Holding

The twin test is the proper standard; eight of the appellant’s products satisfy it as medicaments and are classified under Chapter 30, while three lack medicinal character and are classified as cosmetics under Chapter 33.

Summary

Mis. Puma Ayurvedic Herbal (P) Ltd., a licensed manufacturer of Ayurvedic medicines, challenged the classification of its products as cosmetics by the CEGAT, which attracted a higher excise duty. The Supreme Court applied the well‑settled "twin test"—the common‑parlance test and the Ayurvedic‑text‑book ingredients test—to determine whether each product was a medicament (Chapter 30) or a cosmetic (Chapter 33) under the Central Excise Tariff Act, 1985. The Court held that the burden of proof lies on the revenue and that the Chief Chemist’s opinion was irrelevant, while the Directorate of Ayurveda’s opinion supported the appellant’s case. Applying the twin test, the Court found that eight of the eleven products were clearly medicinal and should be taxed under Chapter 30, whereas three products lacked medicinal properties and were to be treated as cosmetics under Chapter 33. Consequently, the appeals concerning the eight medicament products were allowed, and the appeals concerning the three cosmetic products were dismissed, with the duty for the latter to be quantified by the Assistant Collector.

Issues considered

Whether the Ayurvedic products of the appellant fall within the definition of a medicament under Chapter 30 of the Central Excise Tariff Act, 1985 or a cosmetic under Chapter 33.
Whether the twin test (common‑parlance test and Ayurvedic‑text‑book ingredients test) is the appropriate criterion for classification.
Whether the burden of proof for correct classification lies on the revenue.
Whether the opinion of the Chief Chemist can be relied upon for classification.

Legislation cited

Central Excise Tariff Act, 1985s. Chapter 30, s. Chapter 33, s. Note 3003.20, s. Note 3003.30
Drugs and Cosmetics Act, 1940

Subjects

classificationmedicamentcosmeticscentral excisetwin testAyurvedic productsburden of proofDrugs and Cosmetics ActCentral Excise Tariff Act

Judgment

A MIS. PUMA AYURVEDIC HERBAL (P) LTD.
v.
COMMISSIONER, CENTRAL EXCISE, NAGPUR

MARCH 8, 2006

B [ASHOK BHAN AND ARUN KUMAR, JJ.]

Central Excise Tariff Act, 1985:

Medicaments or Cosmetics-Chapters 30 and 33, Note 3003.201
C 3003.30-Twin test-Applicability of-Determination of classification of a
product-Assessee claimed to be a manufacturer ofAyurvedic products which
were intended to cure certain ailments of the human body-The assessee had
a licence from the Drug Controller under the Drugs and Cosmetics Act to
manufacture certain Ayurvedic products-The assessee claimed that the
D Ayurvedic products were produced from the ingredients found in Ayurveda
text books and were manufactured as per the Ayurveda pharmacopoeia and
had curative, therapeutic or prophylactic values-It was claimed that the said
Ayurvedic products were not items of cosmetics-The evidence produced by
the assessee before the authorities in the shape of letters from consumers,
from doctors and from Ayurvedic physicians satisfied the common parlance
E test-Directorate of Ayurved had clearly and unambiguously stated that the
products in question were meant for treatment of certain skin diseases and the
type of ingredients used in the products were described in Ayurvedic texts,
being useful in such treatments-But CEGAT classified the said Ayurvedic
products as Cosmetics under Chapter 33--Correctness of-Held: In order to
F determine whether a product is a cosmetic or a medicament the twin tests are
(i) whether the item is commonly understood as a medicament which is called
the common parlance test and (ii) whether the ingredients used in the product
mentioned in the authoritative text books on Ayurveda-The cosmetic products
are meant to improve appearance of a person, that is, they enhance beauty-
A medicinal product or a medicament is meant to treat some medical
G condition-The extent or the quantity of medicament used in a particular
product will not be a rele~antfactor-The twin test is satisfied regarding most
of the items under consideration-Hence, Puma Neem Facial Pack (Neema/),
Puma Anti-pimple Herbal Powder (Pimp/ex), Puma Herbal Facial Pack ..
(Herbaucare), Puma Herbal remedy for Facial Blemishes, Puma Hair Tonjc

