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Clarification of using hsn code by composition dealers

gekco (B.Com) (170 Points)

03 October 2017

Hello Sir,

Can any expert clarify if it is compulsory for composition traders to use HSN codes on "Bill of Supply" issued by them or not. I have read articles that using HSN code is not compulsory for traders with turnover less than 1.5 crore. Please confirm .

Thanks

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2 Replies

Deepak Gupta (CA Student) (15922 Points)
Replied 04 October 2017

As per Rule 49(e) of the CGST Rules, 2017, HSN code shall be mentioned in the bill of supply.

First proviso to Rule 49 says that the proviso to Rule 46 shall apply to bill of supply mutatis mutandis. It means that the turnover limit for HSN code also applies to bill of supply.

Further, your observation is also correct. N.N. 12/2017-Central Tax, dt. 28.06.2017, do mention that registered taxable persons having turnover below 1.5 crores in the previous financial year need not mention the HSN code.