All about e-Invoicing under the GST Law

Roadmap for e-Invoicing was laid down with approval of GST Council in its 37th meeting and issue of notification by the Government bearing number 68/2019 CT to 72/2019 CT in December 2019. Due to Global pandemic, implementation of e-Invoicing deferred from April 2020 to October 2020.

One of the myths among traders is that e-invoice will replace manual/own system generated invoice, but it is not the case. Traders will have to prepare/generate invoice manually/ in own system and upload the same on designated portal Invoice Registration Portal (“IRP”), which inter-alia will generate Invoice Reference Number (“IRN”) and quick response code (“QR Code”).

Businesses are required to generate an e-invoice for every sale transaction accounted/reported on their respective ERPs, thus creating an e-invoice is the prior responsibility of the taxpayer (dealer).

Currently threshold limit for generating e-invoice is under:

E-Invoice – Process Flow

Registered person can create e-invoice through GSP, third party software or Offline tool available. It will involve following steps:

> Preparation of invoices in own accounting software or manually;

> Using third party software or own accounting software (through purchased plugins) or offline utility, generate JSON file of all such invoices;

> Uploading of JSON file on IRP;

>  IRP will validate and approve the JSON file and will generate IRN, digitally signed e-invoice;

> IRN along with digitally signed e-invoice will be sent to registered person;

> IRN will also send such e-invoices to the buyer on their mail IDs as provided on the invoice;

> IRP will also generate QR Code for each invoice after uploading JSON of invoices along with IRN. The QR Code will consist of summarized information from the invoice.

The 39th GST council meeting came up with a decision to implement GST e-invoicing of bills and applicability of QR codes from 1st October 2020.

Summary of various notifications issued in this regard is as under:

Other important aspects of e-Invoicing:

> Clarification in respect of applicability of Dynamic Quick Response (QR) Code on B2C invoices and compliance of Notification No. 14/2020 provided vide Circular no. 146/02/2021-GST dated 23rd February 2021.

According to said circular QR Code for B2C invoices should contain the following information:

i. Supplier GSTIN number

ii. Supplier UPI ID

iii. Payee’s Bank A/C number and IFSC

iv. Invoice number & invoice date,

v. Total Invoice Value and

vi. GST amount along with breakup i.e. CGST, SGST, IGST, CESS, etc.

Further, Dynamic QR Code should be such that it can be scanned to make a digital payment.

> Rule 46 of CGST Rules, 2017 as amended from time to time provides particulars and contents of valid Tax Invoice;

> Rule 48 of CGST Rules, 2017 provides for manner of issuing tax invoice i.e. Triplicate copies in case of goods and duplicate copies in case of services and various other aspects of e-invoicing;

> Rule 54 of CGST Rules, 2017 deals with non-applicability of e-invoicing provisions to certain class of registered person.