H 1120
PUMA AYUR HERBAL (P) LTD. v. COMMR., CENT. EX, NAGPUR 1121
·~
Powder (Sukeshij, Puma Anti-Dandruff Oil (Dandika), Puma Shishu Rakshan A·
Tel and Puma Neem Tulsi are clearly medicinal products and are liable to be
classified under Chapter 30-However, Puma Herbal Massage Oil, Puma
Herbal Massage Oil for women and Puma Scalp Tonic Powder (Scalpton) do
not appear to have any medicinal property and, therefore, are liable to be
classified under Chapter 33-Drugs and Cosmetics Act, 1940.
B
Words and Phrases:

''Cosmetics' '-Meaning of-In the context of Drugs and Cosmetics Act,
1940.

The appellant-assessee claimed to be a manufacturer of Ayurvedic C
products which were intended to cure certain ailments of the human body.
The appellant had a licence from the Drug Controller under the Drugs
and Cosmetics Act, 1940 to manufacture certain Ayurvedic products. The
appellant claimed that the Ayurvedic products were produced from the
ingredients found in Ayurveda text books and were manufactured as per D
the Ayurveda pharmacopoeia and had curative, therapeutic or
prophylactic values. It was claimed that the said Ayurvedic products were
not items of cosmetics.

The Customs, Excise and Gold (Control) Appellate Tribunal
classified the said Ayurvedic products as Cosmetics under Chapter 33 of E
the Central Excise Tariff Act, 1985. As Cosmetics the rate of excise duty
was quite high while as medicaments under Chapter 30 the Ayurvedic
products attracted 'Nil' rate of duty. Hence the appeal.

On behalf of the appellant, it was contended that the Ayurvedic
products of the appellant satisfied the twin tests formulated in Richardson F
Hindustan's case; that the evidence produced by the appellant before the
authorities in the shape of letters from consumers, from doctors and from
Ayurvedic physicians satisfied the common parlance test; that the
Directorate of Ayurved had clearly and unambiguously stated that the
products in question were meant for treatment of certain skin diseases and G
the type of ingredients used in the products were described in Ayurvedic
texts, being useful in such treatments; that the opinion of the Chief Chemist
that the products in question fell under Chapter 33 i.e. cosmetics was of
no relevance; and that the Revenue led no evidence of any sort to rebut
the evidence led by the appellant.
H
1122 SUPREME COURT REPORTS [2006) 2 S.C.R.

A The following question arose before the Court:

Whether the Ayurvedic products manufactured by the appellant- ·
assessee fell within the category of medicaments under Chapter 30 or
cosmetics under Chapter 33 of the Central Excise Tariff Act, 1985?

B Disposing of the appeal, the Court

HELD: l. In order to determine whether a product is a cosmetic or
a medicament a twin test has found favour with the Courts. There is no
dispute about this as even the Revenue accepts that the test is
determinative for the issues involved. The tests are:- [1125-E-Fl
c
1. Whether the item is commonly understood as a medicament which
is called the common parlance test. For this test it will have to be seen
whether in common parlance the item is accepted as a medicament. If a
product falls in the category of medicament it will not be an item of
D common use. A user will use it only for treating particular ailment and
will stop its use after the ailment is cured. The approach of the consumer
towards the product is very material. One may buy any of the ordinary
soaps available in the market. But if one has a skin problem, he may have
to buy a medicated soap. Such a soap will not be an ordinary cosmetic. It
will be medicament falling in Chapter 30 of the Central Excise Tariff Act,
E 1985. (1125-Hl
II. Are the ingredients used in the product mentioned in the
authoritative text books on Ayurveda? [1126-AJ

Collector v. Richardson Hindustan Ltd., (2004) 9 SCC 156, relied on.
F
2. The two tests are recognized even by the Central Board of Excise
and Customs and the Board had directed the Assistant Collector to decide
the classification of the products in question by applying the aforesaid two
tests. (1126-BI

