Machinery HSN Code: Understanding HSN Classifications for Machinery Products
Machinery is used in factories, workshops, warehouses and even small shops. It includes machines for cutting, mixing, packing, printing, lifting and many other industrial and commercial activities.
To charge GST correctly and keep compliance smooth, businesses must understand how machinery is classified under HSN and how GST applies to new machinery, old machinery and machinery parts.
What Is the Machinery HSN Code?
Under GST, machinery and mechanical appliances are mainly classified in the machinery chapters of the tariff. These chapters cover power driven machines that perform a function such as processing, lifting, pumping, compressing, packing or printing.
General industrial machines, material handling equipment, pumps, compressors, machine tools and many other plant machines are grouped in these machinery chapters. Electrical machines and equipment such as motors and certain electronic machines are covered in nearby electrical chapters but are still treated as machinery for business purposes.
There is no single machinery HSN code for every type of machine. Instead, each family of machines such as pumps, machine tools, cranes, printing machines and packaging machines has its own HSN group. Businesses must pick the correct group based on the main function of the machine.
| HSN Code | Product Description | Product Type or Variant | GST Rate |
|---|---|---|---|
| 8402 | Steam and hot water boilers | Industrial boilers and similar steam generating plant | 18% |
| 8413 | Pumps for liquids | Industrial water pumps, process and transfer pumps | 18% |
| 8414 | Air and gas pumps, compressors | Air compressors, blowers and vacuum pumps | 18% |
| 8428 | Lifting and handling machinery | Cranes, hoists, conveyors, elevators and similar equipment | 18% |
| 8477 | Machinery for working rubber or plastics | Injection moulding machines, extruders and similar plant | 18% |
| 8479 | Other machinery with individual functions | Mixing, packing and special purpose industrial machines | 18% |
HSN Code for Old Machinery and Plant Machinery
Plant and machinery used in manufacturing units usually follow the same HSN codes whether the machines are new or old. A used cutting machine or second hand packaging line is still classified under the same machinery heading that applied when it was new, because the HSN code depends on the nature of the machine and not its age.
Large machines that form part of plant such as boilers, turbines, conveyors, mixers and reactors are mapped to their specific machinery headings. When a complete plant is sold, the HSN codes can be decided based on the main components or as per the way the supply is structured in the contract.
Old machinery or second hand machinery is often sold at a reduced value. For GST, the same HSN code and GST rate are applied as for new machinery , but the taxable value is determined as per the transaction value or by special valuation rules where applicable. Some registered dealers of second hand assets may use special margin rules, but the HSN code of the machine remains linked to its type.
GST on Machinery Products and HSN Code Classification
Under the current GST structure, most machinery and mechanical appliances attract 18% GST. This rate is commonly applied to industrial machines, plant machinery and many types of equipment used in factories and warehouses.
Certain special types of equipment used in priority sectors may enjoy concessional rates if they are covered by specific entries, but general machines such as pumps, compressors, cranes, conveyors, packing machines and machine tools usually fall in the 18% slab.
Machinery parts such as spares, components and accessories are often classified in separate HSN groups for parts of machinery. These parts are also commonly taxed at 18% GST, unless a special notification gives another rate for a particular item.
For GST compliance, machinery manufacturers and traders create item codes in their accounting software for each machine and important spare part. They assign the correct HSN code and GST rate to each item so that invoices show the right classification, description and tax amount.
During GST return filing, outward supplies are reported HSN wise. Sales of machinery and machinery parts are grouped under their respective HSN codes. This helps the tax department track turnover by product type and allows buyers such as factories and contractors to claim input tax credit on the GST charged on machines and parts, subject to normal rules.
Conclusion
The machinery HSN code system places different industrial and commercial machines in separate HSN groups based on their main function, while machinery parts sit in related parts headings. Old machinery continues to use the same classification as new machinery of the same type.
When businesses map every machine and key spare part to the correct HSN code and apply the standard 18% GST rate in normal cases, their billing remains accurate and GST returns stay clear. This reduces the risk of disputes, interest and penalties linked to wrong HSN codes or GST treatment on machinery products.
I am a chartered accountant with over 14 years of experience. I understand income tax, GST, and balancing financial records. I analyze financial statements and tax codes effectively. However, I also have a passion for writing, which is different from working with numbers. Recently, I started writing articles and blog posts. My goal is to make finance easier for everyday people to understand.
Frequently Asked Questions
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What is the HSN code for machinery in India?
In India, machinery is classified in the machinery chapters of the tariff which cover mechanical appliances and machines that perform functions like processing, lifting, pumping, compressing and packing. Each family of machines has its own HSN group rather than one single code for all machinery.
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How does GST apply to machinery products under HSN code?
Most machinery products are taxed at 18% GST under the machinery HSN codes. The exact rate can change only if a specific machine is covered by a concessional entry or by a special notification that prescribes a different rate.
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What is the HSN code for plant machinery?
Plant machinery such as mixers, conveyors, boilers and reactors is classified under the same machinery headings that apply to those types of machines in general. There is no separate HSN only for plant; the code depends on the main function and design of each machine.
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Are old machinery and new machinery classified under the same HSN code?
Yes. Old machinery and new machinery of the same type share the same HSN code. The age or condition of the machine may affect its value for GST but does not change its HSN classification.
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How do machinery manufacturers use the HSN code for GST filing?
Machinery manufacturers assign HSN codes to each model of machine and to important spare parts in their item master and print these codes on invoices. They then report sales HSN wise in their GST returns so that tax on machines and parts is correctly declared and buyers can match and claim input tax credit.