1. The Government has been pushing for wide variety of digitisation and automation measures with the spirit of Digital India. With the introduction of E-invoice along with QR code in GST, the Government intends moving India under its flagship initiative of Digital India. “Cashless, Faceless, Paperless” is one of the professed role of digital India.

2. As a part of promoting cashless transactions and converting India into less-cash society various mode of digital payments are being made available. One of it is QR Code on GST Invoices.

3. A person may misplace a GST Invoice that was issued or may require additional copies of the same invoice. In such cases, he faces the need to contact the supplier repeatedly. QR Codes in invoice solves this issue. By scanning the QR Code, the GST Invoice can be generated any number of times.

4. The main purpose behind QR code on GST Invoice is to speed up the invoice tracking and payment process.

5. However, QR codes are far from being a novelty in digital world and many users still don’t understand its meaning and purpose completely.


1. QR stands for Quick Response. QR Codes are capable of being scanned within a couple of seconds and hence the name. QR Code is a square-shaped black and white barcode that can be read by devices.

2. It works in a similar fashion to that of a barcode. It is a machine-scannable image that can be read by Smartphone’s or other devises either via its native camera or third-party apps. Every QR Code contains small data packets in the form of dots that hold a certain piece of information.

3. There are four main elements in a QR Code –

a) Positioning marking – This indicates the direction in which the QR Code is printed. This insinuates that even if your camera is tilted at an angle, it will still scan the QR Code.

b) Alignment marking – This basically helps a QR Code with its alignment to be able to be scanned without any errors.

c) Timing pattern – This basically helps the QR Code scanner to gauge the size of the data matrix in the QR Code.

d) Quiet zone – This is a vital part of a QR Code. A QR Code’s quiet zone helps differentiate the QR Code scanner from its surroundings.


1. E-Invoice (having IRP-generated QR Code)

a) As per Rule 48(4) of CGST Rules (inserted vide Notification No. 68/2019 – Central Tax Dated 13.12.2019 and read with other notifications), notified registered persons, in case of B2B & Export supplies, have to prepare invoice by uploading specified particulars in Form GST INV-01 on Invoice Registration Portal (IRP) and upon obtaining Invoice Reference Number (IRN), the Portal will also return a QR Code which contains key particulars of the invoice including IRN.

b) IRN need not be printed on the invoice, the QR code generated by IRP shall be printed on the invoice issued to the buyer.

c) Hence, it can be concluded that for notified persons to whom the provisions of E-Invoice is applicable will have IRP-generated QR Code on B2B & Export Invoices, Credit & Debit Notes.

d) In short, QR code will be generated by Invoice Registration Portal itself.

e) E-invoice (which includes IRP generated QR Code) is made mandatory vide Notification No. 05/2021-Central Tax dated 08.03.2021 for business with aggregate turnover [at PAN level] of Rs. 50 crores or more in any of the three preceding financial years for B2B and export transactions w.e.f 1-Apr-2021.

f) Earlier, E-Invoice was already made mandatory for business with annual turnover of Rs. 100 Cr or more from 1-Jan-2021.

2. Dynamic QR Code

a) The provisions of Rule 46 (Tax Invoice) and Rule 49 (Bill of Supply) of CGST Rules, 2017 were amended vide Notification No. 31/2019 – Central Tax dated 28.06.2019 which empowered the Govt. to specify to have QR Code on Tax Invoice or Bill of Supply.

b) In this regard, Notification No. 14/2020-Central Tax dated 21.03.2020 had mandated that entities with aggregate turnover of more than Rs. 500 Crores in a F.Y to include Dynamic QR code on their B2C invoices w.e.f. 01.10.2020. It was also specified that a Dynamic QR code made available to buyer through digital display (with payment cross-reference) shall be deemed to be having QR code.

c) In this case, the QR Code is generated by supplier himself.

d) The provisions of Dynamic Code were later made applicable if the aggregate turnover is more than 500 crores in any of the last three Financial Years i.e., from 2017-18 onwards vide Notification No. 71/2020 – Central Tax dated 30.09.2020. The implementation of Dynamic QR code on B2C invoices was also deferred to 1st December, 2020.

e) Therefore, the Dynamic QR Code applies if below conditions are satisfied;

i) the turnover during any F.Y. from 2017-18 onwards has exceeded Rs.500 crores

ii) When the supply is made to a person who does not have GST Registration.

f) The penalty for non-compliance with the requirement of dynamic QR code for B2C transactions were waived vide Notification No. 89/2020-Central Tax dated 29.11.2020 till 31st March 2021, subject to the condition of compliance with the provisions from April, 2021.

