What is Harmonised System (HS) Code and Indian Tariff Code (ITC) System?

Since various types of commodities are imported and exported among different countries, a complete list of documents for import and export customs clearance procedures cannot be provided. Moreover, different countries have their own policies and different procedures and formalities for import and export clearance. There may be bilateral import-export agreements between governments of different countries. Imports and exports between such countries may have exemptions on documentation for import and export clearance.

However, there are some legal documents, common documents and specific documents related to commodity imported or exported which are need to complete customs procedures. Considering this complexity, each product under import-export is classified under a code number accepted globally which is called Harmonised System (HS) Code or Indian Tariff Code (ITC) System.

Most of the traders believe that ITC code and HS code are the same. However, in reality, they are not. HS code system means Harmonised System code

The Harmonised Commodity Description and Coding System, also known as the Harmonised System (HS) of tariff nomenclature, is an internationally standardised system of names and numbers to classify traded products. It came into effect in 1988 and has since been developed and maintained by the World Customs Organisation (WCO) (formerly the Customs Co-operation Council), and independent intergovernmental organisation based in Brussels, Belgium, with over 200 member countries. In some countries, HS code is also known as Harmonised Tariff System (HTS). There are ten digit number of a full code. To ensure harmonisation, the first 6 digit numbers are supposed to be same across the whole world. Each country can modify by adding two digits or four digits as per their requirements without changing first six digits. The customs department of more than 140 major countries have been functioning on the basis of the said 6 digit tariff code.

ITC means Indian Tariff Classification, also known as Indian Tariff Code (ITC). The Indian Tariff Code has 8 digit which has been designed in such a way without any modification of first 6 digit as per HS code system, but followed by another two digit classified as 'tariff item'. So, ITC has been classified as first four-digit code called 'heading' and every six-digit code called 'subheading' and 8-digit cade called 'Tariff Item'. This addition is done, within the permissible limit of World Customs Organisation (WCO), without any changes in HS code system.