Navigating the Phase-3 GST Compliance: HSN Reporting and Document Issuance for May 2025

As the Goods and Services Tax (GST) framework evolves into a more data-centric and audit-ready system, the Central Board of Indirect Taxes and Customs (CBIC) has introduced Phase-3 of GSTR-1/1A compliance, effective from the May 2025 tax period onwards. This phase mandates HSN-wise outward supply reporting (Table 12) and document issuance summary reporting (Table 13) across all registered taxpayers.

This article presents a clear understanding of the legal foundation, interpretation of obligations, and compliance procedures—crucial for every GST-registered business.

Legal Foundation: CBIC Notification & GST Law Basis

The reporting framework is rooted in the following key legal provisions:

• Section 37 of the CGST Act, 2017 – Governs the furnishing of outward supply details in GSTR-1.

• Rule 59 of the CGST Rules, 2017 – Specifies the content and format of GSTR-1 returns.

• Notification No. 78/2020 – Central Tax dated 15.10.2020 – Prescribes mandatory HSN code reporting thresholds.

• Notification No. 14/2022 – Central Tax dated 05.07.2022 – Introduces Table 12 (HSN Summary) and Table 13 (Document Summary) in revised GSTR-1 schema.

• Circulars/FAQs issued by GSTN and CBIC – Provide implementation clarifications and tech updates.

HSN Reporting in Table 12 – Legal Obligation & Compliance

From May 2025, businesses must mandatorily fill Table 12: HSN-wise Summary of Outward Supplies in GSTR-1, based on their Aggregate Annual Turnover (AATO):

AATO Threshold	Minimum Digits of HSN Code Required
Up to ₹5 crore	4-digit HSN code
More than ₹5 crore	6-digit HSN code

As per Notification 78/2020-Central Tax, failure to report correct HSN codes can attract penal consequences under Section 122 of CGST Act for furnishing incorrect returns.

Mandatory Fields to Report under Table 12:

• HSN Code (4/6 digits based on turnover)

• Description of goods/services

• UQC (Unit Quantity Code)

• Total quantity

• Taxable value

• Rate-wise breakup of IGST/CGST/SGST

Interpretation Note:
The compliance intent is to standardize classification, improve inter-state data reconciliation, and reduce tax evasion through invoice-level analytics.

Document Issuance Reporting in Table 13 – Purpose & Procedure

Table 13 of GSTR-1 requires businesses to report document issuance summary during the tax period. It applies uniformly to all taxpayers irrespective of turnover.

Documents to be reported:

• Invoices (B2B, B2C large/small, exports, etc.)

• Credit Notes & Debit Notes

• Delivery Challans

• Inward supply invoices received from unregistered persons (self-invoicing)

• Receipt Vouchers, Refund Vouchers, Payment Vouchers, etc.

Details Required:

For each document type:

• Opening serial number

• Closing serial number

• Total number issued

• Total number cancelled

• Net issued documents

Compliance Insight:
Under Rule 56(1)(v) of CGST Rules, businesses must maintain a register of all invoices and serially numbered documents. Table 13 strengthens enforcement by digitally tracking issuance integrity.

Procedural Steps to Ensure Compliance

Action Area	Recommended Steps
1. HSN Code Classification	Conduct an HSN audit of all goods/services. Use CBIC’s official GST Tariff 2024 as reference.
2. ERP / Software Update	Update accounting systems to support Table 12 and Table 13 auto-population. Ensure UQC & tax rate tagging.
3. Document Series Management	Maintain single or multiple series for each document type. Ensure serial continuity and cancellation tracking.
4. Internal Training	Conduct in-house workshops for finance and tax personnel to interpret Table 12 & 13 correctly.
5. Pre-Filing Validation	Use the GSTR-1 offline tool or ERP integration to perform a test return before May 2025 submission.

Penal Implications for Non-Compliance

Non-Compliance	Consequence
Omission/misstatement of HSN code	Penalty u/s 122(1)(vii) – ₹10,000 or higher
Missing document summary	Notice or audit under Section 61/65
Repeated default	GST registration suspension under Rule 21A

The May 2025 transition to Phase-3 GSTR-1 compliance is not merely procedural—it reflects the government’s push toward digitally intelligent tax governance. Accurate HSN reporting and detailed document issuance tracking will soon be benchmarks for audit readiness and registration continuity.

Taxpayer Checklist:

• ✅ Classify HSNs correctly as per turnover slab

• ✅ Automate document tracking & issuance reports

• ✅ Train staff for new GSTR-1 tables

• ✅ Align ERP with Table 12 & 13 schema

• ✅ Monitor CBIC/GSTN updates for schema changes