HSNS Cess Registration Guide: A Complete Compliance Roadmap

HSNS Cess Registration Guide 2026 for Pan Masala Manufacturers

The Health Security se National Security Cess (HSNS Cess) Act, 2025 introduces a new capacity-based taxation regime with a separate compliance framework independent of GST and Central Excise. This article provides a practical guide to HSNS Cess registration, explaining who is required to register, the online registration process through the CBIC portal, and the key forms involved, including Form HSNS REG-01, HSNS REG-02, HSNS DEC-01, HSNS PMT-01 and HSNS RET-01. It discusses the eligibility criteria for registration, the documents required, the procedure for obtaining a Temporary Registration Number and Registration Certificate, and the concept of deemed approval under the HSNS Cess Rules, 2026. The article also outlines the principal post-registration compliance obligations, including machine declarations, monthly payment of cess, return filing and updating machine details. In addition, it examines the legal consequences of operating without valid registration, such as recovery of unpaid cess, interest, penalties and other enforcement measures under the Act. Designed for manufacturers, tax professionals, compliance officers and legal practitioners, this guide explains the statutory registration framework clearly and practically while highlighting the shift from production-based taxation to a capacity-based levy. It serves as a comprehensive reference for understanding the registration and compliance requirements under the Health Security se National Security Cess Act, 2025 and the accompanying HSNS Cess Rules, 2026.

Introduction

The Health Security se National Security Cess Act, 2025 (hereinafter referred to as “the Act”) has been in effect since 1st February 2026. The Act provides for a separate statutory cess applicable to certain goods and a separate compliance regime based on manufacturing capacity. At present, the levy is applicable only on pan masala, but the Central Government may notify other goods to be covered under the levy.

Unlike GST, HSNS Cess has its own independent statutory framework. Therefore, manufacturers cannot rely on their existing GST or Central Excise registrations to comply with the requirements under the HSNS Cess regime. Every taxable person is required to register under the Act, and such registration is the basis for all subsequent compliance obligations. In case of failure to get registration, proceedings for recovery, interest, penalty and prosecution may be initiated under the Act. 

This article provides an overview of the HSNS Cess registration framework, identifies the persons who are required to register, explains the registration process, discusses the main post-registration compliance obligations and highlights the consequences of non-compliance.

What Is HSNS Cess?

The HSNS Cess is levied under Section 4 read with Schedule I of the Act and is presently applicable only to pan masala falling under CTH 2106 90 20 of the Customs Tariff Act, 1975. 

The capacity-based tax model of the Act is one of its key features. The cess is calculated based on the factory’s manufacturing capacity, including the maximum rated speed of packing machines and the weight of each retail pack, as prescribed under Schedule II, and not on actual production or sales. Section 4(2) provides that the cess shall be levied in addition to any duty or tax payable under any other law. Thus, payment of GST does not affect the liability under the HSNS Cess Act.

Who Is Required To Register?

Every taxable person is required to obtain registration under the HSNS Cess Act. Section 3 defines a taxable person to include any person who owns, possesses, controls or operates a packing machine used for manufacturing specified goods, as well as any person undertaking the manufacture of such goods through a wholly manual process.

The registration framework has several important features:

• Registration is mandatory irrespective of whether the manufacturer is already registered under GST or the Central Excise regime. 
• Each factory manufacturing specified goods must obtain separate registration. A single registration cannot cover multiple manufacturing premises.
• The registration requirement also extends to manufacturers undertaking wholly manual manufacturing processes, even where no packing machine is installed.

Step-By-Step Registration Procedure

Registration is obtained entirely online through the CBIC portal at https://cbic-gst.gov.in/, using the HSNS Cess login and enrolment modules. The process runs through the following steps.

