Rui Zhang, the 27-year-old PhD student who attacked his classmate Xiaoyu Cheng by throwing sulphuric acid in his face and hit his head with a hammer, has been found not guilty on grounds of mental illness.

Zhang and Cheng, 25, were both PhD chemistry students at the University of New South Wales. Both Chinese nationals were working in a research laboratory when the incident occured in October 2012 at around 6 pm.

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Cheng was immediately rushed to St. Vincent's Hospital but was later moved to the burns unit of Royal North Shore Hospital.

"It's alleged one student threw a chemical, believed to be sulphuric acid, in another student's face before hitting him on the head with a hammer during an altercation," police said.

Zhang, on the other hand, did not make a bail application. He was put to the Kiloh Center, a mental health facility located at the Prince of Wales Hospital, after he was tried by a judge.

On Thursday, Judge Donna Woodburne found the convicted not guilty because of his mental illness. She ordered for Zhang to be detained in custody until he is released "by due process of law".