TaxTMI 
TaxTMI 
TaxTMI 
National Security Cess Act
The Health Security Se National Security Cess Act, 2025 (‘Act’ for short) was enacted by the Parliament to augment the resources for meeting expenditure on national security and for public health, and to levy a cess for the said purposes on the machines installed or other processes undertaken by which specified goods are manufactured or produced and for matters connected therewith or incidental thereto. The Act contains 9 chapters, 39 sections and 2 schedules. The provisions of this Act will come into effect from 01.02.2026.
Rules
The Central Government, in order to implement the provisions of the Act made ‘The Health Security Se National Cess Security Cess Rules, 2026 (‘Rules’ for short) and published the same in the Official Gazette, vide Notification No. 01/2026-HSNS Cess, dated 01.01.2026. It contains 3 Rules. These rules will come into effect from 01.02.2026.
Application for registration
Every taxable person who owns, possesses, leases or otherwise controls a machine installed or a process undertaken in a factory, shall register himself with the jurisdictional proper officer in Form – HSNS – 1 on the ACES Portal along with the documents specified in the said form. If a taxable person owns, possesses, leases or controls machines installed in more than one factory, a separate application in FORM HSNS REG-01 shall be submitted for each such factory.
The said form has 2 parts – Part A – Preliminary details and Part B – Business and Process details. In Part A of the form the following details are to be furnished-
- Legal name of the business;
- GSTIN number, if any;
- Central Excise Registration No, if any;
- E-mail address; and
- Mobile number.
In Part B the following details are to be furnished-
- Business details;
- Address of manufacturing premises (factory);
- Categorization of taxable activity;
- Details of promoters/partners/Directors;
- Details of Authorised Signatory;
- Bank Account Details;
- Verification.
Along with the form the following documents are to be attached-
- Proof of Constitution of business, such as certificate of incorporation of company, partnership deed;
- Proof of address premises;
- Photo of promoters/partners/Directors;
- Proof of bank account; and
- Authorisation letter.
On submission of the above said form in the portal a temporary registration certificate will be generated and communicated to the taxable person for the purpose of paying the cess pending the grant of registration certificate.
Registration
The proper officer shall examine the application and grant registration within 7 working days from the date of submission of the application. If the application is found defective, the Proper Officer shall inform the applicant and gives him a reasonable opportunity of being heard. The taxable person is to give reply to the notice to the proper officer. The Proper Officer shall consider the explanation offered by the Taxable Person and he may grant registration certificate or reject the application after recording the reasons for rejection of the application. If the proper officer fails to grant registration certificate within 7 working days, then the application shall be deemed to be approved. The certificate of registration shall be in Form – HSNS – 2, that may be available in the portal. The registration certificate shall be effective from the date on which the person becomes liable to be registered under the Act.
Cancellation of registration
The proper officer may, either on his own motion or on an application filed by the registered person, listing the reasons for seeking cancellation of the certificate or by his legal heirs in case of death of such person, cancel the registration, in such manner and within such period, as may be prescribed, having regard to the circumstances where, —
- the business has been discontinued, or transferred fully for any reason including death of the proprietor, or amalgamated with other legal entity, or demerged, or otherwise disposed of; or
- there is any change in the constitution of the business; or
- the taxable person is no longer liable to be registered under this section.
Where there are no dues pending from the registered person, the application for cancellation shall be approved by the proper officer within 30 days from the date of the receipt of the application and the registered person shall be informed accordingly.
The proper officer may, after giving a reasonable opportunity of being heard, cancel the registration of a taxable person from such date, as he may deem fit, where, —
- a registered person has contravened any of the provisions specified in section 18 (penalty for contraventions); or
- a registered person has not furnished returns for six consecutive calendar months; or
- registration has been obtained by means of fraud, wilful misstatement or suppression of facts.
Effect of cancellation
The cancellation of registration shall not affect the liability of the person to pay cess and other dues under this Act or to discharge any other obligation under this Act or the rules made thereunder, for any period prior to the date of such cancellation, whether or not such cess and other dues are determined before or after the date of the cancellation.
Revocation of cancellation
A taxable person whose registration is cancelled may submit an application for revocation of cancellation within 30 days from the date of receipt of the cancellation order. If the proper officer is satisfied that sufficient grounds exist, he shall revoke the cancellation within 30 days of the receipt of such application and the applicant shall be informed accordingly. If the proper officer is not satisfied with the application filed, he shall provide the applicant a reasonable opportunity of being heard, and after considering the representation, if any, furnished by the applicant, he shall either revoke the cancellation or reject the application and the applicant shall be informed accordingly.