GST RATE FOR MACHINED CASTINGS.

[SANJEEV JADHAV]

Dear Experts, We are manufacturer of Other Cast articles of Iron / Steel / St-Steel falling under HSN Code No. 73259910 / 73259920 / 73259930 respectively. For some of castings we are making proof machine and finish Machining. We are in confusion about HSN Code for Machined Castings. Can you please help me which HS code will be applicable for Machined castings and rate of GST for machined castings.

[KASTURI SETHI]

Above Chapter/Heading/Sub-heading Notes/HSN codes are correct for machined castings. Regarding GST rates of machined castings, these are still to be finalized. Checked all sites. These codes for rates are missing in every site.

[MADAN RAHEJA]

Castings of Iron and Steel are rightly classifiable under heading 7325 of Customs Tariff. As regards fully machined cast articles, these are classified as Parts of respective goods. Coming to GST rates you may refer to S.No, 453 of Notification 1/2017-Integrated Tax (Rate), where under all goods falling under any chapter of Customs Tariff which are not specified in Schedule I, II, IV, V or VI of this Notification, would be chargeable to an IGST of 18% for inter-state supply. For intra-state, similar Notification in respect of CGST prescribes tax @ 9% CGST. Same rate of 9% is applicable for SGST/UTGST.

[KASTURI SETHI]

Sh.Madan Raheja, an expert has thrown light on the issue. Thanks for his efforts.

There is no doubt about classification of the goods i.e. machined castings. Doubt about GST rate arises because all relevant websites (including CBEC's site) misses only 7325 99 10, 73259920, 73259930. I mean to say only 73.25 is missing everywhere. Specific entry is required.In such a situation, the words "Not elsewhere specified" may not be applicable and may not serve the purpose. Still it is not clear-cut picture.

[MADAN RAHEJA]

In my opinion, legal provisions are very clear. After 1^st July, 2017, when GST became operative, it cannot be said that rates of tax on any goods has not yet been decided. Under Section 7 of IGST Act and Section 9 of CGST Act, on the recommendation of GST council, Central Government has notified GST rates of all goods. Respective Notifications have 6 Schedules prescribing 6 rates for all goods (Except goods exempted by a separate notification). These rates are 5%, 12%, 18%, 28%, 3% and 0.25%. Against description of goods in each Schedule, tariff item, sub-heading, heading and chapter as specified in the First Schedule to the Customs Tariff Act, have been mentioned. Even Rules of interpretation of said tariff have also been adopted as mentioned in foot note to the notification. Schedule III of this notification details goods with 18% IGST (9% CGST+9% SGST), the last entry of this Schedule reads “all goods falling under any chapter of Customs Tariff which are not specified in Schedule I, II, IV, V or VI”. Thus any goods as per description of Customs tariff which do not find specific mention in any of the Schedules of this Notification would attract 18% GST.

[KASTURI SETHI]

Sh.Madan Raheja Ji,

I fully agree with you. I appreciate your method of correlation.

[KASTURI SETHI]

I was after specific and complete HSN Code with 18% rate of GST, like a ghost.

AI Summary

GST classification for machined castings: unspecified tariff items fall to the general residual GST rate for taxable goods. Machined castings of iron, steel and stainless steel are classifiable under heading 7325. Where specific subheadings for machined castings are not listed in the GST rate Schedules, the residual tariff provision in the notifications applies, so such unspecified goods attract the general GST rate for goods not otherwise specified, with the usual integrated and centre/state tax division for inter state and intra state supplies.