Page 50 - GSTL_23rd July 2020_Vol 38_Part 4

J108 GST LAW TIMES [ Vol. 38
(1) That the opinion of Drug Authorities relating to product being Ayur-
vedic and a Medicament and the Drug License given to that effect
will prevail upon any opinion to the contrary of after tax authorities,
especially in absence of specific definition.
(2) Even when Ayush Department was not in existence as the same came
into existence about 5 years back, the Apex Court as well as C.B.E. &
C. had been relying upon twin test of ingredients and common par-
lance test. Both of which now get satisfied when Ayush Ministry is-
sues the Drug License for the product after due consideration of its
medicinal use and its ingredients.
(3) The Tariff head prescribed additional condition of retail sale packs is
also fulfilled.
(4) Even products like Vicks Vaporub were considered Ayurvedic by the
Apex Court on the basis that only ingredients need mention in Ayur-
vedic Text and not the proportion and that also few additives can
bring into existence a new patented Ayurvedic Product.
The relevant case law in brief are reproduced below :
 2003 (158) E.L.T. 257 (S.C.) : Naturalle Health Products (P) Ltd. v. Collr.
of C. Ex., Hyderabad :-
Ayurvedic medicines - Vicks Medicated cough drops and Vicks
Vaporub throat drops manufactured in accordance with and under
licence issued under Drugs and Cosmetics Act, 1940 - Ingredients
used have sources as natural herbs and extracts taken from such
herbs and purified to pharmaceutical grade before using - All ingre-
dients of the products mentioned in authoritative Ayurvedic Text-
books - Such ingredients even if used after refinement or bringing them to
pharmaceutical quality, do not become synthetic in nature - Classifiable
under sub-heading 3003.30 of Central Excise Tariff Act, 1985 and not
under sub-heading 3003.10 ibid - Tribunal’s order set aside. [paras
21, 23, 36, 37, 39, 41]
Ayurvedic medicines - Departmental clarification - Circular No.
25/91, dated 3-10-1991 issued by Government on basis of represen-
tation received from manufacturers of Ayurvedic preparations, ac-
cepting the two tests for determining a medicine as Ayurvedic med-
icines - Circular issued by Government after examining the matter in
the light of the parameters prescribed by the Tribunal which has
been upheld by Supreme Court - Department’s submission that said
circular do not absolve assessee from onus of proving the exclusive
character of drug as Ayurvedic medicament, not acceptable.
[para 30]
Ayurvedic medicament - Patent Ayurvedic medicament could be one where
all the ingredients find mention in the authoritative textbooks on Ayurve-
da, though formula for preparation of medicament not in accordance with
the formula given in those text books. [para 36]
Ayurvedic medicament even if a patented medicine in U.S.A., does not
cease to be an exclusively Ayurvedic medicine if it has the characteristics of
such medicine. [para 37]
Ayurvedic medicine - Words ‘Ayurvedic medicine’ not having been
defined in the Central Excise Act, 1944 or the Central Excise Tariff
Act, 1985, the common parlance test would have to be resorted to
GST LAW TIMES  23rd July 2020  50