GST invoice format for a cotton ginning and pressing factory
A ginning and pressing factory buys kapas from farmers and sells lint bales, cotton seed and waste. Raw cotton of 5201 to 5203 is taxed at 5%, and cotton seed sold for crushing (1207, not of seed quality) is also at 5%. Purchases of raw cotton from agriculturists fall under reverse charge, so the ginner pays the 5% and issues a self-invoice. Sales invoices should list bale numbers, press-mark, staple length, micronaire, trash, moisture and gross and net weight per bale.
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Sample cotton ginning and pressing factory invoice
Description
HSN/SAC
Qty
Rate (₹)
Taxable (₹)
GST
Ginned cotton lint bales, Shankar-6, 29 mm, approx. 170 kg each
5201
17000 KGS
155.00
26,35,000.00
5%
Cotton seed for crushing (not of seed quality)
1207
300 QTL
3,600.00
10,80,000.00
5%
Cotton waste (gin motes)
5202
1500 KGS
40.00
60,000.00
5%
Cotton linters
1404
800 KGS
55.00
44,000.00
5%
Taxable value
₹38,19,000.00
GST (CGST + SGST, or IGST if inter-state)
₹1,90,950.00
Invoice total
₹40,09,950.00
Sample prices are illustrative. Check the GST rate for your exact item or service before billing.
Extra fields a cotton ginning and pressing factory invoice needs
Bale numbers and press-mark
Each pressed bale carries a running number and the factory's press-mark. Listing them lets spinning mills check every bale received and trace quality claims to particular bales.
Staple length, micronaire and strength
Cotton is priced on fibre quality. Staple length in mm, micronaire value and strength from the test report should be quoted so the buyer pays for the agreed quality.
Trash and moisture percentage
Mills deduct for excess trash or moisture. Recording the tested figures avoids later disputes and debit notes, and gives the ginner evidence when a mill re-tests the bales weeks after delivery in a different climate.
Gross, tare and net weight per bale
Bales weigh around 165 to 170 kg. Net weight after tare decides the invoice value, so each bale's weight should be visible or attached.
Variety and station
Shankar-6, MCU-5, J-34 and other varieties from different stations fetch different prices. Naming the variety and ginning station identifies the cotton.
Broker and contract number
Cotton is often sold through brokers against a contract. The contract number links the invoice to agreed terms on price, quality and delivery period.
Standard GST invoice fields
Rule 46 of the CGST Rules applies to every tax invoice, including this one:
✓Supplier name, address and GSTIN
✓Consecutive invoice number (max 16 characters, unique for the year)
GST rules that matter for a cotton ginning and pressing factory
Raw cotton and cotton seed at 5%
Schedule I of Notification 9/2025-Central Tax (Rate) lists cotton and cotton waste of headings 5201 to 5203 at 5%. Cotton seed not of seed quality falls in the oilseed entry for heading 1207 at 5%, and cotton linters of heading 1404 are listed among vegetable products at 5%. Cotton seed of seed quality, sold for sowing, is exempt under Notification 10/2025. A ginner selling seed both to oil mills and to seed companies must use the seed-quality description only for the exempt lots.
Reverse charge on kapas bought from farmers
Under the reverse charge notification on goods, raw cotton of heading 5201 supplied by an agriculturist to any registered person is taxed in the hands of the recipient. The ginning factory therefore pays the 5% tax on purchases from farmers, issues a self-invoice and a payment voucher, and can take input tax credit of the same tax once paid. Purchases from traders or other ginners are normal forward charge invoices. Getting this right is important because purchase tax under reverse charge can be large in a season.
Cotton seed oil cake is a separate product
Many ginners also run a crushing unit. Cotton seed oil cake is exempt as cattle feed under Notification 10/2025, while cotton seed oil of heading 1512 is taxed at 5% in Schedule I. The invoice for each product must use its own heading and rate, and the crushing unit should keep a separate invoice series or at least separate item codes so that oil, cake and lint never share a line.
E-way bills for bale movement
Each truck of 100 bales is worth several lakh rupees and needs an e-way bill. Bales sent to a warehouse or a CCI depot also need documentation. The bale numbers on the invoice should match the packing list so a roadside check or the buyer's receiving clerk can verify the load.
Ginning on job work
Some ginners gin cotton owned by traders or the Cotton Corporation and charge a ginning and pressing fee. Job work in relation to textiles of chapters 50 to 63 is taxed at 5% under Notification 15/2025. The bill covers only the job charge and the cotton returns under a delivery challan.
Common billing mistakes
✕Not paying reverse charge on kapas bought directly from farmers, which leads to tax demands with interest.
✕Billing crushing-grade cotton seed as exempt seed of sowing quality.
✕Omitting bale numbers and quality parameters, making claims from spinning mills hard to settle.
✕Treating cotton seed oil cake as taxable at 5% like other oil cakes, when it is exempt.
✕Mixing job-work ginning charges with sale of own cotton in the same invoice series.
Cotton ginning and pressing factory GST invoice: FAQ
What is the GST rate on cotton bales?
+
Raw cotton and cotton waste of headings 5201 to 5203 are taxed at 5% under Schedule I of Notification 9/2025-Central Tax (Rate).
Is reverse charge applicable on raw cotton?
+
Yes. Raw cotton supplied by an agriculturist to a registered person is under reverse charge, so the registered buyer pays the tax and issues a self-invoice. Purchases from a registered cotton trader are normal forward-charge purchases on the trader's invoice.
What is the GST on cotton seed?
+
Cotton seed for crushing is taxed at 5%. Cotton seed of seed quality for sowing is exempt.
Is cotton seed cake taxable?
+
Cotton seed oil cake is exempt under Notification 10/2025-Central Tax (Rate) as cattle feed.
What is the GST on ginning job work?
+
Job work on textiles of chapters 50 to 63, which includes ginning and pressing of cotton owned by another person, is taxed at 5%.