G 3. The Revenue led no evidence of any sort to rebut the evidence led
by the assessee. It is settled law that the burden of showing the correct
classification lies on the Revenue. (1127-E)

4. The Chief Chemist had opined about the classification of the
Ayurvedic products of the appellant under Chapter 33 i.e. "Cosmetics"
H
PUMA AYUR. HERBAL (P) LTD. v. COMMR., CENT. EX., NAGPUR 1123

but the opinion of the Chief Chemist on the question of classification has A
no relevance. The role of the Chief Chemist is only to supply the analytical
data. On the other hand, the Directorate of Ayurved has clearly and
unambiguously stated that the products in question are meant for
treatment of certain skin diseases and the type of ingredients used in the
products are described in Ayurvedic texts, being useful in such treatments. B
(1128-B-C)

5.1. It will be seen from the definition of cosmetics in the Drugs and
Cosmetics Act, 1940 that the cosmetic products are meant to improve
appearance of a person, that is, they enhance beauty. Whereas a medicinal
product or a medicament is meant to treat some medical condition. It may C
happen that while treating a particular medical problem, after the problem
is cured, the appearance of the person concerned may improve. What is
to be seen is the primary use of the product. (1131-A-B]

CCE v. Sharma Chemical Works, (2003) 154 ELT 328, CCE v. Pandit
D.P. Sharma, (2003) 154 ELT, Naturalle Health Product (P) Ltd v. CCE, D
(2003) 158 ELT 257, Collector v. Richardson Hindustan Ltd, (1989) 42 ELT
A 100, Amritanjan v. CCE, (1995) 77 ELT 500, BPL Pharmaceuticals v. CCE,
(1995] Supp. 3 SCC 1, Muller and Phipps (India) Ltd v. CCE, (2004) 167
ELT 574, Manisha Pharma Plasto Pvt. Ltd v. Union of India, (1999) 112
ELT 22 and Dabur (India) Ltd. v. CCE, (2005) 182 ELT 290, relied on.
E
5.2. The extent or the quantity of medicament used in a particular
product will also not be a relevant factor. Normally, the extent of use of
medicinal ingredients is very low because a larger use may be harmful
for the human body. The medical ingredients are mixed with what is in
the trade parlance called fillers or vehicles in order to make the F
medicament useful. Therefore, the fact that use of medicinal element in a
product was minimal does not detract from it being classified as a
medicament. 11131-D-Ff

Collector v. Richardson Hindustan Ltd., (1989) 42 ELT A 100, relied
on. G
5.3. In order to be a medicinal preparation or a medicament it is
not necessary that the item must be sold under a doctor's prescription.
Similarly availability of the products across the counter in shops is not
relevant as it makes no difference either way. (1131-F-G]
H
I 124 SUPREME COURT REPORTS [2006) 2 S.C.R.

A 6. The products at Serial Nos. 1, 2, 3, 4, 7, 9, 10 and 11 viz. Puma
Neem Facial Pack (Neemal), Puma Anti-pimple Herbal Powder (Pimplex),
Puma Herbal Facial Pack (Herbaucare), Puma Herbal remedy for Facial
Blemishes, Puma Hair Tonic Powder (Sukeshi), Puma Anti-Dandruff Oil
(Dandika), Puma Shishu Rakshan Tel and Puma Neem Tulsi are clearly
B medicinal products and are intended to treat certain medical conditions
of the human body and, therefore, in view of the above tests, are liable to
be classified as medicaments falling under Chapter 30 and Note 3003.20/
3003.30. Items at Serial Nos. 5, 6 and 8 viz. Puma Herbal Massage Oil,
Puma Herbal Massage Oil for women and Puma Scalp Tonic Powder
(Scalpton), however, do not appear to have any medicinal property and
C it is difficult to classify them under the head medicament. Therefore, the
same will be liable to be classified as "cosmetics" under Chapter Head
33.04. [l 133-A-E)

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6319-6321 of
2003.
D
From the Final Judgment and Order dated 28.3.2003 of the Customs,
Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal Nos. E/
879, 1437, 2755/93-C (Final Order No. 223-225/03-8).

