The CBIC or Central Board of Indirect Taxes and Customs has issued notification No. 60/2020 – Central Tax dated 30th July 2020, that has notified the updated version of new format of e-invoice under GST. The relevant API release, along with validations are yet to be issued by the authority.
Mandatory execution of e-invoicing
Additional, vide subject Notification No. 61/2020–Central Tax date 30th July 2020, the revenue limit for mandatory execution of e-invoicing has been augmented from INR 100 crore to INR 500 crore. However, the date for application of e-invoicing continues to be 1st October 2020. Further, exemption from the issuance of e-invoice has also been extended to Special Economic Zone Unit.
Therefore, e-invoice is now compulsory w.e.f. 1st October 2020 for all taxpayers (other than Guarantor, Banking Company, Financial Institution including NBFC, GTA, supplier of passenger transport service, multiplex screens, and SEZ Unit) having income exceeding INR 500 crore in a financial year.
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SEZ units are excluded from E-Invoice under GST
E-invoicing is a business reform that needs substantial fluctuations to be made to ERP systems, which includes billing schemes and other similar business processes. Provided that businesses are stressed due to disruption caused by COVID-19 pandemic and there are just two months left to implement e-invoicing, it was necessary to provide clarity on the process flow of e-invoice under GST to achieve the same effect. In this respect, NASSCOM made a representation to GST Policy Wing requesting for issuance of the revised schema of e-invoicing. Our description can be accessed here. Changes notified by CBIC are a step-in right direction. An increase in the turnover limit to INR 500 crores will provide more time to other taxpayers to understand and adopt the e-invoicing mechanism.
Electronically-authenticated invoice
CBIC (Central Board of Indirect Taxes and Customs) on Thursday informed the Scheme for E-Invoice under GST for implementing e-invoicing, a form of electronically-authenticated invoice, from 1st October only for commerce with a turnover of Rs. 500 crore or more.
The Government authorized under Rule 48(4) of the Central Goods and Services Tax Rules, 2017, on the references of the Council by amendment in the Notification No.13/2020 Central Tax, date on 21st March 2020, printed in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number GSR 196(E), date the 21st March 2020.
In the said Announcement, in the first paragraph, before the words “those mentioned to in sub-rules,” the word “a Special Economic Zone (SEZ) unit” and should be introduced. Additionally for the words “100 crore rupees,” the words “500 crore rupees” should be substituted.
Conclusion
As per the earlier Notification, a specific class of registered person (insurance company, banking, financial institution, non-banking financial company, GTA, passenger transport service) to be exempt from issuing e-invoice under GST Registration or taking active QR code. The announcement said that “an invoice issued by a registered person, whose total income in a financial year overdoes 500 crore rupees, other than those referred to in sub-rules (2), (3), (4) and (4A) of rule 54 of said rules, and registered person referred to in section 14 of the Combined Goods and Services Tax Act, 2017[1], to an unregistered person (from now on mentioned to as B2C invoice).
It should have Dynamic Quick Response (QR) code. Provided that where such listed person makes a Dynamic Quick Response (QR) code obtainable to the recipient through a digital presentation. Such as 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.”
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