HSN Code 7318: Product Classification, GST Rate & Business Filing Guide

Iron and steel fasteners are the invisible backbone of the Indian industry. From construction sites and automobile factories to furniture workshops and electrical panels, screws, bolts, nuts, washers, rivets and related hardware hold everything together. For businesses that manufacture, trade, or import these products, correctly applying Harmonised System of Nomenclature (HSN) Code 7318 is not merely a compliance formality; it directly affects tax liability, Input Tax Credit (ITC) eligibility and audit readiness.

Which products are classified under HSN Code 7318?

HSN 7318 falls under Chapter 73, which is meant for Articles of Iron or Steel. The chapter covers a broad family of fasteners and fixing hardware made from iron or steel. Here is a detailed breakdown:

What GST rate applies to HSN Code 7318?

Under India’s revised GST rate structure, effective 22 September 2025, following the 56th GST Council meeting, these goods continue to attract 18% GST. There has been no change in the GST rate for HSN 7318 after the September 2025 GST rate rationalisation. 

For GST invoicing, intra-state sales are typically charged at 9% CGST + 9% SGST, while inter-state supplies are charged at 18% IGST. No compensation cess is applicable on products classified under HSN 7318.

Which GST forms are required for products under HSN 7318?

Here are the key GST return filing forms for HSN Code 7318:

GSTR-1

If you sell goods under HSN Code 7318, you report those sales in GSTR-1. This includes B2B invoices, B2C sales, exports, debit notes and credit notes. HSN-wise summary of sales turnover is also disclosed here. Monthly filers generally file by the 11th of the next month, while quarterly QRMP filers file by the 13th of the month following the quarter end.

GSTR-3B

This is the main GST payment return. Businesses dealing in HSN 7318 declare total taxable sales, input tax credit (ITC), GST payable and tax paid here. It is filed monthly or quarterly, depending on registration type. Tax payment is made through this return.

GSTR-9

Regular taxpayers usually file GSTR-9 at the end of the financial year. It consolidates annual sales, purchases, tax paid, and input tax credit (ITC) claimed for goods classified under HSN Code 7318 and other supplies reported under the GSTIN.

GSTR-9C

Certain taxpayers, depending on turnover and audit applicability, may need to file GSTR-9C. It reconciles the books of accounts with GST returns already filed.

What are the e-way bill rules for HSN Code 7318?

HSN 7318 goods generally require an e-way bill when transported if the consignment value exceeds ₹50,000. This applies because fasteners under Chapter 73 are taxable goods and are not part of the standard exemption list under Rule 138. Here are some key conditions related to the e-way bill:

• The ₹50,000 limit usually applies to interstate movement across India. If a supplier in Uttar Pradesh sends bolts or nuts to Delhi, an e-way bill is required once the invoice value exceeds this threshold. For intrastate movement, the requirement depends on the state’s threshold. 
• The e-way bill must be generated before the dispatch of the goods on the GST e-way bill portal. It can be generated by the supplier, recipient or transporter, depending on who causes the movement.
• If multiple invoices are shipped together in one vehicle, a consolidated e-way bill may also be used.
• If HSN 7318 goods are moved without a required e-way bill, authorities may impose a penalty of ₹10,000 or the tax sought to be evaded, whichever is higher, along with detention of goods/vehicle.

What conditions must be met to claim input tax credit under HSN Code 7318?

Here are some conditions that must be fulfilled to claim Input Tax Credit (ITC):

• ITC can be claimed only when goods under HSN 7318 are purchased for use in the course or furtherance of business. For example, bolts or nuts used in machinery installation, fabrication, maintenance or manufacturing generally qualify. Personal use is not eligible.
• You must hold a proper GST tax invoice or debit note issued by the supplier. The invoice should clearly mention GSTIN, invoice number, HSN 7318, taxable value and GST charged.
• ITC is allowed only after the goods are actually received. If the supplier invoices the material but delivery has not happened, credit cannot be claimed yet.
• The supplier should report the invoice in GSTR-1, and it should reflect in your GSTR-2B. Mismatches can delay or block ITC.
• GST charged by the supplier should actually be deposited with the government.

Conclusion

For businesses dealing in fasteners, accuracy around HSN 7318 goes beyond tax filing; it supports smoother day-to-day operations across purchasing, inventory, dispatch and compliance. A small classification error can create bigger issues later in pricing, vendor reconciliation or GST scrutiny. That is why many businesses now prefer keeping product masters, GST details, and invoicing in a single workflow rather than managing them separately. 

Using an accounting and business management solution like TallyPrime can make this process easier by helping teams stay organised, reduce manual errors and keep records ready whenever needed.