Wrong HSN on BE

This query is : Resolved

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The discussion addresses IGST wrongly charged on imported Dicalcium Phosphate due to an incorrect HSN code in the Bill of Entry. The guidance advises correcting the customs classification, claiming a customs refund instead of ITC, not charging GST on exempt sales, and treating related input GST as ineligible credit.

Rajkumar Gutti

Rajkumar Gutti (Querist)
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21 May 2026 We have imported goods ( Dicalcium phosphate ) used for poultry feed. HSN code 283525. The said HSN code gst rate is exempt, As per notification No. 09/2025 ( II/35 ) and 10/2025 Integrated tax rate, dated 17/09/2025. In notification no. 10/2025 IT Rate
Serial 112 - Dicalcium phosphate - written as " IS specification No. 5470 :2002.
But at the time of import custom Dept. Mentioned in Bill of entry HSN code as 28352610 instead of 28352500.
HSN 28352509 is exempt & HSN 28352610 is 18 % rate.
28352500 is for Dicalcium phosphate & 28352610 is for Monocalcium Phosphate.
So our product is DCP is exempt even though custom Dept. Charged 18% IGST.
In above scenario my question
1 - Can we take IGST credit, due to we pay IGST on exempt product i. e on Dicalcium phosphate.
2- if yes, can we charge GST to our outward supply or No, due to exempt supply
3- Due to exempt supply can we apply for refund, if credit is not availed.
4- What is the meaning of " IS specification No. 5470:2002 ( mention in Notification No. 10/2025 IGST rate, DT. 17/09/2025
5- on DCP clearing forwarding expenses can we take gst credit or No.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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21 May 2026 When the Customs Department erroneously charges 18% IGST on an exempt import (Dicalcium Phosphate) due to a wrong HSN classification code on the Bill of Entry, the importer should not claim ITC nor charge GST on subsequent domestic sales, as the item remains legally exempt. Instead, the correct procedure is to seek an amendment or reassessment of the Bill of Entry under the Customs Act and file a Customs Refund Claim under Section 27 to recover the wrongly paid IGST. Additionally, any GST paid on local clearing and forwarding (C&F) expenses is non-deductible (blocked) under Section 17(2) because the underlying goods are exempt.

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Rajkumar Gutti

Rajkumar Gutti (Querist)
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23 May 2026 Thanks a Lot for valuable guidance

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