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PETITIONER: BAIDYANATH AYURVED BHAWAN (P) LTD.JHANSI

       Vs.

RESPONDENT: EXCISE COMMISSIONER, U.P. & ORS.

DATE OF JUDGMENT: 14/10/1970

BENCH: HEGDE, K.S. BENCH: HEGDE, K.S. SHAH, J.C. GROVER, A.N.

CITATION:  1971 AIR  378            1971 SCR  (2) 590  1971 SCC  (1)   4  CITATOR INFO :  D          1989 SC2227  (36,37)  F          1990 SC 781  (26)  E          1990 SC1814  (24)

ACT: Medicinal and Toilet Preparations (Excise Duties) Act (16 of 1955)  s.  4  and Item 1  of  Schedule-Medical  preparations containing tinctures which contain alcohol-If dutiable.

HEADNOTE: The  appellant is a manufacturer of certain  medicines  with the  aid of -substances like tincture, spirit,  etc.,  which contain  alcohol.  On the question whether he was liable  to pay duty under the Medicinal and Toilet Preparation  (Excise Duties) Act, 1955, HELD  :  (1)  The  preparations  are  proprietary  medicinal preparations  and  are  not capable  of  being  consumed  as ordinary  alcohol  beverages,  According to Item  1  of  the Schedule  to the Act, in order to attract duty, all that  is required  is that the medicinal preparation  should  contain alcohol.   Alcohol may be a part of the  preparation  either because  it is directly added to the solution or it came  to be included in the medicinal preparation because one of  its components contains alcohol. [592 E-G] (2)It  may  be that a tincture is dutiable under  the  item, and, when the medicinal preparation in which it was used  is also  made  dutiable it will involve  multi-point  taxation. But  s.  4  of the Act shows that  the  multi-point  tax  on medicinal  preparations  containing alcohol was  within  the contemplation of the Legislature.  That section provides for rebate  of duty on alcohol supplied to the  manufacturer  of dutiable goods, and, every rebate pressupposes imposition of tax or duty. [593 B-F] (3)  The rebate under s. 4 is confined only to  those  goods which  directly  come within the scope of s. 4  and  not  to others.   From  such a provision it cannot be said  that  as regard  the  other medicinal preparations, there can  be  no levy when the language of the provision imposing the levy is plain and unambiguous. [593 F-G] M/,s-.   Pharm Products Ltd.  Thanjavur v. District  Revenue

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Officer A.I.R. 1969 Mad. 448, approved. Cape  Brandy Syndicate v. Commissioners of  Inland  Revenue. [1921] 1 K.B. 64, referred to.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1924 of 1970. Appeal  by special leave from the judgment and  order  dated April 28, 1970 of the Allahabad High Court in Special Appeal ’No. 368 of 1970. S.   V. Gupte and Sobhagmal Jain, for the appellant. 0.   P. Rana and R. Bana, for the respondents.  591 The Judgment of the Court was delivered by Hegde  J.-In this appeal by special leave the true ambit  of item  1  in  the  Schedule  to  the  Medicinal  and   Toilet Preparations  (Excise Duties) Act, 1955 (to  be  hereinafter referred to as the Act) read with S. 3(1) of that Act  comes up for consideration. The  appellant is a manufacturer of certain  medicines  with the  aid  of  substances like  tincture,  spirit  etc.   The tincture  and  spirit in their turn  contain  alcohol.   The Superintendent  of Excise called upon the appellant  to  pay duty  under  the  Act on the medicinal  preparation  on  the ground  that they contain alcohol.  The  appellant  resisted the demand on the ground that the medicines in question were not  prepared  by  adding pure alcohol; the  fact  that  the tincture  which is a component of that preparation  contains alcohol  does not make it a preparation containing  alcohol. That contention was rejected by the Superintendent of Excise as well as by the High Court in the Writ petition brought by the appellant. It is admitted that alcohol though it was not directly added is  a component of the medicinal preparations  in  question. The alcohol has not undergone any chemical change into  some other  substance.  It is present in a liquid form  in  those preparations.   The  question for decision  is  whether  the preparation in question do not attract duty because  alcohol was  not directly added to the solution.  The contention  of the  appellant  is  that unless alcohol is  added  into  the preparation  in its free condition, a medicinal  preparation does not become dutiable.  For deciding this question we may now read the relevant provisions of the Act.               Section 3(1) of the Act says               "There  shall be levied duties of  excise,  at               the  rates specified in the Schedule,  on  all               dutiable goods manufactured in India." "Dutiable  goods"  is  defined in s.  2(c)  as  meaning  the medicinal and toilet preparations specified in the  Schedule as  being subject to the duties of excise levied under  this Act: "Medicinal Preparation" is defined in S. 2(g) in these- words :               "  "medicinal preparation" includes all  drugs               which  are a remedy or  prescription  prepared               for internal or external use of human  beings,               or  animals and all substances intended to  be               used  for or in the treatment,  mitigation  or               prevention  of  disease  in  human  beings  or               animals."               5 9 2               Item  1  of the Schedule, the only  item  with               which  we are concerned in this case reads  as               follows :  Item No.  Description of Dutiable goods  Rate

