In re Samsung India Electronics Private Limited (CAAR Mumbai)
Samsung India Electronics Private Limited filed an application before the Customs Authority for Advance Rulings (CAAR), Mumbai under Section 28H(1) of the Customs Act, 1962, seeking classification of two imported products: (i) Optical Sheet-Complex (BN61-20395A) and (ii) Optical Sheet-High Color (BN61-20400A). The applicant proposed classification under CTH 9002 9000 as mounted optical elements, alternatively under CTH 9001 as unmounted optical elements, and rejected classification under CTH 8529 as parts of LED televisions.
Optical Sheet-Complex (BN61-20395A)
This product comprises three layers:
- Dual Brightness Enhancement Film (DBEF),
- Prism Layer (100 microns), and
- Prism Layer (125 microns).
The DBEF layer recycles S-polarised light and enhances brightness and energy efficiency. The prism layers collimate, reflect, and refract light to enhance frontal luminance. Both DBEF and prism layers qualify as optical elements. While DBEF acts as a polarising material, prism layers function through reflection and refraction but do not polarise light.
The applicant argued that the prism layer imparted the essential character and that the product was permanently mounted, thereby attracting CTH 9002. It relied on Note 3 to Chapter 90 read with Note 3 to Section XVI for classification based on principal function.
However, the Authority observed that both DBEF and prism layers perform complementary roles in achieving a single function—brightness enhancement in LED televisions. Neither layer demonstrated hierarchical dominance. The product was not considered a composite or multi-functional machine, and classification based on principal function was not applicable. Further, the goods were not specifically covered under Chapter 90.
