From 1^st February, 2024 Reporting of HSN in 4/6 digits in E-way Bill shall be mandatory

According to the Notification No. 78/2020- Central Tax dated 15-10-2020, it is compulsory for a registered taxpayer to provide at least 6-digit HSN for all the B2B and export transactions if his Annual Aggregate Turnover (AATO) is more than INR 5 Crores. But if his AATO is below the above prescribed limit, he shall be required to provide at least 4-digit HSN code.

Taking into consideration the above provision, the National Informatics Centre (NIC) issued an advisory regarding the use of HSN codes in E-way Bill System. The advisory has been issued to ensure compliance with the aforesaid notification while generating e-way bills in respect of business transactions. This validation will be implemented in the E-way Bill System from 1^st February, 2024.

Hence, the taxpayers who falls under the purview of this advisory are advised to make necessary changes in their systems and enter 4/6-digit HSN codes while generating e-way bills through web and API systems from 1^st February, 2024.

Conclusion: The advisory issued by NIC is towards ensuring more transparency in taxation system and sufficient time has been allowed by NIC to the stakeholders for making smooth transition by making necessary changes in their systems and API required for e-way bills. From 1^st February 2024, the registered taxpayers who falls in the ambit of the above notification are expected to comply HSN requirements while generating e-way bills.

Disclaimer: The article is based upon the advisory issued by NIC and is meant for educational purposes only. Taxwink shall not be responsible for any loss or damage caused to any person from the use of the information contained in this article. Readers are therefore, requested to act diligently and under consultation of a professional before applying the information contained in this article. For any user support email at: support@taxwink.com