E-Invoice [ Rule 48 of CGST Rules ] - GST Ready Reckoner - GST

E- Invoice E-invoicing has been introduced for reporting of business to business (B2B) invoices to GST System for certain notified category of taxpayers. E-invoicing does not mean that the invoice needs to be prepared/generated on the Government portal. It is only intimating the Government portal that invoice has been issued to the buyer, by registering that particular invoice on the Government portal. Advantages of e-invoicing E - i n v o i c e has many advantages for businesses:- One such advantage is auto-reporting of invoices into GST return and auto-generation of e-way bill (wherever required). Under e-invoicing, business has to report the B2B invoice data only once in the e-invoice form and the same is reported in multiple forms (GSTR-1, e-way bill etc.). E-way bill can be auto-generated using e-invoice data. GSTR-1 can also be auto-populated with the e-invoice data. It will become part of the business p ro c e s s of the taxpayer. there will be a substantial reduction in transcription errors as same data will get reported to tax department as well as to the buyer to prepare his inward supplies (purchase) register. On receipt of information through GST System, buyer can do reconciliation with his Purchase Order. A complete trail of B2B invoices is available with the Department, it will enable the system-level matching of input tax credit and output tax thereby reducing the tax evasion. e-invoicing will eliminate the fake invoices. Claiming fictitious input tax credit (ITC) by raising fake invoices is also one of the biggest challenges currently faced by tax-authorities. The e-invoice system will help to curb the actions of unscrupulous taxpayers and reduce the number of fraud cases as the tax authorities will have access to data in real-time. Statutory provision relating to issue of e-invoice [ as per rule 48(4) to (6) of CGST Rules] The invoice shall be prepared by such class of registered persons as may be notified by the Government, on the recommendations of the Council, by including such particulars contained in FORM GST INV-01 . FORM GST INV-01 after obtaining an Invoice Reference Number by uploading information contained therein on the Common Goods and Services Tax Electronic Portal in such manner and subject to such conditions and restrictions as may be specified in the notification. The Commissioner may, on the recommendations of the Council, by notification, exempt a person or a class of registered persons from issuance of invoice under this sub-rule for a specified period, subject to such conditions and restrictions as may be specified in the said notification. Every invoice issued by a person to whom provisions relating to issuance of e-invoice, applies in any manner other than the manner specified in the said sub-rule shall not be treated as an invoice. The provisions of sub-rules (1) and (2) of Rules 48 , shall not apply to an e-invoice prepared in the manner specified in rule 48(4). Person liable for issue of e-invoice Every person, whose aggregate turnover in any preceding financial year from 2017-18 onwards the specified amount , shall prepare e-invoice in term of rule 48(4) - in respect of supply of goods or services or both to a registered person, or for export. specified amount - Principal notification Notification No. 13/2020 Central Tax (as amended time to time) . More than INR 500 Crores for the period from 01.10.2020 to 31.12.2020. More than INR 100 Crores for the period from 01.01.2021 to 31.03.2021. More than INR 50 Crores for the period from 01.04.2021 to 31.03.2022. More than INR 20 crores for the period from 01.10.2022 to 30.09.2022. More than INR 10 crores for the period from 01.10.2022 to 31.07.2023. More than INR 5 Crores for the period from 01.08.2023 to still continue. If any person are eligible for e-Invoicing, all the invoices including RCM invoices issued by the Supplier need to be registered. GST Portable for the purpose of preparation of the E-invoice [ Notification No. 69 / 2019 Central Tax dated 13.12.2019] The registered person, whose turnover exceeds the prescribed threshold for generation of e-invoicing, are required to issue e-invoices under rule 48(4) of CGST Rules . for the supplies made to Government Departments or establishments / Government agencies / local authorities / PSUs, etc., registered solely for the purpose of TDS, as per provisions of section 51 of the Central Goods and Services Tax Act, 2017 . [ Circular No. 198/10/2023-GST dated 17th July, 2023 ] Non Applicability of issue of E- invoice Invoice issue to other than registered person (i.e B2C Invoices) Invoice issued by Input services Distributers Import of goods Exemption from issue of e-invoice even if their aggregate turnover exceeds the specified amount - A government department and a local authority, [ Notification No. 23/2021 - CT dated 01.06.2021 ] An insurer or a banking company or financial institution, including a non banking financial company, Goods transport agency, Person supplying passengers transportation services , Person supply services by way of admission to exhibition of cinematograph films in multiplex screens , Special economic zone unit. [ CGST Rules Notification No. 61/2021 - CT dated 30.07.2020 ] Exemption from mandatory generation of e-invoices in terms of Notification No. 13/2020-Central Tax , dated 21st March, 2020 , as amended, the said exemption from generation of e-invoices is f or the entity as a whole and is not restricted by the nature of supply being made by the said entity. [ Issue no. 3 Circular No. 186/18/2022-GST Dated 27.12.2022 ] Example A Banking Company providing banking services, may also be involved in making supply of some goods, including