Ferrite Beads classification: treated as inductive chip components and classifiable under tariff heading 8504 50 90.

Classification dispute over imported Ferrite Beads: Explanatory Notes to HS heading 8541 exclude micro-assemblies combining active and passive components, directing such assemblies to Chapters 84, 85 or 90; Explanatory Notes to heading 8504 define inductors as single-coil devices and include printed individual inductors. Technical specifications and manufacturer documentation establish the ferrite beads as passive chip-type components with an internal coil structure functioning primarily as inductive noise suppression devices (EMI/RFI mitigation). Applying functional equivalence to conventional coil inductors, the goods are therefore classifiable as inductive components under tariff entry 8504 50 90.

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Issues: (i) Whether the imported ferrite beads (chip ferrite beads) are classifiable under Customs Tariff Item 8504 50 90 (Other inductors) or under Customs Tariff Item 8541 29 00 (Other semiconductor devices / transistors).

Analysis: The Authority examined the competing tariff headings, Section and Chapter Notes, the HSN Explanatory Notes to headings 8504 and 8541, the technical specifications and product literature showing that the goods are two-terminal, surface-mount chip ferrite beads incorporating an internal coil structure and operating by self-induction to provide high-frequency impedance and noise suppression. The HSN Explanatory Notes to heading 8504 define inductors as devices consisting essentially of a coil of wire which, by self-induction, limits or prevents the flow of alternating current and state that inductors obtained as individual components (including those made by printing processes) remain classifiable in that heading. The Explanatory Notes to heading 8541 describe semiconductor devices (active components such as transistors) and expressly exclude micro-assemblies or combined passive components falling to other Chapters. The Authority applied GIR Rule 1, considered functional characteristics, structure and predominant use of the goods, and followed judicial precedents recognising HSN Explanatory Notes and Section/Chapter Notes as guiding aids for classification.

Conclusion: The ferrite beads are primarily inductive passive components functioning by self-induction and are not semiconductor-based active devices. They satisfy the essential characteristics of inductors contemplated under heading 8504 and are excluded from heading 8541. Therefore, the goods are classifiable under Customs Tariff Item 8504 50 90 (Other inductors). This conclusion is in favour of the assessee.

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