A brief Note on E-Invoice

E-invoice means electronically verified invoice. The invoice verification is done by the Govt. Portal which is called as Invoice Registration Portal. In short it is called as ‘IRP’. The invoice information needs to be sent to the IRP in a particular format which is called as Schema. The schema has mandatory columns as well as non-mandatory columns i.e. some information related to invoice are mandatorily need to be sent to the IRP and non-mandatory fields are optional for the taxpayer to send it to IRP. Since, the mandatory fields has to be filled by all the taxpayers to be sent it to IRP which indirectly means that the taxpayers has to maintain that minimal data in their accounting system.

The Govt. has made this e-invoice mandatory from 01.10.2020 for the taxpayers having turnover more than five hundred crores. The Govt. has themselves enabled those eligible taxpayers for e-invoice compliance in the e-invoice portal. And, those taxpayer whose turnover is more than the threshold turnover but their GSTIN is not enabled for e-invoice should on their own apply and comply for e-invoice. The taxpayer who wants to know that whether his GSTIN has been enabled for e-invoice in the e-invoice portal or not can visit the website and check their status by furnishing their GSTIN https://einvoice1.gst.gov.in/Others/EinvEnabled.

This e-invoice system is introduced in a phased manner and therefore only outward supply of the taxable goods to a registered customer is covered under this e-invoice compliance as of now. That means the taxpayer who is liable for e-invoice has to only comply if he is supplying – a) taxable goods, b) to a customer registered under GST. It therefore, becomes clear that the taxpayer need not generate e-invoice if his supplies are to an unregistered customer and also in case of supply of exempted goods. It is however; specifically the Govt. has mentioned that all kind of exports transaction is coveredunder e-invoice.

Government has exempted following classes of registered persons from e-invoices:

1. Special Economic Zone Units,
2. insurer or a banking company or a financial institution, including a non-banking financial company,
3. goods transport agency supplying services in relation to transportation of goods by road in a goods carriage.
4. Suppliers of passenger transportation service
5. Suppliers of services by way of admission to exhibition of cinematograph films in multiplex screens.

The documents covered for e-invoice is as follows:

1. B2B Tax invoice
2. Export Invoices
3. Credit note
4. Debit note

It is clarified by the Govt. that the taxpayer shall continue to prepare the invoice following their current practice. The only additional task is that to furnish the invoice related information to IRP to get the invoice verified and to get back IRN and QR Code. The IRN refers to Invoice Reference Number and QR Code refers to Quick Response code. The IRN and QR code so received must be printed on the face of the invoice at any desired location.

The medium of sending the data to IRP and getting back IRN and QR code is thru JSON which can be thru API based and GSP based. Later, mobile app-based and offline tool-based reporting to IRP will also be available.

It is further clarified that in IRP the invoice level correction is not possible and for that purpose the taxpayer has to login to GSTN and correct it at the time of filing GSTR-1.

The IRP after generating IRN and QR code will also share the invoice information to GST and E-way bill. Thus, B2B and CD note table of GSTR-1 of the supplier will be auto-populated. At the same time the customer will also get the same information in their GSTR-2A report. Since, this flow of invoices will be on a regular basis, the buyer will be able to see the invoice details much sooner and can compare them with their books and can decide to take input tax credit accordingly. The required correction on any invoice will also be possible on a regular basis.

Further, the Govt. has enabled the e-invoice website for the taxpayer to voluntarily generate e-invoice and acquaint with the process. This benefit must be availed by all the taxpayers liable to do e-invoice so that they can be ready for the mandatory period starting from 01.10.2020.

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