Industry, particularly the auto components segment, has reasons to worry after the Supreme Court dismissed a review petition filed by the finance ministry over classification of goods on the basis of the harmonised system of nomenclature (HSN) codes. This case originally related to excise duty, but it has implications for Customs duty and the goods and services tax (GST), too.
The original case related to the classification of relays used in Railways. In HSN codes, exclusions are sometimes given in some chapters. For instance, chapter 85 (the two digits refer to chapters under HSN codes) covers electrical apparatus