WITH
E
C.A. Nos. 1414-1416/2004.

V. Lakshmi Kumaran, Alok Yadav, S.V. Deshpande, Ms. Anuradha
Rustogi and Karan Talwar for the Appellant.

F K. Radha Krishnan, Hemant Sharma, B.K. Prasad and P. Parmeswaran
for the Respondent.

The Judgment of the Court was delivered by

ARUN KUMAR, J. The appellant claims to be a manufacturer of
G Ayurvedic products which are intended to cure certain ailments of the human
body. A question has arisen as to whether the products manufactured by the
appellant fall within the category of medicaments or cosmetics. Answer to
this question determines as to whether the goods are classifiable under the
Central Excise Tariff Act, 1985 as cosmetics under Chapter 33 or as
medicaments under Chapter 30. As cosmetics the rate of excise duty is quite
H high while as medicament the products attract nil duty. The following products
PUMA AYUR. HERBAL (P) LTD. v. COMMR., CENT. EX., NAGPUR [ARUN KUMAR, J.JI J25

4 manufactured by the appellant are under consideration: A
I. (xvii) Puma Neem Facial Pack (Neemal)
2. (xviii) Puma Anti-Pimple Herbal Powder (Pimplex)
3. (xix) Puma Herbal Facial Pack (Herbaucare)
4. (xx) Puma Herbal remedy for Facial Blemishes B
5. (xxi) Puma Herbal Massage Oil
6. (xxii) Puma Herbal Massage Oil for Women
7. (xxiii) Puma Hair Tonic Powder (Sukeshi)
8. (xxiv) Puma Scalp Tonic Powder (Scalpton)
c
9. (xxv) Puma Anti-Dandruff Oil (Dandika)
10. (xxvi) Puma Shishu Rakshan. Tel
I I. (xxvii)Puma Neem Tulsi
D
~- The appellant has a licence to manufacture these and other products
from the Drug Controller under the Drugs and Cosmetics Act. According to
the learned counsel for the appellant all the above items are produced from
ingredients found in Ayurveda text books. They are manufactured as per the
Ayurveda pharmacopaeia and have curative, therapeutic or prophylactic value.
E
They are basically meant to give relief in body ailments. They are not items
of cosmetics. In order to determine whether a product is a cosmetic or a
medicament a twin test has found favour with the Courts. The test has approval
of this Court also vide Collector v. Richardson Hindustan Ltd., (1989) 42
EL T A I00 (SC)/ [2004] 9 SCC 156. There is no dispute about this as even
the Revenue accepts that the test is determinative for the issue involved. The F
tests are:

I. Whether the item is commonly understood as a medicament which is
called the common parlance test. For this test it will have to be seen whether
in common parlance the item is accepted as a medicament. If a product falls
in the category of medicament it will not be an item of common use. A user G
will use it only for treating a particular ailment and will stop its use after the
ailment is cured. The approach of the consumer towards the product is very
material? One may buy any of the ordinary soaps available in the market. But
if one has a skin problem, he may have to buy a medicated soap. Such a soap
will not be an ordinary cosmetic. It will be medicament falling in Chapter 30 H
1126 SUPREME COURT REPORTS [2006] 2 S.C.R.

A of the Tariff Act.
II Are the ingredients used in the product mentioned in the authoritative
text books on Ayurveda?

The two tests are recognized even by the Central Board of Excise and
B Customs and the Board had vide its letters dated 3rd October 1991 and 5th
December, 1991 directed the Assistant Collector to decide the classification
of the products in question by applying the aforesaid two tests.

The learned counsel for the appellant has argued that the products of
the appellant satisfy both the above tests and, therefore, the CEGA T was
C wrong in classifying them under Chapter 33 as cosmetics. According to the
learned counsel the products in question have a special use. They are not
items of common use. Only those who want to treat a particular ailment will
go for the particular product of the appellant. The use of a product by the
customers i.e. how the consumers take to a product is a very useful method
D of determining the classification of products. What is to be seen is whether
the products are likely to be in common use by normal consumers. Common
parlance meaning and understanding is a strong factor in the determination •
of classification of products. One need not resort to scientific or technical
meaning of the terms used.

