The document outlines the Excise Duties Act of 1955 and its regulations regarding the use of alcohol in medicinal and toilet preparations, imposing different excise duties to prevent misuse and ensure control over consumption. It defines various types of preparations, manufacturing conditions, licensing fees, and exemptions, emphasizing the need for duty payment and proper handling of alcoholic goods. Additionally, it covers the inspection protocols by excise officers and the disposal of seized materials, alongside potential penalties for violations.

1. THE MEDICINAL AND
TOILETRY PREPARATIONS
(THE EXCISE DUTIES ACT 1955
& RULES 1956)

2. INTRODUCTION
• Use of alcohol for preparation of medicines is necessity.
• Alcohol used either for drinking or manufacture, perfumes is
subjected to higher excise duties than that of used in medicine
preparation or toilet preparations.
• The alcohol obtained from Government at lower rate of excise duty
may be misused
• Therefore, it is necessary to control (Drinking & Smuggling) the issue
(Affordability) and transport of alcohol.
• This is the reason to take this Act in existence.
• The Excise Duties Act came in force-1955 and Rules-1956
• Alcohol control measure, excise duty increases need to increase
annually in relation to inflation and income.
• It has found that increasing the level of a minimum price per unit
leads to steep reductions in alcohol consumption and related harms.

3. Objectives
• It provides for the Levy and
collection of duties of excise on
medicinal and toilet
preparations containing alcohol,
opium, Indian hemp, or other
narcotic drugs and narcotics.

4. VARIOUS DEFINITIONS
• Toilet preparation: Means any preparation which is intended for use in the toilet of the
human body or in perfuming apparel of any description, or any substance intended to
cleanse, improve or alter the complexion, skin, hair or teeth, and includes deodorants and
perfumes.
• An excise or excise tax is an inland tax, It is different from Customs duties, considered as
indirect tax, sometimes referred as “Sin tax”.
• Alcohol: means diethyl alcohol, ethanol (C2H6OH)
• Duties goods: Include medicinal and toilet preparations.
• Medicinal preparations: Include remedy and prescription prepared for internal or external
use for human or animal, use for or in treatment, mitigation or prevention of diseases.
• Bonded Manufactory; means the premises or any part of premises approved and licensed
for the manufacture and storage of medicinal and toilet preparations containing alcohol,
opium, Indian hemp and other narcotic drugs or narcotic on which duty has not been paid.
• non-bonded/Outside manufactory means the premises or any part of the premises
approved and licensed for the manufacture and storage of medicinal and toilet preparations
containing alcohol, opium, Indian hemp and other narcotic drugs or narcotics on which duty
has been paid
• Denatured sprits: alcohol of any strength which is harmful/unfit for human consumption
• Rectified sprits: alcohol of determined strength which can be used for human consumption.

8. MANUFACTURE OF ALCOHOLIC
PREPARATIONS
•In bonded manufactory, Medicines are
prepared
•In non-Bonded manufactory, Other than
medicines like beverages, wine, soap,
shampoo, etc.
•No excise duty (Tax) •Excise duty (Tax)

9. Manufacture In-Bond
• Licence
• The following fees must accompany each application for
licence
• Where, consumption of alcohol < 4000 L.P. litre/annum
Rs.100
• Where, consumption is likely to be 4000 L.P. litre/annum
Rs.200
• Manufacture for sale of Ayurvedic or Unani medicines
containing self generated alcohol Rs.25
• Design and construction of bonded lab
• Manufacture of preparations in bonded lab: Rectified sprits
shall be issued without previous payments of the excise duty

11. Manufacture Outside bond/non-bond
• LICENCE
• The following fees are required to be paid for obtaining a licence for non-bonded
manufactory.
• Where, consumption of alcohol is 125 L.P. litres or less per annum Rs.10
• Where, consumption of alcohol per annum is more than 125 but less than 500 L.P. litres
Rs.25
• For manufacture of Ayurvedic or Unani preparations containing self-generated alcohol
produced by distillation
• DESIGN AND CONSTRUCTION OF NON-BONDED LAB
• MANUFACTURE IN NON-BONDED LAB: Rectified sprits shall be paid by the licensee to
the officer-in-charge of the distillery.
• The following categories of preparations are exempt from excise duty
• Hospitals and dispensaries subsidized by the Central Govt. or State Govt.
• Charitable hospitals and dispensaries under the Administrative control and
management of local body.
• Medical Store depot, Central Govt. or State Govt.
• Every other institution certified by the principal Medical Officer of the district in which
such institution is situated, which distributes drugs to poor for free.

13. Duty on Medicinal and Toilet preparations

14. Classification of medicinal and toilet preparations
containing alcohol
1. ALLOPATHETIC PREPARATIONS
 Official allopathetic preparations
 Non-Official allopathetic preparations
2. HOMEOPATHIC PREPARATIONS
3. AYURVEDIC PREPARATIONS

15. Warehousing of Alcoholic preparations
• The manufacturers and dealers in alcoholic preparations are
allowed to establish warehouses anywhere in India for the
purpose of depositing spirituous goods on which duty has not
been paid.
• Those wishing to establish such a warehouse should obtain a
licence for the purpose from the Excise Commissioner of the
State, by making application to him with a fee of Rs.25.
• If the applicant fulfils all the requirements and conditions as
per the rules, the license will be granted.
• No goods should be removed from the warehouse without
payments of duty.

16. MOVEMENT OF GOODS FROM ONE WAREHOUSE TO
ANOTHER
• For the movement of the goods from one warehouse to
another, within a state the consignor (sender) must
submit the application in triplicate with some amount as
security deposit to the officer-in-charge.
• After verification, Officer-In-charge can give the
permission/send duplicate copy to the officer-in-charge of
the destination.
• Once goods arrived at the destination, consignee should
present the transport permit and triplicate copy to the
excise in-charge
• Goods may be kept for maximum 3years from the date of
their deposit.

17. RETURNS
• Within 7 days of the expiry of each month, the
licensee must submit details of the
transactions made in the warehoused goods
INTER-STATE TRANSPORT OF ALCOHOLIC
GOODS
• Alcohol preparation can be transported from
one state to another after payment of duty.

18. EXPORT OF ALCOHOLIC PREPARATIONS
• Application has to be submit to the officer-in-
charge with required amount.
• Forward the application form to customs
officer for necessary action.
• If all the formalities are fulfilled then
permission may granted.
• *Bonded laboratory without payment of duty

19. ENTRY, SEARCH AND SEIZURE
• Excise officer authorised by the Excise Commission
shall inspect all the premises at any times without
notice
• Inspect the building, the plant, machinery, stocks,
records & registers
• May stop and detain any person found carrying
dutiable goods without valid permit
• Excise officer not below SI, can stop and detain car
or arrest the person.
• He must handed over to the officer-in-charge of that
area police station.

20. DISPOSAL OF SEIZED ARTICLES
• The articles seized by the officers should be
disposed off speedily according to the pro
visions of the law.
• In the case of seizure of an animal, the owner
of the animal should provide for its day-to-day
keep, failing which the animal may be sold by
public auction and the expenses incurred in
keeping the animal realize from the proceeds
of the sale.

21. OFFENCES AND PENALTIES