GST Classification for Earthing and Lightning Protection Equipment
The Gujarat Authority for Advance Ruling clarified the HSN classification for earthing products and installation services.
- Ruling
- ADVANCE RULING NO. GUJ/GAAR/R/2018/6 dated 20.03.2018
- Dated
- 20 Mar 2018
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
The short version
- Lightning arresters are classified under tariff heading 8535.
- Earthing pipes are classified as parts under tariff heading 8538.
- Backfill compound is classified as a chemical preparation under heading 3824.
- Installation services fall under Service Accounting Code 9954.
In short
The company asked the Gujarat Authority for Advance Ruling (GAAR) to clarify how to classify their manufactured earthing products and installation services for Goods and Services Tax (GST) purposes. Because these items undergo specific manufacturing processes, the company needed to know if they should be taxed as raw materials or as specialized electrical apparatus.
What has changed
How it worked before
Businesses often struggled to decide if earthing components should be taxed as simple metal rods or as specialized electrical equipment, leading to inconsistent tax reporting.
What has changed
The authority ruled that classification depends on the specific function and manufacturing process of each item. This means manufacturers must now categorize products like lightning arresters and backfill compounds under their specific technical headings rather than grouping them as general metal or clay products.
Who this affects
Manufacturers and suppliers of earthing rods, lightning arresters, and electrical installation services.
An example
A company manufactures specialized copper-coated earthing rods used in industrial power grids. They might wonder if these should be taxed as simple iron rods or as electrical parts. Based on this ruling, they should document the specific electrical function of the rods to justify their chosen HSN code, rather than assuming they fall under a general metal category.
What you should do
Review your product list against these specific tariff headings to ensure your GST filings are accurate. Remember that an advance ruling only binds the company that asked and its local tax office; it is not a universal law for your business.
If you do nothing
If you apply the wrong tax rate based on an incorrect classification, you risk underpaying your GST. This can lead to tax notices, penalties, and interest charges when your filings are audited. A tax officer is not required to follow this ruling for your business and may demand the difference if they disagree with your classification.
The terms explained
- HSN classification
- A system of codes used to classify goods so that tax rates can be applied consistently.
- Tariff heading
- A specific category in the tax schedule that determines the GST rate for a particular product.
- Service Accounting Code (SAC)
- A standardized code used to identify and classify different types of services for tax purposes.
The ruling in detail
Authority for Advance Ruling
M/s. Docsun Power Pvt. Ltd.
ADVANCE RULING NO. GUJ/GAAR/R/2018/6 dated 20.03.2018 · Gujarat
Questions before the authority
- classification of any goods or services or both
- determination of time and value of supply of goods or services or both
- determination of the liability to pay tax on any goods or services or both
- whether applicant is required to be registered under the act
Facts
The applicant is engaged in the manufacturing, assembling, and installation of various earthing products, including earthing pipes, earthing rods, lightning arresters, and backfill compounds. They sought an advance ruling to determine the correct classification of these manufactured goods and the services provided for their installation. The applicant processes raw materials like iron rods and pipes through machining, welding, and electroplating to create these specialized electrical components.
Ruling
| Question | What the authority ruled |
|---|---|
| Lightning Arrester | Tariff Heading 8535 None |
| Earthing Pipe | Tariff Heading 8538 None |
| Solid Rod Earthing | Tariff Heading 7215 None |
| Back Fill Compound | Tariff Heading 3824 None |
| Installation of Earthing System | Service Accounting Code 9954 None |
The Authority ruled on the specific classification of the applicant's manufactured goods and installation services. It determined that the products fall under distinct tariff headings based on their specific functions and manufacturing processes, while the installation service is classified under a specific Service Accounting Code.
Reasoning
The Authority relied on the **functional characteristics** of the products and their manufacturing processes to determine classification. Lightning arresters were classified under 8535 as electrical apparatus for protecting circuits, while earthing pipes were classified under 8538 as parts suitable for use with such apparatus. The backfill compound was classified under 3824 as a chemical preparation because it is a mixture of various products, excluding it from classification as a simple clay under 2508. Installation services were categorized under SAC 9954 based on the nature of electrical installation work.
Provisions relied on
- Section 97(2) of CGST / GGST Act, 2017
- Tariff Heading 8535
- Tariff Heading 8538
- Tariff Heading 7215
- Tariff Heading 3824
- Tariff Heading 2508
- Tariff Heading 2805
- Service Accounting Code 9954
For the practitioner
This ruling provides clarity for manufacturers of earthing and lightning protection equipment regarding the **correct HSN classification** for their product range. It highlights the importance of distinguishing between raw materials and finished apparatus, particularly when products are specifically processed for use in electrical systems. Practitioners should note that the classification of 'Solid Rod Earthing' was determined by its nature as a rod rather than its end-use, as no evidence was provided to link it solely to a lightning arrester system.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/guj-2018-6_dt_20-03-18_docsun.pdf
Legibility of the scan, as read: high.
Prepared 15-10-2026.
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