E So far as the other test is concerned, the learned counsel for the appellant
has placed on record material from the Ayurvedic texts or Pharmacopoeia in
support of each product which is subject matter of the present appeal to show
that the ingredients of each product are independently mentioned in the
Ayurvedic texts. The ingredients are natural Ayurvedic product like shrubs,
herbs, leaves, fruits, nuts, flowers, wood and bark of particular trees. In
F support of his contention the learned counsel for the appellant placed before
the departmental authorities lot of material in the shape of certificates and
letters from doctors, Ayurvedic practitioners, experts and above all from the
users of the products in question.

G The Collector (Appeals) who decided the issue in favour of the appellant
among other things, relied on the opinion obtained by the Assistant Collector
as per Board's Circular from the Directorate of Ayurveda Maharashtra,
Bombay vide their letter No.A YURVEDIC-2/Misc/PUMA/1989110563 dated
1.12.89 which is quoted as under:

H "With reference to your letter dated 12.9.89 on the subject opted
PUMAAYUR. HERBAL(P) LTD. v. COMMR., CENT. EX., NAGPUR [ARUN KUMAR, J.Jl 127

above, the samples of products of Mis. Puma Ayurvedic Herbals (P) A
Ltd., Nagpur (i.e. I I items) were referred to Dravyaguna Department
of one of our institution for carrying out tosts. These items were
tested by Organoloptic Method.

2- Now the Professor and Incharge of Dravyaguna Department has
opined that the raw materials used for preparation of the above items B
are described in Ayurvedic texts. As such, all ingredients are Ayurvedic
raw material. Treatment of certain skin diseases is done by Lep,
Pralep and Pradheh. This type of treatment is described in Ayurvedic
Texts.

3- In view of the above, the samples of 11 items sent by you vide C
your letter under reference can be classified as "Proprietary Ayurvedic
Medicines".

This opinion coming from a competent and authorised source, is of
great relevance so far as the case in hand is concerned. Besides this the
evidence produced by the appellant before the authorities in the shape of D
letters from consumers, from doctors and from Ayurvedic physicians satisfies
the common parlance test.

On the other hand the revenue led no evidence of any sort to rebut the
evidence led by the assessee. It is settled law that burden of showing correct E
classification lies on the revenue. The revenue has done precious little in this
case to discharge this burden. The Collector (Appeals) further relied on the
following evidence in support of his finding that the products in question fall
in the category of medicaments:

(i) licence No.A/40/888 ·granted by the Drug Controllers, F
Maharashtra.
(ii) The inscription of the words on the wrapper "Ayurvedic
Proprietory medicines or and Ayurvedic licence No.A/888 on
the wrapper mentioning of percentage of ingredients as approved
by the Drug Controller.
G
(iii) Circulation of Therapeutic Index of the products for the use of
Doctors/V aidyas.
(iv) Certificate issued by Dr. Narendra Agashe, M.D. Medical
Superintendent, Dr. Dalvi Memorial Hospital, Nagpur, the
relevant extract of which is reproduced below: H
1128 SUPREME COURT REPORTS [2006) 2 S.C.R.

A "This is to certify that we in this hospital have extensively tried the )..
following Ayurvedic Medicinal Products from Puma Ayurvedic &
Herbal Cosmetics Co., Nagpur. We have found them to be of good
therapeautic value and prescribe them regularly whenever the need
arises."

