Lead Waste & Scrap: GST Rates and HSN Code 7802 Overview A substantial part of the Indian metal recycling framework depends on lead waste and scrap for effective industrial waste management and sustainable recycling practices. The Harmonized System of Nomenclature (HSN) Code 7802 functions specifically for Lead Waste and Scrap management under Indian GST taxation policies.
The guide contains all necessary information regarding HSN Code 7802 that identifies classification procedures and clarifies GST rates and operational needs for lead waste and scrap trading organizations.
What is Lead Waste & Scrap? The category includes all pieces of lead material leftover from manufacturing operations or product disposal periods that contain lead. Industrial waste made from discarded lead-acid batteries and pipes, along with sheets and various other lead-containing materials, represents the total category.
Common Sources of Lead Waste & Scrap:
Used lead-acid batteries Lead pipes, sheets, and offcuts Industrial residues from lead smelting/refining Scrap from the automotive and electronics industries Lead linings from old equipment A high demand exists for recycled lead throughout battery production, while the construction and electrical industries drive its profitability for recyclers and dealers.
HSN Code 7802: Classification Overview Under the HSN Code system , lead waste and scrap are classified under Chapter 78 , which pertains to Lead and Articles Thereof . HSN Code: 7802 Description : Lead waste and scrap; remelting scrap ingots of lead.Chapter : 78Subheading : 7802Full Code : 7802.00.10 / 7802.00.90Used For : Users employ Format to report and hold compliant with GST reporting, along with import and export declarations and tax document generation.This classification ensures standardized documentation and facilitates seamless trade across borders and within India.
GST Rate on Lead Waste & Scrap As per the GST rate schedule notified by the GST Council and CBIC, the following GST rate is applicable:
HSN Code Description Rate (%) Effective Date 7802 Lead Waste and Scrap 18 01/07/2027 7802.00.10 HS Codes Classification of Lead scrap, namely the following scrap lead-soft covered by ISRI code word Racks; mixed hard or soft scrap lead covered by ISRI code word Radio; wheel weights covered by ISRI code word Ropes; mixed common babbit covered by ISRI code word Roses 18 01/07/2027 7802.00.90 Lead Waste and scrap - other 18 01/07/2027
Notification Reference: GST taxes at 18% contain a composition of 9% both from CGST and SGST, or 18% from IGST, which depends on whether an operation takes place within a state or beyond state boundaries.
Input Tax Credit (ITC) on Lead Scrap One of the key advantages for businesses dealing in lead scrap is the availability of Input Tax Credit under the GST regime. Registered dealers and manufacturers can claim ITC on:
Purchase of scrap from registered suppliers Transportation and logistics expenses Machinery used in processing or smelting Other eligible inputs and input services This reduces the overall tax burden and supports competitive pricing in the industry.
Invoicing Requirements for Lead Scrap Dealers Under GST, proper documentation is crucial for tax compliance. Dealers and recyclers dealing in lead waste and scrap must:
Issue Tax Invoices with correct HSN code (7802)Mention the GSTINs of the buyer and sellerIndicate the place of supply clearlyCharge applicable GST rate (18%) Maintain a record of purchases and sales for audit and return filings Even purchases from unregistered sources must be properly documented for reverse charge compliance, if applicable.
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Reverse Charge Mechanism (RCM) for Scrap Dealers Earlier, GST rules stated that scrap acquisitions from unregistered suppliers needed to be taxed under Section 9(4) of the CGST Act through the Reverse Charge Mechanism (RCM). However, RCM applicability has been suspended for general purchases from unregistered dealers.
RCM Currently Applicable When: Dealing with specific notified services Business falls under specific reverse charge categories (e.g., GTA, legal services, etc.) As of now, RCM is not generally applicable to lead scrap purchases unless otherwise notified.
Import-Export Implications for HSN Code 7802 Lead scrap is a significant commodity in international trade , especially under India’s metal recycling and circular economy initiatives.
Export Considerations: Exporters must quote HSN 7802 on shipping bills and invoices. Zero-rated GST benefits apply (with or without refund of input credit).Ensure compliance with DGFT regulations and obtain required certifications (e.g., non-radioactive material certificate). Import Considerations: Basic Customs Duty may apply based on prevailing ratesIGST @18% payable at the time of clearanceImporters must comply with environmental clearance norms under the E-Waste and Battery Rules, 2022 GST Compliance Checklist for Lead Scrap Traders To remain GST-compliant, here is a checklist for businesses dealing in HSN 7802:
Compliance Requirement Details GST Registration Mandatory if turnover exceeds ₹40 lakhs (₹20 lakhs for services) HSN Code Disclosure in Invoices Mandatory for turnover above ₹5 crores Monthly/Quarterly GST Returns GSTR-1, GSTR-3B, GSTR-9 (annual return) ITC Reconciliation Match purchase data with GSTR-2A/2B Proper Books of Accounts Maintain inventory records, invoices, and tax ledgers.
Environmental & Legal Considerations Since lead is a hazardous metal , businesses must follow environmental and regulatory norms while dealing with lead waste:
Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016 Battery Waste Management Rules, 2022 Storage and disposal licenses from the State Pollution Control Boards (SPCB) Compliance with CPCB guidelines for handling and transportation Non-compliance may result in penalties, cancellation of licenses, or GST audits.
Market Overview and Trends Circular Economy Push: India is pushing for a circular economy, and lead recycling plays a significant role. The use of recycled lead in battery manufacturing , especially for electric vehicles (EVs), is driving demand.
Infrastructure Growth: Construction, power backup solutions, and solar projects use lead-based products, boosting the trade of recycled lead.
Sustainability Drive: Government and private initiatives encouraging safe e-waste and battery recycling are increasing the volume of legally traded lead scrap under GST.
Conclusion The secondary metal business in India depends heavily on lead waste and scrap products, which fall under HSN Code 7802. This sector demonstrates substantial potential because it has clear invoicing standards combined with 18% GST taxation and solid market demand in the battery and infrastructure sectors.
Every successful business must adhere to environmental compliance as well as both GST record-keeping and responsible sourcing in order to operate sustainably. Traders, along with recyclers and exporters who manage lead scrap, need to regularly check the GST council notifications and pollution norms, and market trends. Also, get to know about the GST Rates and HSN Code 7204 for Ferrous Waste and Scrap
FAQs 1. What is the GST rate on lead scrap? The GST rate is 18% on lead waste and scrap under HSN Code 7802.
2. Is Input Tax Credit available on lead scrap purchases? Yes, ITC is available if the buyer is registered and the purchase is from a registered dealer.
3. What documentation is required for exporting lead scrap? HSN code disclosure, shipping bill, GST-compliant invoice, and environmental compliance certificates are necessary.
4. Are there any environmental regulations for dealing with lead scrap? All entities must follow the Battery Waste Management Rules and Hazardous Waste Rules for their operations.
5. Can we import lead scrap into India? Yes, but importers must follow customs rules, pay IGST, and obtain pollution clearance as applicable.
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