E Invoice under GST

What is E Invoice in GST:- E Invoice is a process of validating all B2B (Business to Business) invoices electronically by GST Network. In E Invoicing system, a register person continues to create their GST Invoice through their accounting software or billing system. Taxpayer upload specified particular of Invoices on Invoice registration portal (IRP) and obtain Invoice reference Number (IRN). After obtaining Invoice reference Number, the taxpayer issue invoices to buyer with QR Code containing such IRN. Such documents are commonly referred to as “E Invoice”. E Invoice is a system in which normally generated invoices are electronically authenticated by GSTN.

E Invoice Applicability:- E Invoices is required for Invoices, debit Note, Credit Notes and export Invoices issued by a registered person whose aggregate turnover in any preceding financial year from 2017-18 onward exceeds INR 500 crore.

The limit of INR 500 crore reduce to INR 100 crore from 1^st January 2021 and then to INR 50 crore from 1^st April 2021. From 1^st April 2022 the limit of E Invoice is INR 20 Crore.

Aggregate turnover include supply of goods or services or both to B2B or supply to SEZ (with or without payment) or supply for the purpose of exports (with or without payment) and include deemed exports.

E Invoice Exemption:- E Invoice provision under GST is not applicable on following categories of registered persons irrespective of the turnover.

• SEZ Units
• Insurer or a banking company or a financial institution
• A Non Banking Financial company
• Good Transport agency supplying services in relation to transportation of goods in a goods carriage
• Suppliers of passenger transportation services
• Suppliers of services by way of Exhibition admission of cinematograph films in multiplex screens.
• Government department and local authority.

Also See “TDS Rate Chart for F.Y. 2022-23“

E Invoice cancellation:- An E Invoice cannot be partially cancelled, it has been cancelled fully. Once cancelled, it will need to be reported in to IRN within 24 hours.

Cancellation done after 24 hours cannot be done on the IRN and need to manually cancel on the GST portal in the GSTR – 1 Return. Issue credit note in GSTR-1 return with the reference of cancelled Invoice. Once an IRN is cancelled then the same invoice number cannot be used again to generate another E Invoice.

Process of getting an E Invoice:- Following process has to be follow to obtain an E Invoice.

1) Register yourself at E Invoice Portal.

2) Prepare a normal invoice on your software containing the all necessary details like billing name and address, GSTN of the supplier, transaction value, item rate, GST rate applicable, tax amount etc.

3) Download E Invoice utility from the Portal. There are two tools for E Invoice generation. One is “Excel Utility” and other is “GePP tool”. GePP tool is made for small taxpayers and Excel utility for others.

4) Validate the utility after entering the required details in utility.

5) After successful validation, click on “Prepare JSON” and “JSON file” would be generated.

6) Upload the JSON file at E Invoice portal and “E Invoice is generated”.

Penal provision on E Invoice not generation: Non generation of E Invoice is an offence and attracts heavy penal provision of up to INR 10,000 per invoice. Further, incorrect E Invoice can lead to a penalty of INR 25,000 per invoice.

E Invoice Advantage:- E Invoice resolves and plugs a major gap in data reconciliation under GST to reduce mismatch error.

E Invoice created on specified software can be read by another and help reduce data entry errors. Real time tracking of invoices prepared by the supplier is enabled by e invoices.

Also See, “Assessment under GST”

CBIC Notification in relation to E Invoice :-

Notification No 68/2019 dated 13-12-2019 – Amendments in Rule 48 (Manner of issuing Invoice) of CGST Rule 2017 to incorporate E Invoicing.

Notification No 70/2019 dated 13-12-2019 – E Invoice made applicable to registered person having an aggregate turnover in a financial year exceeds 100 crore rupees. E Invoice includes supply of goods or services or both to a registered person (B2B Transaction). The effective date of Notification No 70/2019 is 1st day of April 2020.

Notification no 2/2020 dated 01-01-2020 – Substituted Form GST INV-1 as e-invoice schema. (Notification 60/2020 dt. 30-7-2020 further amended the E Invoice Schema).

Notification 13/2020 dated 21-03-2020 (in supersession of 70/2019 dated 13-12-2019 – E-invoicing to start from the 1st October 2020 and specified the following category of person exempted under E Invoice.

Banking Company, A Non banking company, A Financial institution, An Insurer, A Person engaged in supplying passenger transportation service, A GTA and a person supplying service for exhibition admission of cinematograph films in the multiplex screen.

Notification no 61/2020 dated 30-07-2020 – Amended notification 13/2020 dt. 21-3-2020. Special Economic Zone (SEZs) units also excluded from e-invoicing mandate.

Aggregate Turnover of registered persons required to prepare invoice in terms of Rule 48(4) enhanced to Rs. 500 Cr

Notification no 60/2020 dated 30-07-2020 – New form substituted for GST INV-01 (i.e. notified revised Schema/format for e-invoice).

Notification No 70/2020 dated 30-09-2020 – The words “a financial year” in notification 13/2020 dated. 21-3-2020 substituted with “any preceding financial year from 2017-18 onwards”.

Invoices for exports were also included in E Invoice through above notification.

Notification No 72/2020 dated 30-09-2020 – In notification, Rule 46 amended and included Quick Reference code, having embedded Invoice Reference Number (IRN) in E Invoice.

Give power to commissioner to exempt a person or a class of registered persons from the provision of E Invoice with such conditions and restrictions.

Invoices having Quick Reference Code having an embedded invoice reference number may be produced electronically for verification by proper officer.

Notification no 88/2020 dated 10-11-2020 – E Invoicing made mandatory for the registered persons whose aggregate turnover in any preceding financial year from 2017-18 onwards exceeds INR 100 cr with effect from 1^st January 2021.

Notification no 05/2021 dated 08-03-2021 – E Invoicing made mandatory for the registered persons whose aggregate turnover in any preceding financial year from 2017-18 onwards exceeds INR 50 cr with effect from 1^st April 2021.

Notification no 23/2021 dated 01-06-2021 – E Invoice system shall not apply to a Government department and local authority.

Notification No 01/2022 dated 24-02-2022. – E Invoicing made mandatory for the registered persons whose aggregate turnover in any preceding financial year from 2017-18 onwards exceeds INR 20 cr with effect from 1^st April 2022.

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