What is HSN Code?
HSN stands for Harmonised System of Nomenclature, an international system for classifying goods maintained by the World Customs Organization. India uses HSN codes for customs tariffs and for GST on goods. The first six digits are common worldwide, and India adds further digits for more detail. A goods exporter's shipping bill and invoice carry HSN codes so that customs and tax authorities know exactly what is being shipped.
Why it matters for exporters
If you export services only, you will not normally need HSN codes. GST classifies services using SAC codes (six digits starting with 99), and the services table in Part 2B of the EDF has a SAC code column, not an HSN column. Part 2A, which is for goods and would involve goods classification, is left blank for services.
The mix-up usually happens with invoice templates. Many generic GST invoice formats label the classification column "HSN/SAC". That is fine for a business selling both, but a services exporter should put the SAC code there. If you sell goods and services together, such as hardware plus installation, each line should carry its own correct code. Our SAC code finder helps with the service side.
Example
Brightwire Systems sells network appliances to a client in Kenya and also provides remote configuration services. The appliances leave India on a shipping bill with their HSN codes, and that shipping bill serves as the EDF for the goods. The configuration invoice of ₹2,40,000 carries SAC 998313 and goes on a separate services EDF to the AD bank.
Common confusion
People sometimes assume HSN is the "real" code and SAC is optional. For services, SAC is the correct classification. Read HSN vs SAC codes for the full comparison, and confirm codes with your CA.