1. Access the portal and select the New Registration option under the HSNS Cess login section.
2. Furnish basic identification details, namely the Permanent Account Number, name of the business, mobile number, email address, state of business location, and any existing GST or Central Excise registration number.
3. Allow the portal to validate the Permanent Account Number online through the Income Tax system. Once validation succeeds, the system generates a fifteen-digit alphanumeric Enrolment Reference Number, which is sent to the applicant by SMS and email.
4. Log in using the Enrolment Reference Number together with a One Time Password and proceed to complete Form HSNS REG 01.
5. Fill in the detailed particulars sought in Form HSNS REG 01, including business constitution, the address of the principal place of business and any additional business premises, categorization of the taxable activity, particulars of promoters and the authorized signatory, and bank account details.
6. Upload the required supporting documents, namely proof of business constitution, address proof, promoter photographs, bank account proof, and authorization letters.
7. Submit the application. The portal immediately generates a Temporary Registration Number, which may be used at once to begin paying HSNS Cess even while the application remains under examination.
8. Await processing by the jurisdictional Proper Officer, who may raise queries, seek clarifications, or approve.
9. Receive the Registration Certificate in Form HSNS REG 02. Under Rule 5(3) of the HSNS Cess Rules, if the Proper Officer does not act within seven working days, the registration is deemed approved, and the certificate is generated automatically, bearing a registration number in the same format as the Temporary Registration Number.

Compliance Obligations That Follow Registration

Registration is only the starting point of a recurring compliance cycle. The obligations that follow are set out below.

1. Machine declaration: Within seven days of obtaining registration, the manufacturer must file a declaration in Form HSNS DEC-01, setting out the technical parameters of each installed machine, including its maximum rated speed and the weight of the pouches it produces, since these parameters directly determine the monthly cess liability under Schedule II of the Act. Declarations filed in Form HSNS DEC-01 are subject to verification by the jurisdictional Proper Officer, who may be assisted by technical input from the Quality Council of India (QCI) under the Standard Operating Procedure issued in March 2026.
2. Monthly payment: The cess must be paid every month through Form HSNS PMT-01 by the seventh day of that same month, using the e-Payment module on the portal to generate a challan under the designated accounting head and completing payment through net banking, NEFT, RTGS, or the payment gateway linked to ICEGATE.
3. Return Filing: A monthly return in Form HSNS RET-01 must also be filed by the 20th of the succeeding month, reporting the cess paid and reconciling it against the declared machine capacity for the relevant period. 
4. Updated declaration: Any change in the number or capacity of installed machines requires a fresh or amended declaration, since the cess computation is directly tied to the machine parameters on record with the department, and keeping it current protects the manufacturer from disputes over short payment of cess.

Consequences of Failing to Register

Operating a packing machine or undertaking a manufacturing process for pan masala without valid registration exposes a manufacturer to recovery of the unpaid cess along with interest, and to penalty proceedings under the Act. The Rules also provide a compounding mechanism under which certain minor offenses may be settled by paying an amount ranging from fifty to one hundred and fifty per cent of the cess involved. However, this facility is not available to repeat offenders. Given that liability accrues automatically from the date a machine becomes operational, delay in seeking registration does not postpone the liability itself but only increases the risk of interest and penalty accumulating before the manufacturer is formally on record with the department.

Conclusion

The HSNS Cess marks a deliberate shift in India’s approach to taxing demerit goods. For manufacturers of pan masala, timely registration under Form HSNS REG 01 is not simply a procedural courtesy but the legal foundation on which every subsequent obligation, from machine declaration to monthly payment and return filing, is built. 

Manufacturers who have not registered or who are planning to install new packing machines should start the registration process at the earliest, keep proper machine-wise records, and follow the recurring compliance calendar. Knowing the registration and compliance system today will help manufacturers better prepare themselves to adapt to any such expansion in the future. 

The CBIC has confirmed that the existing ACES-GST Helpdesk will support HSNS Cess taxpayers. Technical assistance is available through cbicmitra.helpdesk@icegate.gov.in and the toll-free helpline 1800-425-0232. 

Author: Simmi Parihar, 3rd-Year Student, National Law University, Delhi

References

1. 1. Central Board of Indirect Taxes and Customs, Advisory No 01/2026 https://cbic-gst.gov.in accessed 27 July 2026.
   2. Customs Tariff Act 1975 (Act No 51 of 1975).
   3. Health Security se National Security Cess Act 2025 (Act No 35 of 2025), notified on 16 December 2025.

• Health Security se National Security Cess Rules 2026.

1. Press Information Bureau, Government of India, ‘The Health Security se National Security Cess Bill, 2025 – Factsheet’ (5 December 2025) https://pib.gov.in/FactsheetDetails.aspx?Id=150534 accessed 27 July 2026.
2. PRS Legislative Research, ‘Bill Summary: The Health Security se National Security Cess Bill, 2025′ https://prsindia.org/billtrack/prs-products/prs-bill-summary-1764739347 accessed 27 July 2026.