B We may note here that the Chief Chemist had opined about the
classification of these products under the Chapter 233 i.e. "Cosmetic" but the
opinion of the Chief Chemist on the question of classification has no relevance.
We agree with the Collector (Appeals) that the opinion of the Chief Chemist
has no relevance for determining classification of the products. The role of
C the Chief Chemist is only to supply the analytical data. On the other hand the
opinion of the Directorate of Ayurved, Maharashtra referred to above is of
great relevance. The said Directorate has clearly and unambiguously stated
that the products in question are meant for treatment of certain skin diseases
and the type of ingredients used in the products are described in Ayurvedic
texts, being useful in such treatments.
D
The learned counsel for the appellant drew our attention to certain
decisions of this Court wherein Ayurvedic products have been held to be
falling in Chapter 30 of the Central Excise Tariff Act, 1985 and not under
Chapter 33. In C.C.£. v. Sharma Chemical Works, (2003) 154 ELT 328 it
was held that the onus to prove that a particular product falls under a particular
E head of the Central Excise Tariff is on the Revenue. It was for the Revenue
to show and establish that the product in question was not a medicament or
that the common man did not understand the product as a medicament. In the
present case the Revenue has miserably failed to discharge this burden.

F In C.C.£. v. Sharma Chemicals Works, (2003) 154 ELT 328 this Court
was considering whether "Banphool oil" could be classified as medicament.
The product was a hair oil and all its ingredients were said to be Ayurvedic
which were found in Ayurveda text books. It had 98% Til oil and 2% Camphor,
Amla and Chandan (sandalwood). It was found that all the ingredients of the
hair oil were mentioned in Ayurveda text books and, therefore, the product
G was liable to be classified as medicament.

C.C.E. v. Pandit D.P. Sharma, (2003) 154 ELT 324 was again a case
of hair oil named "Himtaj Hair Oil". The Court emphasized the common
parlance test and found that a common man understood the said hair oil as
a medicinal hair oil and not hair oil of common use as a hair oil. Accordingly,
H this Court upheld its classification as a medicament.
PUMA AYUR. HERBAL (P) LTD. v. COMMR., CENT. EX., NAGPUR [ARUN KUMAR, J.l! 129

Natura/le Health Product (P) Ltd. v. C.C.E., (2003) 158 ELT 257. Two A
appeals were under. consideration in this case. One was with respect to Vicks
Vapo Rub and Vicks Cough Drops while the other was with respect to Sloan's
Balm and Sloan's Rub. Both the appeals were allowed holding that the items
in question were classifiable under the Chapter dealing with medicament in
the Central Excise Tariff Act. In this case this Court followed the twin test
earlier upheld by this Court in C.C.E v. Richardson Hindustan Ltd., (1989) B
(42) EL T A JOO. Further this Court observed:

"3 9 We are also of the opinion that when there is no definition of any
kind in the relevant taxing statute, the articles enumerated in the tariff
schedules must be construed as far as possible in their ordinary or C
popular sense, that is, how the common man and persons dealing
with it understand it. If the customers and the practitioners in
Ayurvedic medicine, the dealers and the licensing officials treat the
products in question as Ayurvedic medicines and not as Allopathic
medicines, that fact gives an indication that they are exclusively
Ayurvedic medicines or that they are used in Ayurvedic system of D
medicine, though it is a patented medicine. This is especially so when
all the ingredients used are mentioned in the authoritative books on
Ayurveda. As rightly contended by the Counsel for the appellants,
the essential character of the medicine and the primary function of
the medicine is derived from the active ingredients contained therein E
and it has certainly a bearing on the determination of classification
under the Central Excise Act. As held in Amruthanjan case, the mere
fact that the ingredients are purified or added with some preservatives
does not really alter their character."

In Amritanjan v. C.C.E., (1995) 77 ELT 500 SC this Court held that F
Amritanjan Pain Balm having Menthol IP, Camphor IP, Turpantine IP and
Methyl IP, Salicylate IP as main ingredients, was classifiable as Ayurvedic
medicine under Chapter 30 of the Tariff. It was noticed that the ingredients
were known both to Ayurvedic and western sciences. Still the classification
as medicament was upheld.
G
BPL Pharmaceuticals v. C.C.E., [1995) Suppl. 3 SCC I was a case in
which "Selsun Shampoo" was under consideration for purposes of
classification under the Tariff Act. According to the manufacturers this
shampoo was a medicated shampoo meant to treat dandruff which is a disease
of the hair. This Court held that having regard to the preparation, label,
literature, character, common and commercial parlance, the product was liable H
1130 SUPREME COURT REPORTS [2006] 2 S.C.R.

