24 May 2013
In case of Dabur INDIA SC- An assessee classifies “Hajmola” as a Candy: Hajmola contains 25% sugar and 75% medicine. It has the necessary ingredients as per Ayurvedic experts, which helps in digestion and control acidity. Based on its essential character and use, it is an ayurvedic medicine and not a candy. Hence, classification is not correct. [Dabur India (SC)]
But my query trade parlance has more importance than technical or dictionary meaning. Then why technical meaning as 25% suger & 75% medicine used here. As in normal practice no doctor will prescribe it as medicine. It is just like other chocolate candies we have.
If meaning of word is not clear, refer to trade practice. If trade understanding of a product cannot be established, find technical or dictionary meaning of the term used in the tariff. You may also refer to BIS or other standards, but trade parlance is most important
24 May 2013
Your activity amounts to manufacture and production of goods as per your activity and it will be fall under the ayurveda. If this product is manufacturing under a brand name then duty of excise will arise at your products. If MRP is put on the packet then goods will be removed after the abatement under section 4A of central excise act 1944.
CAclubindia
