The High Court · 2025

Gounsel for the Petitioner : Mr. T. Chaitanya Kiran Special Standing Counsel for Commercial Tax Counsel for the Respondent : Mr. Karthik Ramana Puttam Reddy representing Mr. S. Dwarakanath Reddy, Sr. Advocate The Court made the following: ORDER HONOURABLE SRI IUSTICE P.SAM KOSHY AND HON'BLE SRI IUSTICE SUDDALA CHALAPATHI RAO TAX REVISION CAS E No.29 OF 2010 ORDER: (per Hon'ble Sri lustice P.Sam Kostry) Heard Mr. T.Chaitanya Kiran, learned Special Stancling Counsel for Commercial Tax for the petitioner and Mr.Karthik Ramana Puttam Reddy, learned counsel representing Mr.S.Dwarakanath, learned counsel for the respondent and perused the record.

2. The challenge in this tax revision case is to rhe order dated 02.07.2009 passed by the Sales Tax Appellate Tribunal, Andhra Pradesh, I-{yderabad in T.A.No.369 of 2004.

3. The point for consideration before this Court is as to whether the product from the respondent organization viz., and Phenyl and antiseptic lotions are medicated products under entry 37 of the lrirst Schedule or fblling under the exclusion of item 37 of First Schedule to the ApGST Act.

4. Perusal of the record would go to show that the Tribunal while deciding the said issue was relied on the judgment of tWs.Heinz lndia private Limited 2 v.State of Andhra Pradeshr wherein the Tribnunal observed that the medicated good for which licence is not necessary, they would fall under Drugs and Medicines under Entry 37 of the First Schedule, for which tax is leviable at l0% onty. Further the 'I'ribunal while dealing with Dettol Antiseptic Lotion in Aackitt Piramal Limited, Vijayawada v. State of Andhra Pradesh2 observed as under: " As seen from the definition of 'Drug'contained in Section 3 of the Drugs and Cosmetics Act, 'Drug' includes all medicines lbr internal or external use on human beings or aninrals and all substances intended to be used for in the diagnosis. treatment. mitigation or prevention of any disease or disorder in human beings or animals including preparations applied on human body tbr the purpose of repelling insects like mosquitoes. Dettol is being used for externat application on the hurnan body to prevent infection. Therefore, it cannot be said that drug does not include Dettol. Dettol does not fall under Exclusions (a) or (c) ol'l:ntry 37. Dettol is to be treated as an item falling under Entry 37 and is to be assessed accordingly."

5. The Tribunat by relying on the above two decisions observed that where drugs licence was obtained under Drugs and Medicines Act, 1940 manufactured and dealt under the said licence having medicinal values, such products would fall under Entry 37 directly, which shall be treated as medicines and where the products are manufactured with medicinal qualities, for which no licence is required, such goods would fall under exclusion clause of entry 37, such as medicated shampoos, medicated soaps, medicated tooth 'lzooay 47 APsrJ 'lzoo+1 38 APSTJ 54 3 paste etc., and therefore, antiseptic lotion dealt by the respondent would not fall under exclusion clause 37 but eligible to tax at l0o/o only. 'fherefore, there is no material available on record to interfere with the said findings of the Tribunal.

6. Apart from the above, we are also not inclined to interfere rvith the order of the Tribunal for the reason that the issue already stands decided by this High Court again in a batch of tax revision cases of sirnilar nature in TREVC Nos.155 of 2004 and batch decided on 14.06.2024, whercin this Court held as under: t\ \ "Taking into account the decision of the Allahabad High Court in the case of Himani Ltd. v. Comm. Of Commercial Tax [201] (2631) E.L.T. 335 (All.) and the common parlance tcst, it is clear that the public perceives products like Himan Boroplus Prickly [{eat Powder as medicinal or Ayurvedic products rather than mcrc cosmetics. Furthermore, the Advance Ruling sought by the assessee before the Gurvahati Commercial Taxes Departrnent, rvhich rras later upheld by the Gauhati High Court in Emarni Limited and Another vs. State of Assam and Another adds more weight to this classification. ln view of these observations and legal precedents. it is concluded that Himani Boroplus Prickly Heat Powder has been rightly classified under Entry 37 in Schedule lst of the APGS1' Act. This classification acknowledges the product's medicinal properties and its role in health and healing. Conversely, the product should not be classified under Entry 36 as 'Cosmetics or Toilet Preparations' in the same schedule of the Act. This is because such a classification would downplay the product's medicinal attributes and potentially misrepresent its purpose and use to the public.

7. Further this Court in the above batch of TRCs held as under: "Though the learned Standing Counsel for the respondent/ Department contended hard to persuade this Bench to hold that the two products i.e. the Himani Navaratan Oil and Himani Gold 4 Turmeric Ayurvedic Cream to be cosmetics, in the absence of any strong material available, the findings given by STAT holding it to be a product to be brought within the purview of Entry 36 of l't Schedule of the Act does not seem to be proper, legal and justified for the grounds and reasons mentioned in the preceding paragraphs, rather it is a case where there two products are products which would be one under Entry 37 of the lst Schedule of the Act."

8. Given the aforesaid judicial precedents rendered in the recent past and also those which have been relied upon by the Tribunal while passing the impugned order, we do not find any merits in the question of law raised by the State.

9. The Tax Revision Case, being devoid of merits, lails and is, accordingly, rejected. No costs. As a sequel, miscellaneous applications pending if any, shall stand closed. To, S . T KRISHNA KU JOINT REGIS //TRUE COPY/ TION OFFICER

1. The Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad. (With records)

2. One Mr. T. Chaitanya Kiran Special Standing Counsel for Commercial Tax IOPUC]

3. One CC to Mr. S. Dwarakanath Reddy, Sr. Counsel, Advocate [OPUC] 4. Two CD Copies 5. The Deputy commissioner (cT), Punjagutta Division, Hyderabad 6. The CommercialTax Officer, Malakpet Circle, Hyderabad DUABK ./ / '1!-i E rr I;i )^.-- )' .,1... : t .;;;' ii ..: .,/ 1? DEC mfi + r:4-;9.:"tl: -,{ HIGH COURT DATED:0911012025 ORDER TREVC.No.29 of z01A REJECTING THE TAX REVISION CASE \\