 1,
1982, as amended by notification dated Februrary 15, 1984. In
support of this submission Shri Venugopal has invited our attention to
the pamphlets issued by other manufacturers about their products and
the contents of those products. Shri Venugopal has placed reliance on
D the decisions of the U.S. Supreme Court in Cumberland Coal Co. v.
Board of Revision, 76 Law Edn. 147 and Iowa-Des Moines National
Bank v. E.R. Bennett, 76 Law Edn. 265 as well as the decision of this
Court in Vishnudas Hindumal Etc. v. State of Madhya Pradesh and
Ors., (1981] 3 S.C.R. 234. The learned Additional Solicitor General
has submitted that the other manufacturers referred to by Shri
E Venugopal are located at different places and are assessable to excise
duty by different authorities and that merely because the relevant
n'?tifications have been wrongly applied to those manufacturers by the
concerned authorities and the said manufacturers are enjoying exemp-
tion from duty in respect of their products would not mean that the
impugned order passed against the appellant is liable to be quashed
F on the ground on violation of the right to equality under Article 14 of
the Constitution. The learned Additional Solicitor General has also
stated that proceedings would be initiated against those manufacturers
in the light of the decision of this Court in this case.

It is not the case of the appellant that the same authority has
G passed orders discriminating between the appellant and other pro-
ducers of similar products. The grievance of the appellant is that on
Jt
account of difference in the interpretation of notification dated
February 15, 1984, amending notification dated November 1, 1982, by
the excise authorities in other regions while the appellant is being
required to pay excise duty on Neftin-50 and Neftin-200 manufactured
H by it, other manufacturers of similar products in other regions are
ESKAYEF v. C.C.E. [AGRAWAL, J.] 455

enjoying exemption from payment of such duty. The appellant, in
A
substance, wants that because other producers have been graflted
exemption, though wrongly, the same exemption should be extended
to it. In our opinion this is impermissible. The appellant cannot obtain
such an exemption in disregard of the law by invoking the right to
equality before the law and equal protection of the laws guaranteed
under Article 14 of the Constitution. A similar question arose before B
this Court in Narain Dass v. The Improvement Trust, Amritsar &
Another, AIR 1972 S.C. 865. In that case it was contended that while
administering Section 56 of the Punjab Town Improvement Act, 1922,
there had been hostile discrimination against the appellants because
lands under orchards belonging to persons similarly placed had been
exempted whereas the appellants had been refused exemption. Reject-
ing this contention this Court has observed:
c
"In any event if the appellants had failed to bring their case
within Section 56 of the Act, then merely because some
other party had erroneously succeeded in getting his lands
exempted ostensibly under that Section that by itself would D
not clothe the present appellants with a right to secure
exemption for their lands. The rule of equality before the
law or of the equal protection of the laws under Article 14
could not be invoked in such a case."

In .Cumberland Coal Co. (Supra) and Iowa-Des Moines National E
Bank (supra) it was found that there was intentional and systematic
discrimination in favour of certain persons by the officials administer-
ing the law. In the instant case it is not said that there has been
intentional and systematic discrimination in favour of the producers
other than the appellant. The said decisions have, therefore, no appli-
cation to the present case. F

Vishnudas Hindumal v. State of Madhya.Pradesh (Supra) was in
respect of a scheme for nationalisation of motor transport whereunder
the permits of the appellants before this Court had been curtailed and
they were prohibited from operating their stage carriages on that
portion of the route for which they had permits which was overlapping G
with the notified route while others similarly situate were permitted to
ply their stage carriages over the routes for which they had permits
passing over a portion of the notified route without any let or hind-
rance and their permits were neither curtailed nor cancelled. This
Court found that this was dlle to an error or omission on the part of the
Regional Transport Authority in not supplying full information to the H
456 SUPREME COURT REPORTS [1990] Supp. 1 S.C.R.

A Special Secretary about all the valid permits in force at the relevant
date. After referring to the decision of this Court in Ramnath Verma v.
State of Rajasthan, [1963] 2 S.C.R. 152 wherein it was held that dis-
crimination under Article 14 is conscious discrimination and not acci-
dental discrimination that arises from oversight which the State is
ready to rectify, this Court observed:
B
"We did not find any willingness on the part of the State
authorities to rectify the error in the High Court or before
this Court."

In these circumstances. this Court, instead of rejecting the whole
c scheme, considered it appropriate to rectify the same by removing the
discrimination by putting the appellants before it in the same class as
those who had en joyed favourable treatment by inadvertance on the
part of the Regional Transport Authority. The present case stands on a
different footing. Here the discrimination complained of arises on
account of orders passed by different excise authorities acting quasi
D judicially. Moreover it cannot be said that there is no willingness on the
part of the authorities to recover excise duty on similar products
manufactured by other producers because the learned Additional
Solicitor General, during the course of his arguments, has indicated
that proceedings would be initiated against those manufacturers in the
light of the decision of this Court in this case. The decision in Vish-
E
nudas's case (supra) has, therefore, no application to the present case.

For the reasons aforesaid we find no substance in this appeal and
it is accordingly dismissed. There will be no order as to costs.

P.S.S. Appeal dismissed.

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