M/s. Carestream Health India Pvt. Ltd. v. Commissioner of Customs, 2026 INSC 837 (12 August 2026)
What the case was about
This appeal turned on whether imported hospital printers should be taxed as diagnostic medical instruments or as mere accessories. M/s. Carestream Health India Pvt. Ltd. imported “Dryview 6850 Laser Imagers W/3D” from China and declared them under a customs heading reserved for diagnostic apparatus. The Revenue authorities disagreed, reclassifying them under a residuary heading for unspecified parts and accessories. After the Assistant Commissioner of Customs rejected Carestream’s classification, both the Commissioner of Customs (Appeals) and the Customs, Excise and Service Tax Appellate Tribunal (South Zone Bench, Chennai) dismissed the company’s challenges. Carestream then filed the present appeal under Section 130E(b) of the Customs Act, 1962 (paras 1, 3).
The key facts
The imported laser imager is a printer that uses photo thermographic (dry laser) technology to develop images on film. It receives digital data from diagnostic machines such as Magnetic Resonance Imaging (MRI), Computed Tomography (CT), Computed Radiography (CR), and Picture Archiving and Communication Systems (PACS), and prints the resulting images for medical use (para 5). Crucially, the Court noted that the machine “is not medical equipment, in itself, as it does not possess independent diagnostic skills or capabilities” (para 5). It cannot examine a patient or generate diagnostic data; it only outputs what other machines produce. The Revenue argued that this supplementary role made the imager an accessory, while Carestream maintained it was an independent apparatus used in diagnosis (paras 6–7).
The questions before the Court
The appeal raised two linked questions. First, are the laser imagers classifiable under CTH 9018 90 19 as “other diagnostic instruments and apparatus,” or under the residuary heading CTH 9033 00 00 as parts and accessories not specified elsewhere in Chapter 90? Second, if they are accessories, does Note 2(b) or Note 2(c) to Chapter 90 of the Customs Tariff Act, 1975 govern their classification (paras 4, 11–12)?
What the Court decided and why
A Bench comprising Justices Sanjay Kumar and Sanjeev Sachdeva dismissed the appeal, upholding the concurrent findings below (para 19).
No independent diagnostic function
The Court held that heading CTH 9018 90 19 applies only to “diagnostic instruments” or “diagnostic apparatus.” Because 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,” it cannot qualify as a diagnostic apparatus per se (para 8). Instead, it functions as an “accessory” to the diagnostic equipment from which it receives data, since its role is limited to transferring that data onto film (para 8).
The “same heading” limit of Rule 2(b)
Carestream argued that even if the imager was an accessory, it should be classified alongside the diagnostic machines under CTH 9018 because it was principally used with them. The Court examined Note 2(b) to Chapter 90, which allows accessories suitable for use “solely or principally” with a particular kind of machine, or with a number of machines falling under the same tariff heading, to be classified with those machines (para 16). The Court found that the appellant’s own catalogue showed the imagers were compatible with several machines under CTH 9018, such as Linear Ultrasound Scanners (CTH 9018 12 10), Magnetic Resonance Imaging apparatus (CTH 9018 13 00), Echo Cardiographs (CTH 9018 19 20), and ultra-violet or infra-red ray apparatus (CTH 9018 20 00). However, the Revenue pointed out that the imagers were also compatible with machines falling under CTH 9022 (para 15). Because the accessory was suitable for use with machines across two separate headings—9018 and 9022—Rule 2(b) could not apply (paras 17–18).
Rule 2(c) as the residuary route
The Court held that Rule 2(c) therefore governed the classification. That provision directs that “all other parts and accessories” compatible with machines of Chapter 90, but not confined to a single heading, must be classified under the residuary heading CTH 9033 00 00 (para 18).
Precedents and procedural objections
The Court cited Annapurna Carbon Industries Company v. State of Andhra Pradesh, (1976) 2 SCC 273, for the observation that accessories are not necessarily confined to the particular machines they serve, and the same item may be an accessory to more than one kind of instrument (para 14). It also distinguished Commissioner of Customs, New Delhi v. C-Net Communication (India) (Pvt.) Ltd., (2007) 12 SCC 72, finding it inapplicable to the facts (para 9). Additionally, the Court refused to consider Notification No. 12/2012-Customs, which Carestream had raised for the first time in the Supreme Court, noting that the appellant could not rely on it without first establishing compliance with its conditions in the lower forums (para 10).
Why it matters
The ruling clarifies that the classification of medical peripherals under the Customs Tariff Act depends on their intrinsic functional reality, not on how integral they are to a hospital’s workflow. A device that lacks independent diagnostic capability and merely prints output generated by other equipment will be treated as an accessory, even if it is indispensable in clinical practice.
More importantly, the judgment sets a clear interpretative boundary for Note 2 to Chapter 90. Rule 2(b) is not a broad licence to classify an accessory under the heading of the main machine; it is available only where the accessory is tied exclusively, or at least principally, to machines falling under a single tariff heading. The moment an accessory is shown to be compatible with machines across different headings—as demonstrated here by the importer’s own product literature—the accessory must travel to the residuary heading 9033 under Rule 2(c). This has immediate practical consequences for how medical device importers classify goods and plan duty liability.
Finally, the Court’s refusal to entertain a belatedly raised customs notification reinforces that procedural defences and claimed exemptions must be front-loaded in litigation, not introduced at the final appellate stage. The judgment thus reinforces both substantive interpretative discipline and procedural regularity in customs disputes.