Judgment:
Milap Chandra Jain, J.
1. This revision petition has been filed under Section 15, Rajasthan Sales Tax Act, 1954 (hereinafter to be called 'the Act') against the order of the Rajasthan Sales Tax Tribunal, Ajmer dated July 5, 1989 by which it has allowed the appeal of the Department, set aside the order of the Deputy Commissioner (Appeals), Jodhpur and restored the order of the Commercial Taxes Officer, Circle 'D', Jodhpur, holding that the petitioner's 'JALJIRA' and 'CHURANS' do no fall under the entry 'Medicine and Drugs and All Kinds of Pharmaceutical Preparations (5%)' but fall under the last entry (Residuary) (7%) of the Notification No. F5(16) F.D.C.T/69-7 dated March 9, 1976, issued under Section 5 of the Act.
2. At the time of admission of the revision petition, the following question of law was formulated:
Whether the Tribunal was justified In holding that the 'Jaljira' and 'Churans' manufactured and sold by assessee are not medicine & exigible to tax @ 5%, but are taxable at the residuary rate of 7% during the relevant assessment years (1978-79)?
3. It has been contended by the learned Counsel for the assessee-petitioners that the petitioners' product 'JALJIRA' and 'CHURANS' are medicines, they fall in the aforesaid entry of medicines and pharmaceutical preparations and as such taxable @ 5% and the learned Tribunal has seriously erred in holding that they are not medicines and are taxable at the residuary rate of 7%. He relied upon the meanings of medicines and drugs given in Random House Dictionary, Readers' Digest Universal Dictionary, Encyclopedia Britanica and placed reliance on CST v. Gramodhyog Karyalaya , Dabur India Ltd. v. State of U.P. : 1990(49)ELT3(SC) , CST v. Dr. Jai Singh (1980) UPTC 1189 (All), CST v. Murari, Bros (1979) UPTC 1091 (All), CST v. Western India Chemical Co. (1985) 59 STC 313 (Bom), and CST v. M.G. & Co. (1983) 8 STL 47 (All).
4. In reply, it has been contended by Shri Dinesh Mehta Advocate that the Tribunal has given a categorical finding that the petitioner's Jaljira and Churans are not medicines, it is a finding of fact, no question of law is involved and as such revision petition is not maintainable. He also contended that petitioners' products were not being treated as medicines till the assessment year 1977-78 and the petitioners paid tax at the residuary rate during all the previous years. He further contended that for the first time on May 24, 1978 the petitioners obtained licence under Drugs and Cosmetics Act, 1940 and by the grant of this licence it cannot be said that their products became medicines. He also contended that it is not the case of the petitioners that their products are known in common or commercial parlance as medicines and Vaidhyas prescribe them to their patients as medicines. He relied upon Commissioner of Sales Tax, Madhya Pradesh Indore v. Shri Sadhna Aushadhalaya, 14 STC 813 (MP) and Commissioner of Sales Tax v. Ear Prasad Ayodhya Prasad, 39 STC 420. It was further contended that the licence under the Drugs and Cosmetics Act, 1940 has been granted in respect of Jaljira only and not for Churans and Churans in no case be treated as medicines. He lastly contended that Section 3(a), Drugs and Cosmetics Act, 1940 defines Ayurvedic drug and it does not define medicine, Section 2(1), Patents Act, 1970 defines medicine and drug, as such it is not necessary to see the meanings of these words as given in the aforesaid dictionaries and as interpreted in the cases relied upon by the petitioners and the petitioners' literature (papers No. 21 to 25) itself shows that the said products of petitioners are not medicines.
5. There is no substance in the revision petition. In this revision petition, the petitioners have filed copies of certain documents (paper No. 19-29) which had been filed before the assessing authority. The licence, Paper No. 19, shows that it was granted on May 24, 1978. The assessment order dated November 29, 1980 reveals that till its previous year, the petitioners were charging sales-tax from their customers on the sale of their Jaljira and Churans at the higher rate (residuary entry) and not at the lower rate (as medicine) and were paying the same.
6. Section 3(a), Drugs and Cosmetics Act, 1940 runs as under:
(a) Ayurvedic, Siddha or Unani drugs includes all medicines Intended for internal or external use for or in the diagnosis, treatment, mitigation or prevention of disease or disorder in human beings or animals, and manufactured exclusively in accordance with the formulae described In, the authoritative books of Ayurvedic, Siddha and Unani Tibb systems of medicine, specified in the First Schedule.