bullion. The said banking company is exempted from mandatory issuance of e-invoice in terms of Notification No. 13/2020-Central Tax , dated 21st March, 2020 , as amended, for all supplies of goods and services and thus, will not be required to issue e-invoice with respect to any supply made by it. Validity of E-invoice I RP portal is the website for uploading/reporting of E- invoices by the person, who is required to issue of E-invoice. I RP portal sends the e-invoice data along with IRN to the GST System as well as to e-way bill system. G ST invoice will be valid only with a valid IRN. The Invoice Reference Number (IRN) is a unique number (also known as hash) generated by the e-invoice system using a hash generation algorithm. For every document viz., an invoice or debit or credit note to be submitted on the e-invoice system, a unique 64-character Invoice Reference Number (IRN) shall be generated which is based on the computation of hash of GSTIN of supplier of document (invoice or credit note etc.), Year, Document type and Document number. This shall be unique to each invoice and hence will be the unique identity for each invoice for the entire financial year in the entire GST System for a taxpayer. IRN is different from invoice number. Invoice no. (e.g. ABC/1/2019-20) is assigned by supplier and is internal to business. Its format can differ from business to business and also governed by relevant GST rules. IRN is a uni q u e reference number (hash) generated and returned by IRP, on successful registration of e-invoice. Following advisory has been issued on time Limit for Reporting e-Invoice on the IRP Portal at various date From 1st April 2025 , taxpayers with an AATO of 10 crores and above would not be allowed to report e-Invoices older than 30 days from the date of reporting on IRP portals and Lowering of Threshold to AATO 10 Crores and Above ( Refer ) From 1st November 2023 , taxpayers with an AATO of 100 crores and above would not be allowed to report e-Invoices older than 30 days from the date of reporting on IRP portals. ( Refer ) From 1st May 2023 , taxpayers with an AATO of 100 crores and above would not be allowed to report e-Invoices older than 7 days from the date of reporting on IRP portals. ( Refer ) Amendment or cancellation of E-Invoice/IRN Cancellation or deletion:- E-Invoice/IRN can t be partially cancelled. It has to be fully cancelled. once generated cannot be modified or deleted. However, if IRN is generated with wrong information, it can be cancelled. Once cancelled, the same document (with same document number) can t be reported again for generation of IRN. The cancellation is required to be done within 24 hours from the time of generation. Amendment in IRN :- If there is a mistake, incorrect or wrong entry in the e-invoice, then it cannot be edited or corrected. Only option is to cancel that invoice/IRN and report a new document (with new number) and generate a fresh IRN. Once the e-invoice system has validated and registered an IRN, it will be made available to the taxpayer for reference on e-invoice system for only 24 hours. The e-invoice mechanism enables invoices to be cancelled. This will have to be triggered through the IRP within 24 hours . Applicability of QR code Up o n successful registration of invoice on IRP, it will return a signed e-invoice to the supplier with IRN and QR Code. IRN is embedded in the QR Code which shall be extracted and printed on the invoice. The QR code enables quick view, validation and access of the invoices from the GST system fro m hand-held devices. The digitally signed QR code will have a unique IRN which can be verified on the central portal as well as by an offline app by the officer. This will be helpful for tax officers checking the invoice offline on the roadside where internet may not be available all the time. When supply of goods or service to unregistered person (B2C), if if aggregate turnover of any preceding financial year from 2017-18 upto 500 crore - no need to generate Quick Response (QR) code if aggregate turnover of any preceding financial year from 2017-18 more than 500 crore - need to generate Quick Response(QR) code as per notification number 14/2020 where such registered person makes a Dynamic Quick Response (QR) code available to the recipient through a digital display, such B2C invoice issued by such registered person containing cross-reference of the payment using a Dynamic Quick Response (QR) code, shall be deemed to be having Quick Response (QR) code. Exemption to supplier from generation of Quick Response Code :- Circular No. 146 / 02 / 2021 -GST has clarified for The exemption Non applicability of QR code in following cases An insurer or a banking company or a financial institution, including a non-banking financial company A goods transport agency Person supplying passenger transportation service Person supplying services by way of admission to exhibition of cinematograph films in multiplex screens Supplier of OIDAR Services ( under section 14 of IGST Act) Various clarification in respect of applicability of Dynamic Quick Response (QR) Code on B2C invoices and compliance of notification 14/2020- Central Tax dated 21 st March, 2020 in the Circular No. 146/02/2021-GST dated 23rd February, 2021. Penalty for non-compliance and Waiver of the same Non-generation of dynamic QR codes for invoices issued by a registered person to unregistered persons with effect from 1st October 2021 by companies having an annual turnover in excess of ₹ 500 Crores could now attract penalty under section 125 of CGST Act, 2017. However, vide Notification No. 28/2021 CT dated 30-06-2021 , the Government has waived such penalty for non-compliance between the period from 01.12.2020 and 31.09.2021.