The Supreme Court, in a judgment delivered by a bench comprising Justice Sanjay Kumar and Justice Sanjeev Sachdeva, held that imported accessories usable with diagnostic machines falling under multiple distinct tariff headings cannot be classified under Customs Tariff Heading (CTH) 9018 as diagnostic apparatus. Instead, such items must be classified under the residuary CTH 9033 00 00. Dismissing an appeal filed by M/s. Carestream Health India Pvt. Ltd., the apex court affirmed concurrent findings of the lower authorities and the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), ruling that laser imagers which serve as accessories to machines across different tariff entries fall squarely under Rule 2(c) of the Notes to Chapter 90 of the Customs Tariff Act, 1975.
Background of the Case
The appellant, Carestream Health India Pvt. Ltd., imported ‘Dryview 6850 Laser Imagers W/3D’ from China under a Bill of Entry dated April 2, 2013. The company classified the imported goods under CTH 9018 90 19 in Chapter 90 of Section XVIII of the First Schedule to the Customs Tariff Act, 1975, claiming they qualified as “Other diagnostic instruments and apparatus.”
However, the Assistant Commissioner of Customs, Chennai, rejected this classification by an Order-in-Original dated June 24, 2013, directing re-classification under CTH 9033 00 00 as accessories not specified or included elsewhere in Chapter 90. The Commissioner of Customs (Appeals), Chennai, affirmed this view on March 10, 2014. The South Zone Bench of CESTAT, Chennai, subsequently dismissed the importer’s appeal on August 21, 2024. Aggrieved by these decisions, Carestream Health India Pvt. Ltd. approached the Supreme Court under Section 130E(b) of the Customs Act, 1962. The duty difference between the two tariff headings was 2.5% at the time, resulting in a differential duty demand of ₹5,21,616/-.
Arguments of the Parties
The imported laser imager is a printer that uses photo thermographic (dry laser) technology to develop images on film. It interfaces with digital diagnostic machines such as Magnetic Resonance Imaging (MRI), Computed Tomography (CT), Full-Field Digital Mammography (FFDM), Digital Radiology (DR), Computed Radiography (CR), Picture Archiving and Communication System (PACS), and Digital Fluoroscopy, and can also be used for other grayscale film applications. However, it possesses no independent diagnostic skills or capabilities of its own.
The appellant contended that the laser imager is an “apparatus” used for diagnostic purposes rather than a “part” or “accessory.” Since it is used with medical machines classified under CTH 9018, the company argued that it should be categorized under CTH 9018 90 19 as a residuary diagnostic apparatus. The appellant also sought to rely on Notification No. 12/2012 dated March 17, 2012, which provided a standard customs duty rate of 5% for goods falling under specified headings, including CTH 9018.
Conversely, the Revenue contended that the imported laser imager is compatible for use not only with machines under CTH 9018, but also with equipment falling under CTH 9022 (such as CT apparatus and X-ray generators). As such, the Revenue maintained that the product falls within the ambit of residuary CTH 9033 00 00, which covers parts and accessories for Chapter 90 machines not specified elsewhere.
Court’s Analysis
The Supreme Court rejected the appellant’s claim that the laser imager is a diagnostic apparatus in its own right, observing:
“Admittedly, the laser imager has no diagnostic skill or capability of its own and must necessarily receive inputs from diagnostic equipment to carry out its function of printing films. In effect, it is an ‘accessory’ to the diagnostic equipment from which it receives inputs, as it then transfers the same onto films. CTH 9018 90 19 admittedly applies only to ‘other diagnostic instruments and apparatus’, i.e., either ‘diagnostic instruments’ or ‘diagnostic apparatus’. As the laser imager has no diagnostic capabilities of its own, it cannot per se be classified under this heading.”
Addressing the precedent cited by the appellant, Commissioner of Customs, New Delhi vs. C-Net Communication (India) (Pvt.) Ltd. (2007), the Court distinguished the case, noting:
“Applying this test, it is clear that the laser imager does not aid in or augment the performance of the medical equipment that it receives inputs from. It only plays the ancillary function of transferring such inputs onto film for preservation or further use by medical professionals. The medical equipment that carries out the diagnostic function is complete in itself and the laser imager does not contribute in any manner to that exercise. In effect, it only serves as an accessory to such medical equipment by printing the transmitted diagnostic data on films.”
Regarding Notification No. 12/2012, the Court observed that CTH 9033 was not listed under Sl. No. 473 of the notification table. Furthermore, the appellant had raised this notification for the first time before the Supreme Court without demonstrating foundational compliance with its attached conditions.
To evaluate the classification of accessories, the Court examined Note 2 to Chapter 90. Rule 2(b) stipulates that parts and accessories suitable for use “solely or principally” with a particular kind of machine or a number of machines under the same heading are classified with those machines. Rule 2(c) states that all other parts and accessories are to be classified under Heading 9033.
Referring to judicial precedent in Annapurna Carbon Industries Company vs. State of Andhra Pradesh (1976), the Court highlighted that the same item may serve as an accessory to more than one kind of instrument. The appellant’s product catalogue itself demonstrated that the laser imagers were compatible with machines falling under CTH 9018 (such as Ultrasound Scanners, MRI apparatus, and Echo Cardiographs) as well as machines under CTH 9022 (such as CT apparatus and X-ray generators).
Interpreting Rule 2(b), the Court held:
“When it speaks of accessories suitable for use ‘solely or principally’ with a particular kind of machine or a number of machines of the same tariff heading, Rule 2(b) clearly distinguishes and separates such accessories from those suitable for use with a number of machines falling under different tariff headings.”
The Court highlighted the difference in tariff duty rates applicable to machines under CTH 9018 (7.5%) and CTH 9022 (10% or 15%), stating:
“In such a scenario, it defies logic and rationale to invoke Rule 2(b) for application to an accessory that may be clubbed with machines falling under CTH 9018 and also CTH 9022, when different rates of tariff duties would apply to such machines.”
Decision
Upholding the CESTAT’s ruling, the Supreme Court concluded:
“In consequence, accessories suitable for use with a number of machines, instruments or apparatus falling under the same tariff heading would have to be classified with such machines, instruments or apparatus, but when such accessories are suitable for use not only with machines, instruments or apparatus under a particular tariff heading but also with machines, instruments or apparatus falling under another tariff heading, they would necessarily have to be brought under residuary CTH 9033 00 00, being accessories suitable for use with machines, appliances, instruments or apparatus falling under Chapter 90, which have not been specified or included under a particular tariff heading.”
Finding no merit in the appeal, the Supreme Court dismissed the appeal and disposed of all pending applications.
Case Title: M/s. Carestream Health India Pvt. Ltd. v. Commissioner of Customs
Case No.: Civil Appeal No. 3440 of 2025
Bench: Justice Sanjay Kumar and Justice Sanjeev Sachdeva
Date: August 12, 2026