This Act does not define 'Medicine'. It is defined in Patents Act, 1970. Section 2(1), Patents Act runs as under:
1. 'medicine or drug' includes:
(i) all medicines for internal or external use of human beings or animals, (ii) all substances Intended to be used for or in the diagnosis, treatment, mitigation or prevention of diseases in human beings or animals,
(iii) all substances intended to be used for or in the maintenance of public health, or the prevention or control of any epidemic disease among human beings or animals,
(iv) insecticides, germicides, fungicides, weedicides and all other substances intended to be used for the protection or preservation of plants;
(v) all chemical substances which are ordinarily used as intermediates in the preparation or manufacture of any of the medicines or substances above referred to.
7. The petitioners have filed literature relating to their preparations vide papers No. 21-25. It is clearly mentioned in each item of their preparations that it is not an ayurvedic formula but it is their own formula and they are preparing it since last 80 years except 'Hingastic' and 'Lavan Bhaskar' Churan for which it is mentioned 'Ayurvedic as per Yog Chintamani'. Yog Chintamani is mentioned at Serial No. 42 of the First Schedule of the Drugs and Cosmetics Act, 1940.
8. The petitioners have filed their price list, paper No. 26. Its relevant portions run as under:
(Established 1899)
Jalani Karyalaya
Rakhi House, Jodhpur-342 002 (India)
Manufacturer of:
Jalani
Jaljira* Various Masalas* Digestive & Tasty Churans
It is no where been mentioned in it that they are manufacturer of any medicine. They have also filed the price-lists of Vaidhya Nandram Gigram Chamariya, Fatehpur (Shekhawati), Bajaj and Company, Fatehpur (Shekhawati), Mohta Ayurvedic Rasayanshala, Bikaner and Mewar Ayurvedic Works, Udaipur. It is clearly mentioned in the first price list, paper No. 27, 'Ayurvedic Patent And Shashroktya Aushdhiya'. In the second price-list, it is stated 'Ayurvedic Swanu Bhuti and Shashtroktya Aushdhiyan'. The price list of Mohta Ayurvedic Rasayanshala, Bikaner has given the list of important medicines for the main diseases. In the price list of Mewar Ayurvedic Works, Udaipur, it is mentioned that these medicines are reimbursable to State Government employees as per notification of the State Government. In view of the above quoted provisions of Section 3(a) of the Drugs and Cosmetics Act, 1940, it cannot be said that the petitioner's Jaljira and Churans (except Hingastic and Lavan Bhaskar Churan) are medicines and are exigible to tax as such.
9. It is not the case of the petitioners that their Jaljira and Churans are known in commercial or in common parlance as medicines. It is well settled law that while interpreting the entries of fiscal statues, technical interpretation is not to be given but meaning as understood by the persons dealing with such commodities has to be adopted. It is also not the case of the petitioners that their Jaljira and Churans are prescribed to patients as medicines.
10. In CST v. Gramodhyog Karyalaya , it has been observed that the word 'medicine' has not been defined and meaning given in common parlance has to be attributed to it. It has further been observed that a medicine is a substance or preparation used in the treatment of diseases and must have curative power so as to make it effective for treatment of ailments. It is not the case of the petitioner that Jaljira and Churans are used for the treatment of diseases. In Dabur India Ltd. v. State of U.P. : 1990(49)ELT3(SC) , it was held on facts that Homodent tooth paste was a medicine. In Panama Chemical Works v. Union of India (1992) 62 Excise Law Times 241 (MP), digestive tablet 'SWAD' was found to have 3% active ingredients as per Ayurvedic taste and 97% sugar/liquid glucose for taste and preservation and was held as a medicine. In C.S.T. v. Murari Bros. (1979) UPCT 1081 (All), Bhimseni Kajal was held as an ayurvedic medicine as it was found useful for treatment of ailments of eye. In C.S.T. v. Western India Chemical Company (1985) 59 STC 313 (Bom), 'Jai Kajal' was held on fact as a medicine. In C.S.T. v. M.G. & Co. (1983) 8 STL 47 (All), Glucose D was held on facts to be a medicine. In other cases, referred to by the learned Counsel for the petitioners, various items in respect of which taxable liability was disputed were held on facts as medicines. This is not the position in respect of petitioner's Jaljira and Churans (except Hingastic and Lavan Bhaskar Churans).
11. Accordingly, the revision petition is allowed in respect of Hingastic and Lavan Bhaskar Churans only. It is dismissed so far it relates to Jaljira and all other kinds of Churans. The above quoted question is accordingly answered in affirmative. No order as to costs.
Note:
The order dated 22.11.93 has been marked as Reportable on 8.7.94. The petition for Special Leave to Appeal No. 4113/94 has been filed by the petitioner M/s Jalani Karyalaya before the Hon'ble Supreme Court. It has been dismissed in respect of 'Jaljira' and has been admitted in respect of 'Trifladi Churan' only.