PVC master batch classification cannot rest on a rigid colourant percentage test without examining trade parlance and product use.

PVC master batch could not be classified solely on a rigid minimum 10% colourant test. The Board circular and Chief Chemist's view did not rule out master batch containing less than 10% colourant, and classification had to consider the product's nature, actual use and trade parlance. Because the adjudicating authority relied only on the percentage criterion without adequate factual enquiry, the demand of duty and penalty could not be sustained in that form. The impugned orders were set aside and the matter remanded for fresh adjudication after proper examination and personal hearing.

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Issues: Whether PVC Master batch could be classified merely on the basis of a minimum 10% colourant content and whether the demand of duty and penalty based on that criterion could be sustained.

Analysis: The order records that the Board's circular and the Chief Chemist's view did not exclude the possibility of master batch containing less than 10% colourant. It further holds that the adjudicating authority could not rest the classification solely on that percentage without examining the nature of the product, its actual use, and how it was known in trade parlance. Since the impugned orders were founded on an inflexible percentage test without adequate factual enquiry, they could not be sustained in that form.

Conclusion: The impugned orders were set aside and the matters were remanded for fresh adjudication after proper examination of the product and after granting personal hearing.

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