A to be classified as a medicament. It was not an ordinary shampoo which
could be of common use by common people. The shampoo was meant to
cure a particular disease of hair and after the cure it was not meant to be used
in ordinary course.

Muller & Phipps (India) Ltd. v. C.C.E., (2004) 167 EL T374 was a case
B of Johnson Prickly Heat Powder. This powder was again held to be a
medicament because it was not an ordinary talcum powder but a powder to
be used to get rid of the problem of prickly heat. Similar was the case
reported in 1999 (112) EL T 22 Manisha PharmaP/asto Pvt. Ltd v. Union of •
India. In this case the product under consideration was Nycil Prickly Heat
C Powder. The ingredients whereof were

Chlorphensesin IP 1% w/w

Zinc Oxide IP 16% w/w

Starch IP 51% w/w
D
Talc Purified IP to 100% wlw
•
The powder was held to be not an ordinary talcum powder but one falling in
the category of medicament.

E Lastly we were referred to Dabur (India) Ltd v. C.C.£., (2005) 182
EL T 290 SC. This is a judgment of three Judge Bench of this Court and the
products under consideration were Janam Ghunti and Lal Tail. Regarding Lal

F
Tail, this Court held that it was liable to be classified as medicament under
Chapter 30 as all its imgredients were found to be in Ayurvedic texts. However,
regarding other product the matter was remanded for further consideration on
basis of evidence to be recorded.
-
From the above judgments it follows that the law is settled on the
applicability of the twin test for determination of classification of a product.
We have already found that the twin test is satisfied in the present case
G regarding most of the items under consideration.
The word 'medicament' is not defined anywhere while the word
"cosmetic" is defined in the Drugs and Cosmetics Act, I940 as under:

"A 'cosmetic' means any article intended to be rubbed, poured,
H sprinkled or sprayed on,-or introduced into, or otherwise applied to,
PUMA AYUR. HERBAL (P) LID. v. COMMR., CENT. EX., NAGPUR [ARUN KUMAR, J.Jl J3 J

the human body or any part thereof for cleansing, beautifying, A
promoting attractiveness, or altering the appearance, and includes
any article intended for use as a component of cosmetic."

