Adhesive classification under Chapter 39 upheld for bulk-cleared polymers, not retail-packed glues excluded from Chapter 35.

Bulk-cleared adhesive products not sold in retail packs of not exceeding 1 kg were treated as remaining within Chapter 39, because adhesive properties alone did not shift polymers to Chapter 35. The Board circular dated 31-8-1990, read with the HSN Explanatory Notes, was taken as clarifying that such goods stay classifiable under Chapter 39 unless they are retail-packed glues or adhesives of the excluded type. On that basis, sub-heading 3506.00 was rejected and the product was held outside Chapter 35, with consequential relief granted.

---

---

Issues: Whether the adhesive product cleared in bulk form, and not in retail packs not exceeding 1 kg, was classifiable under tariff sub-heading 3905.10 of Chapter 39 or under tariff sub-heading 3506.00 of Chapter 35.

Analysis: The product was cleared in bulk and not as retail-packed glues or adhesives of the kind excluded from Chapter 39. The Board circular dated 31-8-1990, read with the HSN Explanatory Notes, indicated that polymers of Chapter 39 having adhesive properties would remain within Chapter 39 when not cleared for retail sale in packs not exceeding 1 kg, and would not shift to Chapter 35 merely because of their adhesive character. The distinction drawn by the lower authority was not accepted, and the circular was treated as clarifying the classification position beyond doubt.

Conclusion: The product was not classifiable under sub-heading 3506.00. The appeal succeeded and the assessee was entitled to consequential relief.

---