Medicated prickly heat talcum powder 'Nycil' a cosmetic: SC

The Supreme Court has declared medicated prickly heat talcum powder 'Nycil' is a cosmetic and does not fall under the category of medicines or drugs, making its manufacturer Heinz India Ltd liable to pay higher rate of tax.

A bench of Justices S Ravindra Bhatt and Dipankar Datta upheld the decisions of the Kerala and the Madras High Courts that the 'Nycil Prickly Heat Powder' cannot fall within the ambit of the category of 'medicine'.

Referring to the Tamil Nadu General Sales Tax Act, the court pointed out the law was consciously amended to include talcum powder, whether or not medicated in the specific entry or class of entries, enumerating cosmetics.

“Hence, like in the Kerala case, the plain meaning of that taxation head or entry had to be given, as there was no ambiguity. Consequently, the findings recorded by the HCs are justified,” the apex court said.

The bench pointed out there was a clear legislative intent that all kinds of talcum powders, which contained medications (irrespective of the proportion, or at any rate, not containing predominant proportions) should necessarily be treated as cosmetics, falling under Entry 127, thus leaving no scope for the court to interpret the Entry.

The court dismissed appeals filed by Heinz India Ltd and another against the Madras and Kerala High Court judgements.

Heinz India Ltd challenged the Kerala government’s decision to impose higher 20 per cent sales tax rate on Nycil against 8 per cent that was charged for medicines and drugs.

Glaxo Smithkline Pharmaceuticals moved the SC against the Tamil Nadu’s similar decision of levying sales tax at 16 per cent rate against 5 per cent on Nycil under the Tamil Nadu General Sales Tax Act. Heinz’s unit was taken over by GSK during the interregnum (1993-95).