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             of Duty       Medicinal preparation.       Medicinal preparations, being patent  or               Ten  proprietary  medicines,  containing   alcohol               Percent       and  which are not capable of being   ab               valouem       consumed    as    ordinary     alcoholic               beverages.               The   only  other  provision  which  we   need               consider  is  s. 4 of the Act.   That  section               reads thus :               Where  alcohol,  opium, Indian hemp  or  other               narcotic drug or narcotic had been supplied to               a  manufacturer of any suitable goods for  use               as  an ingredient of such goods by,  or  under               the  authority of, the  collecting  Government               and a duty of excise on the goods so  supplied               had already been recovered by such  Government               under any law for the time being in force, the               collecting Government shall, on an application               being  made  to it in this  behalf,  grant  in               respect of the duty ’of excise leviable  under               this Act, a rebate to such manufacturer of the               excess, if any, of the duty so recovered  over               the duty leviable under this Act." It was conceded that the preparations with which we are con- cerned  in this case are medicinal preparations.   They  are proprietary  medicines  and that they are  not  capable  of being  consumed  as ordinary alcohol  beverages.   The  only question   that   has  to  be  decided  is   whether   those preparations contain alcohol.  It is admitted that  tincture is  a  component  of  that  preparation  and  alcohol  is  a component of tincture.  Therefore we fail to see how it  can be urged that those preparations do not contain alcohol.  In order  to  attract  duty  all that is  required  is  that  a medicinal preparation should contain alcohol.  Alcohol  may be  a part of the preparation either because it is  directly added  to  the solution or it came to be  included  in  that medicinal  preparation because of one of the  components  of that preparation contained alcohol.  According to the  plain language  of the provision all that is required is that  the preparation should contain alcohol.  In interpreting a  tax- ing  provision,  the courts should  not  ordinarily  concern themselves with the policy behind the provision or even with its  impact.   As  observed by Rowlatt  J.  in  Cape  Brandy Syndicate v. Commissioners of Inland Revenue(1) in a  taxing Act one has to look at (1)  [1921] 1 K. B. 64.  593 what is clearly said.  There is no room for any  intendment. There is no equity about a tax.  There is no presumption  as to  a  tax.   Nothing is to be read in,  nothing  is  to  be implied.  One can only look fairly at the language used.  It was  urged on behalf of the appellant that if we  hold  that even  indirect  introduction  of alcohol  into  a  medicinal preparation  brings that preparation within the scope of  s. 3(1) of the Act, it would mean multipoint taxation.   Coming to the medicinal preparations with which we are concerned in this case, it was urged that if the view taken by the  High Court  is  correct  then, first  the  tincture  used  became dutiable and thereafter the medicinal preparations in  which tincture  was used became dutiable.  It was said  that  that could not be the intention of the parliament.  We are unable

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to  appreciate this contention.  Multipoint taxation is  not unknown to us. Our  attention was invited to S. 4 of the Act in support  of the  Contention that the legislature did not intend to  levy multi-point  tax.  Section 4 provides for rebate of duty  on alcohol  supplied to the manufacturer of dutiable goods  for use as an ingredient of such goods by or under the authority of  the collecting government and a duty of excise on  goods so  supplied bad already been recovered by  such  Government under  any law for the time being in force.  In our  opinion this  provision instead of supporting the appellant goes  to show   that  multi-point  tax  on   medicinal   preparations containing  alcohol  was  within the  contemplation  of  the leigslature; otherwise there was no purpose in incorporating S.  4 into the Act. if section 3 did not impose any levy  on medicinal  preparations  of  which pure  alcohol  is  not  a component,  there  was  no need for S. I. There  can  be  no question  of any rebate if there was no levy at all.   Every rebate  presupposes an imposition of tax or duty.  But  the rebate  under  s. 4 is confined only to  those  goods  which directly  come within the scope of s. 4 and not  to  others. That  was the will of Parliament.  If Parliament desired  to give  rebate  only in certain cases and not  to  others,  it cannot   be  said  that  as  regards  the  other   medicinal preparations  there  can be no levy.  In  our  judgment  the language  of-the  provision imposing the levy is  plain  and unambiguous.  It imposes duty on all medicinal  preparations containing  alcohol.   At  the  hearing  our  attention  was invited  to  the decision of the Madras High Court  in  M/s. Pharm  Products  Ltd.  Thanjavur  &  ors.  v.  Dist.    Rev. Officer(1).   The  conclusion  reached by  that  High  Court accords with our conclusion. In  the result this appeal fails and the same  is  dismissed with costs. V.P.S.                                                Appeal dismissed. (1)  A.I.R. 1969 Mad. 448. 59 4