It will be seen from the above definition of cosmetic that the cosmetic
products are meant to improve appearance of a person, that is, they enhance
beauty. Whereas a medicinal product or a medicament is meant to treat some B
medical condition. It may happen that while treating a particular medical
problem, after the problem is cured, the appearance of the person concerned
may improve. What is to be seen is the primary use of the product. To
illustrate, a particular Ayurvedic product may be used for treating baldness.
Baldness is a medical problem. By use of the product if a person is able to C
grow hair on his head, his ailment of baldness is cured and the person's
appearance may improve. The product used for the purpose cannot be
described as cosmetic simply because it has ultimately led to improvement in
appearance of the person. The primary role of the product was to grow hair
on his head and cure his baldness.
D
The extent or the quantity of medicament used in a particular product
will also not be a relevant factor. Normally, the extent of use of medicinal
ingredients is very low because a larger use may be harmful for the human
body. The medical ingredients are mixed with what is in the trade parlance
called fillers or vehicles in order to make the medicament useful. To illustrate
an example of Vicks Vaporub is given in which 98% is said to be paraffine E
wax, while the medicinal part i.e. Menthol is only 2%. Vicks Vaporub has
been held to be medicament by this Court in CCE v. Richardson Hindustan
Ltd., ( 1989) 42 EL T A JOO. Therefore, the fact that use of medicinal element
in a product was minimal does not detract from it being classified as a
~~~ F
.,.,
In order to be a medicinal preparation or a medicament it is not necessary
that the item must be sold under a doctor's prescription. Similarly availability
of the products across the counter il1 shops is not relevant as it makes no
difference either way.
G
The learned counsel for the respondent drew our attention to Note 2 of
Chapter 33 of the· Central Excise Tariff which is as under:

"Note 2. Heading Nos.33.03 to 33.07 apply, inter alia, to products,
whether or not mixed (other than aqueous distillates and aqueous
solutions of essential oils), suitable for use as goods of these headings H
1132 SUPREME COURT REPORTS [2006) 2 S.C.R.

A and put up in packings with labels literature or other indications that
they are for use as cosmetics or toilet preparations or put up in a fonn
clearly specialized to such use and includes products whether or not
they contain subsidiary phannaceutical or antiseptic constituents, or
are held out as having subsidiary curative or prophylactic value."

B On the basis of this Note it was argued that even if a product had some
curative or prophylactic value, it will still be cosmetic. We cannot accept this
argument. The teamed counsel has overlooked the use of the word 'subsidiary'
in the said note from which it follows that a subsidiary curative or prophylactic
use will not convert a cosmetic into medicament. We have tried to illustrate
C this by giving the example of bald man treating his baldness by use of
Ayurvedic product. The curative use of the product is primary in that example
and not subsidiary. The subsidiary result is improvement in appearance.
Therefore, in our view, Note 2 to Chapter 33 does not help the respondent.
Rather Note 5 to the said Chapter, makes it clear that the products which fall
under heading 33.04 are primarily beauty or make up preparations. They may
D incidentally help in protection against skin irritants. They may also help as
a skin tonic, yet they are cosmetics because skin protection is subsidiary
benefit. •

In this connection reference may also be made to Note I(d) to Chapter

E
30 of the Central Excise Tariff. The said Note reads as under:

Note I starts with "This Chapter does not cover". -
(a)

F
(b)

(c)
-
(d) "Preparations of Chapter 33 even if they have therapeutic or
prophylactic properties."
Thus preparations falling in Chapter 33 even if they have therapeutic
G or prophylactic properties will not fall under Chapter 30 which deals with
phannaceutical products. The reasons for this appears to be that even cosmetics
may have something to improve skin or other parts of the body where they
are used. In that sense they may have some therapeutic value yet they remain
t
cosmetic.

H From the above discussion it is clear to us that the Revenue has failed
PUMA AYUR HERBAL(P) LID. v. COMMR., CENT. EX., NAGPUR [ARUN KUMAR, J.Jl 133

to make out any case in support of its stand that all the products in question A
fall under Chapter 33 i.e. under Heading Note 33.04.

Now we will taj<e up each item of the products of appellant and examine
as to under which classification they fall. The products at Serial
Nos.1,2,3,4,7,9,10 & 11 viz. Puma Neem Facial Pack (Neemal},Puma Anti-
Pimple Herbal Powder (Pimplex), Puma Herbal Facial Pack (Herbaucare), B
Puma Herbal remedy for Facial Blemishes, Puma Hair Tonic Powder (Sukeshi},
Puma Anti-Dandruff Oil (Dandika), Puma Shishu Rakshan Tel and Puma
Neem Tulsi are clearly medicinal products and are intended to treat certain
medical conditions of the human body and therefore, in view of the above
tests, are liable to be classified as medicaments falling under Chapter 30 and C
Note 3003.20/3003.30 Items at Serial No.5,6 and 8 viz. Puma Herbal Massage
Oil, Puma Herbal Massage Oil for Women and Puma Scalp Tonic Powder
(Scalpton) however do not appear to be of any medicinal property and it is
difficult to classify them under the head of medicament. I n fact the learned
counsel for appellant conceded that these three items do not qualify to be
treated as medicaments. Therefore, the same will be liable to be classified as D
"cosmetic" under Chapter head 33.04. Regarding these 3 items the matter
will have to go to the Assistant Coliector for quantification of the duty for
the relevant period. Subject to this, the appeals are allowed. No costs.

Civil Appeals No.1414-1416/2004
E
In view of the above these appeals stand dismissed.
v.s.s. Civil Appeal Nos. 6319-6321/2003,
allowed and Civil Appeal Nos. 1414-14165/2004, dismissed.

t