HSN CODE under GST [Video]

By | January 25, 2019
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(Last Updated On: January 25, 2019)

HSN CODE under GST


Free GST Online Videos [ Videos ] by CA Satbir Singh

  1. What is HSN code for Goods? Harmonised Commodity Description and Coding System (Generally referred to as ‘Harmonised System of Nomenclature’ or simply ‘HSN’) was developed by World Customs Organisation Harmonised System (HS) provides commodity/product codes and description upto 4-digit (Heading) and 6-digit (Sub-Heading) levels only and member countries of WCO are allowed to extend the codes upto any level subject to the condition that nothing changes at the 4-digit or 6-digit levels. India has developed 8- digit level classification to indicate specific statistical codes for indigenous products and also to monitor the trade volumes – Chapter 4 Para 2.2 of Customs Manual, 2011.
  2. What is HSN code for Goods ? Example: Tariff Item Description of goods Unit Rate of duty Prefer- ential Areas Standard 0901 COFFEE, WHETHER OR NOT ROASTED OR DACAFFEINATED; COFFEE HUSKS AND SKINS: COFFEE SUBSTITUTES CONTAINING COFFEE IN ANY PROPORTION – Coffee, not roasted – Not decaffeinated — Arabica plantation: 0901 11 A Grade kg. 100% 100% less 13 paise per kg. 100% less 13 paise per kg. 0901 11 12 B Grade kg. 100%
  3. What is code for Services ? Scheme of Classification of Services has been notified by Government as Annexure to Notification No. 11/2017-Central Tax (Rate) dated 28-6 2017 The classification of services is modified version of United Nations Central Product Classification CBI&C press release dated 11-6- 2018
  4. What is code for Services ? Since Customs Tariff has 1 to 98 Chapters, chapter No. 99 has been given for services. The service classification is 6 digit code. The services have been classified in five broad sections as follows Section 5 – Construction service Section 6 Distributive Trade Services, Accommodation, Food service Section 7 Financial and related Services Section 8 Business and Production Services Section 9 – Community, social and personal services his section number forms third digit e.g. construction services commence with ‘995’. The sections are divided into headings which is a four digit code. These are divided in groups which becomes a fifth digit code. Its further division is made in Tariff Item’ which is a six digit code.
  5. Annexure: Scheme of Classification of Services S.No.Chapter, Service Code Service Description Section, Heading or(Tariff) Group All Services Construction Services Construction services Chapter 99 2 Section 5 3 Heading 9954 4 Group 99541 Construction services of buildings 9954 995412 995413 Construction services of single dwelling or multi dwelling Construction services of other residential buildings such Construction services of industrial buildings such as or multi- storied residential buildings as old age homes, homeless shelters, hostels and the like 7 buildings used for production activities (used for as- sembly line activities), workshops, storage buildings and other similar industrial buildings 995414 Construction services of commercial buildings such as office buildings, exhibition and marriage halls, malls, hotels, restaurants, airports, rail or road terminals, parking garages, petrol and service stations, theatres and other similar buildings
  6. What is code for Services ? Explanatory Notes to the scheme of classification of services – CBI&C has issued explanatory notes to scheme of classification of services, vide CBI&C press release dated 11-6-2018, as a guiding tool. t has been clarfied that lrewneiai treatment for ashyauPe preferred However, it may be noted that where a service is capable of differential treatment for any purpose based on its description, specific description shall be preferred over a more general description.
  7. HSN Code in GST Tax Invoice Notification No. 12/2017-Central Tax dated 28-6-2017 and Notification No 5/2017 Integrated Tax dated 28-6-2017, under Proviso to Rule 46 of CGST Rules 2017 Annual Turnover in preceding Financial year upto Rs 1.5 Crore : HSN Code is not required to be mentioned in tax Invoice. Annual turnover in preceding Financial year above Rs 1.50 crore but below Rs 5 crore: HSN code at two digit level (i.e. only chapter number) is required in tax Invoice. Annual turnover in preceding Financial year above Rs 5 crores, HSN code at four digits level is required.
  8. HSN Code in GST Tax Invoice Note: Annual Turnover not defined under GST Act “Aggregate turnover” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on al India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess; [ Section 2(6) of CGST Act 2017 1
  9. HSN Code in GST Tax Invoice “turnover in State” or “turnover in Union territory” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis) and exempt supplies made within a State or Union territory by a taxable person, exports of goods or services or both and inter-State supplies of goods or services or both made from the State or Union territory by the said taxable person but excludes central tax, State tax, Union territory tax, integrated tax and cess; [ Section 2(6) of CGST Act 2017 ]
  10. HSN Code in Delivery Challan Transportation of goods without issue of invoice Rule 55(1) CGST Rules 2017 :-For the purposes of- (a)supply of liquid gas where the quantity at the time of removal from the place of business of the supplier is not known, (b)transportation of goods for job work, (c)transportation of goods for reasons other than by way of supply, or (d)such other supplies as may be notified by the Board, the consigner may issue a delivery challan, serially numbered not exceeding sixteen characters, in one or multiple series, in lieu of invoice at the time of removal of goods for transportation, containing the following details, namely:- (iv) Harmonised System of Nomenclature code and description of goods
  11. HSN Code in Bill of Supply Rule 49 of CGST Rules 2017 A bill of supply referred to in clause (c) of sub-section (3) of section 31 shall be issued by the supplier containing the following details, namely, (e) Harmonised System of Nomenclature Code for goods or services; Provided that the provisos to rule 46 shall, mutatis mutandis, apply to the bill of supply issued under this rule:
  12. HSN Code in Bill of Supply Rule 49 of CGST Rules 2017 A bill of supply referred to in clause (c) of sub-section (3) of section 31 shall be issued by the supplier containing the following details, namely, (e) Harmonised System of Nomenclature Code for goods or services; Provided that the provisos to rule 46 shall, mutatis mutandis, apply to the bill of supply issued under this rule: Comment : Thus HSN code to be mentioned in Bill of Supply based on Annual Turnover in preceding Financial year
  13. HSN Code in GST Outward Supply Return (GSTR-1) As per Instruction No 16 and 17 of GSTR 1 16. Summary of supplies effected against a particular HSN code to be reported only in summary table. It will be optional for taxpayers having annual turnover upto Rs. 1.50 Cr but they need to provide information about description of goods. 17. It will be mandatory to report HSN code at two digits level for taxpayers having annual turnover in the preceding year above Rs. 1.50 Cr but upto Rs. 5.00 Cr and at four digits level for taxpayers having annual turnover above Rs. 5.00 Cr

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