The Central Board of Indirect Taxes and Customs (CBIC) has issued a crucial clarification via its official X handle regarding the applicability of HSN codes in Table 12 of GSTR-1. This came in response to a recent GSTN advisory highlighting changes in the GSTR-1 filing structure, effective from May 1, 2025.
As per Notification No. 12/2017 - Central Tax dated June 28, 2017, as amended, taxpayers with an aggregate turnover up to Rs 5 crore in the preceding financial year are not required to mention HSN codes for B2C (Business-to-Consumer) supplies in their tax invoices. However, HSN codes remain mandatory for all B2B (Business-to-Business) supplies.
Text of the Clarification is as follows
"Vide notification No. 12/2017-Central Tax dated 28th June, 2017 (as amended), a registered person having aggregate turnover up to five crores rupees in the previous financial year may not mention the number of digits of HSN Code, in a tax invoice issued by him under the said rules in respect of supplies made to unregistered persons. So, B2C supplies by a taxpayer whose turnover is upto Rs. 5 crore in the previous financial year has the option not to mention HSN code in his invoice.
GSTN vide advisory dated 01st May 2025 has informed taxpayers that Table 12 of GSTR-1/1A is now bifurcated into two tabs, namely, "B2B Supplies" & "B2C Supplies". Taxpayers need to enter HSN summary details of B2B Supplies and B2C Supplies separately under respective tab. Certain validations have been introduced to match the HSN wise value declared in Table 12 with the values declared in other tables of the return. In case of B2B supplies, the HSN summary is mandatory.
In case of B2C supplies, as the HSN code is optional (vide Notification No. 12/2017-Central Tax as amended), the system has not made the B2C table mandatory i.e., system allows the HSN summary to be entered any value/ can be left blank by a taxpayer having aggregate turnover upto Rs. 5 crore in the previous Financial Year."
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