Paddy Husk HSN Code and GST Rate

Paddy husk, a byproduct of rice milling, is widely used in India as a fuel and animal feed. As with any commodity, it is subject to taxes and levies under the Indian tax system. So, if you're involved in the supply or purchase of paddy husk, it's important to know the Harmonized System of Nomenclature (HSN) code and the Goods and Service Tax (GST) rate applicable to it.

In this article, we'll provide an overview of GST on paddy husk, including the GST rate on paddy husk, as well as the applicability, exemptions, and invoicing requirements.

Applicability of GST on Paddy Husk 

Under GST law, paddy husk is exempt from GST. When we talk about exempted goods under GST, it means that they are not subject to GST, and hence, there is no GST applicable to their sale. 

This means that if a business deals only with exempted goods such as cereal husks, then they are not required to register for GST unless they also deal with other taxable items and their aggregate turnover exceeds the threshold limit of Rs.40 lakhs.

GST Rate and HSN code for Paddy Husk

Paddy husk is a type of cereal husk and falls under the HSN code 1213. Paddy husk is a Nil-rated supply. The rate of GST on paddy husk is 0%. 

It is important to note that GST rates are subject to change, and it is advisable to check the latest rates on the CBIC website before conducting a business transaction.

ITC Availability On Paddy Husk 

Input Tax Credit (ITC) is a deduction that allows businesses to claim credit for the taxes paid on the purchases they make for their business. It can be claimed against the tax liability of a business, which reduces the overall tax burden. 

That said, ITC cannot be claimed on products exempted from GST, including paddy husks. Since these products are not subject to GST, one cannot claim ITC on the same.

Conclusion

GST has brought greater uniformity in tax rates across different states in India. It has reduced the cost of transportation and made it easier for businesses to move paddy husk from one state to another. Additionally, GST has eliminated the need for multiple tax registrations, making compliance easier for businesses.

Businesses need to stay informed of the latest regulations and seek professional advice when necessary to ensure compliance and minimise the negative impact of GST on their operations.

FAQs

What is the HSN code for raw rice husk?

The HSN code for rice husks is 1213.

Is GST applicable on rice husks?

No, all cereal husks, including rice husks, are exempt from GST under HSN code 1213. 

What is the percentage of husks in paddy?

The percentage of husk in paddy varies depending on the variety and growing conditions, but on average, it is approximately 20% of the weight of the paddy.