hsn code for scrap fridge compressors

[faiz shaikh]

Sir i deals in old and used fridge compressors. Hsn code for compressor is 8414 which comes under 28% slab. Sir i deal in scrap compressors , so in which slab it comes and what is the Hsn code for scrap compressors. i am very much confused . plz reply as soon as possible.

[DR.MARIAPPAN GOVINDARAJAN]

In my view it is 28% as indicated by you.

[faiz shaikh]

sir for new compressor is 28% and for scrap compressor is also 28 % isin't it unfair.

[DR.MARIAPPAN GOVINDARAJAN]

Yes. You or your association may represent to the Government in this regard.

[KASTURI SETHI]

New compressor and scrap compressor cannot attract same rate of GST. Scrap compressor may fall under another HSN meant for scrap which attract GST @ 18% . Ferrous waste and scrap falls under HSN 7204 and attract GST @18%.

[faiz shaikh]

thanks for ur comments Sir, it was very helpfull

[KASTURI SETHI]

With reference to your message, aluminium scrap (7602) and copper scrap (7404) also attract GST @18%. Sh.M.Govindarajan, Sir has given you the best option. Follow the same. You should represent to the Chairperson, GST Council and your problem will be solved. I hope. Nobody can deny that new compressor and scrap compressor cannot attract same rate of GST. Scrap is scrap and it cannot replace new one.

[KASTURI SETHI]

You may be aware that next meeting of GST Council is to be held on 5.8.17. Email your issue.

[MUKUND THAKKAR]

I am agree with your view.Sh. Kasturiji..

scrap of air compressor is not cover with HSN code of new Air compressor. that means every product HSN code become Scrap code and pay the GST applicable not as scrap.

[Rajagopalan Ranganathan]

Sir,

In my opinion scrap of any machinery or parts thereof have to be classified as waste of the materials out of which such machinery or parts are made off. If it is made of iron and steel it will fall under heading 7204.

[Rajagopalan Ranganathan]

Sir,

In continuation of my reply dated 29.7.2017 Ferrous waste and scrap will attract CGST @9% vide Sl. No. 199 of Schedule III of Notification No. 1/2017-Central Tax (Rate) dated 28.6.2017.

[faiz shaikh]

sir u mean hsn code 7204 for scrap compressors which is 18 % and in invoice we have to mention hsn code 7204.

[KASTURI SETHI]

Decide according to what part/components are dominating. GST rate of scrap is same. I think aluminium is dominating.

[Rajagopalan Ranganathan]

Sir,

According to Notification No. 12/2017-Central Tax dated 28.6.2017 if your annual turnover is up to rupees one crore and fifty lakhs you need not mention the HSN Code. If your turnover is more than one crore and fifty lakhs and up to rupees five crores you have mention 2 digit of HSN Code. If your turnover is more than five crores you have to mention four digit HSN Code.

If the scrapped compressor is made of copper it is classifiable under heading 7404 and if it is made of aluminium it is classifiable under heading 7602 all attracting CGST @9%.

[faiz shaikh]

sir thanks for ur comment

and sir hsn code 7404 and 7602 showing 18 %

AI Summary

Scrap classification: scrap compressors classified by dominant metal under scrap HSNs, attracting the scrap GST rate. Scrap fridge compressors are classified by the dominant material of the scrapped unit: ferrous scrap is classifiable under the ferrous scrap heading, copper scrap under the copper scrap heading and aluminium scrap under the aluminium scrap heading, each attracting the GST rate applicable to scrap. Invoice HSN reporting is required according to turnover bands: exempt for the smallest band, two-digit HSN for the middle band and four-digit HSN for the largest band as specified in the notification.