“Vicco Turmeric, Nahi Cosmetic; Vicco Turmeric Ayurvedic Cream” – a jingle etched in our memories, transcending time and generations. It is undeniable that, while reading this jingle, the tune of the song has at least once crossed your mind. But was this jingle, with its simple message, a mere call to attract customers, or did it carry a subtle jab aimed at the Central Excise department?

The VICCO turmeric jingle, widely known across generations, has had a fascinating backstory. In the 1980s, VICCO became one of the first brands to sponsor a TV show, ‘Yeh Jo Hai Zindagi,’ with their ‘Marketing Blitzkrieg' strategy aimed at widespread exposure across multiple channels simultaneously. This involved playing the jingle before movies in theatres, creating a lasting impression on the audience.

However, the roots of the VICCO turmeric cream story trace back even further to 1952 in Bombay (now Mumbai).

Let’s delve into the interesting story behind it and explore how the iconic jingle was created.

In the 1950s, a company named ‘Vishnu Industrial Chemical Company’ was established in Bombay, famously known as VICCO by Keshav Pendarkar. Initially, they ventured into the production of toothpaste and creams. The first product of the company was the VICCO Vajaradanti, an Ayurvedic toothpaste, and later in the 1950s, they launched the VICCO Turmeric Cream.

However, in 1976, VICCO faced a challenge when the Central Excise of India questioned their eligibility for Ayurvedic tax benefits. The excise authorities argued that since the company had ‘Chemical’ in its name and produced cosmetic products, it should be taxed as a chemical company.

Despite this, VICCO contested the excise order in 1977, asserting that their products were genuinely Ayurvedic, and they shouldn’t be subjected to chemical taxes. The legal battle, known as the case of VICCO Turmeric versus Central Excise, began in 1978 and continued until 1982, culminating in VICCO winning the case. However, the dispute continued as the Central Excise took the matter to the Bombay High Court.

In 1988, the Bombay High Court ruled in favour of VICCO, affirming that their products were indeed Ayurvedic, and therefore, they were not liable for chemical taxes. This legal victory solidified VICCO’s position as an Ayurvedic company and established a precedent for its tax treatment.

In 1985, a significant tax reform took place with the implementation of the new Central Excise Tariff Act 1985 in 1986. This led to a legal dispute between Central Excise and VICCO once again, which lasted for many years until the Supreme Court pronounced its decision in 2007.

Surprisingly, the Supreme Court ruled in favour of VICCO, stating that their products, including VICCO Turmeric Cream, should be considered ayurvedic medicines and not cosmetics. As a result, the court declared that cosmetic taxes should not be applied to VICCO’s products.

The origin of this legal battle was the question of whether VICCO Turmeric Cream, despite having ‘chemical' in its name, should be classified as a cosmetic or ayurvedic product. To address this, VICCO cleverly composed a simple yet iconic jingle: “Vicco turmeric, Nahi Cosmetic; Vicco Turmeric Ayurvedic Cream (Vicco Turmeric, Not Cosmetic; Vicco Turmeric Ayurvedic Cream).” Although seemingly basic, this jingle played a crucial role in resolving the legal complexities surrounding VICCO’s product classification. Finally, in 2007, after years of legal battles, the matter came to a close.

Now, what is the difference between cosmetic Ayurvedic and Chemical tax?

In India, there is a difference in how we tax cosmetic ayurvedic products, often called ‘cosmeceuticals,' and chemical products. Cosmetic ayurvedic items fall under the cosmetic category, getting a lower Goods and Services Tax (GST) of 9 per cent for both CGST and SGST. Meanwhile, medicinal ayurvedic products face a slightly higher tax of 12 per cent for CGST and SGST each, as per the Authority for Advance Ruling (AAR) decision. On the other side, chemical products, including pharmaceuticals, industrial chemicals, and consumer goods, can have varying GST rates, ranging from 5 per cent to 18 per cent, depending on their application.

So, in a nutshell, when it comes to tax, cosmetic ayurvedic products enjoy a bit of a break with lower rates, while chemical products have a broader range of tax rates based on their specific category and use.

The legal battles between Central Excise and companies like VICCO highlight the complexity of this classification. The case of VICCO Turmeric, with the word ‘chemical’ in its name, exemplifies the challenges in determining the nature of a product. In such instances, companies may need to provide evidence, and in VICCO’s case, they went the extra mile by composing a memorable jingle asserting the ayurvedic nature of their product.

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This story originally appeared in the Free Press Journal and is published here under a mutual content-sharing agreement.