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of <h1>Imported smart vision sensor for automated industrial inspection classified as optical checking instrument under CTH 9031 49 00</h1> The dominant issue was tariff classification of an imported smart vision sensor for sale in India, namely whether it fell under Ch. 85 or under Ch. 90 as ... Classification of imported 'IV3- 500MA Smart Vision Sensor' in India for further sale - whether the product merits classification under Chapter 85? - HELD THAT:- Based upon the literature provided by the applicant, technical specification, GRI 1 and explanatory notes, it is ampule clear that the IV3-500MA Smart Vision Sensor is specifically designed and primarily intended for automated industrial inspection and checking. The product integrates advanced optical components and AI-based image processing tools to perform high- precision visual inspections, including presence detection, orientation verification, and defect identification across a wide range of manufacturing applications. The IV3-500CA Smart Vision Sensor uses optical components (camera, lenses, illumination) to capture images and performs automated checking of objects based on pre-registered OK/NG image data. Does not perform general-purpose image recording or transmission. Its principal function is checking and inspection using optical image analysis. Therefore, just like the AIM, the IV3-500CA uses optical elements not for viewing but for functional image-based checking. Currently, IV3- 500CA Smart Vision Sensor is classified as 'other Parts and accessories' under subheading 9031.90. However, as the product itself has capability of checking function with equipped optical components (i.e., lens), therefore, it is found that subject goods are appropriately classifiable under CTH 9031 49 00 'Other' under the subhead 'Other optical instruments and appliances. 1. ISSUES PRESENTED AND CONSIDERED (i) Whether the imported 'IV3-500MA Smart Vision Sensor' is classifiable as a 'measuring or checking' instrument/machine under Heading 9031, specifically under subheading 9031 49 00 as 'Other optical instruments and appliances', applying the General Rules for Interpretation and relevant Section/Chapter Notes. (ii) Whether classification under Chapter 85 (including Heading 8525 relating to television/digital cameras and video camera recorders) is excluded on the basis of the product's principal function and the statutory exclusion of Chapter 90 articles from Section XVI. 2. ISSUE-WISE DETAILED ANALYSIS Issue (i): Classification under Heading 9031 (CTI 90314900) based on principal function as an optical checking/inspection instrument Legal framework (as discussed by the Court): The Court applied Rule 1 of the General Rules for Interpretation (classification according to terms of headings and relevant Section/Chapter Notes). It also applied Note 3 to Section XVI (composite/multi-function machines classified according to the principal function), as made applicable to Chapter 90 via Chapter Note 3 to Chapter 90. Interpretation and reasoning: The Court found the product is fundamentally designed for high-precision industrial inspection and checking-presence, orientation, quality verification, and differentiation-forming part of quality control on production lines. It captures images using optical elements and then performs AI-based image processing to generate inspection 'judgment' outputs (e.g., OK/NG signals). The Court treated image capture as part of an integrated inspection system, and emphasized that the product's effectiveness lies in analyzing captured images to perform checks; without such evaluation, the images would lack practical utility for quality control. The Court relied on the product's suite of standard and advanced inspection tools (e.g., width/diameter/edge/pitch checks, OCR, blob count, learning mode, multi-position adjustment) as showing 'precise checking' capability consistent with Heading 9031. The Court concluded that the principal function is inspection/checking using optical image analysis, and therefore the product fits within Heading 9031 as an 'other optical instrument and appliance', and not as a mere camera-like device. Conclusion: The Court conclusively held that the product merits classification under Heading 9031, and more specifically under CTI 9031 49 00 ('Other - Other optical instruments and appliances'). Issue (ii): Exclusion of Chapter 85 / Heading 8525 classification due to Chapter 90 coverage and principal function Legal framework (as discussed by the Court): The Court applied Note 3 to Section XVI to identify the product's principal function. It further applied Section Note 1(m) to Section XVI, which excludes 'articles of Chapter 90' from Section XVI (which includes Chapter 85). The Court also examined the scope of Heading 8525 and contrasted it with the product's functionality. Interpretation and reasoning: The Court reasoned that once the product is found to fall under Heading 9031 (Chapter 90), Section Note 1(m) operates to exclude it from Section XVI, and therefore from Chapter 85. Independently, the Court found the product does not satisfy the essential character of Heading 8525 devices, because its principal function is not the capture and transmission/recording of images for viewing, but inspection and judgment based on AI processing and comparison with pre-registered OK/NG data, producing industrial output signals. Any image storage was treated as incidental and limited (inspection history), not a primary recording function. On this basis, the Court rejected Chapter 85/Heading 8525 classification. Conclusion: The Court conclusively determined that Chapter 85 (including Heading 8525) does not apply; the product remains classifiable under Chapter 90, Heading 9031, specifically CTI 9031 49 00.
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