g) Hence, effective 01.04.2021, issuance of Dynamic QR code on B2C invoice is mandatory for businesses having turnover more than Rs. 500 Crore.

h) The purpose of the Dynamic QR Code is to enable and encourage digital payments where buyer can scan the dynamic QR code and make payment from mobile wallet directly.

i) Today, many shops have static QR code at the payment counter which is scanned by the buyer but the buyer has to enter the amount to be paid to the shop (in the mobile payment App). The dynamic QR code, on the other hand, will have the payment details and thus ‘scan and pay’ in one go will be possible.

j) Where the Dynamic QR Code requirement is applicable and the customer pays for the invoice using any mode like UPI, credit/ debit card or online banking or cash or combination of various modes of payment, with or without using Dynamic QR Code, and the supplier provides a cross reference of the payment (transaction id along with date, time and amount of payment, mode of payment like UPI, Credit card, Debit card, online banking etc.) on the invoice, the requirement of Dynamic QR Code shall be deemed to have been complied.

k) Further, in cases where payment is received in advance and if the cross reference of the payment is made on the invoice, then the requirement of Dynamic QR code shall be deemed to have been complied.

l) However, if payment is made after generation /issuance of invoice, the supplier shall provide Dynamic QR Code on the invoice.

m) Hence, in cases other than pre-paid supply i.e. where payment is made after generation / issuance of invoice, the supplier shall provide Dynamic QR Code on the invoice.

n) Generally the QR Codes can be customized to any desired colour, pattern, and template depending on the requirement. However, remember that only dynamic QR Codes can be edited after creating it. Static QR Codes can be customized but there is no opportunity to edit them after downloading them. The Dynamic QR code should contain the following;

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 with breakup i.e. CGST, SGST, IGST, CESS, etc.

o) Dynamic QR Codes cannot be differentiated from static QR Codes, in terms of looks. However, the functionality differs drastically. For a dynamic QR Code to function as a dynamic QR Code, a short URL is assigned to the QR Code and separate landing pages are created based on the time, location, and device to be used. These dynamic QR Codes redirect the user to different landing pages based on the protocol set by the user on the dashboard.

3. To summarise there are two type of QR Code in GST;

a) IRP-generated QR Code on B2B & Export Invoices, Credit & Debit Notes (Applicable to Registered person who will generate E-Invoice)

b) Self-generated Dynamic QR Code on B2C invoices (Applicable to Registered person having Aggregate Turnover of more than Rs. 500 Crore)

4. The major differences between above two QR Code are as under;

a) IRP-generated QR code applies to supplies made by a class of registered persons to other registered persons and exports (B2B and Exports). Whereas, Self-generated Dynamic QR Code applies to supplies made by a registered person to unregistered persons (also called B2C supplies)

b) The purpose of IRP-generated QR code is to embed key particulars of reported invoice and to verify whether an invoice has actually been reported to IRP or not and whether digital signature is intact or tampered with. However, self-generated Dynamic QR is to enable payment using UPI by a mobile application by scanning of this QR Code.

c) IRP-generated QR code does not apply to B2C invoices, however, it mandates taxpayers to generate dynamic QR Codes for their B2C invoices.

d) In simpler words, QR Codes can be self-generated in the case of B2C Invoices, although the same is not the case with B2B invoices.


1. The existing ERP system must be reconfigured in view of requirement of seamlessly sync with IRP and Dynamic QR Code. It will have one time cost most as well recurring cost. A large group having different business verticals within the group may have varying demands for invoice generation, which would require additional customization of commonly maintained ERP system.

2. Businesses will also have to look at the requirements for skill development and further upgradation for staff concerned with invoice generation and accounts.

3. For smooth functioning we require additional technology upgradation to automate processes to fully gain the benefits of the transition.


1. The introduction of electronic invoicing and Dynamic QR Code promises to be the most significant steps since the introduction of GST. The businesses must understand the proposed system at its very inception so that adequate preparation can be taken care of.

2. In totality this must be seen as a compliance tool evolved as a technological solution. It is conceptualized to be a win-win situation with digitalisation resulting in ease of compliance for businesses as well as having real-time access to data.

3. India is majorly cash driven economy where people prefer to carry cash, however with QR code it is moving towards less-cash economy where consumers will scan and pay.

4. In near future, QR code on GST Invoices will be made mandatory irrespective of turnover limits.


Disclaimer: This article is for information purpose only. The author can be approached at [email protected]

Author Bio

Qualification: CS
Company: N/A
Location: Vapi, Gujarat, India
Member Since: 29 Mar 2021 | Total Posts: 1

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April 2021