What is the difference between the hierarchical and Non-Hierarchical Taxonomies?

When I was using a plugin to create and , I came across following situation.

After creating custom taxonomy, I was hoping for was a simple option where I could uses the check box UI for selecting categories on each post.

checkbox UI
check box UI

Instead of that I got comma-separated text input.

text box
text box

I did some research and found out that, that plugin use a setting “Hierarchical ==>> false” when registering custom taxonomy.
‘hierarchical’=>false you get the metabox   format WordPress uses for Post Tags:

hierarchical=>false
hierarchical=>false

‘hierarchical’=>true you get the meta box format that WordPress uses for Categories:

hierarchical=>true

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